Trend watch: carbon accounting & MRV in 2026

The carbon accounting software market reached $22.51 billion in 2025 and is projected to grow to $100.84 billion by 2032 at a 23.9% CAGR, according to Fortune Business Insights. For sustainability leads in Asia-Pacific, where China holds 28% of the global carbon accounting software market and regional regulatory mandates are accelerating, understanding which standards and platforms will dominate the next 12-24 months is essential for compliance planning and vendor selection.

Why It Matters

Carbon accounting has transitioned from voluntary corporate responsibility to regulatory imperative across the Asia-Pacific region. China's national carbon market—the world's largest by covered emissions—now includes over 2,200 power generation companies representing 4.5 billion tonnes of annual CO2 emissions. Japan's mandatory GHG reporting system covers approximately 12,000 entities, while Singapore's carbon tax (increased to SGD 25 per tonne in 2024, rising to SGD 45 by 2026) creates direct financial incentives for accurate emissions measurement.

The credibility of carbon accounting depends on robust Measurement, Reporting, and Verification (MRV) systems. Poor MRV has undermined confidence in voluntary carbon markets—the Integrity Council for Voluntary Carbon Markets (ICVCM) now assesses credit quality using standardized Core Carbon Principles, and major buyers (Microsoft, Stripe, Frontier) demand rigorous verification. In regulated markets, MRV failures can result in financial penalties and reputational damage.

For Asia-Pacific sustainability leads, the emerging question is not whether to implement carbon accounting but which standards, platforms, and verification approaches will satisfy evolving regulatory requirements and buyer expectations. The Science Based Targets initiative (SBTi) reached 10,000 validated corporate targets in January 2026—a milestone demonstrating widespread commitment but also highlighting the infrastructure needed to track progress credibly.

Key Concepts

The MRV Technology Stack

Modern MRV systems combine multiple technologies:

Data Collection Layer: Sensors, meters, and IoT devices capturing activity data at source. Direct measurement (flow meters, continuous emissions monitors) provides highest accuracy but requires capital investment. Estimation approaches (emission factors applied to activity data) offer lower cost but higher uncertainty.

Processing Layer: Platforms that aggregate data, apply emission factors, calculate footprints, and identify reduction opportunities. Cloud-based carbon accounting software (Persefoni, Greenly, Salesforce Net Zero Cloud) dominates this layer, with 73-75% of the market using cloud deployment.

Verification Layer: Third-party auditors and automated systems that validate calculations and claims. Traditional verification relies on human auditors reviewing documentation. Digital MRV (dMRV) combines satellite imagery, IoT sensors, AI pattern recognition, and blockchain-based registries to enable continuous, automated verification.

Scope Evolution and Complexity

Emissions reporting spans three scopes with dramatically different data requirements:

Scope 1: Direct emissions from owned or controlled sources. Relatively straightforward to measure with established methodologies. Most companies achieve 90%+ accuracy.

Scope 2: Indirect emissions from purchased electricity, steam, heating, and cooling. Market-based accounting (using contractual instruments like Renewable Energy Certificates) has created complexity around avoided emissions claims.

Scope 3: All other indirect emissions in the value chain—typically 80-90% of total footprint for most companies. The 15 Scope 3 categories create massive data collection challenges. Only 9% of companies achieve comprehensive Scope 1-3 reporting (BCG/CO2 AI survey of 1,864 companies). Product-level tracking is the emerging frontier.

Emerging Standards Landscape

Multiple frameworks are converging:

GHG Protocol: The foundational standard, currently undergoing revision to address Scope 2 accounting controversies and Scope 3 measurement challenges.

ISSB (International Sustainability Standards Board): Global baseline for climate disclosure, with standards (IFRS S1, S2) being adopted by jurisdictions including Singapore, Japan, and Australia.

CDP (formerly Carbon Disclosure Project): Annual disclosure framework used by 23,000+ companies, increasingly aligned with ISSB requirements.

SBTi: Validates corporate emissions reduction targets against science-based pathways. The 2025-2026 Corporate Net-Zero Standard revision includes enhanced MRV framework requirements.

