Ex-ante stress-test of Finland’s new biodiversity offsetting system

The Finnish government introduced a new voluntary biodiversity offsetting policy in 2023 after years of policy development. Now that the system has been established, it is important to assess how well it aligns with the general international principles of biodiversity offsetting and whether its metrics, rules and methods could be extended to emerging nature credit markets more broadly.

To provide an objective expert perspective, Ministry of the Environment Finland, together with the BOOST research consortium, invited Dr Sophus zu Ermgassen from the University of Oxford to conduct an ex-ante evaluation of the system. The results were first presented at a public event on 18 March 2026 in Helsinki (link below). These results are now available in a report published by the ministry, in which Sophus zu Ermgassen summarises the strengths and risks of the policy, drawing on international experiences.

According to zu Ermgassen, key strengths of the Finnish system are the solid and clear regulatory regime, legal permanence, and one of the most legitimate ecologically-informed consensus-based offset calculation methods of any offset system globally. Critical risks include a lack of clear demand drivers, an institutional mismatch between some of the most ecologically important interventions (forest protection) and calculation methods which risk systemically undervaluing these interventions, and the reliance on up-front projections of biodiversity change without scope for long-term monitoring and adaptive management – all of which have been scientifically demonstrated to have negatively impacted other biodiversity and nature-based carbon offsetting systems around the world. 

Zu Ermgassen notes that this paper is to be read alongside the Kujala et al. (2024) evaluation of the strengths and weaknesses of Finland’s biodiversity offset policy, and aims wherever possible to focus on factors that are additional to that existing evaluation.

Access and reference: zu Ermgasse, S. (2026). Ex-ante stress-test of Finland’s new biodiversity offsetting system. Publications of the Ministry of the Environment 2026:21. https://urn.fi/URN:ISBN:978-952-361-439-0

Recording and summary of the event (18 March 2026) where zu Ermgassen presented his evaluation: https://boostbiodiversityoffsets.fi/recording-evaluation-of-the-finnish-biodiversity-offsetting-system/