Corporate motivations and co-benefit valuation in private climate finance investments through voluntary carbon markets

This paper investigates corporate motivations for investing in voluntary carbon offset (VCO) projects and how these motivations influence the valuation of local co-benefits. Using a mixed-methods analysis of 186 companies and 534 projects in 2017, the study identifies three primary motivations: carbon management and efficiency, market competitiveness, and company values. Companies driven by values and market competitiveness showed a preference for high-cost projects with significant local co-benefits, while those focused on carbon management prioritized lower-cost projects, particularly renewable energy. The findings highlight contrasting trends in offset investment based on pricing signals and the importance of co-benefits in corporate decision-making.

Jiehong Lou, Nathan Hultman, Anand Patwardhan, Irving Mintzer