Deep dive: nature-based solutions — metrics that matter and how to measure them

Nature-based solutions (NBS) represent one of the most promising pathways for addressing the interconnected crises of climate change and biodiversity loss. Yet the effectiveness of NBS investments hinges entirely on our ability to measure outcomes rigorously. Without robust measurement, reporting, and verification (MRV) frameworks, NBS projects risk becoming vehicles for greenwashing rather than genuine environmental impact. This article provides a comprehensive analysis of the metrics that matter most and the methodological approaches required to measure them with scientific integrity.

Why It Matters

The scale of opportunity and the magnitude of the financing gap make rigorous NBS measurement an urgent priority. According to research published in 2024, high-quality nature-based solutions can mitigate up to 10 GtCO2 per year, representing approximately 27% of current global emissions. Cost-effective NBS interventions could contribute roughly 20% of the mitigation needed to achieve 2050 climate targets.

However, the investment landscape reveals a stark disconnect between potential and reality. Current annual investment in NBS stands at approximately $154 billion, but achieving meaningful scale requires $384 billion by 2025 and $484 billion by 2030. The global biodiversity finance gap remains at $700 billion annually, underscoring the need for credible metrics that can attract institutional capital.

The good news is that private finance for nature has surged dramatically, reaching $102 billion in 2024, an 11-fold increase from $9.4 billion in 2020. This influx of capital brings heightened scrutiny. Over 620 organizations representing $20 trillion in assets under management have committed to nature-related financial disclosures through the Taskforce on Nature-related Financial Disclosures (TNFD) framework. These commitments demand standardized, verifiable metrics that can withstand regulatory and investor due diligence.

Key Concepts

The Four Pillars of NBS Measurement

Effective NBS measurement requires quantifying outcomes across four interconnected domains: carbon, biodiversity, water, and soil. Each domain presents unique methodological challenges and requires distinct measurement approaches.

Carbon Sequestration (tCO2e): The most mature measurement domain, carbon quantification relies on established protocols for estimating above-ground biomass, below-ground carbon stocks, and soil organic carbon. Metrics include tonnes of CO2 equivalent (tCO2e) sequestered annually, permanence risk assessments, and additionality verification. Remote sensing technologies, including LiDAR and satellite imagery, have dramatically improved the accuracy and cost-effectiveness of carbon stock estimation.

Biodiversity Indices: Unlike carbon, biodiversity lacks a single universal metric. Practitioners typically employ composite indices that aggregate species richness, abundance, and community composition data. The Mean Species Abundance (MSA) index, Biodiversity Intactness Index (BII), and Species Threat Abatement and Restoration (STAR) metric each offer different perspectives on ecosystem health. The UK's Biodiversity Net Gain policy, which requires developers to deliver a 10% improvement in biodiversity value, has pioneered the use of standardized habitat condition assessments and biodiversity unit calculations.

Water Quality and Quantity: NBS water metrics encompass both quality parameters (nutrient loading, sediment concentration, pathogen levels) and hydrological functions (infiltration rates, groundwater recharge, flood peak attenuation). Watershed-scale measurement requires integrating point measurements with hydrological modeling to attribute outcomes to specific interventions.

Soil Organic Carbon (SOC): Particularly relevant for agricultural and grassland NBS, SOC measurement involves stratified sampling protocols and laboratory analysis. The spatial variability of soil carbon presents significant measurement challenges, requiring dense sampling grids and geostatistical interpolation methods.

The MRV Technology Landscape

The measurement, reporting, and verification technology ecosystem has matured rapidly, with several platforms emerging as industry leaders. Pachama leverages machine learning and satellite imagery to provide continuous monitoring of forest carbon projects, enabling near-real-time detection of deforestation and degradation events. The LEON (Land Emissions Observatory Network) project combines ground-based flux towers with atmospheric measurements to validate ecosystem-level carbon budgets. Cultivo focuses on agricultural landscapes, providing soil carbon quantification for regenerative agriculture projects. Treecycle specializes in tropical reforestation, integrating drone-based monitoring with community-level verification protocols.

These platforms share several common capabilities: automated baseline establishment, change detection algorithms, uncertainty quantification, and standardized reporting interfaces. However, significant methodological differences remain, particularly in approaches to additionality assessment and leakage accounting.

What's Working and What Isn't

What's Working

Satellite-based monitoring at scale: The combination of freely available satellite imagery (Sentinel, Landsat) with commercial high-resolution providers has enabled cost-effective monitoring across vast landscapes. Machine learning algorithms can now detect land cover changes with greater than 90% accuracy, providing early warning of reversals and enabling adaptive management.

Stacked benefit frameworks: Leading projects are moving beyond carbon monoculture to quantify and monetize multiple ecosystem services. Projects that demonstrate verified improvements across carbon, biodiversity, and water command premium prices in voluntary carbon markets and attract impact investors seeking measurable co-benefits.

Regulatory harmonization: The emergence of TNFD alongside existing frameworks like the Science Based Targets Network (SBTN) is driving convergence toward standardized disclosure requirements. This harmonization reduces reporting burden for corporates while improving comparability for investors and regulators.

Community-based monitoring: Projects incorporating local communities in data collection achieve higher accuracy for biodiversity metrics while building social license and ensuring benefit-sharing. Participatory monitoring approaches also reduce costs and increase monitoring frequency.

What Isn't Working

Additionality verification: Demonstrating that measured outcomes would not have occurred without the intervention remains the most contested aspect of NBS crediting. Counterfactual baseline establishment involves inherent uncertainty, and different methodologies can produce dramatically different additionality estimates for identical projects.

