Nature credits – Nordea’s perspectives on an evolving market

“The biodiversity/nature credit market, meaning the trading of positive biodiversity impacts, is still in an early stage,” explains Anna-Karin Modin Edman. “The focus has so far concentrated on developing robust credit certification systems to ensure trust, which is great, as the supply of credits is of course fundamental for developing a well-functioning market.” She adds:

“In parallel, we hope to see increased ambitions and focus on how to build and scale demand. In the short term, we see limited commercial opportunities for Nordea related to biodiversity/nature credits due to challenges related to a lack of demand at scale. However, in the medium to long term, EU ambitions to scale this instrument will likely impact market opportunities positively.”

“The biodiversity/nature credits market could offer future commercial opportunities for Nordea, similar to those explored in the carbon removals market, and we want to be a part of this development. To scale the market for biodiversity/nature credits, and for Nordea to play a more commercial role, several actions are necessary.” He continues: 

“Firstly, cost-efficient and rational ways for companies to quantify biodiversity impacts are needed to support their transition toward net-zero loss of biodiversity and positive impacts. A more widely accepted definition of how biodiversity/nature credits can be used as offsets and/or compensation for diffuse and/or historic impact in the value chain should be developed, i.e. what level of like-for-like compensation is necessary.” 

“Secondly, policy development is needed to promote and scale demand for biodiversity/nature credits as demand cannot be solely driven by philanthropy and smaller investments as part of CSR/branding efforts. And thirdly, a secondary trading market should be developed in parallel with the development of supply and demand for biodiversity/nature credits to further support the general market development.”