Swedbank, which recently invested in a pilot project that will generate biodiversity credits, says a global market for them could exist within a year.
The Stockholm-based firm has invested an undisclosed sum in a project that will generate biodiversity credits from around 13 hectares of forested area in Sweden over a period of 20 years.
This is thought to be the first such transaction from a bank.
Swedbank has not yet decided whether the credits will be sold for offsetting or exclusively for nature-positive purposes and will not sell them while the methodology is being refined.
Ulf Möller, the bank’s head of forest and agriculture, said: “We’re not interested in making a huge bunch of money; that’s not the point. It’s not a business idea, it’s an issue of sustainability.”
He added: “We are maybe one to five years from [a biodiversity credits market]. My personal thoughts are it will probably go faster than we think. Politicians are in a hurry to do something.”
The Swedish University of Agricultural Sciences has drafted the methodology behind the pilot, which involves forest management activities, including protection of high-nature value areas, promoting old-growth qualities in forest areas, promoting broadleaves, creating deadwood and managing burning.
The monitoring of the pilot includes annual reporting and third-party audits every five years, according to Aleksandra Holmlund, a doctoral researcher at the university.
She said: “The market for biodiversity credits is nascent, and there are no verification bodies for methodologies and projects yet. However, the Biodiversity Credit Alliance (BCA), supported by the UN Development Programme and United Nations Environment Programme Finance Initiative, has been founded to provide guidance for both the project developers and buyers.”
The investment follows a report from unofficial watchdog ShareAction, which found European firms were leading the charge to tackle climate change.
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