Biodiversity Offsetting
Institute of Environmental Management and Assessment (IEMA)
IEMA is the UK’s leading professional body for environment and sustainability practitioners, with
over 15,000 members and represents professionals working in FTSE 100 companies, public sector
organisations, SMEs, consultants and higher education. As an independent not for profit organisation
funded by our members, our aim is to promote the goal of sustainable development by improved
environmental practice and performance.
In pursuing our aim, we actively support the development of knowledge, understanding and capability
such that practitioners and decision makers make an active contribution to conserving and enhancing
the natural environment. Our members work across multi-disciplinary environmental issues,
including climate change mitigation and adaptation, ecosystem services and biodiversity. IEMA
members are active across many disciplines including Environmental Impact Assessment,
Sustainability Appraisal, Life Cycle Assessment, environmental management, sustainable sourcing,
Corporate Social Responsibility and environmental auditing. They will be instrumental in biodiversity
offsetting from a range of differing positions (as planners, businesses, consultants and developers).
We believe ecosystem protection, enhancement and reinstatement is an immediate priority. We
recognise the natural environment is central to society’s prosperity and that long term failings have
existed in the economy and in overarching policy and these have served to undervalue its
contribution. We also strongly believe that ecological skills and understanding can continue to
develop for UK economic advantage (within a wider context of mainstreaming green skills across the
economy). In October 2010, we responded to the Government’s consultation exercise on the
development of the natural environment white paper and a summary from our response is provided
at Annex 1.
1) Additionality – (Lawton, localism and green economy)
Dependant upon final scheme details, potential exists for significant biodiversity value through
contributions that could be secured for both local biodiversity and also for landscape scale habitats.
Given the need for habitat enhancement to help address historic loss and to buffer biodiversity
against future threats e.g. climate change1 and also the reality that offset proposals will always carry
some uncertainties (despite best efforts and planning) we believe the scheme should not limit itself
to simple 1-1 replacement at an immediate local level. Biodiversity offsetting should move beyond
no net loss and an objective of ‘net ecological gain’ should be set for the scheme overall.
It is suggested that a significant target for landscape scale additionality should be set out in the final
scheme proposals. Such ‘built in’ additionality could be achieved by requiring both a) a level of local
compensation, allied with b) contribution to a strategic project in the region2. There may also be
value in a scheme level target for total habitat created (and target ratio to associated habitat loss).
1
Reference Professor Lawton’s independent review (September 2010) and Government’s response http://www.defra.gov.uk/publications/2011/06/07/government-response-making-space-for-nature-review/
2
A final scheme could be designed to enable creative financial use of offsets to in turn secure greater
additionality. For example an offset as a matched contribution might further enhance a bid for additional funds
to a strategic scale biodiversity enhancement (i.e. well beyond the initial isolated offset)
If valuation of the natural environment continues to develop in line with the 2010 White Paper (for
example into and through decision making processes such as procurement) we are confident that
forward thinking companies will be able to incorporate additional biodiversity benefit into project
bids to demonstrate added value and in securing competitive advantage.
2) Integration – (maintaining protection / adding value/ consistent standards)
Although Defra information pages on biodiversity offsets clearly state - “We should continue to
avoid building on areas of high wildlife value, wherever possible” there are concerns biodiversity
offsetting could indirectly lead to or facilitate an increased rate of development losses of locally
important wildlife sites and habitats. This is a concern to guard against, not necessarily with the
proposals themselves, but with regard to their impact if operating alongside any wider changes (e.g.
potential changes to planning within the emerging context of localism).
Annex 2 sets out a well established mitigation hierarchy, developed from principles initially within
the EIA Directive – 85/337/EEC as amended). It is encouraging that a mitigation hierarchy approach
has been referenced in Defra literature on biodiversity offsetting3 It should however be stressed
that biodiversity offsetting is not simply compensation (i.e. one site for another site) and can operate
in many ways. Opportunities should not be limited by too narrow a focus on sites.
Biodiversity offsetting needs to be developed as an integrated measure in the context of the Natural
Environment White Paper. There are concerns that biodiversity offsetting could be progressed as
‘stand alone’ without integration with existing conservation approaches or consideration of wider
ecosystem services such as carbon sequestration, flood alleviation, landscape value and wider
benefits (e.g. from economic uses such as coppiced wood fuel through to social benefits such as
health gains from public green space).
In relation to maximising its potential, biodiversity offsetting should be tested and developed with
regard to a full range of developments, including larger scale opportunities at the level of important
national infrastructure4 and including the full range of offset options.
In developing a final scheme it will be important to ensure that scheme requirements are consistent
and harmonised with wider international developments in this field (e.g. developing standards from
BBOP to be launched in January 2012).
3) Funding and scheme details - (clarity / ownership / flexibility / permanence)
As a principle, biodiversity offsets could provide a net benefit to society. They can improve and
facilitate decision making, thereby reducing unnecessary and wasteful delay. Along with wider natural
environment developments such as ecosystem services, they can provide an opportunity for
biodiversity to move beyond compliance and to grow within the green economy.
3
See Para 68 - http://archive.defra.gov.uk/environment/biodiversity/offsetting/documents/110714offsettingbackground.pdf
4
Infrastructure Planning Commission - http://infrastructure.independent.gov.uk/
All parties will need to have confidence in the biodiversity offsets and a final scheme framework will
need to ensure clarity for all. Participating developers will need to know that their payments will
form the extent of any required contribution (notwithstanding opportunities for voluntary
contribution longer term). Stakeholders in turn require confidence that provision exists for longer
term sustainable management and offset permanence.
Funding arrangements must be robust and sustainable with regard to the medium and longer term
costs of establishing and maintaining semi-natural habitats. Concerns exist that ‘financing’ of the
projects (given initial rates indicated) may not be realistic for some habitat establishment in the
medium to long term. Consideration should also be given to suitable longer term economic land
uses (i.e. viable and appropriate use) that will help to guarantee the offset permanence. The final
scheme may be well advised to investigate partnership arrangements with conservation bodies,
trusts, farmers and land managers (bodies experienced with longer term land stewardship).
Any scheme should be harmonized to complement other natural environment ‘quantification’
developments (e.g. Forestry Commission’s woodland carbon code5) and should not sit in isolation
from the user’s perspective. Initial offset payment rates may for example fail to encourage woodland
creation as a biodiversity offset in contrast to habitats that are cheaper to establish. However a link
with the Forestry Commission’s recent woodland carbon code developments may help to bridge any
funding gap. The site will then have two ‘environmental purposes’ that are both funded.
4) Scheme name - (offsets, compensation, enhancement)?
Confusion between different types of offsetting may be a concern and experience in recent years
from carbon offsetting6 has generated (or received) a degree of confusion and contention around
offsetting and terminology. Some broader consideration of biodiversity compensation and
enhancement may be advisable to help avoid similar doubts and scepticism in the final scheme.
Alternative names such as “biodiversity compensation or enhancement” may be worth considering
in terms of making a clear message that measures are not simply ‘like for like’ (i.e. that these are
additional measures after mitigation on site and can seek both compensation and enhancement).
If the name offset is used within a final scheme, then care will be required to avoid confusion with
carbon offsetting. The scheme should also learn from the experiences and issues surrounding
carbon offsetting and (as already mentioned) ensure that typical offset concerns such as additionality,
leakage, permanence and double counting are all fully considered and addressed.
ANNEX 1
IEMA response to the Natural Environment White Paper
In October 2010, IEMA responded to the Government’s consultation exercise on the development
of the natural environment white paper– invitation to shape the nature of England7. IEMA’s response
5
Forestry Commission Woodland Carbon Code - http://www.forestry.gov.uk/carboncode
6
See PP 42-43 - http://www.iema.net/download/press/GHG%20Launch/IEMA%20GHG%20Report%204.10.10.pdf
7
IEMA full response to the 2010 White Paper can be viewed at - http://www.iema.net/news/iemanews?aid=19861
stressed the importance of environmental professionals in providing Government, Planning
Authorities, business and other organisations with appropriate and effective information. It
highlighted that any new approaches for introducing and valuing ecosystem services will need to be
carefully developed to reflect the multiple benefits provided and to avoid unintended negative
consequences. It further identified the need to go beyond simple awareness raising and to ensure
that appropriate training is provided to equip decision makers at all levels both in the public and
private sector with knowledge, skills and tools essential to providing a greater understanding of the
complexities of natural value and to allow for more integrated decision-making.
IEMA believes ecosystem protection, enhancement and reinstatement is an immediate priority. We
recognise the natural environment is central to society’s prosperity and that long term failings have
existed in the economy and overarching policy - serving to miss or undervalue this contribution. In
relation to ecosystem services within the context of the White Paper, we identified the following;

