Carbon soot is an end-product of combustion. When soot adheres to sticky deposits of oil and fuel constituents on the valve stems it has a negative effect on engine performance. This problem is a circular process where the thickness of the carbon deposits continuously increases over time.
Excessive valve stem carbon deposits cause significant performance loss, sporadic ignition failures and, potentially, holes burned in the catalytic converter (should bits of carbon break from the valves and pass though the combustion chamber and down the exhaust system).