Search Results (62)

Voluntary carbon markets (VCMs) are growing rapidly but remain structurally fragmented due to verification delays, lifecycle opacity, inconsistent metadata, and capital mobilisation bottlenecks. While blockchain is often proposed as a digitalisation layer to improve transparency and traceability, this paper reframes tokenisation as a sector-aware financial infrastructure capturing the full lifecycle of carbon credits. Rather than treating it as a digital overlay, this study argues that tokenisation functions as a modular, automated architecture capable of absorbing sector-specific frictions within VCMs. Drawing on 1495 registry-compliant projects from the Berkeley Voluntary Offsets Database (BVOD v2025-06), the study develops the sector tokenisation opportunity matrix (STOM). This diagnostic framework maps registry-derived indicators—issuance volume, credit retirement ratio, and average credits per project—to three tokenisation functions: market expansion, retirement acceleration, and structuring for scale and fragmentation. STOM reveals how tokenisation can address VCM fragmentation by mobilising capital, reinforcing lifecycle integrity, and enabling assets to be packaged across diverse project types. By linking friction diagnostics to governance-sensitive infrastructure design, the research proposes a sector-aware blueprint for climate finance infrastructure and positions tokenisation as a strategic tool for scaling high-integrity climate action. Full article

The Asia Pacific, led by the resource-dependent ASEAN-5, is the largest carbon contributor, yet its firms exhibit critically low transparency. This study examines the relationship between voluntary Sustainability Assurance (SA) and carbon disclosure transparency using 875 firm-year observations (2018–2022). Applying panel regression and several robustness tests, we find that SA adoption has a positive relationship with the magnitude of disclosed carbon emissions, indicating enhanced transparency. This positive relationship is significantly more pronounced in firms with high environmental performance and greater property, plant, and equipment (PPE) efficiency, suggesting SA aligns with genuine sustainability efforts rather than symbolic reporting. Furthermore, SA increases the likelihood of disclosing the complex Scope 3 emissions. However, the effectiveness of SA is conditional: its transparency benefit is statistically significant only within mandatory sustainability reporting (SR) regimes and in non-environmentally sensitive industries, highlighting crucial variations across regulatory and industrial contexts within ASEAN-5. This research provides evidence on the role of SA in emerging markets, extending Agency Theory by demonstrating its function as a credibility signal that reduces information asymmetry. We offer practical guidance for managers seeking market differentiation, and for regulators aiming to align voluntary SA with IFRS S1/S2 to enhance disclosure quality. Full article

Climate change mitigation involves carbon sequestration that can be supported by Voluntary Carbon Markets (VCMs) and counted as Nationally Determined Contributions (NDCs) in national climate change strategies. Integrating these allows for the determination of greenhouse gas (GHG) emissions and carbon sequestration at the national level. The case for Egypt and other nontropical dryland nations is made in this systematic review article through consideration of monitoring, reporting, and verification (MRV) protocol challenges and initiatives. Improvements are indicated based on the literature, encompassing the academic literature as well as organizational reports and governmental policy documents. Agricultural MRV protocols depending on soil organic carbon (SOC) measurements are specifically considered, delineating the challenges and barriers for SOC MRV methods. Considering the impacts of climate zones affecting soils and providing as much standardization as possible for MRV protocols will improve the accuracy and generalizability of data. Measurements in carbon sequestration monitoring based on SOC MRV protocols need to be informed by soil experts alongside climatologists and policymakers in a multidisciplinary approach. Full article

Climate change is driving the need for forest management strategies that simultaneously enhance ecosystem resilience and contribute to climate change mitigation. Voluntary carbon markets (VCMs), regulated in the European Union by the Carbon Removal Certification Framework (CRCF), offer potential financial incentives for such management, but eligibility criteria—particularly biodiversity requirements—limit the applicability of certain species. This study assessed the ecological and economic outcomes of six alternative management scenarios for a 4.7 ha, 99-year-old Scots pine (Pinus sylvestris) stand in western Hungary, comparing them against a business-as-usual (BAU) regeneration baseline. Using field inventory data, species-specific yield tables, and the Forest Industry Carbon Model, we modelled living and dead biomass carbon stocks for 2025–2050 and calculated potential CO₂ credit generation. Economic evaluation employed total discounted contribution margin (TDCM) analyses under varying carbon credit prices (€0–150/tCO₂). Results showed that an extended rotation yielded the highest carbon sequestration (958 tCO₂ above BAU) and TDCM but was deemed operationally unfeasible due to declining stand health. Black locust (Robinia pseudoacacia) regeneration provided high mitigation potential (690 tCO₂) but was ineligible under CRCF rules. Grey poplar (Populus × canescens) regeneration emerged as the most viable option, balancing biodiversity compliance, climate adaptability, and economic return (TDCM = EUR 22,900 at €50/tCO₂). The findings underscore the importance of integrating ecological suitability, market regulations, and economic performance in planning carbon farming projects, and highlight that regulatory biodiversity safeguards can significantly shape feasible mitigation pathways. Full article

