Unsustainable land use and agriculture contribute to climate change through landscape degradation and greenhouse gas (GHG) emissions. Without sustainable practices, agriculture will exacerbate climate change. Agroforestry (AF) is an environmentally friendly approach that offers benefits such as carbon sequestration (Cseq) and biodiversity conservation. This chapter emphasizes the importance of policy and governance in shaping the future of AF for carbon (C) credits. C credits recognize efforts to combat climate change by reducing emissions, and AF falls under the category of C removal units (CRUs). However, small-scale farmers in developing countries face financial limitations in managing AF. Establishing a C market for trading AF credits would benefit smallholders and support their activities. Effective policy-making and governance are crucial to realizing the potential of AF for C credits. Many countries globally adhere to their Nationally Determined Contributions (NDCs), incorporating sustainable agricultural practices like AF into their development strategies. However, only Nepal and India have implemented a National Agroforestry Policy (NAP). It is therefore recommended to advocate for the establishment and enforcement of additional NAPs, as they will significantly advance AF systems for C credits.