The report investigates how community forest governance influences the synergies and trade-offs among carbon sequestration, biodiversity, and local livelihoods. Using data from 314 forest commons across 15 tropical countries in Africa, Asia, and Latin America, the study explores the relationships between above-ground biomass (as a proxy for carbon storage), tree species richness (biodiversity), and forest-based livelihoods. It identifies five distinct clusters of forests that exhibit varying levels of these three benefits. Forests governed by formal community management and local participation in rule-making tend to achieve multiple positive outcomes, making local governance crucial for multifunctional forest landscapes.

Data and analysis

The dataset for the analysis comes from the International Forestry Resources and Institutions (IFRI) programme. It includes a sample of forests with formal and informal management across human-dominated landscapes in tropical countries. Each forest was assessed for three key benefits: carbon storage (measured by above-ground biomass), biodiversity (tree species richness), and livelihoods (dependence on forest products such as firewood and timber).

The study employed a hierarchical cluster analysis to group the forests into five clusters: sustainable forests, carbon forests, conservation forests, subsistence forests, and degraded forests. Forests with formal governance structures were 19% more likely to be classified as sustainable forests and 6% more likely to be carbon forests. Local rule-making participation increased the likelihood of forests being classified as subsistence forests by 16%, illustrating that empowering communities leads to more positive outcomes across these benefits.

Drivers of multiple forest outcomes

The analysis shows that formal community management and local rule-making are consistent predictors of positive outcomes. For example, forests with formal community management were 19% more likely to be classified as sustainable, 6% more likely to be carbon forests, and 11% more likely to be subsistence forests. Local participation in rule-making increased the probability of forests being carbon forests by 8% and subsistence forests by 16%. These governance factors also reduced the likelihood of forests being degraded or conservation-focused, indicating that strong community involvement drives multifunctional forest benefits.

However, tree plantations had mixed effects. They were positively associated with subsistence and sustainable forests but negatively associated with carbon and conservation forests. Tree plantations reduced the likelihood of forests being classified as carbon forests by 11% and conservation forests by 37%. This highlights the need for careful consideration of how tree planting is implemented in forest restoration projects, as it can lead to trade-offs between carbon storage and biodiversity.

Discussion

The study underscores the importance of empowering local communities in forest governance to achieve sustainable outcomes in carbon sequestration, biodiversity, and livelihoods. While tree planting initiatives have been promoted as a carbon mitigation strategy, the report advises caution. Tree plantations, although beneficial for some forest outcomes, can negatively affect carbon storage and biodiversity.

Recommendations include focusing on governance reforms that empower local communities, which are more effective in promoting positive outcomes than tree planting alone. Financial professionals should consider investing in projects that strengthen local governance structures and community participation, as these are likely to yield better long-term outcomes in carbon sequestration, biodiversity, and livelihoods.