Sector-Specific KPI Benchmarks

KPI	Laggard	Average	Leader	Notes
Scope 1-2 data coverage	<80%	90-95%	>99%	Of relevant emission sources
Scope 3 category coverage	<5 categories	8-12 categories	All 15 categories	Material categories minimum
Data latency (close to report)	>90 days	30-60 days	<14 days	For quarterly reporting
Emission factor accuracy	Spend-based	Industry average	Primary supplier data	Scope 3 quality
Third-party verification	None	Annual limited	Quarterly reasonable	Assurance level
Product-level tracking	None	Top 20% products	All significant products	Emerging requirement

What's Working and What Isn't

What's Working

Digital MRV reducing verification costs: Traditional MRV costs 30-40% of project value for nature-based carbon projects—an unsustainable burden that undermined credit quality. Digital approaches (satellite imagery, IoT sensors, AI analytics) are demonstrating 10-15% cost targets while improving accuracy and frequency. Carbonfuture's digital trust infrastructure for biochar and direct air capture verification has attracted clients including Microsoft and Swiss Re, validating demand for technology-enabled MRV.

Platform consolidation improving data quality: Leading carbon accounting platforms (Persefoni, Greenly, Salesforce Net Zero Cloud) now integrate with enterprise ERP systems, procurement platforms, and supplier databases. This integration reduces manual data entry errors and enables more granular emissions tracking. Companies using AI-powered carbon accounting are 4.5x more likely to see significant decarbonization benefits, according to BCG/CO2 AI research.

Regulatory alignment creating consistency: The convergence of ISSB, CDP, and regional standards is reducing reporting complexity. Companies preparing for Singapore's mandatory climate disclosure (starting 2025 for listed companies) find that ISSB-aligned frameworks satisfy multiple stakeholder requirements simultaneously.

What Isn't Working

Scope 3 data quality remains poor: Despite years of effort, most companies still estimate Scope 3 emissions using spend-based calculations or industry-average emission factors. These approaches achieve only 60-70% accuracy—insufficient for credible reduction tracking or regulatory compliance. The fundamental challenge is supplier data: most companies lack actual emissions data from their supply chains and face limited leverage to demand it.

Carbon credit quality concerns persist: Voluntary carbon market retirements reached approximately 170 million credits in 2025 (flat versus 2022-2024) at $960 million total value. But high-quality credits remain in short supply for the third consecutive year, and durable carbon removal credits (direct air capture, enhanced weathering) represented less than 0.11% of retirements. The gap between forward commitments ($13.7 billion announced in 2025) and actual retirements highlights market immaturity.

SME adoption lagging: Only approximately 25% of businesses had adopted carbon accounting by 2024, with cost and complexity cited as primary barriers. SME-focused solutions exist (Schneider Electric launched an SMB product in April 2024), but the modular, affordable platforms needed for supply chain engagement remain underdeveloped.

Key Players

Established Leaders

Persefoni AI (US): Enterprise carbon management platform with strong investor backing and rapid customer acquisition. Persefoni emphasizes automated data collection and AI-driven insights for large corporations.

Greenly (France): Raised $52 million Series B in March 2024, focusing on mid-market and SME segments often underserved by enterprise platforms. Their approach emphasizes supply chain engagement and supplier emissions tracking.

Salesforce Net Zero Cloud (US): Integrated with the Salesforce ecosystem, Net Zero Cloud benefits from existing enterprise relationships. Strong positioning for companies already using Salesforce CRM and ERP solutions.

SAP Sustainability Control Tower (Germany): Enterprise sustainability management integrated with SAP's dominant ERP systems. Particularly strong for manufacturing and industrial companies with complex supply chains.

Emerging Startups

Carbonfuture (Germany): Digital trust infrastructure for durable carbon removal, with clients including Microsoft and Swiss Re. Carbonfuture's focus on high-quality removal credits positions them for the emerging carbon removal segment.

Sylvera (UK): Carbon credit ratings, pricing analytics, and MRV robustness scoring. Sylvera provides transparency in credit quality, serving both buyers and project developers.

Anaxee (India): Digital MRV with 40,000+ field "Digital Runners" for on-ground verification in developing markets. Anaxee's approach combines technology with human networks for contexts where satellite-only monitoring is insufficient.

Nadar.earth (Netherlands): Satellite-powered carbon monitoring for REDD+ and afforestation/reforestation projects in tropical and mangrove forests, Verra-compatible.

Key Investors & Funders

Breakthrough Energy Ventures: Invested across carbon accounting and MRV space, demonstrating conviction that measurement infrastructure is critical climate technology.

