This is a guest post by Car­los Fer­reira, Research Assis­tant in the Cen­ter for Busi­ness in Soci­ety at Coven­try Uni­ver­sity. He can be reached at carlos.ferreira@coventry.ac.uk.

This com­ment has pre­vi­ously been pub­lished on Ecosys­tem Mar­ket­place. It is the expres­sion of the author’s thoughts and expe­ri­ences and as such is acknowl­edged as a fruit­ful con­tri­bu­tion to the dis­cus­sion on bio­di­ver­sity off­sets. If you want to react or clar­ify your own posi­tion (under­pin or dis­prove Car­los’ rea­son­ing), please leave a reply below!

Bio­di­ver­sity off­sets have the poten­tial to imple­ment high qual­ity con­ser­va­tion in the face of encroach­ing devel­op­ment. But, unless it’s under attack, the con­cept remains almost unheard of among con­sumers. This is a big prob­lem, accord­ing to a researcher on the sub­ject who says growth and reg­u­la­tory sup­port depends on pub­lic opin­ion. 

A visit to the Species­Bank­ing web­site con­firms what spe­cial­ists have known for some time: that the prac­tice of off­set­ting impacts to bio­di­ver­sity is wide­spread. And while national, regional and local prac­tices vary widely, one point is clear: off­set­ting is an increas­ingly impor­tant mech­a­nism for con­ser­va­tion as more and more com­pa­nies use them to mit­i­gate their bio­di­ver­sity impacts.

How­ever, few firms are choos­ing to off­set as a way to man­age their image and show con­sumers that they are environmentally-responsible com­pa­nies. The rea­sons for this may lie with the fact that very lit­tle is known about what con­sumers think of bio­di­ver­sity off­sets. And this unaware­ness at the con­sumer level could be impact­ing the sector’s abil­ity to expand.

The eth­i­cal con­sumer – a new fron­tier for bio­di­ver­sity offsets?

For decades there has been an inter­est in under­stand­ing how con­sumers’ eth­i­cal and envi­ron­men­tal pref­er­ences trans­late into behav­iors. So far, these pref­er­ences has trans­lated into what is known as the eth­i­cal con­sumer – buy­ers gen­uinely inter­ested in mak­ing pur­chases that have lit­tle neg­a­tive envi­ron­ment and social impacts. Experts rou­tinely sug­gest that these ethically-motivated con­sumers will drive com­pa­nies to lessen their envi­ron­men­tal impact, by with­draw­ing their sup­port – and their cus­tom – from those firms per­ceived as caus­ing unnec­es­sary damage.

There is evi­dence that this is indeed the case: on the one hand, study after study has shown that peo­ple pre­fer to asso­ciate with brands and prod­ucts lauded for their sus­tain­abil­ity. Green is good, and the halo effect of sus­tain­able prod­ucts is not neg­li­gi­ble. On the other hand, the growth of eth­i­cal mar­kets such as Fair­Trade, organic, low car­bon, and more recently Fair­Wage – has been a well-documented phe­nom­e­non. Eth­i­cal and envi­ron­men­tal actions by com­pa­nies add value to prod­ucts and improve brand rep­u­ta­tion. Car­ing con­sumers will poten­tially pay more for prod­ucts from busi­nesses tak­ing action to make the world a bet­ter place.

Despite this poten­tial, the eth­i­cal con­sumer remains one of the great untapped resources in the devel­op­ment of bio­di­ver­sity off­sets. While many com­pa­nies acknowl­edge the poten­tial of off­set­ting as a mech­a­nism for assur­ing reg­u­la­tory good­will and secur­ing social license to oper­ate, there is very lit­tle evi­dence that it is being used as a mech­a­nism for man­ag­ing cor­po­rate rep­u­ta­tions or cor­po­rate social responsibility.

Apart from Walmart’s asso­ci­a­tion with the Acres for Amer­ica pro­gramme, no com­pa­nies have cho­sen to pub­li­cise their involve­ment with off­set­ting. In fact, the con­cept of off­set­ting bio­di­ver­sity impacts remains vir­tu­ally unheard of among con­sumers. And therein may lay one of the big prob­lems for the off­set­ting industry.

Bio­di­ver­sity Off­sets in Britain: com­pet­ing ideas and con­sumer confusion

The British gov­ern­ment has sup­ported the intro­duc­tion of bio­di­ver­sity off­set­ting, and 6 bio­di­ver­sity off­set pilots have been oper­at­ing in Eng­land since early 2012. How­ever, anec­do­tal evi­dence indi­cates that most con­sumers have never heard of bio­di­ver­sity off­sets. Nor have con­sumers heard of the idea of no net loss of bio­di­ver­sity, which is intended to com­mit com­pa­nies to demon­strate mea­sur­able outcomes.

No net loss of bio­di­ver­sity is not only a good for­mu­la­tion of an objec­tive; it is also a high thresh­old. And the uncer­tain­ties asso­ci­ated with it often mean that, in order to demon­strate achiev­ing no net loss, devel­op­ers and off­set providers pre­fer to err on the side of cau­tion, and employ high ratios of offset-to-development area. It also means that care is taken to min­i­mize activ­i­ties harm­ful to nature. No net loss of bio­di­ver­sity, along with ideas such as zero net defor­esta­tion, has the poten­tial to be a good rep­u­ta­tion man­age­ment tool.

How­ever, the reluc­tance of talk­ing about off­set­ting to con­sumers has cre­ated a sit­u­a­tion where, in Britain at least, bio­di­ver­sity off­sets are more often than not pub­licly attacked and con­demned as a license to trash. Seiz­ing on the com­plex­i­ties of off­set­ting and on the uncer­tain­ties sur­round­ing how it is done, its lim­i­ta­tions and its uses, crit­ics of bio­di­ver­sity off­set­ting have been much more vocal about the topic than pro­po­nents, mak­ing use of both broad­cast and social media to pro­mote this idea of license to trash.

This might lead to the poten­tially para­dox­i­cal sit­u­a­tion where con­sumers may hear of bio­di­ver­sity off­sets for the first time in the con­text of a cri­tique. Again, anec­do­tal evi­dence has sug­gested that some con­sumers first heard of bio­di­ver­sity off­sets while being asked to sign a peti­tion against it! So much for cor­po­rate rep­u­ta­tion man­age­ment – this has the poten­tial to make bio­di­ver­sity off­sets some­thing that com­pa­nies actively want to dis­so­ci­ate them­selves from.

From good inten­tions to good communication

For all the ques­tions sur­round­ing it, there is no ques­tion that those involved in bio­di­ver­sity off­sets have the best of inten­tions. Peo­ple gen­uinely want to do some­thing which is both good for nature and for busi­ness. And close obser­va­tion of the debates within the com­mu­nity reveals that all those involved are aware of the chal­lenges and lim­i­ta­tions of bio­di­ver­sity offsets.

But it’s clear, in Britain at least, that this mes­sage isn’t reach­ing the con­sumers with those in oppo­si­tion to the mech­a­nism com­mu­ni­cat­ing the most. This con­sti­tutes a prob­lem: in demo­c­ra­tic soci­eties, pub­lic sup­port is required for ini­tia­tives to be suc­cess­ful. And while pro­mot­ers of bio­di­ver­sity off­sets have, rightly, attempted to obtain the atten­tion and sup­port of pol­icy mak­ers, they must also take the time to address consumers.

Because major­ity of con­sumers haven’t heard of bio­di­ver­sity off­sets, we gen­uinely don’t know how they will feel about them. But find­ing out is cru­cial because the future of this mech­a­nism just might depend on where they stand.