The interests shown by and challenges for Japanese firms in forest conservation in developing countries

REDD+ engagement types preferred by Japanese private firms: The challenges and opportunities in relation to private sector participation

Makoto Ehara (a), Hiromitsu Samejima (b), Makino Yamanoshita (b), Yoko Asada (c), Yutaro Shogaki (c), Masato Yano (c), Kimihiko Hyakumura (d)

(a) Center for International Partnerships and Research on Climate Change, FFPRI, Tsukuba, Ibaraki, Japan.

(b) Institute for Global Environmental Strategies, Hayama, Kanagawa, Japan.

(c) Mitsubishi UFJ Research and Consulting Co., Ltd., Tokyo Japan.

(d) Kyushu University, Fukuoka, Japan.

Forest Policy and Economics 106 September 2019 101945 DOI：10.1016/j.forpol.2019.06.002( External link )

REDD+ is a mechanism that provides economic incentives for the reduction of CO₂ emissions through reduced deforestation and forest degradation, and for CO₂ removals through sustainable forest management in developing countries. As several REDD+ host countries are at their implementation phase, it is necessary to take on private sector finance in addition to public finance. Hence, Japan has been providing support for private participation in REDD+, primarily targeting firms that aim to acquire profit through REDD+ credit development and transactions.

In this study, questionnaire surveys were administered to major firms listed on national stock exchanges regarding their preferred purposes and engagement types for participation in REDD+. We found that a certain number of firms in Japan are interested in REDD+ as a means of enhancing their corporate values and fulfilling their corporate social responsibilities. We also found that the challenges to participation in REDD+ include the unclear prospect of the demand for REDD+ credits and the lack of methods for conveying the importance of forest conservation to clients in a comprehensible manner. To address these challenges, it is important to provide support in matching firms that are interested in forest conservation with local governments and NGOs and to develop a framework that facilitates the implementation of REDD+ related conservation activities by bundling firms that find it difficult to work alone.

Based on these findings, it is expected that policy options for promoting private participation in REDD+ will expand, which will aid forest management policies and measures in confronting climate change in Japan and developing countries.

Table 1: Challenges Japanese firms face when participating in REDD+ and their countermeasures

UNFCCC：the United Nations Framework Convention on Climate Change,
JCM：the Joint Crediting Mechanism,
MRV: measuring, reporting, and verification.