Analysing integrity, transparency and accountability in a fragile state

Carbon market expansion across Africa presents opportunities and risks for countries like Mozambique, where governance systems remain fragile and deeply shaped by the country’s complex political economy. This study explores how integrity, transparency and accountability can be strengthened in Mozambique’s engagement with carbon markets, particularly with the environment, agriculture, forestry, mining and energy. It seeks to provide a grounded understanding of the systemic and contextual challenges that affect the credibility and fairness of carbon-related initiatives, while identifying lessons from other countries that may inform more robust governance approaches in Mozambique.

The primary objective of this study is to analyse the underlying causes and drivers of potential integrity failures in Mozambique’s carbon markets through a political economy lens. By doing so, it uncovers how incentives, relationships and institutional weaknesses shape the behaviour of main actors and influence governance outcomes. The analysis considers Mozambique’s ongoing political crisis and conflict in the north, the new risks arising from instability, and the capacity and competency gaps in governance systems. It also examines how power is distributed and contested among different administrative levels and between various interest groups and individuals to understand how these dynamics affect integrity, transparency and accountability in carbon market development.

To guide the analysis, the study was informed by three research questions:

1. What are the biggest challenges to promoting integrity, transparency and accountability in carbon markets in Mozambique?
2. How do these challenges play out in the broader political economy, including state weakness stemming from a long history of conflict and other structural factors?
3. What carbon market standards and verification systems exist, and how might these be affected by Mozambique’s existing governance risks, including corruption?

These questions form the basis for a comprehensive exploration of integrity risks and opportunities in Mozambique’s evolving carbon market landscape to inform policy, donor engagement and institutional reform. We have emphasised issues related to land-based carbon projects, considering that, in October 2021, Mozambique became the first country to receive payments from the Forest Carbon Partnership Facility (FCPF) trust fund for verified reductions in emissions from deforestation and forest degradation (REDD+).

The triple nexus and integrity in carbon markets

The humanitarian–development–peace (HDP)af73deb4962e nexus helps us understand integrity in Mozambique’s emerging carbon markets. In fragile and conflict-affected contexts, carbon finance must do more than reduce emissions; it should also strengthen resilience and social stability. Applying the HDP nexus means ensuring that carbon initiatives are

• humanitarian, by protecting vulnerable communities and avoiding harm.
• developmental, by generating long-term livelihood and governance benefits.
• peace-oriented, by addressing land disputes and fostering dialogue between state, private actors and citizens.

In Mozambique, where conflict, displacement and land insecurity intersect, integrating the HDP nexus into carbon market design can help prevent new grievances while enhancing transparency and local trust. Despite such efforts, in fragile states susceptible to corruption and weak oversight, significant challenges remain. Yet aligning carbon initiatives with the HDP nexus is important to address deeper structural issues of governance, inequality and exclusion that underpin fragility and integrity risks.

Methods

To answer the research questions, the study applied a varied and iterative methodology. It began with a comprehensive literature review of academic and policy sources on carbon markets, governance and corruption in Mozambique and comparable contexts. This was complemented by informal, unstructured conversations in stakeholder networks engaged in environmental governance, anti-corruption and integrity-related sectors. The draft paper was then subject to a validation process, including a web-based workshop with representatives in Mozambique from donor agencies, civil society organisations and government institutions. That was followed by targeted consultations to refine the findings and recommendations based on participant feedback and emerging insights.

Structure of the paper

This paper is organised in three parts. After this section, which presents the objectives and methods of the study, we present the historical background of Mozambique, its governing fragility and its carbon market initiatives.

Then the paper presents the country’s political economy and integrity challenges related to fragility, particularly regarding carbon markets. This includes weak state capacity, pervasive corruption, political instability and conflict, limited and shrinking civil society, restricted information flows, high inequity and external intervention complexities.

Finally, we present relevant integrity standards in carbon markets, followed by concluding remarks and recommendations.

