Property Possibilities are Running Wild

Farrer & Co Senior Associate Rebecca Standing considers the options for investors and developers facing the UK’s biodiversity net gain rules.

The requirement to provide 10% biodiversity net gain (BNG) became mandatory in England when Part 6 of the Environment Act 2021 (2021 Act) came into force on 12 February 2024, or 2 April 2024 for small sites – developments with nine houses or fewer on a site of less than one hectare. From this date, all planning permissions issued in England are subject to a deemed condition that the development for which permission is sought must meet the BNG objective.

The UK government guidance describes the aim of the BNG objective as “habitats for wildlife are left in a measurably better state than they were before the development” – which translates into a requirement that the post-development site achieves a net increase in biodiversity of at least 10%, compared to the biodiversity value of the site pre-development. The associated habitat creation or enhancements must then be maintained for 30 years.

BNG metrics and methods

In order to ensure that the biodiversity value of a site is calculated in a standardised way, Natural England has published the statutory biodiversity metric. This is a calculation tool which, with the help of an ecologist, enables developers to calculate the present and projected future biodiversity value of a site, before and after development. It can also predict how much biodiversity value certain habitat creation or enhancement works will create and, as such, is a helpful planning tool.

Examples of BNG delivery are diverse and can include both larger-scale elements – including the creation of dedicated habitat areas, such as wildflower meadows, wetlands, and orchards – and smaller scale elements, such as bird boxes, bee bricks and hedgehog highways. BNG delivery can also be achieved in the construction of the built environment itself, through the inclusion of infrastructure like solar slate, green walls, ground source heat pumps, and rainwater collection.

The required 10% gain can be achieved in one of three ways, or a combination of them, by:

carrying out habitat creation or enhancement works on the development site itself – i.e. onsite creating or enhancing habitats in offsite locations buying statutory credits Offsite or onsite?

When considering which of the three methods to use, it should be noted that the government has made it clear that statutory credits are to be

How Investors can Accelerate the Food and Agriculture Revolution

Dr Henning Stein, Finance Fellow at Cambridge Judge Business School, and Ariel Barack, CEO of Ordway Selections, explain why the drivers of change – and the roles of the public and private markets – are evolving.

Efforts to build a genuinely sustainable food and agriculture system have now been under way for a number of years. On the whole, the story so far has reflected an uncomfortable truth: revolutions are messy.

There have been few exceptions to this rule throughout history. Political, social and even scientific upheaval has almost always proved tumultuous, for the simple reason that radical change is seldom easily achieved.

Given this, we should not be surprised that the global transformation of how we produce and consume food has been neither flawless nor swift. Equally, we should not shy away from its imperfect path to date.

There is no denying that some of the setbacks have been jarring. There is also no denying that many investors’ faith in the quest to feed humanity while safeguarding the environment has been undermined.

Other stakeholders have also been left disenchanted. By way of illustration, consider all those who have ‘bet the farm’ – sometimes literally as well as figuratively – on novel technologies whose promise has not yet translated into tangible results.

Yet none of this means we are in the midst of a revolution that is doomed to fail. Rather, it means we are still on a steep learning curve.

As investors, we have to understand what has happened, recognise where errors have been made and rethink our approaches. In public and private markets alike, there are important lessons to digest.

The irrefutable case for change

It is first imperative to appreciate why, in spite of limited progress, the investment attractions of sustainable food and agriculture not only remain strong but have arguably increased. This obliges us to see the bigger picture.

The most significant point here is that this is a transition that absolutely has to take place. The policies and practices that have dominated food production and consumption for the past three quarters of a century are no longer fit for purpose.

Incorporating farming, processing and distribution, the food system in its entirety is responsible for around a quarter of all greenhouse gas emissions. In turn, the dire effects of climate change – including extreme weather events, ecological decline and dwindling biodiversity – are ravaging landscapes and

Church Commissioners’ Planet Lead to Heighten Engagement Efforts

In her new role, Laura Moss-Bromage will develop a coherent strategy focusing on climate change, nature loss and social inequality.

The Church Commissioners for England has appointed Laura Moss-Bromage as Planet Lead – a new role created as the organisation looks to bolster engagement with companies and policymakers on climate change and biodiversity.

“My responsibilities will be designing and implementing the fund’s nature strategy as well as driving our environmental engagement initiatives,” Moss-Bromage told ESG Investor. “As I build out the fund’s nature strategy, a core pillar will be understanding the climate and nature impacts of the portfolio, which will then shape our future environmental stewardship priorities.”

The Church Commissioners is already involved in a number of environmental engagement initiatives, including Climate Action 100+, Nature Action 100, Finance Sector Deforestation Action, Investor Policy Dialogue on Deforestation, and the Investor Initiative on Responsible Nickel Supply Chains – facilitated by the Investors for Sustainable Development (VBDO) and Rainforest Foundation Norway.

As part of her new role, Moss-Bromage will design and drive the Church Commissioners’ portfolio-wide biodiversity strategy and lead on nature and climate-related stewardship initiatives.

“The Church Commissioners views engagement as one of the most important levers to drive real-world change,” she said. “I will be revamping our climate change engagement strategy to focus engagement efforts on companies that we believe will genuinely play an important role in the transition.”

Corporate activity has been a major driver of both climate change and nature loss, so engaging with companies to reduce their impact and influence positive change has been a priority, Moss-Bromage explained.

Engaging with industry bodies and policymakers can also be an effective lever, as it helps to provide companies with a policy environment that is “stable and supportive from a sustainability perspective,” she added.

Last June, the Church of England Pensions Board (CoEPB) and Church Commissioners announced they were divesting from oil and gas firms – including BP, ExxonMobil, Shell and Total – due to their failure to align with climate goals. The latter had previously excluded 20 oil and gas majors from its investment portfolio.

“Over the past few years, we’ve seen significant commitments made by organisations and now it is time to focus on the actions that will really lead to transformative outcomes,” said Moss-Bromage. “That will be