Biodiversity: About the European Commission’s Nature Credits

Globally, it is estimated that a third of the planet's land is severely degraded, with around 24 billion tonnes of fertile soil being lost annually. 

The World Health Organisation says: “Biodiversity loss is occurring at an alarming rate, with recent estimates showing that species extinctions are currently 10 to 100 times higher than the natural baseline. 

“This is largely due to human activities like deforestation, habitat fragmentation and climate change.”

The European Commission has launched a roadmap towards nature credits, incentivising private investments into actions and rewarding those who participate with the aim to protect and preserve nature.

Increasing certainty of investments in nature positive actions may encourage uptake of more sustainable production.

Ursula von der Leyen, President of the European Commission, says: “We have to put nature on the balance sheet. That's exactly what nature credits do. 

“When well-designed, they will provide an efficient, market-driven instrument that encourages the private sector to invest and innovate.

“With investment and innovation, we generate revenue for those who work to protect nature, including our farmers, our landowners and our foresters.”

What are nature credits?

Nature credits are a voluntary tool that aims to support key actors like farmers, fishers, land managers and foresters to build ecosystem resilience. 

The credits are an investment into nature, with positive actions by a company, financial institution, public entity or a citizen.

The roadmap aims to develop clear standards and reliable certification for these nature positive actions to make nature credits effective and trustworthy. 

The Commission hopes to develop a bottom up approach that builds on close involvement of concerned stakeholders due to the variety of ecosystems across the EU.

Nature credits represent an opportunity for both business and nature restoration simultaneously, set to boost biodiversity and preserve habitats while generating revenue for those who work to protect nature and for investors.

What are the benefits to nature credits?

Companies can benefit from cleaner ecosystems, risk reduction, improved reputation and higher social acceptability for their projects.

Increasing certainty of investments in nature positive actions, nature credits may encourage an increased uptake of more sustainable production models with aims of protecting EU food security in the long term.

The roadmap will complement existing pilots and initiatives, helping it gain credibility, raise investor interest and scale up nature credit markets.

Jessika Roswall, Commissioner for Environment, Water Resilience and a Competitive Circular Economy, says: “With this roadmap, we are taking a bold step to recognise nature as a strategic asset for Europe’s future.

“Nature credits have the potential to attract essential private investment, while also rewarding those who are the custodians of our land and seas, including farmers, foresters and local communities. 

“Our goal is clear: working hand in hand with nature and turning this into an opportunity for a resilient and competitive economy.”