Mozambique’s historical background and carbon market initiatives

Fragility

This U4 Issue considers Mozambique’s state fragility and how it affects the country’s participation in carbon markets. Fragile contexts face challenges to integrity and transparency due to several interrelated factors, including weak state capacity and fragmented oversight structures, pervasive corruption, political instability and conflict, limited or retracting civil society, restricted information flows, high inequity, and external intervention complexities.6c7d2e0bb4a9

Mozambique has become a fragile state092dbefd8894 due to a complex interplay of historical, political, economic, social and environmental factors. At independence in 1975, the new state inherited a tradition of state repression and an economy of extraction. The attempt to correct existing inequities through an authoritarian single party socialist experiment was violently opposed internally, and a prolonged civil war funded by the Rhodesian and South African regimes ensued. Peace talks between the ruling FRELIMO party and the rebel movement RENAMO led to an agreement in 1992. However, low-intensity conflict resumed in 2013, with RENAMO accusing FRELIMO of not fully honouring the 1992 peace accord’s resolutions and excluding the opposition from political and economic power. In 2017, another conflict erupted in the country’s north, this time with a religious bent. After multiple contested election results, the country has grappled with post-election turmoil since October 2024. This recurring instability is challenging for governance and establishing credible, transparent and accountable institutions.

The structural adjustment programmes of the 1980s and 1990s, in particular, contributed to the weakening of the state through defunding. This overwhelmingly hit the social sectors, reducing the quality of health, education and social protection.83681e7ffed3 The negative impact of structural adjustments across the African continent in that period have been well documented in terms of social consequences and on the prevalence of corruption.d2b4736b22d7

Despite those setbacks, the country enjoyed an economic boom after the war ended that lasted from the late 1990s to 2014. Although poverty decreased during those years, inequality increased sharply. The boom ended abruptly in 2016 with the discovery of a sovereign debt acquired without parliamentary approval, and that triggered the hidden debt scandal.7631fe68ab20 Reduced growth and even stagnation then spurred rapidly rising poverty rates. The northern and central regions, heavily hit by the war and continuous state neglect, remained particularly impoverished. Those regions are where natural resources come from but their communities have not benefitted from them. On the contrary, they often become dispossessed because of external economic actors’ interests. This drives conflict ranging from simple land disputes to open insurgency.4a6f5f4054c4

Simultaneously, Mozambique is highly susceptible to climate-related disasters, such as cyclones and floods, which have been exacerbated by climate change.316c014c0534 Although severe climate events have always occurred with some intervals, they have become more frequent and destructive, which compounds existing vulnerabilities and impedes ongoing development efforts.

Carbon market initiatives

Mozambique has been engaging with carbon markets through several initiatives. Most aim to leverage forest conservation for carbon emission reductions. These initiatives include the Nhambita Community Carbon Project (NCCP), which started in the early 2000s and aimed to sequester carbon through agroforestry and reforestation, providing financial incentives to local communities.73f57000e368 Another initiative was the Zambézia Integrated Landscape Management Programme (ZILMP), part of Mozambique’s national REDD+ strategy.

The country’s REDD+ strategy is integral to its carbon market initiatives, aiming to mitigate climate change through sustainable forest management and carbon emission reductions. The national REDD+ strategy was approved in November 2016 by the then Ministry of Land, Environment and Rural Development (MITADER). This strategy prioritises conserving wooded areas, promoting sustainable development and reducing deforestation by enhancing forest resilience to climate change. It aims to increase carbon stocks by reducing emissions by 170 million tonnes of CO₂ annually until 2030.265ecddd7121 In 2021, Mozambique became the first country to receive payments from the World Bank’s FCPF, securing $6.4 million for 1.3 million verified emission reductions.9d164f9b066f

Mozambique is also engaging in blue carbon initiatives to harness the potential of its coastal ecosystems, particularly mangroves, for carbon sequestration and climate change mitigation. One of its most ambitious initiatives, and the largest of its kind globally, is the Mozambique Blue Carbon Project (MozBlue). It aims to protect and restore approximately 140,000 hectares of mangrove forests and prevent the loss of over 100,000 hectares of mangroves by 2050.67ecd68194c3

In November 2023, with support from the African Carbon Markets Initiative (ACMI), Mozambique established an Inter-Ministerial Task Force on Carbon Markets. This led to the Carbon Market Activation Plan (CMAP), aiming to regulate and enhance transparency in carbon market transactions. Legislation is under discussion with stakeholders. Several development partners are supporting the government of Mozambique in including integrity measures in the legislation.228b65307893

Mozambique’s political economy and challenges to integrity

Weak state capacity and fragmented oversight structures

Fragile states often lack robust institutional frameworks, leading to inadequate law and regulation enforcement and an inability to uphold accountability and transparency (see the U4 Brief42a56bf67252 on fragile states for a general overview). Additionally, multiple power centres lead to competing sources of legitimacy and authority, complicating the establishment of uniform integrity standards. Governance structures are often siloed and unable or unwilling to cooperate.