Investment is required in tools and assessment processes that can enable professionals to
provide Government, Planning Authorities, business and others with appropriate and effective
information concerning the value of ecosystem services. Quantification is important, but there
must be provision for valuing non-measurable benefits. These developments must be
integrated into or help to support/improve existing practice in environmental assessment and
sustainability appraisal (and related disciplines e.g. LCA)

The above ‘assessment’ improvements will need to be supported by new economic and
related approaches for introducing and valuing ecosystem services within decision-making.
These will need to be carefully developed to reflect the multiple benefits provided by
ecosystems and to avoid unintentional negative consequences.

There is a need to go beyond simple awareness raising of environmental issues and ensure
that appropriate training is provided to equip decision makers at all levels both in the public
and private sector with the necessary knowledge, skills and tools. Such training is essential to
provide a greater understanding of the complexities of natural value and to allow for more
integrated decision-making.
ANNEX 2 – Mitigation Hierarchy
Flow diagram from Practitioner Volume 12: Environmental Management Plans (IEMA, Dec 2008)
The hierarchy of mitigation of environmental effects is:
AVOIDANCE:
Making changes to the project’s design (or potential location) to avoid adverse environmental effects.
REDUCTION:
Where avoidance is not possible, adverse effects can be reduced through sensitive environmental
treatments/design8.
REMEDIATION:
Where adverse effects are unavoidable, management measures can be introduced to limit their
influence9.
COMPENSATION:
Where avoidance or reduction measures are not available, it may be appropriate to provide
compensatory measures10. It should be noted that compensatory measures do not eliminate the
original adverse effect, they merely seek to offset it with a comparable positive one.
ENHANCEMENT:
Projects can have positive effects as well as negative ones, and the project preparation stage presents
an opportunity to enhance these positive features through innovative design.
8
For example, where structures are to be built on river banks with the potential to disrupt otter pathways, otter
ledges can be incorporated into the project design to ensure their pathways are maintained and the potential
for adverse effects is reduced.
9
This can include construction and site operation controls which have no physical manifestation in the built
scheme, including, for example, dust control measures, construction noise abatement techniques etc.
10
For example, where a development destroys an area of habitat, this could be recreated at an alternative
location.