- The voluntary carbon market has the potential to address $4.1 trillion in nature financing gap by 2050 and support Indigenous peoples and local communities — when done right, argue a cohort of Indigenous leaders in a new commentary.
- The voluntary carbon market can work for and support Indigenous peoples and local communities (IPs and LCs), and them for it, but these communities have not been adequately engaged or consulted to participate in this carbon market.
- The Indigenous leaders announce the new IPs and LCs Voluntary Carbon Market Engagement Forum that is taking shape and will try to address these IPs and LCs’ priorities. The Forum is now coordinating open calls for Governing Board members and Forum partners.
- This post is a commentary. The views expressed are those of the author, not necessarily Mongabay.
“Humanity has opened the gates to hell by allowing the climate crisis to worsen”, said Antonio Guterres, UN Secretary-General at the U.N. Climate Ambition Summit in September.
This year, 2023, is shaping up to be the hottest year on record with floods, heatwaves and droughts affecting millions of people in countries worldwide without distinction of political system, level of wealth, or geographic localization. It is evident that the climate emergency is a global humanitarian crisis demanding collective efforts toward speeding, scaling up, and concretizing climate solutions.
The impacts of our warming climate are disproportionately affecting the Global South: those who have contributed least to global heating, and have even fewer resources to respond. Countries here are faced with a spiraling debt crisis and are falling behind in the race to deliver on Sustainable Development Goals.
Indigenous peoples and local communities (IPs and LCs) are the frontliners of the climate crisis, facing its immediate impacts to their ancestral livelihoods while also being fundamental stewards of our world’s natural carbon sinks and ecosystems. Indigenous peoples make up around 15% of the world’s extreme poor and just 5% of the global population. Yet we protect and manage approximately 40% of the planet’s ecologically intact landscapes, including the protection of the vast majority, in some cases up to 80%, of the world’s remaining biodiversity.
The reality, however, is that from 2011 to 2020, less than 1% of official development assistance for climate change, and less than 5% of official development assistance for general environmental protection, was delivered to IPs and LCs’ tenure and their territorial resource management. It is critically important that more inclusive multisectoral efforts are developed toward accelerating high-integrity climate solutions (genuine and verifiable emission reductions) and finance that recognize and respect IPs and LCs’ rights and livelihoods and incorporate IPs and LCs-led activities.
Leveraging the voluntary carbon market to mobilize climate finance for IPs and LCs
The UNFCCC estimates that around $600 billion of financing is needed to implement the targets of the Paris Agreement. However, governments and philanthropies alone cannot deliver finance at the scale required. The voluntary carbon market (VCM), where businesses buy carbon credits to compensate for emissions in their value chain that they cannot yet cut, for example by restoring natural ecosystems in another part of the world, is one of the most effective ways to address carbon emissions and mobilize private sector finance — and could help to address $4.1 trillion nature financing gap by 2050.
High-integrity carbon credits offer a market-based solution that can build trust in the voluntary carbon market and unlock private sector finance, channeling it directly to IPs and LCs for climate projects that would not otherwise be viable.
High-integrity carbon credits must not only achieve genuine emissions reductions and removals, but must also align with the United Nations Declaration on the Rights of Indigenous Peoples. This entails upholding our right to self-determination and the associated obligation to obtain our “free, prior, and informed consent” regarding any projects involving our communities and territorial lands. Placing our rights at the forefront of any negotiation or development plans related to our lands is crucial to supporting sustainable development and communities on the ground.
This includes ensuring direct, fair, and equitable access to the distribution of benefits. It acknowledges IPs and LCs as essential partners and custodians of nature, and the rights necessary to scale up solutions to environmental challenges, including climate change and biodiversity losses.
When done right, the voluntary carbon market has the potential to provide solutions that contribute to sustainable development, enhancing the lives, livelihoods, and territorial governance of Indigenous peoples and of local communities in alignment with our visions, cultures, ancestral knowledge, traditions, resource management practices, and rights. Market and financial principles, mechanisms, and frameworks rooted in this perspective can stimulate finance that adds value and reinforces sustainable development, high-integrity carbon credit supply, and long-term self-governance of Indigenous territories.
How carbon finance can work for communities
Until now, IPs and LCs have not been adequately represented or given leadership positions in discussions and initiatives concerning our participation in the voluntary carbon market. We have lacked access to, and been deprived of the fair sharing of the benefits derived from carbon finance being generated from our lands. Historically, the engagement of IPs and LCs in the voluntary carbon markets, ranging from project developers to programs and carbon credit buyers, has been limited, fragmented, and often confusing and obscure.
