Government-backed Green Finance Standards Launched to Boost Investment in Nature and Drive Economic Growth
New Government-Backed Green Finance Standards Launched to Boost Nature Investment and Economic Growth
Today, the UK has taken a significant step towards becoming a global leader in nature markets with the introduction of pioneering green finance standards. The Overarching Principles Standard, developed by the British Standards Institution (BSI), aims to support investments in high-quality projects that restore rich habitats and drive economic growth as part of the country’s Plan for Change.
This landmark standard is designed to boost confidence among businesses investing in nature-friendly projects by ensuring that these investments are truly making a positive impact on the natural environment. Projects that could benefit from this standard include the restoration of wetlands, improvements in water quality, building flood resilience, and creating new habitats.
According to Secretary of State for the Environment, Food and Rural Affairs Steve Reed, urgent action is needed to address the nature crisis, and businesses play a crucial role in this effort. The new standards aim to combat greenwashing and provide businesses with the assurance that their investments are contributing to the recovery of the natural world.
The introduction of the Overarching Principles Standard marks the UK’s ambition to become the green finance capital of the world. A healthy natural environment is essential for economic growth, and without it, there would be no food, no business, and no economy. The Green Finance Institute has warned that nature-related risks could lead to a significant reduction in GDP in the years ahead, highlighting the importance of economic growth and nature restoration going hand in hand.
The new standard is the first of its kind in the UK for collective nature markets and is one of the first in the world. It sets the UK apart as a global leader in pioneering nature markets that prevent greenwashing and lead to lasting environmental change.
The introduction of the Overarching Principles Standard has been welcomed by officials from Wales, Scotland, and Northern Ireland, who see it as a crucial step towards creating value-led and responsible natural capital markets in their respective regions.
In addition to the Overarching Principles Standard, BSI is launching a consultation on a Natural Carbon Standard, which will gather market views on high-integrity principles for projects selling nature-based carbon credits in UK markets. These credits will help the UK reach its Net Zero goals while providing benefits for landscapes and wildlife.
The new standards are part of a wider framework that will apply to nature markets, with additional standards in development covering biodiversity markets, nutrients projects, and guidance on engaging with local communities. A navigation tool is available on the BSI Nature Markets online Hub to help stakeholders navigate the suite of BSI nature investment standards.
Overall, the introduction of these green finance standards marks a significant milestone in the UK’s efforts to drive investment in nature, support economic growth, and combat the nature crisis. By setting clear standards and promoting high-integrity investments, the UK is taking a crucial step towards building a stronger, fairer, and greener economy for the future.
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