MakingREDD+ pay: Shifting rationales and tactics of private finance and the governance of avoided deforestation inIndonesia

This paper presents an analysis of changing rationales and tactics among actors engaged in mobilising private finance for I ndonesia's emergent Reducing Emissions from Deforestation and Forest Degradation ( REDD +) programme. Despite limited flows of private finance so far, private sector actors have been responsible for a great deal of development and innovation in the forest carbon sector in I ndonesia, and have thus played – and continue to play – an important part in shaping the country's REDD + programme. Drawing on extended field research and interviews with key actors engaged with REDD + in I ndonesia, we identify a variety of private investor motivations, strategies and tactics, many of which depart considerably from the common understanding of REDD + as avoided deforestation funded through carbon offsets. As non‐state actors increasingly shape emerging REDD + projects, they assume important roles as agents of environmental governance – working through a variety of private market and hybrid modes of forest/climate governance. We describe four general modes of engagement, centred around: investment in REDD + verified emissions reductions; corporate social responsibility; sustainable commodities; and impact investment. The research thus contributes to an improved understanding of the nature of private REDD + finance in I ndonesia, and the implications, potential and limits of private, market‐based climate governance.