Source: New Zealand Government
It’s my pleasure to be here today amongst some of the strongest guardians of our native biodiversity in the country.
Wouldn’t we rather have more carrot than stick if we work for nature on our land?
That’s what my announcement about expanding a voluntary nature credits market in New Zealand was about last week at Fieldays.
We are backing the expansion of a market that will be durable, measurable and transparent. An enduring legacy of commitment to the land.
The market will hopefully help you and other landowners and conservation groups unlock new income streams for looking after nature on your land.
Now I say ‘hopefully’ because I haven’t yet fully transitioned into being a politician. I’m still a pragmatist. I still prefer to under promise and over deliver, and 28 years of farming makes me a firm believer in Murphy’s Law. But the only way to find out if this will work is to give it a crack, do some trials, see what works and doesn’t, and then take the lessons on board and move forward.
So, assuming Murphy gives us a break, how do I envision these nature credit markets could work?
Nature and carbon credit markets connect investors looking for reputable nature and climate opportunities with landowners, farmers and community groups who are actively restoring and repairing nature by adding biodiversity value to their land.
At a high-level nature and carbon projects are developed, according to established evidence-based standards, to produce voluntary credits that can be issued for sale on a marketplace for purchasers to buy.
Purchasers can then either use the credits, claiming support for the project and retiring the credits, or they can hold onto the credits (without claim) for resale or use down the track.
I’m often asked who would buy these credits?
International and domestic investors—including corporates, banks, and philanthropists—are seeking high-quality nature and carbon credits that meet global standards.
They are looking for reputable nature and climate action projects undertaken by landowners, farmers, and community groups. This allows investors to demonstrate their environmental commitment to their customers.
In 2024 New Zealand investors spent over $20 million on voluntary nature and carbon credits; mostly on offshore projects due to the lack of suitable New Zealand projects.
But with the right framework, we can keep more of that investment at home and restore and protect New Zealand’s unique native species.
I’m told there’s interest from international investors in New Zealand credits with overseas companies and international investment funds purchasing them.
Expanding the nature credit market is both important to investors and New Zealand’s reputation. We all know how heavily New Zealand’s economy is dependent on the natural environment to support our exports and economy.
Our exports rely on our ‘clean green’ environmental image. 80% of our exports ( $59.6 billion) go to markets where environmental, social, and governance reporting is required.
Voluntary carbon and nature credits can help companies demonstrate commitment to addressing nature loss and climate change while satisfying regulation, trade agreements, and supply chain requirements of international markets and customers.
A successful voluntary nature credits market can enable the many private and public agencies, individuals, and councils that already do great work, but lack the networks, expertise and resources to connect, to do more. This approach has worked well in nature markets in the United Kingdom and Australia.
And it’s worth it financially. A 2024 report from the Worldwide Fund for Nature and EY suggests that halting and reversing biodiversity loss could save New Zealand more than $270 billion over the next 50 years.
Many New Zealand carbon and nature credits projects use international standards to develop credits. However, the high costs and stringent reporting requirements often make this impractical for smaller landowners and projects. This results in untapped potential. Consequently, smaller-scale New Zealand carbon and nature credits projects are effectively excluded from the market due to these prohibitive costs and requirements.
Market participants say formal arrangements and support from the New Zealand Government are necessary to create trust, growth and investment in the New Zealand market.
Privately funded pilot projects are underway to test how nature credits markets can work in the New Zealand context. As part of these pilots, we will test the role for Government which may include a government endorsed qual mark for project standards and measures to assure participants that market conduct is fair, honest and transparent.
The pilots represent different land conditions – including many farms – locations, types of market participants, and activities. This real-life experience will provide valuable insights as we move to the next stage of market design.
Before I close – you’re probably wanting to know what’s next.
We’ll be announcing further details on the Government’s role and the design of the expanded market in the coming months.
In the meantime, we’re looking forward to working alongside groups and individuals involved in the pilots, and others interested in this project. Please get in touch with the Ministry for the Environment if you’re interested.
It is also my pleasure to announce the Ministry for the Environment’s sponsorship of the biodiversity award which recognizes work done to protect our native flora and fauna. Our government believes in celebrating the fantastic work that you and many other farmers are doing and this is a tangible example of how we will support those who are investing in sustainable agriculture.
Thank you for your time today – and I hope you enjoy the National Sustainability Showcase; I look forward to catching up with you later this evening.