Global biodiversity decreased by 69% from 1970 to 2022, representing a key risk to economic activity. However, the link between nature, biodiversity and finance has received little attention within the field of sustainable finance. This paper attempts to fill this gap. Nature finance aims to avoid biodiversity loss and promote nature-positive activities, such as the conservation and protection of biodiversity through market-based solutions with the proper measurement of impact. Measuring biodiversity impact remains a challenge for most companies and banks, with a fragmented landscape of nature frameworks. We conduct a bibliometric analysis of the literature on biodiversity finance and analyze a unique market dataset of five global investment funds as well as all corporate bonds issued in Brazil, the country with the largest biodiversity assets. First, we find that the literature on nature finance is recent with a tipping point in 2020, with the three most common concepts being ecosystem services, nature-based solutions and circular economy. Second, we find that sovereigns and two corporate sectors (food production, pulp & paper) represent the vast majority of issuers that currently incorporate biodiversity considerations into funding structures, suggesting an opportunity to expand accountability for biodiversity impacts across a greater number of sectors. Third, we find a disconnect between science and finance. Out of a catalogue of 158 biodiversity metrics proposed by the IFC, just 33 have been used in bond issuances and 32 by fund managers, suggesting an opportunity for technical assistance for companies and to simplify catalogs to create a common language. Lack of consensus around metrics, complexity, and cost explain this gap. Fourth, we identify a distinction between liquid markets and illiquid markets in their application of biodiversity impact management and measurement. Illiquid markets, such as private equity, bilateral lending, voluntary carbon markets or investment funds can develop complex bespoke mechanisms to measure nature, leveraging detailed catalogues of metrics. Liquid markets, including bonds, exhibit a preference for simpler metrics such as preserved areas or forest cover. Full article

Corporate carbon information disclosure (CID) is gradually transitioning from being voluntary to mandatory, consistent with the global consensus on addressing climate change and achieving sustainable development. CID reflects corporate environmental performance and is a crucial source for the market to comprehend corporate environmental risks and assess their long-term value. However, corporate operations are often influenced by managers’ behavioral preferences when formulating disclosure strategies, as managerial cognitive vision and values directly affect strategic decisions. This study used a sample of Chinese A-share-listed companies for 2010 to 2023 to investigate the relationship between managerial myopia and CID. The findings indicate that managerial myopia significantly inhibits CID by reducing executive environmental awareness and corporate green innovation capabilities. A heterogeneity analysis shows that managerial myopia has a stronger inhibitory effect on CID in companies with weak governance structures and those that are not technology-intensive, providing valuable references for environmental performance and CID practice in emerging countries. Full article

Whether voluntary carbon markets can effectively contribute to climate mitigation remains a debated issue. Taking Chinese Certified Emission Reduction (CCER) projects as a quasi-natural experiment, this study employed a difference-in-difference approach calibrated with a county-level panel dataset spanning 2008–2021 to examine the carbon abatement effect of CCER projects. The results show that CCER projects reduced county-level emissions by 2.8%, though this reduction falls short of the levels self-declared by project developers, implying the possibility of overstating emission reductions. The carbon abatement effect is more pronounced in biogas projects and projects verified by large agencies, underscoring the mitigation potential of biogas deployment as well as the importance of professional expertise in enhancing project quality. In addition, CCER projects generate a range of socio-economic benefits, including raising income, creating employment opportunities, and preserving farmland. Overall, this study identified the effectiveness of voluntary carbon markets, providing valuable insights for fostering their further sustainable development. Full article

