Balance sheet biodiversity: making nature an asset

An eco-fintech platform turns land regeneration into an investment opportunity for businesses

Spotted: According to the World Economic Forum, over half the world’s total GDP is moderately or highly dependent on nature, but all across the globe, nature is on the decline. Part of the problem is the difficulty of establishing a science-based system for ascribing financial values to nature, but now German startup The Landbanking Group is taking on this challenge with its ‘Landler’ platform. 

Leveraging satellite and field data in combination with machine learning and distributed ledger technology, the company creates ‘digital natural capital’ accounts for pieces of land. These are made up of structured values for soil, water, carbon, and biodiversity that form a baseline that’s used to create a new category of asset called ‘Nature Equity’.

Businesses, such as large agrifood companies, enter into outcome-based contracts with land stewards that reward improvements in the four values over time, as assessed by the startup’s AI-backed monitoring, reporting, and verification (MRV) tools. All the company’s models are reviewed by independent scientists and statistically validated and certified.

When uplifts in the natural capital account are registered by Landler’s technology, they become ‘Nature Equity Assets’ – a traceable and dynamic ‘claim’ on the improvement of a specific ‘polygon’ of land. Businesses can trade these claims through the Landler platform just like any other financial asset.  

For businesses working within their own supply chains, the outcomes-based agreements provide a mechanism for incentivising regenerative practices that improve supply chain resilience and reduce scope 3 emissions. For companies looking to invest in carbon reduction and nature, whether voluntarily or because of regulation, purchasing claims on the Landler platform enables them to demonstrate leadership in the nature-positive movement without fears of greenwashing. Land stewards, meanwhile, are rewarded for transitioning to regenerative practices.

Rather than beginning with the offsetting market, The Landbanking Group is initially focused on facilitating ‘insetting’ for the agrifood industry – where companies aim to drive improvements in their own supply chains. It will then seek to address new markets in the infrastructure, financial services, and energy industries.

Springwise has spotted other ways innovators are combining financial solutions with nature regeneration, including by ascribing a financial value to certain species and biodiversity analytics for investors.

Written By: Matthew Hempstead