Taking stock of creating your offering sustainably: How can companies use carbon pricing internally?

This literature review analyses internal carbon pricing and discusses its purposes, impacts and challenges. First, the theoretical part describes how ICP is used to manage risks, reveal opportunities and as a transition tool. Then, the paper introduces what kinds of impacts ICP has on the environment and on stakeholders. After that, the implementation part presents the best practices that are learnt from the literature. Implementations are followed by the challenges that arise in the literature. The second part of this paper introduces how three different industries are currently using ICP. To conclude, the main findings of this paper are collected, limitations are considered and ideas for future research are presented.