Introduction to Biodiversity Credits

For years, ESG finance has revolved around carbon. Carbon markets, net-zero targets, and emissions disclosures became the dominant tools for managing environmental risk, especially in the context of evolving EU climate targets and ESG strategies. Yet recent developments reported through Environmental Finance indicate a meaningful shift. Biodiversity credits are beginning to move from concept to concrete financial application.

This matters because biodiversity loss is accelerating faster than corporate ESG strategies are adapting. Ecosystems underpin supply chains, water security, food systems, and economic resilience. When nature degrades, ESG risks escalate. increasingly recognised as an economic and financial issue in global discussions on biodiversity and nature risk

Biodiversity credits aim to redirect capital toward measurable, verified improvements in ecosystems. Until recently, this remained largely theoretical. That is now changing.

 

The Real Case That Signals a Turning Point

What makes this moment different is a specific, real-world financial transaction.

As reported in ESG-focused financial media, a biodiversity credit–linked loan has been structured involving Fondo Nimbus, with Ponterra acting as the implementing partner. Ponterra is a company specializing in the restoration and regeneration of forest ecosystems, translating ecological outcomes into measurable biodiversity value.

In this case, financing is explicitly linked to biodiversity performance generated through forest restoration activities. The creation and verification of biodiversity credits form part of the financial logic of the transaction , reflecting broader efforts to mobilise private capital for nature through nature finance mechanisms.

This is significant. It shows biodiversity moving:

• From environmental aspiration
• To measurable ecological outcomes
• To financial conditions that influence capital allocation

In my experience advising organizations on ESG and sustainability strategy, this is the point at which ESG tools become operational rather than symbolic.

 

Why This Changes the ESG Finance Landscape

Biodiversity becomes financially material

Sustainability-linked finance tied to carbon metrics is now familiar. What is new here is the extension of that logic to nature performance. The Fondo Nimbus and Ponterra case shows that biodiversity outcomes can influence financing structures, not just reporting narratives.

Once biodiversity affects access to capital or loan terms, it enters the core of financial decision-making aligning with the growing focus on nature-related financial risk.

From ambition to accountability

One of the historic weaknesses of biodiversity commitments has been the lack of finance-ready metrics. Biodiversity credits attempt to close this gap by linking capital to verified ecological restoration, such as forest regeneration and ecosystem recovery.

This case demonstrates that financial institutions are willing to test these mechanisms, even as methodologies continue to mature , a challenge highlighted by organisations working on biodiversity finance governance such as the International Institute for Environment and Development

Expanding ESG beyond carbon

Carbon remains essential, but it is not sufficient. Climate mitigation does not automatically restore ecosystems. Forest regeneration, species recovery, and habitat quality require dedicated tools.

Biodiversity credits address what carbon markets were never designed to measure.

 

Practical Implications for ESG Leaders

Understand what biodiversity credits are and are not

Biodiversity credits are not offsets for environmental harm elsewhere. They must demonstrate additionality, durability, and credible verification. The Fondo Nimbus example reinforces that financial credibility depends on ecological integrity.

Integrate biodiversity into ESG governance

When biodiversity performance is linked to finance, it must be governed accordingly. This includes executive oversight, risk management, and transparent reporting. These themes are increasingly central in high-level dialogues such as the Sustainability & Climate Resilience Forum 2025

Start with pilots, not scale

This transaction remains an early-stage example, and that is appropriate. ESG leaders should engage through pilots to understand how biodiversity metrics behave under real financial pressure.

Common mistakes to avoid

A frequent error is assuming biodiversity credits can replace carbon action. They cannot. Another is treating them as branding tools rather than instruments of risk management and value creation.

 

Why This Could Be a Game Changer

What makes this case powerful is not its size, but its signal.

It shows:

1. Biodiversity is entering financial structures
2. ESG finance is evolving beyond carbon-only logic
3. Nature performance is beginning to influence capital costs

If replicated responsibly, this approach could reshape how ESG performance is financed and assessed.

Biodiversity Credits Do Not Replace Carbon Credits

It must be stated clearly. Biodiversity credits do not substitute carbon credits.

Climate change and biodiversity loss are interconnected but distinct challenges. ESG strategies must address both, using appropriate tools for each.

The correct hierarchy remains:

• Reduce impacts at source
• Use carbon credits only for residual emissions
• Invest in biodiversity credits for nature-positive outcomes

 

My Perspective on What Comes Next

From my perspective, the Fondo Nimbus and Ponterra transaction represents a stress test for ESG maturity. It shows what happens when environmental finance starts reflecting environmental reality.

These insights also build on themes I explore more extensively in my books on ESG and sustainability strategy, where I examine how environmental risks increasingly translate into strategic and financial decision-making

If governed well, biodiversity credits can mobilize capital toward urgently needed ecosystem restoration. If rushed or misused, they risk repeating early carbon-market mistakes.

The direction, however, is clear. Biodiversity is no longer external to finance. ESG leaders now need to decide whether to engage early and shape standards, or wait and follow later.

FAQs

What are biodiversity credits in simple terms?

Biodiversity credits represent verified positive outcomes for nature, such as restored or regenerated ecosystems, supported through targeted finance.

How long does it take to understand biodiversity credits?

For ESG professionals, it usually takes several months of focused learning and exposure to real-world projects to understand biodiversity metrics and governance.

Are biodiversity credits worth it for ESG career growth?

Yes. As biodiversity enters mainstream finance, professionals who understand nature-related risks alongside climate and ESG reporting will be increasingly valuable.