Accurate forecasting of carbon credit prices is increasingly vital for the effective functioning of forest carbon markets, which play a growing role in global climate mitigation strategies. Against this backdrop, the present study conducts a systematic literature review to evaluate the state of carbon price forecasting methodologies, with particular emphasis on their applicability to forest-based carbon credits. The review highlights the predominance of machine learning (ML) and hybrid modeling approaches, which demonstrate enhanced predictive capabilities relative to conventional econometric techniques, particularly in capturing nonlinear dynamics and integrating heterogeneous data sources. However, their predictive power is limited by data scarcity, market opacity, and regulatory volatility. These issues are particularly severe in voluntary forest credit markets. The review identifies a critical research gap. Few studies explicitly model the behavior of forest credit prices. The findings suggest that future research should prioritize the development of policy-sensitive, scenario-based models that incorporate ecological, economic, and regulatory dimensions. While the majority of studies concentrate on compliance carbon markets, the methodological insights and forecasting approaches reviewed are highly relevant for the evolving forest carbon sector, nature-based mitigation strategies, and climate solutions. It also offers guidance for creating more transparent and robust forecasting tools in the forest carbon sector. Full article

Climate change is intensifying droughts, heatwaves, dust storms, and rainfall variability across Eastern Europe, undermining yields and soil stability. In Ukraine, decades of underinvestment and wartime damage have led to widespread degradation of field shelterbelts, while the adoption of agroforestry remains constrained by tenure ambiguity, fragmented responsibilities, and limited access to finance. This study develops a policy-and-technology framework to restore agroforestry at scale under severe fiscal and institutional constraints. We apply a three-stage approach: (i) a national baseline (post-1991 legislation, statistics) to diagnose the biophysical and legal drivers of shelterbelt decline, including wartime damage; (ii) a comparative synthesis of international support models (governance, incentives, finance); and (iii) an assessment of transferability of digital monitoring, reporting, and verification (MRV) tools to Ukraine. We find that eliminating tenure ambiguities, introducing targeted cost sharing, and enabling access to payments for ecosystem services and voluntary carbon markets can unlock financing at scale. A digital MRV stack—Earth observation, UAV/LiDAR, IoT sensors, and AI—can verify tree establishment and survival, quantify biomass and carbon increments, and document eligibility for performance-based incentives while lowering transaction costs relative to field-only surveys. The resulting sequenced policy package provides an actionable pathway for policymakers and donors to finance, monitor, and scale shelterbelt restoration in Ukraine and in similar resource-constrained settings. Full article

Kazakhstan, a fossil-fuel-dependent economy, faces growing pressure to reduce greenhouse gas emissions while maintaining industrial competitiveness. Carbon Capture, Utilization, and Storage (CCS/CCUS) technologies offer a viable pathway for decarbonizing hard-to-abate sectors, particularly in power generation, metallurgy, and oil and gas processing. This paper provides a comprehensive review of the state of CCS/CCUS technologies globally and examines their applicability within Kazakhstan. The study also explores long-term CO₂ storage mechanisms and monitoring frameworks, with attention to carbon leakage risks and the importance of addressing methane emissions. A critical part of the analysis is dedicated to Kazakhstan’s Emissions Trading System, identifying its current limitations such as low carbon prices, and limited sectoral coverage, and outlining practical reforms to enhance its role in supporting CCS/CCUS and broader decarbonization efforts. The integration of CCS/CCUS with a strengthened ETS, combined with access to international climate finance instruments and voluntary carbon markets, is proposed as a key strategy for Kazakhstan’s transition to a low-carbon economy. By linking engineering innovation with targeted policy interventions, this study offers a dual-perspective contribution. It not only provides technical insights into CCS/CCUS technologies but also presents policy recommendations that are specifically tailored to Kazakhstan’s context. The findings reinforce the role of CCS/CCUS as a crucial component of national climate strategy and industrial transformation. Full article

As the world’s largest developing and carbon-emitting country, China is accelerating its greenhouse gas (GHG) emission reduction process, and it is of vital importance in achieving the goals set out in the Paris Agreement. This paper examines the historical development and current operation of China’s carbon emissions trading market (CETM). The current progress of research on the implementation of carbon emissions trading policy (CETP) is described in four dimensions: environment, economy, innovation, and society. The results show that CETP generates clear environmental and social benefits but exhibits mixed economic and innovation effects. Furthermore, this paper analyses the challenges of China’s carbon market, including the green paradox, the low carbon price, the imperfections in cap setting and allocation of allowances, the small scope of coverage, and the weakness of the legal supervision system. Ultimately, this paper proposes recommendations for fostering China’s CETM with the anticipation of offering a comprehensive outlook for future research. Full article

