What is the Role of Policy in Encouraging Investments in Nature in Canada?

Many conservation finance success stories stem from effective policy and regulation.

Effective regulatory measures can include clear requirements that signal to businesses how to meet compliance, providing assurance that their strategies and spending will be aligned with regulations. Another example is funding programs that require innovative accounting and tracking of environmental impact, which –  when presented with new data related to natural capital – motivates improved management of natural resources.

Effective policy and regulation can also enable the creation of new markets and provide assurance that there will be demand for the ecosystem value stream being produced. For example, putting a cap on carbon emissions and a price on carbon provides clarity for those investing in nature-based carbon projects, conveying to investors that there will be both demand for offsets, and some assurance on the price they can return on their investment.

This explainer looks at the importance of regulatory clarity, the current policy gaps in Canada, and the enabling conditions needed to foster increased investment in nature.

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