Harnessing Carbon Markets for Climate Justice: A Pathway to Sustainable Development

Abstract

As climate and environmental challenges grow increasingly severe, carbon markets have garnered significant attention in academic research. Carbon trading and offsetting are central to these mechanisms, with the primary objective of reducing greenhouse gas emissions. Climate change injustice is the situation where communities that contribute the least to climate change disproportionately bear the severe consequences. The aim of this review is to explore how carbon markets can be utilised as a mechanism to promote climate justice and contribute to sustainable development. By examining various policy approaches and their implications, the research seeks to shed light on how carbon markets can either advance or hinder climate justice goals. The findings indicate that carbon markets have the potential to encourage investments in clean energy and sustainable development projects, which can benefit communities disproportionately affected by pollution. It can provide opportunities for broader participation in climate action, allowing smaller emitters or developing countries to participate in emission trading. To maximise their positive impacts and minimise risks, carbon markets must be accompanied by complementary policies and measures that prioritise equity, inclusion, and community participation. Countries with greater capacity and responsibility for emissions need to take more drastic actions and provide financial and technical support to developing nations.