The significance of carbon markets

Carbon markets are pricing mechanisms that allow companies and governments to trade GHG emissions credits, or ‘CCCs’ (Certified Carbon Credits) (6). This works as distributing and offsetting emissions to meet ESG goals and climate targets (6). Credits are verified by a third-party standard setter calculated from the projects they fund, which may include tree planting, technology-based reductions  or carbon capture. CCCs are a simple, measurable way for companies and governments to offset their emissions, meet goals, and put real numbers to sustainability claims. They have many benefits, most importantly helping companies and governments meet climate goals by tracking and reducing overall emissions, and financial incentives that encourage innovative low-carbon technologies. Offering additional offsetting opportunities to company operations means they can also help decarbonise technologies. However, this approach equates the value of nature to a single metric: tonnes of carbon. Nature is valued only for its parts that are easily translatable into CCCs, and when this happens many essential aspects of nature are overlooked.

The limitations of carbon markets

Carbon markets treat nature primarily as a store of carbon that is a backdrop to emissions trading. This perspective overlooks and undervalues processes and ecosystems that do not translate easily into carbon credits or numerical figures. Protecting biodiversity and established ecosystems, for example, may not be highly valuable in market terms, yet are critical both to carbon storage and to natural resilience to climate change. Take coral reefs: from a narrow carbon perspective they are worth almost nothing, yet they are essential habitats for marine life, protect coastlines from erosion, and livelihoods worldwide. However, their importance is overlooked and underappreciated by carbon markets because they do not introduce additional carbon capture.

When ecosystems are valued only for carbon, other important features—such as biodiversity, flora maturity, soil and hydrological health—are devalued. This reproduces the commodification of nature that has contributed to the climate crisis: forests, oceans and nature as a whole have been treated as raw material to be exploited for one or more commodities, and used as dumping grounds for human excess, whether it be physical waste or emissions. In the same way, carbon markets are making nature a product measured in tonnes of carbon for emission offsetting. This is not to say carbon markets, CCCs, or emissions-focused climate initiatives don’t have their place, but evidence from carbon offset schemes shows that oversimplifying nature into carbon units can encourage harmful practices, such as removing communities from their land and diverting resources away from effective conservation efforts (4) (8).

The importance of Nature Positivity

The Nature Positive movement offers an alternative approach that values nature holistically. Its aim is to ensure there is more nature in 2030 than in 2020, and to achieve full recovery of ecosystems by 2050 (5). Unlike carbon markets, which use one metric, nature positivity is holistic. It focuses on three areas of measurement:

1. Species – richness, abundance, distribution, and extinction risk
2. Ecosystems – extent and ecological integrity of habitats
3. Natural processes – including hydrological cycles, migration patterns, and carbon sequestration

This approach recognises that nature’s value does not come only from its relationship with carbon, but also that its importance to carbon relies on the integrity and health of nature in its entirety. By addressing biodiversity, ecological conservation, and natural processes, it provides a framework that values nature as a whole.

Nature is our protection against climate change

A nature positive approach is not only about restoring nature for its own sake but also our sake. For example, climate change, driven by carbon and other GHG emissions, is already causing more frequent and intense extreme weather events. These include heatwaves, floods, droughts, and fires, which are expected to be the biggest global climate challenge in the near future (1).

Healthy ecosystems reduce human vulnerability to these impacts. For example:

• Wetlands and marshlands act as buffers against flooding. One acre alone can store and filter up to 330,000 gallons of water, reducing inland flood risk (3)
• Forests regulate rainfall, stabilise soils, and store carbon, meaning they help regulate the global water and carbon cycles that create the environmental conditions for extreme weather
• Oceans and coastal habitats provide natural defence against storm surges and erosion, and offer economic opportunities to coastal communities (2)

Such protections are not valued by carbon markets. While emissions-focused approaches can help reduce atmospheric GHGs that worsen these changes, holistically valuing nature is imperative to human resilience to climate changes. When funding distribution and conservation efforts are informed largely by carbon metrics, these aspects go undervalued and underprotected - putting nature, and us, at risk.

Equally, healthy ecosystems help maximise nature’s carbon storage potential. Oceans and wetlands are the most effective carbon sinks on earth, and all natural environments help regulate the global carbon cycle that makes this possible (7). Even for mechanisms like carbon markets that focus primarily on maximising natural carbon storage, we can’t afford to overlook any part of nature for they all contribute to global environmental health.

Nature is not just natural

Nature is important to human cultures and societies beyond environmental protection, because it informs cultural identities, traditions, and values. This connection is particularly important for Indigenous peoples globally, whose cultures are often deeply rooted in their environments and ecosystems. No doubt this is precisely why Indigenous communities have stewarded their ancestral lands for centuries, through practices and knowledge systems that foreground nature’s intrinsic value, and recognise humans are part of it. The Nature Positive movement echoes this holistic perspective, similarly emphasising human responsibility (5).

Indigenous communities are often overlooked in mainstream climate initiatives. Exploitative economic projects like logging and mining, continue to disproportionately threaten Indigenous ecosystems and cultural heritage. Similarly, poorly designed offsetting projects fail to protect them from exploitation by a market where they often receive tiny %s of the final sale price, and in some cases have actually led to indigenous people being kicked off their land. As a marginalised global minority, the social impacts on Indigenous communities are further underconsidered, as are the historic inequalities that produce their vulnerability (4). These communities are also among the most vulnerable to impacts of climate change, often facing displacement from floods, droughts, and deforestation (1)(2).

Protecting Indigenous peoples, their lands, and their knowledge systems is therefore essential to global environmental protection, but also for environmental justice. Their perspectives offer models of stewardship that value nature as a whole, not as a commodity, which are essential to the long-term success of economic activity and climate initiatives. Addressing historic and present inequalities that have left these communities disproportionately vulnerable to climate risk and capitalist exploitation is essential to justly conserving their rights and wisdom (5).

Why a new approach is necessary

Carbon markets have significant limitations. Measuring the value of nature in tonnes of carbon is reductive to climate initiatives, in that it overlooks the importance of biodiversity, ecological balance, conservation, and leads to a host of misaligned incentives and unintended consequences which have been written about elsewhere. A nature positive framework provides a holistic, scientifically informed approach that values all aspects of nature. A nature positive approach is therefore a perspective designed to promote sustainability and longevity in climate initiatives, and complement the benefits carbon markets do have.

How Native embraces Nature Positivity

Native’s approach aligns with nature positivity, as an industry change-maker valuing nature holistically. We help individuals and companies protect the planet, one Square at a time; each 3m2 Square is a real, tangible, precious piece of nature that can be seen on a map. We believe the value of nature cannot be reduced to tonnes of carbon. To fight this trend Native offers three types of impact in one product, assessing the value of a Square not only against verified carbon metrics, but also biodiversity and social impact. The carbon in our first project was quantified by the Cambridge Centre for Carbon Credits and their non-profit spinoff Canopy PACT, and we measure biodiversity on the ground using eDNA and bioaccoustic microphones. Our social impact is in our approach: supporting Indigenous communities to protect their land, on their terms, by pledging to direct the majority of revenue to them. Financial assistance allows communities to remain in place, resist pressure from logging companies and improve healthcare and education outcomes so that they can continue the essential work they have been doing for centuries.

Written by Amy Breen