What is measured can be treasured: the quantification of nature and biodiversity is a key success factor for the nature-positive transition.
The private sector has a crucial role in bridging the financing gap for nature and biodiversity conservation and restoration. Robust metrics are essential for financiers of nature-positive outcomes (such as buyers of biodiversity credits) to validate progress in nature, and agreement on these metrics is vital to scaling demand for nature-positive financing.
This paper outlines key decisions that nature-positive financiers, credit standard-setters, and project developers must make in navigating nature and biodiversity metrics. Each actor must measure biodiversity and nature to select providers of credits or other instruments, set standards, or decide which standards to adopt. The key decisions in this process are as follows: should practices or outcomes be measured? What types of metrics should be used? How aggregated should the metrics be? How should change in the metrics be quantified?
With these decisions in mind, the paper focuses on biodiversity credit markets, analyzing and comparing three emerging models under the established key decisions among existing credit methodologies and standards: the comprehensive aggregate model, using composite, direct measurements; the critical indicator model, taking higher-level and more ecosystem-specific views; and the mosaic compilation model, which includes a variety of measurements related to key decisions.
Additionally, the paper explores how metrics relate to disclosure frameworks, a particularly relevant topic for businesses engaging in nature-positive finance. Disclosure frameworks generally operate at a higher level—suggesting metric types rather than exact metrics—given their role in stakeholder engagement and transparency. Existing biodiversity credits tend to align with these frameworks and their respective types of metrics. Notably, the Taskforce on Nature-related Financial Disclosures (TNFD) and the Science Based Targets Network (SBTN) provide example metrics that overlap with those used by credits today.
While additional work is required to encourage standardization across nature and biodiversity metrics, this paper outlines essential considerations that financiers of nature-positive outcomes, credit standard-setters, and project developers can apply to navigate biodiversity metrics effectively. The final objective is to stimulate robust and scalable nature-positive financing for a transition to a more sustainable future.
