Voluntary Carbon Markets (VCMs) in a nutshell: A systematic review based on the empirical evidence from across the globe

Abstract

Voluntary Carbon Markets (VCMs) have attracted various stakeholders to participate in their value chain as they allow carbon credits to be traded. This study systematically reviews the academic literature pertinent to VCMs combined with an analysis of the selected studies on certain bases such as classification based on the climate zones & regions, Global North- Global South perspective, and land use perspective. Further, it also explores the broad themes, the research timeline, and the empirical methods used in the extant literature. Additionally, the study digs into the gendered dimension in certain VCM projects. To fulfill these purposes, sixty-nine studies based on empirical evidence have been chosen from the vast literature. A critical appraisal of the key findings reveals an urgent requirement for a policy framework for VCMs irrespective of the climate zone the study belongs to. A focus on the financial and socio-economic aspects of carbon projects is noted and a substantial difference in the nature of studies conducted in Global North/Global South is observed. Effective land use regarding superior alternatives is cited in informing policymakers and project developers of financially, environmentally, and socially feasible uses. The gender stereotypes revolving around certain VCM-based projects need to be addressed. Drawing upon the critical findings of this study, possible future work in the domain of carbon pricing in VCM, investigating efficient land use to combat climate change, “Women and ESG”, and the unified role of compliance and voluntary markets in mitigating climate change is suggested.