A tool that aims to promote and safeguard sustainable development under the UN carbon market offers indigenous peoples and local communities little protection against projects which infringe on their land or violate their human rights. This was the disturbing finding of a joint investigation by Carbon Market Watch and the Land Matrix Initiative.
There had been widespread hope that the carbon market mechanism established under Article 6 of the Paris Agreement would correct the problems plaguing its predecessor, the Clean Development Mechanism (CDM), and voluntary initiatives, such as human rights violations and infringements on the land rights of indigenous peoples and local communities.
However, the instrument meant to safeguard these rights, the Sustainable Development (SD) Tool developed by the Supervisory Body overseeing the implementation of the market under Article 6.4 of the Paris Agreement, leaves vulnerable communities with little real-world protection against such risks as land grabs and displacement.
This was the conclusion of a joint report by Carbon Market Watch and the Land Matrix Initiative which has been released today, 30 April 2026. Titled ‘Trading carbon credits for human rights’, the investigation examines nearly 2,000 projects in the pipeline for the market mechanism which make intensive use of land, such as forestry, wind, solar, hydropower and ecosystem restoration projects. Of these, 426 projects exhibited a high risk of directly overlapping with the land over which indigenous peoples and local communities enjoy customary rights, while another 319 lie in close proximity.
“A carbon market built on insecure land rights is a market built to fail,” says lead author of the report, Christoph Kubitza of the Land Matrix Initiative. “Article 6.4 risks are real: conflicts are already documented, and hundreds of projects could overlap with Indigenous and community lands.”
“Human rights are absolute, not relative and countries that signed the Paris Agreement have committed to respecting their human rights obligations. The Paris Agreement carbon market must facilitate this commitment through robust safeguards that effectively protect marginalised communities worldwide,” adds Isa Mulder, an expert on Article 6 at Carbon Market Watch who was also involved in this report. “It is vital that the Supervisory Body undertake efforts now to prevent human rights violations.”
Land rights and wrongs
One example of a carbon market project hoping to channel into the Article 6.4 mechanism while having a demonstrated history of local land rights violations is Plantar in Brazil. The project converted large areas of community land used by traditional communities into eucalyptus plantations, with reports of expulsions and contaminated water as a result. Another example relates to carbon market activities in Kenya’s Mau Forest, which are deeply entangled with land rights conflicts and forced evictions of the Ogiek community.
And these troubling issues do not just relate to the past but extend into the future. For instance, the proposed Botolan Wind Farm in the Philippines did not carry out a proper early consultation and gather pro forma local approvals. As a result, the Aeta indigenous community has been left with virtually no ability to influence the project, facing uncertainty over potential damage to their sacred forests and vital watersheds.
Poor tools of the trade
Although the SD Tool is an improvement on the previous one under the CDM and many existing systems in the voluntary carbon market and contains some good language on land and human rights safeguards, this is largely a dead letter, as the mechanism is mostly procedural in its design and contains barely any teeth for enforcement.
“The Paris Agreement carbon market cannot pat itself on the back for doing better than the worst in class,” insists Mulder. “It must strive to raise the bar to comply with the best practices of the voluntary carbon market, and international and regional human rights and land governance frameworks.”
One fatal weakness of the SD Tool is its failure to establish a clear legal hierarchy that places international human rights standards ahead of deficient or exclusionary domestic laws, which leaves indigenous peoples and local communities unprotected when national or local laws do not recognise or undermine them, and the tool takes an alarmingly narrow approach to free, prior and informed consent.
The SD Tool limits the need to acquire such consent to formally recognised indigenous peoples, which excludes those that lack formal recognition, as well as other marginalised groups, such as customary landholders, small-scale farmers, and local communities. Shockingly, the mechanism also explicitly allows for involuntary resettlement as long as mitigation measures are proposed. This follows a narrow compensation logic, in which land can be simply substituted for income or jobs while its cultural, ecological, and spiritual value is ignored.
The importance of consent
These harmful deficiencies and weaknesses in the SD Tool can be fixed. In the report, Carbon Market Watch and the Land Matrix Initiative make a series of recommendations. These include ensuring the tool always complies with international human rights norms and expanding the need for free, prior and informed consent to cover all affected groups.
This also involves project developers recognising informal as well as legal land rights and resolving all tenure issues prior to receiving consent, as well as a shift from consultative to participatory governance.
With the SD Tool undergoing its first review at the next Supervisory Body meeting, between 18 and 21 May, the time to heed these recommendations is now.
