Correction: A previous version of this story said Accounting for Nature will be responsible for verification and issuance of credits under GreenCollar Group’s NaturePlus crediting programme. However, the correct situation is that it has licensed its MRV framework to GreenCollar, but will not be involved in verification and crediting beyond that.

A market expert has urged the Australian government to take its time to develop its nature repair market, warning that other jurisdictions pursuing similar schemes were sleep walking into a “massive greenwashing nightmare”.

Accounting for Nature CEO Adrian Ward made the comments during a webinar Friday, focussing on Australia’s planned nature repair market, which is currently open for consultation.

Ward said he had recently returned from the the World Economic Forum in Davos, where he was involved in the Taskforce for Nature-related Financial Disclosures (TNFD).

He noted there was massive demand for biodiversity and nature credits from investors, but said “they don’t know what they are, necessarily”.

“I wouldn’t say we as an industry in Australia are sleep walking into a massive greenwashing nightmare, but I think some jurisdictions are, I think this is going to be a real problem, a messy area for a while,” he said.

“There is a lot of confusion in the market, it’s not like carbon where you have 1 tCO2e, and that’s the problem, it’s not comparable, it’s highly local.”

Noting the rapid speed at which biodiversity schemes were looking to be implemented, Ward said Australia needed to take a more considered approach.

“We can take our time, because if we don’t take out time we’re going to absolutely stuff it up, and we’re going to be 10 years down the track with stuff that’s just not going to be fit-for-purpose and it’s probably going to have perverse outcomes, so we just need to be very careful,” he said.

“We just have to slow down a little bit and do it properly, because at the moment the green rush is pretty hot. Honestly, it is a massive risk.”

Despite Ward’s caution, his company, Accounting for Nature, has licensed its MRV framework to one of the world’s first biodiversity credit programmes – GreenCollar Group’s NaturePlus credits.

GreenCollar will use Accounting for Nature’s MRV framework for the verification and issuance of credits under the programme, with the first units expected to emerge soon.

The Science Based Targets Network (SBTN) this week published its first draft land targets, intended to help businesses align their commitments and actions to halt and reverse global nature loss.

The move is considered vital, as setting the targets can only be done after companies have properly assessed their impacts and dependencies on nature, which only a small number of global corporations have done so far.

Meanwhile, a global trading firm is already in the process of negotiating its first voluntary biodiversity credit transaction.

Ward’s comments contrast other experts in the field in Australia, who have argued that the government’s repair market would likely see it become the sole buyer of nature repair credits, claiming that the private sector would not feel obliged to invest in nature, the way it does in carbon markets.

However, Laura Waterford, a director at investor firm Pollination, said the implications of the TNFD and the SBTN meant that the private sector was “starting to think seriously about investing in nature outcomes … in a voluntary sense”.

She said that companies wanted to demonstrate that alongside the impact and dependency they have on nature and the risk that represents, they were doing something to mitigate those risks.

“That idea about needing to be able to demonstrate a contribution to system change I think also supports investment in nature and ecosystems,” she said.

Anthony Bennie, the governmental department division head of biodiversity markets, economics and environmental science said that stakeholders have said that a national system needed to be in place in order for them to seriously invest in it.

“So the intent behind the nature repair market will be to be able to unlock some of that investment,” he said.

“As companies come to better understand their dependencies and impacts on nature, that will potentially roll into an increased demand for these kind of certificates.”

Bennie said that once the consultation on the draft legislation was finished, the department will engage in further debate around best approaches, before presenting advice for ministerial approval.

He said it would be up to the minister to decide when legislation on the market would be introduced to parliament.

By Mark Tilly – mark@carbon-pulse.com

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