Mozambique’s participation in the carbon market faces significant regulatory challenges, including weak land tenure systems that risk land grabs, lack of transparency in emissions calculations and double counting of carbon offsets. Corruption in land administration and law enforcement further undermines integrity. Money laundering risks highlight the need for stricter oversight.d2d5730e9039 To improve oversight, the country should consider establishing an independent carbon market regulator; improve monitoring and verification systems, including through improved technology; improve the legal frameworks, with strict penalties for corruption, land grabbing and false carbon claims; and improve law enforcement capacity in detecting fraud and other types of violations related to carbon projects.

Moreover, many government institutions in Mozambique suffer from a shortage of trained staff and inadequate financial resources, which hampers their ability to analyse and implement policies effectively. This poses a particular challenge to policies related to the carbon market, which need coordination across several sectors, namely environment, finance, agriculture and land administration. There is a lack of formal mechanisms for inter-ministerial policy coordination, leading to fragmented efforts and inefficiencies. The consequence is policy inconsistencies, leading to potentially conflicting policies and creating an unpredictable environment for carbon market initiatives.

Pervasive corruption

Corruption in Mozambique has created a vicious circle that has undermined public trust and state legitimacy.17d2a34fda4f This has led to weak governance structures. FRELIMO, which has been the ruling party since independence, has historically been characterised by internal factions and self-interests that have influenced its policy decisions and governance. These internal dynamics have significant implications for various sectors, including those linked to the carbon market.

The intertwining of political power and economic interests has fostered a culture of corruption and clientelism. This environment has often led to misallocating resources and prioritising projects, particularly those highly profitable linked to the extractive industries, that benefit a select few, undermining broader developmental efforts. Mega projects have systematically shown to be of little benefit to local communities, leading to resettlements and disrupted livelihoods, many times without appropriate compensation and failing to follow mandatory legal prescriptions.0cea0fa92c1c Corruption in large investments has implications for communities, as much as for the environment. Corruption negatively affects the integrity of marketable carbon for the country and trust in relevant governance mechanisms, such as the land and mining registry, as well as mechanisms that prevent land grabs and the conflicts that ensue.

Consequently, trust has eroded with local communities and international partners.4c523b22688d Countering entrenched corrupt practices is challenging and requires strong political will and commitment. Possible approaches that increase transparency include a public carbon project registry; external audits to validate carbon credit claims; secure reporting mechanisms for fraud and corruption, with legal protections for informants; and accessible, independent bodies that can reliably handle grievances from different stakeholders, including communities and investors.

Political instability and conflict

In Mozambique, recurring conflicts and political uncertainties undermine environmental initiatives, deter investment and worsen socio-economic inequalities. Weak governance structures and lack of trust and legitimacy often stem from political instability. Concurrently, the same structures are unable to contain emerging conflicts that result from lack of trust and legitimacy, as the insurgency in Cabo Delgado has shown. Recurring conflict tends to disrupt governance and oversight mechanisms, making implementing transparency initiatives extremely difficult.

Armed conflicts make integrity challenging. Military action often destroys forests, natural reserves and existing infrastructure and assets. This compromises the resources from which the country can operate carbon sequestration and conservation projects.e3c8dd726e08 For example, in the aftermath of the 2024 post-election protests, at least three conservation area administrations – Gile in Zambézia, Pomene in Inhambane and Chimanimani in Manica Province5ce2cf283794 – were destroyed by protesters. Natural parks are already in regular conflict with locals due to a lack of economic opportunities, and dispossessive and exclusionary policies, which is widespread in the world.198b7c52f30a This is in addition to environmental degradation due to poaching, human encroachment, logging and deforestation.ad3e095d406a

In addition to direct environmental destruction, violence and instability have forced population displacement, disrupting community-based natural resource management, which can potentially interrupt carbon credit initiatives that run in conflict areas. The country’s climate vulnerability and socio-economic asymmetries only intensify these displacements.fd7eaf292827 Lack of security also disrupts the legal environment and increases investment risks, discouraging investors from financing carbon projects.414d396f2614 Conflict makes it difficult to implement and monitor carbon projects due to restricted access to affected areas and security concerns for field teams.

