“Market-based instruments, such as taxes, charges or tradable permits can, if carefully designed and implemented, complement regulations by changing economic incentives, and therefore the behaviour of private actors, when deciding upon resource use. When set at accurate levels, they ensure that the beneficiaries of biodiversity and ecosystem services pay the full cost of service provision. Experience shows that environmental goals may be reached more efficiently by market-based instruments than by regulation alone. Some market-based instruments have the added advantage of generating public revenues” (TEEB, 2009., P.32).
Offsetting can come in many forms, investing in renewable energy, reforestation or rebuilding habitat elsewhere. The diagram below provides a simple graphic example carbon offsetting in action:
It is clear to see how biodiversity offsetting has the potential to have considerable consequences for tropical rainforests (be those positive or negative, the jury's still out). There are many contentious issues when it comes to marketising biodiversity - how effective it is as a governance/management approach, how do you assign an 'environmental currency' to the environment, how much are people willing to pay to conserve The Amazon, for example? In a bid not to disregard any of these concerns, but to bring to attention another of the controversial matters surrounding this topic - does a market based approach to biodiversity actually conserve, or are we just commodifying nature? And is this a bad thing? It's actually more of a moral question that anything else - one that you could argue the likes of certain large companies or even governments are more than happy to skip over if it means providing a loophole for 'meeting' conservation targets. This very interesting article in Nature discusses the misuse of biodiversity offsets for 'meeting' targets. Maron et al. (2015), highlight the growing concern with governments using offsetting for damage caused to biodiversity and habitats in the name of development. They note that in most cases offsetting isn't being used as a last resort after all other mitigation methods have been exhausted, but as a go-to quick-fix solution that keeps them on track to achieving international conservation targets to which they have previously committed to.
The confounding nature of morality in the instance of biodiversity offsetting is revealed when considering both sides of the argument. Reid (P.232) uses the example of water to epitomise the point:
Essentially, what the above quote is arguing, is that there are several methods that have been developed, that could be used in modern market-based societies, that attend to both the needs of progressive and accelerating economies, as well as ecosystems that need protecting and sustaining in order to ensure their longevity (and services) in this advancing world. Biodiversity is in the driving seat when it comes to sustaining ecosystem services, as is very clearly illustrated by this schematic that I keep referring to in my posts...
There are several mechanisms that have been widely discussed in terms of market-based biodiversity conservation - one of the most well-established methods is 'biodiversity off-setting'. The essential 'mantra' behind the approach is that any development (and of course, we want to keep developing, don't we?) should cause no net-loss to biodiversity. Reid (2012, P.219) perfectly summarises biodiversity offsetting:
There are several mechanisms that have been widely discussed in terms of market-based biodiversity conservation - one of the most well-established methods is 'biodiversity off-setting'. The essential 'mantra' behind the approach is that any development (and of course, we want to keep developing, don't we?) should cause no net-loss to biodiversity. Reid (2012, P.219) perfectly summarises biodiversity offsetting:
"those whose activities cause a loss of biodiversity can offset this by undertaking activities elsewhere that enhance biodiversity in some way".
Offsetting can come in many forms, investing in renewable energy, reforestation or rebuilding habitat elsewhere. The diagram below provides a simple graphic example carbon offsetting in action:
It is clear to see how biodiversity offsetting has the potential to have considerable consequences for tropical rainforests (be those positive or negative, the jury's still out). There are many contentious issues when it comes to marketising biodiversity - how effective it is as a governance/management approach, how do you assign an 'environmental currency' to the environment, how much are people willing to pay to conserve The Amazon, for example? In a bid not to disregard any of these concerns, but to bring to attention another of the controversial matters surrounding this topic - does a market based approach to biodiversity actually conserve, or are we just commodifying nature? And is this a bad thing? It's actually more of a moral question that anything else - one that you could argue the likes of certain large companies or even governments are more than happy to skip over if it means providing a loophole for 'meeting' conservation targets. This very interesting article in Nature discusses the misuse of biodiversity offsets for 'meeting' targets. Maron et al. (2015), highlight the growing concern with governments using offsetting for damage caused to biodiversity and habitats in the name of development. They note that in most cases offsetting isn't being used as a last resort after all other mitigation methods have been exhausted, but as a go-to quick-fix solution that keeps them on track to achieving international conservation targets to which they have previously committed to.
The confounding nature of morality in the instance of biodiversity offsetting is revealed when considering both sides of the argument. Reid (P.232) uses the example of water to epitomise the point:
'On the one hand it is said that:
[Water] is not a commercial product like any other but, rather, a heritage which must be
protected, defended and treated as such.
On the other hand, it is said:
Past failure to recognize the economic value of water has led to wasteful and environmentally damaging uses of the resource. Managing water as an economic good is an
important way of achieving efficient and equitable use, and of encouraging conservation
and protection of water resources.'
It is possible to see how this point applies to the case of tropical rainforests. As with water, a lack of complete understanding of the resource that is the rainforest: a medicinal resource, a habitat, a source of the highest biodiversity, has led to the haphazard destruction and deforestation of trees hundreds of years old. However, proponents of the approach, for example Tom Tew of the UK Environment Bank, have argued otherwise:
“It is a great opportunity to fund landscape-scale restoration projects. There is little money in biodiversity. [Offsetting ] can deliver local schemes or regional or landscape-scale ones.”
Others like Tew argue of the conservation benefits biodiversity offsetting can have. By marketising biodiversity, it becomes something with value, something that business-economisty-types can start to understand and see the benefits in protecting, closing the gap between economy and environment.
In my view, biodiversity offsetting and other market-based approaches to biodiversity are walking a very fine line, I feel it is almost too tantalisingly tempting for governments, especially governments in advancing nations, to continue with development full steam ahead with no care for the environment as they have 'it' 'covered' by offsetting schemes. As with other contentious 'solutions' such as bioengineering, offsetting is risky in that it has the potential to be used as a scape-goat for a laissez-faire attitude to our environment. When I think of a market-based approach to biodiversity I feel just about as concerned as the animals do in the cartoon below...
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