The European Commission has proposed a new initiative aimed at strengthening financing for nature protection and restoration through so-called "Nature Credits". This one road map, introduced The Commission, to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, outlines a path towards developing high-quality instruments that transform investments in nature into a reliable engine of value creation.

The urgent need for funding for nature Nature is invaluable to our society and economy, providing essential ecosystem services such as water retention, soil fertility and pollination. More than half of the world's GDP and two-thirds of the EU's economic value added depend on nature and its ecosystem services.. Around 72% of companies in the euro area are critically dependent on ecosystem services. Nature loss is already considered a major cause of economic losses and financial risks. However, ecosystem services are difficult to monetise and are not adequately reflected in market price signals, contributing to underinvestment in nature restoration and protection.

While there are significant public commitments, such as allocating 10% of the EU budget to biodiversity in 2026 and 2027, there are public funds are insufficient in themselvesThe global biodiversity financing gap is estimated at $700 billion per year, and at EU level, the annual investment needs are around €65 billion, which cannot be covered by public finance alone. A combination of public and private capital is therefore essential to achieve the necessary scale and speed. For businesses that adopt nature-positive actions, this brings benefits such as increased investor confidence, better financing conditions and long-term resilience.

What are Nature Credits and how do they work? Nature credits are identified as a key tool for rewarding nature-friendly activities through private investment. The aim is to stimulate a shift from damage limitation to actively reversing the trend of nature loss.

A nature credit is defined as a unit that represents a beneficial outcome for nature, obtained from a certified and independently verified activity and quantified using a recognized biodiversity metric or indicator.These instruments are designed to complement public funding, enable investments in activities that benefit nature and help reverse biodiversity loss.

The system works on two-step model: certification and subsequent award of credits.

• Certification ensures that specific, high-quality, nature-beneficial activities are implemented in accordance with pre-defined criteria. It is a formal, independently verified recognition that an intervention meets agreed standards for biodiversity relevance and good practice. This helps reduce risks for investors and builds initial trust.
• Credits They then monetize the demonstrated impact, potentially offering dividends to suppliers and early investors. Credits can be registered, pooled, banked, and traded.

An example might be a group of farmers working to improve a wetland ecosystem.An independent certifier assesses their plan and methods, and based on this the group receives a certificate. Over time the project is monitored and nature credits are gradually issued as results are demonstratedThe nature credits value chain includes intermediaries, certifiers, registries and buyers, including companies, financial institutions, public entities and citizens.

Building trust and integrity The key to success is ensuring the credibility and integrity of the system. Strict criteria and principles must be put in place for transparency, avoiding conflicts of interest and protecting against "greenwashing" and double counting.. A separation of tasks between project developers, certifiers and registry operators is also essential. It is important that certification builds on existing EU standards and frameworks, such as the organic farming scheme, to minimise administrative burden.

The European Commission has learned from the experience of carbon markets. Although carbon credit markets have faced integrity issues and the risk of greenwashing, demand for high-quality projects with environmental and social benefits remains strong. This underlines the importance of laying a solid foundation for nature credit markets at an early stage, including ambitious and scientifically rigorous standards, independent monitoring and sound governanceThe EU Regulation on Carbon Removal and Carbon Farming (CRCF) already establishes a voluntary certification scheme for carbon removals with mandatory biodiversity benefits, setting an important precedent for future biodiversity-focused frameworks.

Developing nature credits: An EU roadmap The European Commission plans to take key steps to develop markets for nature credits between 2025 and 2027:

• Creating an expert team: The Commission will launch a call for expressions of interest in 2025 to participate in a new EU expert group on nature credits. This group will share knowledge, promote cooperation and identify good practices.
• Development of methodologies and management: In mid-2026, the Commission will invite an expert group to provide its expertise on criteria and methodologies for nature credit markets. In 2027, the group will be invited to propose governance frameworks, with particular attention to small farmers and small and medium-sized enterprises (SMEs).
• Market readiness support: The Commission will carry out a Europe-wide assessment of the supply and demand for nature credits in 2025-2026.
• Public seed funding: A pilot project on nature credits will be launched in 2025-2027, supported by EU funds to support competitiveness and innovative European projects. Public funding can play a key role in reducing risks and providing a predictable source of income for actors involved in nature-friendly activities.
• International cooperation: The Commission will engage in international fora to ensure that EU policy developments are informed by emerging global standards, while helping to shape the development of nature credit markets at international level.

These steps will lay the foundation for robust methodologies, reliable certification processes and inclusive governance frameworks that will support high-quality supply and demand for nature credits. The aim is to ensure subsidiarity, integrity, simplicity and minimise administrative burden. All interested actors are invited to submit their views and contributions to the elements of this roadmap.. Spring