Limited and shrinking civil society

Civil society organisations (CSOs), mainly those dealing with human rights, face repression, insecurity, resource constraints and volatility in fragile contexts. This limits their ability to advocate for transparency or hold authorities accountable. The evolution of civil society in Mozambique reveals a troubling trajectory toward authoritarianismf8e3ad9248a7 through a combination of legal restrictions, violent suppression of dissent and targeted attacks on opposition figures.ddf5eaf140cd

Reducing civil society weakens CSOs’ capacity for advocacy to monitor carbon market projects effectively. This limitation can lead to increased risks of fraud, corruption and elite capture, where benefits are diverted away from intended communities. CSOs have been essential in advocating for equitable benefit-sharing and environmental justice policies. A reduced civil society stifles advocacy efforts, resulting in policy frameworks that may favour powerful interests over marginalised communities. This imbalance can exacerbate existing social inequalities and undermine the legitimacy of carbon market mechanisms.

Mozambican non-government organisations and local farmer’s associations have long advocated for increased and effective participation of local communities in decision-making that directly affect them. The containment of civil society has constrained community engagement, leading to projects that do not align with local interests or respect customary land ownership practices. This misalignment has resulted in conflicts and reduced project efficacy. Research indicates that ongoing deforestation in REDD+ areas and delays in fund dispersals to local communities highlight the lack of inclusive implementation practices by investors and the state.94217a9c6492 The lack of consequences for such behaviour showcases the limited capacity of civil society.

Restricted information flows

Accessing accurate and unbiased information in fragile contexts is challenging due to limited infrastructure, biased dissemination or censorship. This limits transparency efforts and informed citizen engagement. Moreover, a lack of transparency can lead to fraudulent activities, such as data manipulation, ghost projects, duplicated counting and elite capture, where benefits are diverted away from intended communities. These integrity risks are particularly prevalent in environments with weak oversight mechanisms like Mozambique.

Mozambique has historically lacked information regarding land tenure. This is partially due to the Land Law of 1997, which establishes that the state owns all land that cannot be sold, mortgaged or otherwise transferred. Due to bureaucratic inefficiencies, limited awareness of land rights among communities, and difficulties in land administration, there have been attempts to reform the law, and land registration initiatives have been funded largely by the World Bank and USAID. The most significant example is the Terra Segura (Secure Land) programme, initiated in 2015, which aimed to allocate 5 million land titles and map 4,000 communities over a five-year period, only to be met with bureaucratic obstacles, limited resources and technical difficulties.²⁸

Subsequently, however, some improvements in land law have occurred. For example, in November 2022, the Council of Ministers approved a new National Land Policy that explicitly links good land governance to improved access to information and public participation. The policy requires that the state recognise and integrate community-led land documentation efforts into the national cadastral system. It also emphasises the creation of an accessible and functional national spatial data infrastructure (NSDI) to facilitate the production, sharing and use of geospatial data from national to local levels.

If effectively implemented, these provisions could increase transparency and integrity in land administration and, by extension, in carbon market governance, where secure and verifiable land tenure is critical for project legitimacy and benefit-sharing. However, progress has been slow. Technical, financial and political constraints, along with limited coordination between central and local authorities, continue to delay the full operationalisation of the policy. Ensuring that the NSDI and cadastral reforms include local communities and are linked to transparency in carbon project registration will be essential for realising the integrity benefits envisaged in the 2022 land policy.

Restricted or defective information increases uncertainties regarding land tenure, leading to disputes, potential land grabs and ‘green grabs’, where land is appropriated under the guise of development or environmental conservation. This ambiguity further disenfranchises local communities and can undermine the legitimacy of carbon offset projects. One example is Green Resources, which has been implicated in land conflicts with communities who reported losing access to vital land and resources and empty promises of employment and development. This has fuelled resentment towards the company and the government entities that facilitated the project and suspicion towards similar projects.05fac68a4c32

Limited data access also impedes formulating effective policies and regulations for carbon markets. Without comprehensive and unbiased information, policymakers struggle to design frameworks that ensure transparency, accountability and equitable benefit distribution.4cc500d0cb26 Finally, accurate monitoring of carbon emissions and sequestration is vital for the credibility of carbon credits. Flawed information hinders the verification of reported data, leading to questions about the authenticity of carbon offsets and the overall effectiveness of market mechanisms.

High inequity

Communities in fragile contexts are exposed to exploitation and barriers to accessing services, exacerbating existing inequalities. There are often regional, rural–urban, social and gender disparities that affect different groups unequally. In Mozambique, social and economic disparities influence the distribution of benefits from carbon projects and access to resources.

