Indigenous Communities Must Lead in Shaping Voluntary Carbon Market Reform

Indigenous Peoples and local communities must be central partners in shaping the reformed voluntary carbon market if it is to achieve its full potential to fund climate solutions and protect nature, according to the Integrity Council for the Voluntary Carbon Market. Research indicates that the VCM could provide up to one-third of funding needed for nature-based climate solutions, potentially reducing 2.7 billion tonnes of emissions annually by 2030.

The ICVCM argued that achieving the 1.5-degree Celsius temperature limit is impossible without protecting and restoring forests and other natural carbon sinks — ecosystems where Indigenous Peoples and local communities serve as primary stewards. IPs and LCs manage 40% of the planet's ecologically intact landscapes. However, despite this critical ecological role, these communities remain among the most marginalised in accessing climate finance and have often received limited benefit from carbon credit projects affecting their lands and resources.

To address this structural imbalance, the Indigenous Peoples and Local Communities VCM Engagement Forum was established following a workshop at COP27 hosted by the ICVCM and The Nature Conservancy. The Forum, which is independent and self-governing, brings together representatives from Africa, Asia, Latin America, and Oceania with a mandate to protect and promote IP and LC rights within the voluntary carbon market. The ICVCM's Core Carbon Principles already include requirements for Free Prior and Informed Consent and transparent benefit sharing in all CCP-labelled projects.

The Forum has identified key priorities including developing capacity-building strategies for IPs and LCs, establishing best practices for benefit distribution and ecological knowledge, and removing technical, legal, and financial barriers to VCM participation. The ICVCM noted that reform-focused organisations including the ICVCM, VCMI, and GCMU are leading efforts to scale a high-integrity market — but that this requires IP and LC communities to be engaged as strategic decision-making partners rather than passive participants. This blog post was adapted from a speech by Forum co-chair Onel Masardule at VCM Day at Climate Week New York.

Key figure — VCM could reduce 2.7 billion tonnes of emissions annually by 2030 through nature-based solutions