Establishing an international mechanism to regulate the trade of biodiversity credits globally, like Article 6 of the Paris Agreement, is key to supporting government action and bolstering market uptake, the head of a biodiversity credit project developer said on Friday.
Simon Morgan, co-founder and CEO of project developer ValueNature, stressed the need to better align initiatives undertaken at the national level, at an online event on biodiversity credits hosted by the African chapter of the Society of Ecological Restoration.
“There’s been a slight barrier because governments do things under their own scheme,” Morgan said.
“What we need is an Article 6 for nature. Potentially, that’s how we could drive regulation, trying to think at an international level that speaks directly to nature,” he added, referencing the Paris Agreement crediting scheme for carbon markets.
This could also advance the market’s development within regions that have been largely excluded from early biodiversity credit initiatives so far, such as Africa.
While companies in the so-called Global North have looked with increasing interest at biodiversity credits as a potential tool to address their impacts and dependencies on nature, transactions have yet to pick up, and few opportunities have emerged in Africa.
Among these is a UK-funded initiative to pilot biodiversity crediting in Uganda and Zambia, launched last September with ValueNature as a project partner.
This week, ValueNature and CreditNature announced a partnership to align their work with the aim of scaling nature markets in Africa, Europe, and the Americas.
DISCLOSURE FOCUS
“What we’re seeing in the Global North are a lot of considerations around disclosures … Those kind of pressures are making corporates stand up and take notice … and biodiversity credits fit quite neatly into that,” said Morgan.
“But I think there is a role for us to play within the African landscape. The rules are being written at the moment – the more we can participate, the better we can ensure that those rules are aligned.”
Morgan is part of a working group set up by the UN-backed Biodiversity Credit Alliance to give a definition of biodiversity credits and associated terms, in an attempt to avoid the market making a false start.
He is also among the members of the International Advisory Panel on Biodiversity Credits, a UK-France joint initiative planning to launch a market framework during the UN COP16 biodiversity summit, due to be held in Cali, Colombia over Oct. 21-Nov. 1.
Over the past few months, other initiatives have emerged to investigate the feasibility of using biodiversity credits to promote nature positive activities, including the World Economic Forum and consultants McKinsey & Co initiating a coalition of companies and financial institutions this year aiming to build confidence in the market.
“We’re seeing a bit of a stumbling block as a lot of the corporates are saying: ‘We see why it’s important, but how do we account for this? What claims do we make against the purchase of these biodiversity credits?’,” said Morgan.
“Companies are largely waiting for the conceptualisation to be presented in a more unified manner. We’re going to see a lot more happening from that perspective at COP16 later on in the year.”
By Sergio Colombo – sergio@carbon-pulse.com
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