An Indigenous-led organisation has released guidelines to mobilise funding for First Nations’ nature conservation efforts in Canada, with biodiversity credits among the financing mechanisms that should be explored.

Coast Funds identified a number of conservation finance tools that could enable First Nations to secure funding for terrestrial conservation and restoration activities, including debt-based instruments, grants, and carbon and biodiversity credits, pointing out that Indigenous communities are well-placed to scale up these efforts.

“Many of the First Nations we serve in the Great Bear Rainforest and Haida Gwaii have ambitious plans for new Indigenous protected and conserved areas and for growing their programmes,” said Eddy Adra, CEO at Coast Funds.

“To sustain their stewardship programmes, First Nations need access to diversified funding sources … Newer tools could also play a role in filling funding gaps.”

For each financing mechanism tool, Coast Funds took into account 10 criteria that cover a range of aspects, including the amount of funding, effect on self-determination, and Indigenous retention of value. Each criterion was scored out of three points, determining the overall rating.

Government revenue sharing, conservation trust funds, industry revenue sharing, and debt-based instruments such as green bonds took the top spots in the Coast Funds’ assessment, while payment for ecosystem services, offsetting, and natural asset companies (NACs) ranked lowest.

“No conservation finance mechanism meets all the evaluation criteria,” said Coast Funds in its study. “To address financing gaps, First Nations will need to combine multiple mechanisms.”

While offsetting was associated with low revenue stream consistency over time and a high degree of uncertainty regarding the financing’s sustainability, the report mentioned the exploration of emerging biodiversity credits among the communities’ priorities.

FUNDING COMMUNITY PRIORITIES

Other priorities include the creation of Indigenous protected and conserved areas, habitat restoration, and land use planning and feasibility studies.

“A key challenge is how these community priorities can be supported by different economic and funding models, including conservation finance,” said the report.

Biodiversity credit and offset initiatives have emerged following the Kunming-Montreal Global Biodiversity Framework agreement in 2022, though some observers have raised concerns over Indigenous participation in developing such markets.

In a document published in April, Brussels-based think tank Green Finance Observatory (GFO) said Indigenous Peoples should reject proposals for the biodiversity credit market as they will promote offsetting.

Biodiversity credits usually mean units representing quantifiable nature uplift over time, without offsetting harm elsewhere – unlike biodiversity offsets.

GFO’s document was published in response to the draft recommendations on biodiversity credits released by the Community Advisory Panel (CAP) of the UN-backed Biodiversity Credit Alliance (BCA), intended to bring attention to the rights of Indigenous Peoples and local communities.

While the text did not openly endorse the establishment of a biodiversity market, it aimed to establish a framework for guiding the early-stage development of the nature market.

By Sergio Colombo – sergio@carbon-pulse.com

** Click here to sign up to our twice-weekly biodiversity newsletter **