If anyone had doubts about the importance of the voluntary carbon market they would certainly have been overcome by the announcement last month by Merrill Lynch of a new carbon offset service to assist businesses to reduce emissions through voluntary offsets. In partnership with ICF International, Merrill Lynch's new Green and Gold initiative is the latest in a series of moves by major financial institutions to position themselves in a market valued by Abyd Karmail, Merrill Lynch's managing director and global head of carbon emissions at over of $70 billion. Merrill Lynch intends to provide clients with the highest sustainability carbon emission offsets and access to its full suite of proprietary carbon finance products. Carbon credits offered include those that meet the Gold Standard VER, Gold Standard CDM, and Climate, Community, and Biodiversity Alliance (CCBA) standards which carry the endorsement of leading environmental and conservation NGOs. Merrill Lynch is but one of many major financial houses that have entered this fast growing component of the carbon credit marketplace. In 2007 Morgan Stanley, another global financial institution with assets of nearly $800 billion, launched the world's first carbon bank, with services that allowed clients to compile their emissions inventory and calculate their carbon footprint using ISO 14064 standards. Morgan Stanley's Commodities Group procures and cancels carbon credits equivalent to a client's verified carbon footprint. By 2011, Morgan Stanley will have invested upwards of $3.5 billion into the carbon market, and expects very high returns when the current Kyoto Protocol expires in 2012. Barclays, one of the UK's leading financial institutions has been involved in carbon trading since 2005. It was the first UK bank to set up a dedicated carbon trading desk to help clients, and is one of the most active players in the emissions trading market, having traded some 300 million tonnes as of 2007. As part of its own carbon neutral strategy, Barclays also produces its own brand of high quality offsets. So far Barclays has produced over 200,000 tonnes of its own tradable carbon credits. The Voluntary Carbon Market Many are confused about the carbon trading market, and in particular about the difference between the company carbon trading, and the legislated carbon market. Only in Europe are large companies in specific sectors mandated by law to buy carbon offset credits if they exceed legal pollution limits. The European Union Emissions Trading System (EU ETS) Voluntary carbon offset trading comes stems from a variety of sources - people trying to offset their carbon footprints, businesses seeking to reduce their greenhouse gas emissions, or major events trying to be carbon neutral, such as the Olympics, the Super Bowl, etc. Carbon offsets can come from many sources. The "State of the Voluntary Carbon Markets 2007'