Carbon market projects, such as those under the REDD+ strategy, often generate revenues intended to support local communities. However, these benefits frequently fail to reach the most vulnerable populations due to existing inequalities, leading to perceptions of injustice and potential conflicts. The intertwining of political power and economic interests, which has fostered the culture of corruption and clientelism in government institutions, has also created risks of land grabbing and increased social inequalities.d5b5935a6c15

Inequality leads to marginalised communities, particularly smallholder farmers and more particularly women, with limited access to decision-making platforms. Historically, much land appropriation has resorted to forced removals. This has disrupted local livelihoods, leading to resistance and, in some cases, violent confrontation.736172307ccc

Examples of land-related dispossession include the establishment of protected areas, such as Limpopo National Park, which led to the relocation of approximately 7,000 people in the park’s interior, resulting in the loss of ancestral lands and livelihoods for affected populations.ad65cbb69034 The promotion of biofuel projects has also contributed to land appropriation. In Massingir, in southern Mozambique, large swaths of land have been allocated for biofuel production and conservation/tourism.4e0af0d8017b Another project by Portucel Moçambique in Zambézia province has led to farmers losing access to land essential for their subsistence. While economically significant, the project did not have adequate consultation with local communities, which resulted in adverse effects on their livelihoods.10211af28bae This has led to tensions with and threats from the community.220c6c2cbf07

Researchers and CSOs have called for the inclusion of farmers and CSOs in regulating and constructing the voluntary CMAP to ensure climate justice principles are incorporated into policy design.ea9dd650fa29 This means ensuring free, prior and informed consent (FPIC) from the affected communities. Consultation should fully inform communities about project risks, benefits and long-term impacts. Revenue shares must be clearly stated, and payment mechanisms should preferably be done through direct payments. Communities should ideally have access to independent legal representation to ensure contracts protect local rights and interests. Organisations and individuals providing these services should not be impeded in doing their work. Simultaneously, communities should improve their capacity to conduct community-led oversight and monitoring of project implementation and compliance.

Financial inclusion and integrity in benefit-sharing

Access to formal financial services remains limited in Mozambique. According to the World Bank Global Findex (2021),7de055af4994 only 23% of adults have a formal bank account. Most banking infrastructure is concentrated in urban areas, leaving rural districts, where many carbon projects are located, largely unserved. In these regions, people often rely on informal savings groups or cash transactions. Increasingly, and where there is mobile coverage, mobile banking is making inroads.e5fc1823dc72 However, high transaction fees, low digital literacy and unreliable connectivity continue to constrain inclusion. These challenges mean that while direct payments could strengthen accountability, weak financial access risks excluding precisely those communities that carbon markets are meant to support. To bridge this gap, donors could play a catalytic role by supporting the expansion of digital and mobile payment systems, such as M-Pesa and similar platforms, in rural and hard-to-reach areas. Linking transparent digital payment mechanisms to community carbon revenue distribution would reduce corruption risk, promote financial inclusion and strengthen social foundations for high-integrity carbon markets. Notably, anti-terrorism financing legislation creates inhibitions for potential users.

Ensuring that revenues from carbon markets reach local communities transparently is central to maintaining integrity and public trust. In Mozambique, where corruption and elite capture have historically undermined resource governance, direct payments to individuals or community groups could reduce opportunities for intermediaries to divert funds and ensure that the benefits of carbon finance are more equitably distributed.

External intervention complexities

Like other fragile states, Mozambique cannot fully fund their functioning and therefore depend on external aid and investments, which profoundly affect their governance capacities. While international development partners often fund and promote integrity and transparency initiatives, their interventions can sometimes undermine local governance structures or fail to align with the nuanced realities. At the same time, as in other parts of the world, foreign investments and interests can and have actively contributed to corrupt activities.

Multiple international actors can complicate the governance of carbon markets, increasing the risk of fraud, corruption and elite capture. They can also stimulate a complex regulatory environment, making coordination and effective implementation more difficult. Simultaneously, overreliance on foreign funding and expertise limits Mozambique’s autonomy in shaping its climate policies, potentially aligning them more with donor and external economic interests than with local needs.

