Bridging the finance gap for nature-positive investments | CreditNature

INSIGHT by Cain Blythe, Founder and CEO at CreditNature and Ecosulis (BCorp), Author & Speaker

The global financial landscape is undergoing a transformative shift towards nature-positive investments, driven by the urgent need to address climate change and biodiversity loss. CreditNature, at the forefront of this revolution, combines ecosystem science, finance, and technology to introduce digital assets known as Digital Nature Assets. These assets create a connection between landholders and investors, providing a stake in validated nature recovery projects.

| Financial sustainability in fintech

The relationship between finance and climate change is increasingly evident in the fintech sector. Fintech companies are now prioritizing sustainability, offering innovative green alternatives to address environmental issues. The shift towards sustainability is driven by consumer demand, outperformance of eco-conscious companies, regulatory expectations, and a broader understanding of the long-term impacts of climate change.

Corporates and investors are currently examining various approaches to investing in nature restoration, conservation, and biodiversity. As they progress on the path to achieving Task Force on Nature-related Financial Disclosures (TNFD) readiness, corporations will unveil their influence on nature and biodiversity. Given the absence of fully developed and transparent markets for tradable biodiversity units in 2024, the focus is likely to persist on substantiating impact assertions with reliable data. A robust framework for biodiversity monitoring, verification, and reporting (MRV) will be crucial, serving as a cornerstone in furnishing evidence of best practices and mitigating reputational risks. CreditNature aims to leverage this momentum by creating markets dedicated to investing in nature recovery projects.

| Nature credits and opportunities

The World Economic Forum estimates the current market for voluntary nature credits at around $8 million. However, effective progress on governance could propel global demand for these credits to $2 billion in 2030 and a staggering $69 billion by 2050.

To unlock this potential, addressing four key challenges is imperative:

• Establishing a clear business case for buyers.
• Developing high-integrity supply at a sufficient scale.
• Consolidating common principles, standards, and methods.
• Creating a supportive policy environment.

To capture the biodiversity impact of a project investment, a suite of biodiversity metrics is essential. These metrics should be ecologically meaningful, scientifically robust and transparent in their monitoring.  Our solution is firmly rooted around these pillars, as we do this with our Digital Nature Assets. They offer a robust, transparent, trustworthy and credible way to make nature positive investments by allowing corporates and landowners to display a digital representation of the recovery of a land asset. Our fundamental difference is that we’re all about bringing transformative change in a high integrity way. We’ve designed a nature credit approach that not only allows users to monitor the performance of their investments, they can also evidence how they contribute to the recovery of the planet.

The timing for investing in nature has never been more opportune. CreditNature is actively developing a pipeline of projects and working towards positioning Scotland as a leader in nature fintech, inviting corporate stakeholders to join them in building a future where landholders generate investment and revenues from ecosystem recovery at a scale that ameliorates the impacts of climate change.

| The shift to nature positive

Biodiversity, natural capital, and associated financial risks have been emerging rapidly the last few years – nature positive investment is the next big thing after the drive toward net zero. These issues are now the most imperative for asset managers and investors to consider, aligning with the efforts of governments, regulators, and stakeholder groups.

Collectively, the global biodiversity framework and TNFD establish an international framework for nature, mirroring the international climate regime in many aspects. This framework is likely to shape regulatory and economic developments that significantly impact asset managers, the companies in their portfolios, and the expectations of their investors.

Asset managers are advised to promptly engage with nature, quantifying their impact, anticipating shifts in investor demand and regulatory pressure, and safeguarding the value in their portfolios. Moreover, they should consider extending any recent enhancements to their business models, governance, and investment processes related to climate risk to address the risks and opportunities presented by nature.

| Future outlook

As the financial world increasingly recognises the material importance of nature recovery, the collaboration between innovative fintech solutions and ecological science offers hope for a future where investments contribute to the restoration and conservation of our planet’s ecosystems. The emergence of nature-positive reporting, nature credits, and sustainable finance initiatives signals the beginning of a journey towards a more sustainable and interconnected world. CreditNature’s comprehensive approach, including digital nature assets, nature credits, and the NARIA framework, marks a transformative era in sustainable finance.

| brief bio

Cain Blythe is a Chartered Environmentalist and an award-winning leader in ecosystem restoration and nature recovery. He is the founder and CEO of two pioneering organisations leading the drive to help accelerate global rewilding. His expertise merges applied ecosystem practice, technology, finance and the recognition that the best outcomes are achieved through partnership and collaboration.

With a career spanning over three decades, Cain has integrated his expertise in biodiversity and habitat management to unlock the full potential of rewilding, as one of the most viable nature-based solutions available today. Cain’s

accomplishments have placed him at the forefront of environmental thought leadership. His practical expertise in the planning and delivery of many impactful habitat creation projects, species reintroductions and ecosystem scale management strategies, underscores his contribution to the field. As well as being a full member of the Chartered Institute of Ecology and Environmental Management, his contributions have led to him being recognised as one of the UKs 100 most influential environmentalists in 2022, a LinkedIn Top Voice in the UK and finalist for Environmental Professional of the Year in 2023.

Dedicated to accelerating global rewilding, Cain’s mission is nothing short of ambitious: to rewild half the planet by 2050. His commitment to this vision is evident in his pragmatic and transformative approaches to ecosystem conservation and recovery. He actively bridges the gap between the practical and theoretical aspects of rewilding, using technology and finance as catalysts for achieving ecological balance and resilience.

Cain Blythe’s clear commitment to the sector, his experience, innovative thinking, and profound commitment to ecological recovery have established him as a leader in his field. His transformative approach to blending finance and technology in conservation, along with his commitment to global rewilding, make him a highly influential figure in the sphere of nature-positive finance. His relentless pursuit of his mission, to restore biodiversity and resilience on a global scale, continues to inspire and make a significant impact on our world.