Ecosystem services—the benefits humans derive from nature—are foundational to environmental sustainability and economic well-being, with carbon sequestration and storage standing out as critical regulating services in the fight against climate change. This study presents a comprehensive financial valuation of the carbon sequestration, storage and product substitution ecosystem services provided by the Hungarian forest-based sector. Using a multi-scenario framework, four complementary valuation concepts are assessed: total carbon storage (biomass, soil, and harvested wood products), annual net sequestration, emissions avoided through material and energy substitution, and marketable carbon value under voluntary carbon market (VCM) and EU Carbon Removal Certification Framework (CRCF) mechanisms. Data sources include the National Forestry Database, the Hungarian Greenhouse Gas Inventory, and national estimates on substitution effects and soil carbon stocks. The total carbon stock of Hungarian forests is estimated at 1289 million tons of CO₂ eq, corresponding to a theoretical climate liability value of over EUR 64 billion. Annual sequestration is valued at approximately 380 million EUR/year, while avoided emissions contribute an additional 453 million EUR/year in mitigation benefits. A comparative analysis of two mutually exclusive crediting strategies—improved forest management projects (IFMs) avoiding final harvesting versus long-term carbon storage through the use of harvested wood products—reveals that intensified harvesting for durable wood use offers higher revenue potential (up to 90 million EUR/year) than non-harvesting IFM scenarios. These findings highlight the dual role of forests as both carbon sinks and sources of climate-smart materials and call for policy frameworks that integrate substitution benefits and long-term storage opportunities in support of effective climate and bioeconomy strategies. Full article

Natural Climate Solutions (NCSs) represent a critical tool for addressing climate change, yet their long-term success is threatened by inadequate consideration of community impacts in current verification standards. While Article 6 of the Paris Agreement establishes rigorous requirements for carbon sequestration and emission avoidance verification, existing standards lack comprehensive frameworks for assessing and ensuring community well-being, undermining project permanence and market confidence. We developed an integrated framework combining community well-being assessment with verification requirements through analysis of Article 6 implementation requirements, existing voluntary carbon offset credit standards, emerging national standards, and community engagement mechanisms. Our analysis yielded a framework establishing five core tenets for community engagement (inclusion, engagement, contribution, ownership, and well-being) and nine essential well-being assessment domains, each with specific measurable indicators. The framework provides clear verification alignment protocols that integrate with existing standards while maintaining rigorous requirements and offering practical implementation guidance. Integration of community well-being assessment into NCS verification standards strengthens project permanence while meeting verification requirements, providing practical tools for standards bodies, project developers, and market participants to ensure both environmental and social benefits. As Article 6 mechanisms mature, this integration becomes increasingly crucial for project success. Full article

This study examines the causal and dynamic effects of carbon information disclosure on firm value, using a policy-driven setting in China’s carbon-intensive industries. In 2018, the Ministry of Ecology and Environment implemented a regulatory policy requiring internal carbon accounting and third-party verification for carbon-intensive enterprises, without mandating public disclosure. This exogenous policy shock offers a quasi-natural experiment to investigate how firms in carbon-intensive industries respond to environmental mandates through voluntary disclosure and how such disclosure affects their market valuation. Employing a difference-in-differences framework combined with two-stage least squares estimation, we identify a significant increase in carbon information disclosure following the policy intervention. This disclosure leads to a positive and growing effect on firm value, particularly when sustained over multiple years. Moreover, the valuation effect is moderated by regional environmental regulation: firms in areas with lower enforcement intensity benefit more from disclosure, as the signal is perceived to be more voluntary and credible. These findings provide robust causal evidence on the role of carbon information disclosure in shaping market outcomes under regulatory pressure. The study contributes to the literature on environmental regulation and corporate financial behavior in emerging markets. Full article

As China’s voluntary greenhouse gas emission reduction mechanism undergoes institutional revitalization, the accurate valuation of carbon assets such as China Certified Emission Reductions (CCERs) becomes increasingly critical for effective climate finance and sustainability-oriented investment. This study proposes an integrated value assessment model for CCERs that combines Long Short-Term Memory (LSTM) neural network-based carbon price forecasting with both the discounted net cash flow method and the Black–Scholes option pricing framework. Applying this model to a wind power project, the study found that the practical value of CCERs, derived from verified emission reductions, significantly exceeds their market option value, underscoring the economic and environmental viability of such projects. By distinguishing between the realized and potential values of carbon credits, this research offers a comprehensive tool for carbon asset valuation that supports corporate carbon management and policy development. The framework contributes to the growing literature on sustainable finance by aligning carbon asset pricing with long-term climate goals and enhancing transparency in carbon markets. Full article