Framework created for voluntary biodiversity markets – cooperation started to boost action

Financing is needed to preserve biodiversity, both in Finland and globally. The EU Nature Restoration Regulation, the EU Biodiversity Strategy and the Kunming-Montreal Global Biodiversity Framework call for measures that will require evermore financing, especially from the private sector.

The aim of Prime Minister Petteri Orpo’s Government is to enable new multi-channel financial instruments to preserve and enhance biodiversity and support companies in their work to promote biodiversity. There is demand for market-based nature actions as companies see new means to take nature- and climate-positive action and to report on them.

“A market for nature values must be launched on a voluntary basis. We have the opportunity to learn from other markets, such as the carbon market. We must build appropriate practices for collaboration between nature action and the private sector. Providing incentives both for the producers of nature values, and for companies is paramount. The State’s role is clear: launching markets with well-functioning structures and criteria. The next steps are in the hands of active market operators,” Minister of Climate and the Environment Kai Mykkänen says.

To encourage companies in their nature action, the Ministry of the Environment is creating a framework for voluntary biodiversity markets. The Ministry has launched a project to advance markets for the benefit of climate and nature (Marketta). The market principles mirror those of the voluntary carbon markets. The idea is that nature credits bought from the market, i.e. units such as nature value hectares, can be used to make nature-related claims in the company’s reporting or marketing of products and services. A nature-related claim can be, for example, that the company has financed the restoration of 100 hectares of aapa mires.

“Already at present the Nature Conservation Act enables the offsetting of harm to the environment on market terms, which means that a company can buy nature credits produced by a landowner to compensate for biodiversity loss caused by e.g. construction. A process is underway to further specify the provisions of the Nature Conservation Act in such a way that the nature credits and the national register for offsetting could be used for purposes other than offsetting harm, such as for making nature-related claims,” Chief Specialist Emma Terämä says.

The State’s role is to create a reliable framework for the system: establish criteria for the nature credits to be produced, create a verification system, and ensure the registration and permanence of the credits. Support will also be offered for making nature-related claims. The Ministry of the Environment has commissioned work to compile a guide that clarifies the common principles, and will produce practical examples for this purpose. Through harmonised regulation and open data the State can offer an environment to market operators where the risk of greenwashing is minimised.

EU support for increasing private financing and promoting administrative reforms

Finland participates in an analysis and development project of the EU that aims to find ways to increase private financing for biodiversity in the Member States. Finland’s participation in the project takes place under the EU programme Technical Support Instrument (TSI), which in turn aims to support the Member States in reforming their administrations. TSI can be used to improve administrative efficiency, build new competence and skills or enhance awareness of new topics and trends in the administration.

The support under this project is used to explore the current status of financing for promoting biodiversity in Finland and the need for financing to meet Finland’s international and national biodiversity commitments. The project will also identify financial instruments and operating models that are suitable for Finland and through which especially private financing could be significantly increased.

The two-year project is implemented by the International Union for Conservation of Nature IUCN and the Organisation for Economic Co-operation and Development OECD. The data collected during the project will also contribute to the implementation of the commitments of the Kunming-Montreal Global Biodiversity Framework and the implementation of the EU Nature Restoration Regulation and the National Biodiversity Strategy and Action Plan.

Inquiries

Project to advance markets for the benefit of natural values and climate (Marketta) 
Emma Terämä 
Chief Specialist 
tel. +358 295 250 255 
[email protected]

TSI project
Kirsi-Marja Lonkila 
Senior Specialist 
tel. +358 295 250 356 
[email protected]