Other African nations have employed strategies like strengthening local governance, fostering regional cooperation and diversifying international partnerships. Examples include Ethiopia’s economic reforms to reduce aid dependency, Botswana’s efforts to combat corruption and empower local governance (such as the kgotla, an indigenous leadership forum),372147bc2788 and Rwanda’s investments in local industries to enhance self-sufficiency. Countries like Tanzania have diversified partnerships to reduce reliance on traditional foreign actors.c5f0380545b6

While Tanzania’s diversification of international partnerships has reduced reliance on Western aid, concerns about transparency remain. Rwanda’s prioritisation of local industries has driven growth, though it faces criticism for political repression and unequal benefits. Botswana is praised for its anti-corruption efforts, but challenges like income inequality and limited political pluralism persist. While these measures have fostered economic progress and reduced external dependency, issues like governance, corruption and equity still need attention.

Some donors place restrictions on land-based carbon initiatives,51c39b53f1ef and, importantly, even non-land-based mitigation efforts, including renewable energy or energy efficiencies (such as cookstoves; see text box), inevitably interact with land and resource governance. Ensuring fair land access, consultation and compensation thus remains essential to maintain integrity and social legitimacy across all types of carbon-related investments in Mozambique.

Integrity standards in voluntary carbon markets: Relevance for Mozambique

Ensuring integrity in voluntary carbon markets is fundamental for their credibility and long-term effectiveness. Integrity standards are designed to guarantee that carbon credits represent real, measurable and verifiable emission reductions, and that projects are implemented transparently, equitably and with accountability. They function as governance instruments that define how projects are developed, monitored, verified and traded.

In the voluntary carbon market, several recognised standards have emerged to promote quality and accountability. At the project level, certification systems such as the Verified Carbon Standard (VCS), the Gold Standard, the Climate, Community and Biodiversity (CCB) Standards, and the Plan Vivo Standard provide detailed methodologies for establishing baselines, measuring emissions reductions, and safeguarding social and environmental impacts. These systems rely on independent private third-party verification and public registries to track carbon credits and prevent, as best as possible, double counting.

At the market level, newer initiatives such as The Integrity Council for the Voluntary Carbon Market (ICVCM) and the Voluntary Carbon Markets Integrity Initiative (VCMI) set overarching principles and claims frameworks to strengthen confidence in carbon trading. The ICVCM’s Core Carbon Principles (CCPs) define what constitutes a high-integrity credit, while the VCMI provides guidance for buyers on how to make credible and transparent use of offsets. Together, these efforts seek to address long-standing concerns related to additionality, permanence, leakage and fair benefit-sharing.

However, experiences across Africa show that verification processes alone are not sufficient to guarantee integrity. In Uganda’s Bukaleba and Kikonda forest plantations, implemented under the Clean Development Mechanism and later certified through voluntary standards, local communities reported land dispossession, inadequate consultation and minimal benefits, even though the projects were formally verified and registered.c6f8a3110889 Likewise, Green Resources’s forestry projects in Tanzania and Mozambique, certified under international standards, faced allegations of community displacement and unfulfilled social promises.aa2f55eb0dff These cases underline that integrity mechanisms can fail when oversight is limited to technical verification and does not account for local governance dynamics, power asymmetries or social justice concerns.

For Mozambique, now in the early stages of building its national carbon market architecture, these lessons are highly relevant. International standards offer a foundation for transparency and credibility, but they must be anchored in strong domestic governance systems. Integrating global standards into the emerging CMAP can help establish oversight mechanisms, public registries and clear benefit-sharing rules. With this, there is some form of codified standard guidelines for verification. Yet effective implementation requires addressing systemic challenges – weak institutional capacity, fragmented oversight and contested land tenure – that undermine verification and enforcement.

To ensure that integrity frameworks translate into practice, Mozambique’s carbon market governance should embed the CCPs into national legislation, establish a publicly accessible carbon registry, and link verification processes with independent audits and community monitoring. Projects should demonstrate compliance with FPIC and disclose information on revenue distribution. Development partners can support capacity-building for verifiers, strengthen data systems and promote collaboration with CSOs to ensure that integrity standards are locally understood and enforced.

Ultimately, integrity standards are not merely technical instruments but mechanisms of trust and accountability. For Mozambique, their careful adaptation to local realities will determine whether the carbon market becomes a credible tool for climate action and sustainable development or it risks repeating the mistakes seen elsewhere in the region, where formal conservation efforts did not prevent social harm or the erosion of legitimacy.c16746a48f76

Strengthening governance and building trust

Weak state capacity and fragmented oversight structures require strengthened governance systems, streamlining bureaucratic processes, ensuring community consent and improving transparency to make the market more effective and credible. Thus, the country must address its weak institutional capacity to improve and protect land tenure rights and knowledge of rural communities for understanding and negotiating beneficial carbon agreements.

