As a concept, REDD is simple. It concerns payments to parties in developing countries that prevent deforestation or forest degradation that would otherwise have taken place. One of the main sources of such funding comes from carbon trading, where actors in industrialised countries offset their own unavoidable emissions by purchasing carbon credits from REDD+ projects on a voluntary basis.
The money is used for forest conservation and a more sustainable use the forests (say, through more appropriate harvesting of wood and other forest products). In many REDD+ projects the money is also used to improve the use of the surrounding agricultural area, which further reduces the pressure on the forest. In order to guarantee the quality of the credits, most companies, including the members of RBI, only purchase certified credits from the widely used Voluntary Carbon Standard (VCS) and the Climate, Community& Biodiversity Standard (CCBS).
Next to this agreements with governments are needed to properly embed (nest) the project in national forest and climate policy in order to make sure that:
Forest conservation in one place cannot be associated with additional forest loss elsewhere;
Forest gain and loss is monitored in the context of the climate convention.