General Atlantic: Major investor in Persefoni's $200M+ funding rounds, signaling institutional confidence in carbon management software as enterprise category.

Frontier Climate: $1 billion+ advance market commitment for permanent carbon removal, requiring rigorous MRV from suppliers. Frontier's standards influence the broader market.

Examples

Verra's Digital Registry Transformation: The world's largest voluntary carbon market standard, Verra is digitizing its registry with AI-automated calculations and enhanced transparency features. The transformation addresses longstanding criticism of VCS credit quality by enabling real-time monitoring and automated verification. Verra's changes ripple across the voluntary market, affecting thousands of registered projects and millions of credits annually.
China's National Carbon Market Expansion: China launched international carbon credit trading through its exchange, accepting 2.5 million credits from projects in Bangladesh, Brazil, and Ethiopia in early moves. The market's scale (4.5 billion tonnes covered emissions) and China's influence over Asian supply chains means its standards effectively set regional benchmarks. Companies selling into Chinese markets increasingly need China-compatible MRV systems.
SBTi's MRV Framework Revision: The Science Based Targets initiative is revising its Corporate Net-Zero Standard (2025-2026) to include enhanced MRV requirements. With 10,000+ companies holding validated SBTi targets, these requirements will influence corporate carbon accounting practices globally. The revision emphasizes verified emissions data over estimates and increased third-party assurance.

Action Checklist

Assess current carbon accounting infrastructure against ISSB S1/S2 requirements; identify gaps in Scope 3 data collection and verification
Evaluate carbon accounting platform options with emphasis on regional capability (China market access, APAC language support) and integration with existing enterprise systems
Develop Scope 3 supplier engagement strategy; prioritize top 50 suppliers by emissions contribution for primary data collection
Establish internal carbon pricing to inform procurement decisions; Asia-Pacific average internal prices range from $20-80 per tonne
Build MRV literacy within sustainability and finance teams; digital MRV technologies require different skills than traditional audit approaches
Monitor ICVCM Core Carbon Principles implementation and apply quality criteria to any carbon credit purchases

FAQ

Q: How do we prioritize Scope 3 categories for measurement? A: Start with a screening exercise using spend-based estimates to identify material categories. Typically, 3-5 categories represent 80%+ of Scope 3 emissions. For most companies, purchased goods/services (Category 1) and use of sold products (Category 11) dominate. Focus primary data collection on these material categories; accept estimates for immaterial categories. Re-screen annually as business mix changes.

Q: What level of third-party assurance should we target? A: Emerging regulatory requirements (ISSB, EU CSRD) generally require limited assurance initially, progressing to reasonable assurance over 2-3 years. Reasonable assurance requires more evidence but provides higher stakeholder confidence. Budget 0.5-1% of emissions management costs for third-party assurance. Select assurers with sector expertise and familiarity with your carbon accounting platform.

Q: How do we evaluate carbon credit quality for offset purchases? A: Apply ICVCM Core Carbon Principles: additionality (would the project have happened anyway?), permanence (how long will carbon stay stored?), robust MRV (how was the claim verified?), and no double counting. Use independent ratings (Sylvera, BeZero, Calyx Global) to assess individual projects. Prioritize removal credits over avoidance; prioritize durable removal (decades+) over temporary. Budget premiums for high-quality credits—they often cost 2-5x average prices but reduce reputational risk.

Q: What's the timeline for ISSB adoption in Asia-Pacific? A: Singapore: mandatory for listed companies starting 2025, phased expansion through 2027. Australia: Treasury consultation complete, mandatory disclosure expected 2025-2026. Japan: FSA guidance aligns with ISSB, mandatory elements phasing in 2024-2026. Hong Kong: HKEX consultation on ISSB-aligned disclosure, likely mandatory 2025-2026. China: separate standards but increasing alignment with international frameworks.

Sources

Fortune Business Insights. "Carbon Accounting Software Market Size, Industry Share, 2032." 2024.
SNS Insider. "Carbon Accounting Software Market Size to Surpass USD 191.21 Billion by 2035." February 2026.
BCG and CO2 AI. "Carbon Survey 2024." 2024.
Sylvera. "Carbon Market Trends 2026: Prices, Quality, and the Future of Carbon Credits." 2026.
Science Based Targets initiative. "Measurement, Reporting and Verification (MRV)." 2025.
Mordor Intelligence. "Carbon Accounting Market Size & Share Outlook to 2030." 2024.