Corporate Demand Must Scale for Tropical Forest Credits

A $1 billion corporate demand signal for tropical forest credits in 2021 has bolstered jurisdictional REDD+, but broader procurement remains the defining gap.

In a guest article, Lucy Almond, director and chair of Nature4Climate, wrote: “The defining challenge for this emergency brake solution is now demand.” The LEAF Coalition sent that signal in 2021, when a small group of companies was helping bolster the developing system.

What makes tropical forest protection an emergency brake?

Despite decades of commitments and campaigns, millions of hectares of forest still disappear every year. The UN Emissions Gap Report 2026 says the world is now set to exceed 1.5°C of warming. Almond frames the task as minimizing damage and buying time while the larger energy transition continues.

Almond, citing Drawdown and Foreign Policy, identifies two immediate emergency brakes: cutting methane and other short-lived “super” pollutants, and stopping tropical deforestation. The latter prevents enormous quantities of carbon from entering the atmosphere. Both can deliver rapid benefits without a technological breakthrough, but they require scaling known solutions alongside deep decarbonization.

Government action has supplied the evidence. Brazil demonstrated in the 2000s and again more recently that enforcement can reduce deforestation at scale; Indonesia has made significant progress through stronger governance and forest protections. Political commitment, enforcement and sustained investment made the difference.

Almond also points to the recent Brazilian election results and steady progress by the Tropical Forest Forever Fund. The remaining challenge is creating economic incentives that maintain progress over time.

The mechanism can slow warming now, but political commitment and sustained investment must keep it working.

How does jurisdictional REDD+ work?

Jurisdictional REDD+, or JREDD+, differs from individual forest carbon projects because it operates across an entire country, state or province. It rewards governments and communities for independently verified reductions in forest emissions and generates carbon credits for companies and other buyers to purchase.

Over two decades, governments, Indigenous Peoples, local communities, scientists and standards bodies developed monitoring systems, safeguards, verification processes and benefit-sharing arrangements. Delays, disagreements and legitimate questions accompanied that work, but scrutiny produced systems capable of directing substantial private finance toward forest protection.

Programs are now moving from preparation to delivery:

• Guyana has demonstrated the potential for large-scale JREDD+ transactions.
• Costa Rica has issued credits recognizing forest restoration.
• Argentina’s Misiones province has secured approval for its jurisdictional forest carbon program.
• Ghana is advancing toward issuance.

More jurisdictions across the tropics are preparing to follow. These milestones are not interchangeable: a transaction, issued credit, approved program and pending issuance sit at different stages of market readiness.

Some jurisdictions have reached transaction or issuance milestones, while others remain in preparation.

Why has corporate demand not scaled?

Those early corporate leaders have played an indispensable role, but they cannot deliver the finance needed for a meaningful dent in tropical deforestation. The buyer base must broaden.

Few investments offer the potential to support a global climate emergency brake while also protecting biodiversity, supporting livelihoods and strengthening local economies. Yet Almond says the climate argument alone cannot overcome barriers to investment beyond a company’s own value chain.

Three barriers stand in the way:

• A clearer business case. Buyers need to show climate impact, explain how credits contribute to corporate climate commitments, secure appropriate recognition and manage reputational and legal risk.
• Consistent market rules. Overlapping standards, voluntary guidance and regulatory approaches make it harder for companies to use credits responsibly or describe those purchases with confidence.
• Policy that keeps both tools open. European debates and Article 6.4 of the Paris Agreement need to recognize the complementary roles of emissions reductions, including avoided deforestation, and carbon removals rather than close either route too early.

Almond says governments, standards bodies and the environmental community must work together on clearer rules, stronger incentives and greater confidence without compromising environmental integrity. Businesses must then be prepared to respond.

Corporate scale will arrive only when buyers can value climate impact, trust the credits and read the rules without guesswork.

What must change before COP31?

Corporate climate strategies should not stop at the boundaries of operations and supply chains. Alongside internal decarbonization, Almond argues that investment in high-integrity jurisdictional forest protection should become a mainstream part of corporate climate action.

Her personal benchmark is equally direct. As a teenager in the 1980s, she was mildly irritated by Sting’s repeated television and magazine appeals to save the Amazon. Four decades later, she asks why companies still hesitate when the financing tools are within reach.

Almond’s conclusion is cautious: “We are finally beginning to demonstrate that they can.” Forests can now draw credible, large-scale climate finance, but demand has not matched the protection system.

The decisive milestone is corporate purchasing under clear European and Article 6.4 rules; COP31 can accelerate that market, but cannot substitute for orders.