ESG & Investing
Biodiversity Credits Gain Traction But Questions Persist
An international market for the instruments is growing, but as with carbon offsets, greenwashing fears remain.
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An international market for biodiversity credits is gaining traction, but as questions arise concerning the risk of greenwashing, proponents are seeking to distance these new instruments from their much-criticized predecessor, carbon offsets.
Momentum has been building since the end of 2022 when almost 200 countries signed the Kunming-Montreal Global Biodiversity Framework, a pact dubbed the “Paris Agreement for nature” that calls on signatories to come up with “innovative” financing initiatives—such as biodiversity credits.