Permanence guarantees: Climate benefits from carbon sequestration require multi-decadal to centennial permanence, yet most verification cycles operate on annual timescales. Buffer pool approaches and insurance mechanisms provide partial solutions, but fundamental uncertainty remains about long-term carbon storage in a changing climate.

Biodiversity metric fragmentation: The proliferation of biodiversity indices and assessment frameworks creates confusion and enables cherry-picking. A project might demonstrate gains on one index while obscuring losses on another, undermining the credibility of biodiversity claims.

Ground-truth data scarcity: Despite advances in remote sensing, satellite-based estimates require calibration against ground-truth measurements. Many regions, particularly in the Global South where NBS opportunities are greatest, lack adequate ground-based monitoring infrastructure.

Examples

1. Sabah, Malaysia Forest Conservation: The Sabah REDD+ project in Malaysian Borneo demonstrates the application of integrated MRV across 1 million hectares of tropical forest. The project combines Airborne LiDAR surveys for biomass estimation, camera trap networks for wildlife monitoring, and community-based forest patrols. Between 2018 and 2024, the project verified 5.4 million tCO2e in avoided emissions while documenting stable populations of endangered Bornean orangutans and pygmy elephants. The multi-metric approach enabled the project to access both carbon credit revenue and biodiversity-focused philanthropic funding.

2. UK Biodiversity Net Gain Implementation: Since the mandatory 10% Biodiversity Net Gain requirement took effect for major developments in England, over 2,500 projects have undergone biodiversity unit calculations using the standardized DEFRA metric. Analysis of early implementation reveals that 78% of projects are achieving net gain primarily through on-site habitat creation, with the remainder utilizing off-site credits and strategic conservation investments. The standardized approach has created a functioning market for biodiversity units, with prices ranging from £20,000 to £45,000 per unit depending on habitat type and location.

3. Microsoft Watershed Restoration Partnership: Microsoft's investment in watershed restoration projects across the Western United States illustrates corporate application of water-focused NBS metrics. Working with The Nature Conservancy, the partnership has restored 12,000 hectares of degraded riparian habitat since 2022, measuring outcomes through streamflow gauges, water quality sensors, and satellite-derived vegetation indices. Verified outcomes include 15% improvement in base flow conditions and 40% reduction in sediment loading during storm events. The project demonstrates how technology companies with significant water footprints can invest in quantified watershed services.

Action Checklist

• Conduct a baseline assessment using standardized protocols (Verra VCS, Gold Standard, or TNFD guidance) before any NBS intervention begins, documenting carbon stocks, biodiversity conditions, and ecosystem service flows
• Select MRV technology partners whose methodologies align with your target credit standard or disclosure framework, ensuring compatibility with buyer requirements and regulatory expectations
• Establish ground-truth monitoring infrastructure including permanent sample plots, biodiversity transects, and community monitoring networks to validate remote sensing estimates
• Develop a stacked benefits quantification strategy that measures and reports on carbon, biodiversity, water, and social outcomes, avoiding over-reliance on any single metric
• Build permanence and reversal risk into project design through buffer pools, insurance mechanisms, and adaptive management triggers that respond to monitoring signals

FAQ

Q: What is the minimum credible monitoring period for NBS carbon projects? A: Credible carbon quantification requires a minimum five-year monitoring period to establish baseline trends and capture inter-annual variability. Most certification standards require 20 to 40-year crediting periods with ongoing monitoring at defined intervals (typically annual remote sensing assessment plus field verification every three to five years). Projects with shorter monitoring horizons face significant discounting for permanence risk and may struggle to attract institutional buyers.

Q: How do biodiversity metrics differ from carbon metrics in terms of standardization? A: Carbon metrics benefit from decades of scientific development and international policy frameworks (IPCC guidelines, UNFCCC accounting rules) that have driven methodological convergence. Biodiversity metrics remain fragmented, with multiple competing indices optimized for different purposes. The UK Biodiversity Net Gain metric represents an important step toward standardization, but global consensus on a universal biodiversity accounting unit remains elusive. Practitioners should select metrics aligned with their disclosure requirements and geographic context.

Q: Can remote sensing fully replace ground-based monitoring for NBS verification? A: Remote sensing provides essential spatial coverage and temporal frequency but cannot fully replace ground-based monitoring. Satellite imagery accurately detects land cover change but cannot reliably estimate species composition, forest understory conditions, or soil carbon stocks. Best practice combines satellite monitoring for wall-to-wall coverage with stratified ground sampling for calibration and validation. The optimal balance depends on project scale, budget constraints, and accuracy requirements of the target crediting standard.

Q: How should organizations account for NBS measurement uncertainty in their disclosures? A: Transparent uncertainty quantification is essential for credible NBS claims. Organizations should report confidence intervals alongside point estimates, clearly distinguish between measured and modeled values, and disclose the methodological assumptions underlying their calculations. TNFD guidance recommends scenario analysis to explore how outcomes might vary under different climate and land-use trajectories. Conservative accounting practices, such as using lower-bound estimates for credit issuance, build long-term credibility even at the cost of short-term credit volumes.

Sources

• UNEP State of Finance for Nature 2024
• Taskforce on Nature-related Financial Disclosures (TNFD) Recommendations
• Nature Climate Change: Cost-effective NBS for climate mitigation
• UK Government Biodiversity Net Gain Guidance
• Pachama Forest Carbon Monitoring Platform
• Science Based Targets Network (SBTN) Technical Guidance