EU has a new global plan to pour private money into nature conservation
YEREVAN, Armenia — The European Union has launched a new international partnership designed to solve one of the big challenges of conservation policy: Getting rich investors to pay to restore nature.
Their answer is to create an international market in "biodiversity credits."
At a biannual U.N. nature summit in Armenia's capital on Tuesday, the European Commission launched a new platform aimed at getting countries to work together on nature and biodiversity credits to help drive private finance into protecting ecosystems.
The initiative seeks to address a central problem in global conservation efforts: how to pay the bill. The U.N. has identified an annual biodiversity financing gap of $700 billion and governments are eager to find ways to channel private capital to help fill that hole.
Through the new Friends of Credits for Nature and Biodiversity platform, the EU would work with other governments to develop credible schemes that attract corporate investment in nature protection and restoration.
"It sends a powerful signal to the world that we are determined to cooperate at international level on nature," said Environment Commissioner Jessika Roswall during a launch event co-organized with France and Peru. "Protecting our environment can pay both in the short term but in the longer term as well," she added.
At the COP17 biodiversity summit, Brussels is discussing the topic with countries including Armenia, Peru, the U.K., Canada, Indonesia and Thailand, according to an EU official familiar with the talks.
Like carbon credits — which represent emissions avoided or removed through projects such as tree planting — a nature credit is intended to represent a unit of measurable improvement in ecosystem health. Companies could then purchase them to compensate for harming the environment.
But some environmental groups warn that nature credit schemes could lead to greenwashing if the credit-generating projects are not monitored properly.
"While innovative financing is welcome, a biodiversity credit market risks enabling greenwashing without rigorous ecological baselines," said Patricia Iacob, a law and policy advisor at legal charity ClientEarth. "Crucially, the true test of any new biodiversity finance mechanism is whether the money actually reaches the ground."
Indigenous groups, meanwhile, have long been critical of systems that seek to monetize nature, arguing they can threaten their livelihoods and lead to land disputes if local communities are not involved. International agencies say a balance can be found between protecting indigenous rights and attracting more financing into conservation projects.
U.N. Environment Programme Executive Director Inger Andersen told POLITICO that, while she recognizes and respects the criticisms of indigenous groups, "because nature provides all of us with services, there is obviously an opportunity for finding ways of having such nature credits." There are "many ways of structuring this," she added.
In 2025, the Commission launched a pilot project for nature credits, drawing skepticism from lawmakers and NGOs. They warned that credit schemes should not replace ambitious public funding for nature and questioned whether businesses would even be interested in buying the credits.
