IETA Urges Reform of Australia’s Climate Active Scheme amid Rising APAC Carbon Market Momentum

SINGAPORE, February 23, 2026 — The International Emissions Trading Association (IETA) has urged the Australian Government to reform and strengthen its Climate Active programme rather than repeal it, warning that weakening voluntary climate frameworks could undermine corporate decarbonisation efforts across the Asia-Pacific region.

In a public letter issued by its Australia Working Group in January 2026, IETA described Climate Active as a cornerstone of Australia’s voluntary corporate climate architecture since 2010, with more than 750 certifications across over 500 businesses. The scheme has supported investment into renewable energy, regenerative agriculture and land restoration projects domestically and internationally.

However, growing scrutiny, delays in programme updates and legal challenges have weakened participation incentives. IETA argues that reform, rather than repeal, is essential to restore credibility and align the framework with evolving global integrity standards.

“At this time, it is critical that Climate Active is strengthened and reformed, not repealed,” the letter states.

Regional implications for voluntary carbon markets

The debate in Australia comes at a time when Asia-Pacific governments are coalescing around the role of carbon markets in driving corporate climate action.

The Coalition to Grow Carbon Markets, launched by the United Kingdom, Singapore and Kenya and subsequently joined by France and Panama, signals growing international alignment on principles for the use of carbon credits in corporate net zero pathways.

Singapore in particular has positioned itself as a regional hub for high-integrity voluntary carbon markets, while Article 6 implementation under the Paris Agreement is gaining traction across Southeast Asia.

Against this backdrop, IETA cautions that regulatory uncertainty in Australia could send mixed signals to multinational corporations operating across Asia-Pacific jurisdictions.

Australia’s updated Nationally Determined Contribution target of reducing emissions by 62 to 70 percent by 2035 will require substantial private sector mobilisation.

Voluntary action frameworks such as Climate Active play a bridging role by enabling companies to address residual emissions while scaling direct reductions.

Integrity and alignment at the centre of reform

IETA’s recommendations focus heavily on aligning Climate Active with international integrity frameworks.

The association calls for strengthened eligibility criteria for carbon credits, referencing the Integrity Council for the Voluntary Carbon Market’s Core Carbon Principles and the Article 6.4 Paris Agreement Crediting Mechanism.

It also emphasises the need for regulatory alignment with the Australian Securities and Investments Commission and the Australian Competition and Consumer Commission to ensure consistency in corporate climate claims. Without harmonised guidance, companies face growing legal and reputational risks that could discourage voluntary participation.

Further, IETA proposes a modernised corporate claims framework referencing ISO Net Zero Guidelines, the Voluntary Carbon Market Initiative Claims Code of Practice and the forthcoming Science Based Targets Initiative Corporate Net Zero Standard.

The continued use of Australian Carbon Credit Units is described as integral to Australia’s Safeguard Mechanism and its Paris commitments, though the letter calls for enhanced project-level transparency and alignment with global best practice.

Balancing ambition and credibility in Asia-Pacific

Across Asia-Pacific, corporate climate claims are facing increased scrutiny from regulators, investors and civil society. Jurisdictions including Singapore, Japan and South Korea are refining disclosure rules and carbon market oversight mechanisms.

In this environment, voluntary programmes must demonstrate both integrity and clarity. IETA warns that discontinuing Climate Active without an alternative framework for corporate claims could stall private sector investment and weaken Australia’s position within the region’s evolving carbon market architecture.

“A modernised Climate Active will help Australian firms navigate an increasingly complex global landscape and unlock the scale of private investment needed for a truly net zero economy,” the letter concludes.

For Asia-Pacific markets seeking to scale voluntary carbon finance while maintaining trust, the outcome of Australia’s policy debate may serve as a bellwether for how governments balance integrity reforms with corporate climate ambition.