It is deeply regrettable that this has led in some cases to human rights abuses and displacement. The creation of carbon credits without the consideration for our traditions, ancestral knowledge, visions, cultures, and ways to secure our rights cannot continue. Our inclusion and contribution are essential to the ongoing and future efforts toward rebuilding and scaling up carbon markets driven by high-integrity, high quality, and inclusiveness principles, practices, and frameworks.
Our collective ability as a planet to achieve a transition to limit warming to 1.5°C on a global level depends on ensuring that IPs and LCs can continue managing vital ecosystem services at the local, subnational or national levels. We see inclusive, Indigenous-led engagement, governance, and a collaborative approach to developing market and finance strategies for climate solutions as fundamental to promoting, strengthening and accelerating the supply of high-integrity projects and programs in IPs and LCs territories.
For this reason, we and other IPs and LCs leaders have supported and collaborated with the work of the Integrity Council for the Voluntary Carbon Market (ICVCM) and the development of its Core Carbon Principles (CCPs), which set a global benchmark for high integrity. CCP-labelled carbon credits will build confidence that carbon credits reduce emissions, put in place robust social and environmental safeguards and also deliver positive sustainable development impacts. After consulting with IPs and LCs worldwide and incorporating their perspectives into the ICVCM governing board, we have worked to ensure that the ICVCM’s CCPs safeguard the rights, livelihoods and values of IPs and LCs.
Coming out of COP27 in Egypt last year, we, and other Indigenous peoples’ organizations and those representing local communities, had a clear demand: closer Indigenous-led coordination with multisectoral partners and targeted capacity building to support and enable strengthened engagement of IPs and LCs in a high integrity VCM.
An upcoming engagement forum
Following the COP27, the ICVCM’s IPs and LCs Taskforce also engaged and consulted with IPs and LCs individuals and organizational representatives to develop the foundations and structure for a dedicated, independent IPs and LCs VCM Engagement Forum. During 2023, multiple workshops, conversations and other engagement activities took place to gather first-hand feedback that fed into the development of the Forum.
It was agreed that the Forum will include representation from across Africa, Asia, Latin America, Northern region, and Oceania, plus one representative from the U.N. Local Communities and Indigenous Peoples Platform (LCIPP), and will strive to engage and collaborate with other existing forums and institutions to avoid duplicating work.
This will be a self-governing IPs and LCs platform with a two-fold purpose:
- To contribute to the climate objectives of the Paris Agreement – which can only be accelerated with a high-integrity VCM that safeguards the rights of IPs and LCs; and,
- To strengthen the contribution of IPs and LCs as partners in a high-integrity VCM – which demands a unifying voice and Indigenous-led coordination that resonates in different decision-making bodies.
The Forum will be jointly established by the ICVCM and the Voluntary Carbon Markets Integrity Initiative, and co-hosted with partners. The Forum will seek to address IPs and LCs’ priorities in the VCM and proactively identify opportunities, by facilitating knowledge exchange and capacity building with experts from across the VCM, and co-creating IPs and LCs-led solutions to common challenges. The Forum will enable IPs and LCs to facilitate and coordinate multisectoral efforts toward high-integrity carbon projects and programs, aligning them with IPs and LCs visions and perspectives.
At the very start of its journey, the Forum is now coordinating two open calls to establish its governance and strategy development. The first is for nominations for Governing Board members from IPs and LCs to govern the Forum. The second is for expressions of interest for Forum partners, either as co-hosts or contributing partners.
Through an active and democratic Forum, IPs and LCs can support and empower communities in the right way, growing participation as shareholders of the VCM and delivering significant benefits such as enhancing land rights, income opportunities, and biodiversity protection.
So far, we are not receiving the support we need from the rest of the world to be part of the solution. We need respect, recognition, and the implementation of finance in line with the contribution of our territories, our knowledge, and our ancestral resource management practices that protect and preserve Mother Nature.
Banner image: In Mt. Mantalingahan’s Sitio Paho, Pala’wan Indigenous leader Mami Lapasan, 77, rushes downhill carrying a load of almaciga resin. His community’s organic farming practices is successfully conserving old-growth forests and watersheds in the Mount Mantalingahan Protected Landscape, a biodiversity hotspot. However, the farmers face many challenges and lack of support for their conservation efforts. Photo by Keith Anthony Fabro for Mongabay.
Related listening from Mongabay’s podcast: The struggles faced by Indigenous communities in Papua New Guinea to protect their customary land rights in the face of the carbon market, and one governor’s perspective on how to change that conversation. Listen here:
Implementation of operational directive 4.20 on Indigenous Peoples : An independent desk review. World Bank. (n.d.). https://documents.worldbank.org/en/publication/documents-reports/documentdetail/570331468761746572/implementation-of-operational-directive-4-20-on-indigenous-peoples-an-independent-desk-review
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