Voluntary Carbon Market Engagement: Exploring the Motivations for VCM Engagement Among Icelandic Corporations, their Carbon Credit Criteria and Preferences

• Main Author: Ólafsdóttir, Diljá
• Format: Other/Unknown Material
• Language: English
• Published: Lunds universitet/Internationella miljöinstitutet 2024
• Subjects: Voluntary carbon market; sustainability-driven enterprises; Iceland; 1.5°C emission target; corporate sustainability strategies; Business and Economics
• Online Access: http://lup.lub.lu.se/student-papers/record/9171304

Voluntary Carbon Markets (VCM) have emerged with the intention of supporting decarbonisation and carbon dioxide removal solutions around the world. However, and despite a rapid growth, the motivations and preferences of the demand side to engage in with the VCM have not been thoroughly studied before. Iceland, the focus of this thesis, exemplifies this trend. To address this knowledge gap, this thesis aims to understand why Icelandic corporations that are committed to reducing their emissions engage with the VCM and identify their criteria and preferences for carbon credits. From a methodological point of view, the thesis develops an analytical framework using existing theories and literature on VCMs, net zero adoption, business culture and organisational behaviour. Results from a survey and in-depth interviews are analysed with a directed content analysis. The findings reveal that Icelandic corporations are driven by corporate values and competitive pressures when engaging with the VCM. Their top criterion when purchasing carbon credits is that the credits are certified by a standardising body. Furthermore, Icelandic corporations committed to reducing their emissions seek to purchase removal credits that align with the corporation’s values, and prefer to purchase carbon credits from local carbon projects. However, the lack of certified local projects available at reasonable prices drives them to purchase credits from international projects instead. An understanding of these factors is beneficial to project developers and local practitioners, as it allows them to adjust their operations and strategies to better fit the market’s criteria. Findings also provide important lessons for policy makers aiming to strengthen the credibility and integrity of the VCM in Iceland. The thesis lays the foundations for future research by providing the necessary building blocks to understand the demand side of the Icelandic VCM.