Corruption intersects with several factors that contribute to institutional weakening. Countering it requires strong political will. Additionally, to address corruption as a risk to carbon market initiatives, Mozambique should improve land and project registration transparency, conduct independent audits, guarantee whistleblower protection, and develop a trustworthy dispute resolution mechanism.

Addressing political instability and conflict requires structural changes that address social and economic inequalities. This requires inclusive policies and reduced state violence, especially regarding land dispossession. This should lead to increased trust for state institutions, but it is a long-term approach that should occur consistently over time.

Safeguarding and expanding civil society is imperative. Empowering civil society ensures that environmental initiatives are inclusive, equitable and aligned with national and community interests.

Improvement in information flow requires fostering open communication channels among all stakeholders. Quality information can also improve political trust, promote inclusive policies and increase transparency.

To reduce inequality, it is crucial to develop clear guidelines to guarantee that revenues from carbon projects are equitably distributed, prioritising the advancement of disadvantaged communities. Policy frameworks governing carbon markets actively involve marginalised groups, granting them a voice in decision-making processes.

Donor dependency makes the country vulnerable to external intervention and interests. Successful cases of donor dependency reduction include diversified engagement with development and economic actors. Increased economic self-reliance is also fundamental.

Recommendations

Mozambique’s growing engagement in carbon markets offers opportunities for sustainable development and climate finance, but integrity risks linked to weak governance, corruption and fragility remain significant. Integrity in Mozambique’s carbon markets will depend on inclusive governance, transparent financial flows and conflict-sensitive implementation. Donors and governments should view integrity not as a compliance burden but as a pathway to build legitimacy, trust and sustainable development from carbon finance. To build a high-integrity carbon market that contributes to stability, equity and environmental credibility, the following actions are recommended:

1. Strengthen governance and regulatory oversight. The government of Mozambique, with support from donors and other relevant stakeholders should:

• Establish an independent carbon market regulator to coordinate policy across ministries and ensure transparency in project approval, monitoring and credit issuance.
• Integrate CCPs and verification requirements into national legislation through the CMAP.
• Develop and maintain a publicly accessible national carbon registry to prevent double counting and enhance investor and community confidence.

2. Enhance transparency, data access and information integrity:

• Operationalise the NSDI envisaged in the 2022 land policy to ensure open and verifiable land and project data.
• Require carbon projects to publish documentation on ownership, verification results and community benefit-sharing arrangements.
• Promote independent auditing and grievance mechanisms with legal protection for whistleblowers.

3. Promote community participation and social safeguards:

• Institutionalise FPIC as a prerequisite for all carbon projects and ensure transparent consultation processes.
• Support community-led monitoring and oversight, particularly in conflict-affected and high-risk areas, through partnerships with civil society and farmer associations.
• Guarantee that carbon revenues are distributed equitably, with clear benefit-sharing rules favouring marginalised groups, including women and youth.

4. Advance financial inclusion for transparent benefit-sharing. Donors can support the government to:

• Encourage direct digital payments to individuals and community organisations to reduce corruption and leakage of carbon revenues.
• Expand access to mobile and digital financial services by supporting the roll-out of platforms such as M-Pesa and other fintech solutions in rural and hard-to-reach regions.
• Provide financial literacy and digital inclusion programmes to enable communities to manage payments safely and effectively.

5. Integrate the HDP nexus:

• Design carbon initiatives that contribute simultaneously to livelihood security, institutional resilience and conflict prevention.
• Ensure that projects in fragile or contested regions are conflict-sensitive and aligned with local peacebuilding strategies.
• Adopt the HDP nexus (for donors) as a cross-cutting integrity principle, recognising that peace, development and governance reforms are prerequisites for credible carbon markets.

6. Support institutional capacity and donor coordination:

• Build technical capacity in government agencies for monitoring, reporting and verification, and link them to regional and international learning platforms.
• Encourage coordination among donors to align integrity measures, avoid duplication and support Mozambique’s long-term ownership of its carbon governance framework.
• Prioritise transparency and accountability in donor-supported technical assistance to prevent reinforcing governance weaknesses that carbon markets seek to overcome.