Abstract

Summary The influence of carbon markets on the current structure of the Australian forest industries is mostly evident in the emergence of 24 new entrepreneurial firms that are primarily engaged in the business of afforestation-based offsets. Whilst these firms currently account for only a small amount of business (in terms of financial turnover and area of tree plantings) compared with the traditional constituents of the Australian forest industries, their emergence is indicative of a changing strategic outlook for the industry in which carbon markets are likely to play a much more influential role. The authors argue that regulated carbon market policy should be designed to support the capacity of such entrepreneurial firms to engage in carbon markets, particularly in the early stages of the introduction of a mandatory emissions trading scheme and particularly how policy influences the entrepreneurial firms' capacity to secure finance.

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