Tom Montag, CEO of Rubicon Carbon, joins us to discuss the world of carbon credits. Tom has had an illustrious career, previously serving as Chief Operating Officer at Bank of America, President of Global Banking and Markets, and a member of the executive management team. He joined Merrill Lynch as Executive Vice President and Head of Global Sales and Trading in 2008, just before its merger with Bank of America. Before that, he was with Goldman Sachs, co-heading the Global Securities Business and serving on its management committee. He currently serves on the board of directors of Goldman Sachs Group Inc. and is a board member of Northwestern University, NYU Langone Medical Center, the Hispanic Federation, Deschutes Land Trust, and the Japan Society. He is also a former BlackRock board member.

In this episode, we dive into why, after such an accomplished career, Tom chose to dedicate his next chapter to carbon markets. We have a fascinating conversation about the current state of voluntary carbon markets and how Tom views them in relation to the financial services industry when he started his career in the 1980s. We explore why carbon credits matter, the circumstances under which companies should use them, and the origin of Rubicon Carbon, including the role of TPG’s Rise Fund. Tom also discusses Rubicon's approach to bundled credit offerings and addresses some of the trust challenges facing the carbon markets today, as well as where he believes they are headed.

In this episode, we cover: 

• [2:19] Tom's financial background and career pathway to Rubicon 
• [5:21] The state of the voluntary carbon market, including its size and growth potential
• [7:41] Parallels between the early derivatives market and the current carbon markets
• [11:41] Challenges around additionality, financial hedging, and trust in the carbon markets
• [13:41] An overview of Rubicon Carbon
• [20:55] Regulatory and compliance considerations around carbon markets
• [26:30] The need for more standardization and risk adjustment in the VCM
• [33:44] Examples of Rubicon Carbon's projects and partnerships
• [36:08] Role of oil and gas in the future of VCM
• [40:12] Bull and bear cases for the future of carbon markets

Episode recorded on Aug 22, 2024 (Published on Nov 11, 2024)

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*Editing and post-production work for this episode was provided by The Podcast Consultant