»Ê¼Ò»ªÈË

»Ê¼Ò»ªÈËwelcomes the government’s call for evidence on expanding the role of the private sector in nature recovery. We have been calling for stronger governance of nature markets since the launch of our five key principles for environmental markets in 2022.

The agriculture sector is uniquely placed to supply carbon and nature outcomes from multifunctional land management systems to support the delivery of a more sustainable economy.

The scale of land managed by farmers and growers provides significant scope for environmental delivery into the carbon, water and biodiversity markets.

However, there exists a barrier to scale of delivery for the majority of farm businesses, given the spatial trade-offs that exist between environmental delivery through interventions such as woodland creation, peatland restoration and habitat creation and the food producing capabilities of a farming system.

For this reason, whilst environmental markets have the potential to provide an attractive source of diversified income to support the economic resilience of farming businesses, scalable supply into markets from agricultural systems will only be achieved by ensuring nature market compatibility with the core food, energy and fibre producing enterprise.

This call for evidence, through its proposed objectives on economic growth and fair and proportionate burden sharing, recognises the importance of ensuring that the broader commercial drivers for farmers and growers are considered when looking to align the appropriate economic incentives for nature recovery alongside food production in the agri-food sector.

Five key principles

Through significant engagement with farmers and growers, industry stakeholders and policy makers, the NFU has identified five key principles which, if met, would ensure the effective functioning of environmental markets for the agriculture sector.

These are:

1. Environmental markets must work alongside the domestic production of food, energy and fibre.
2. Public policy and government initiatives must support the development of private markets.
3. Environmental markets require clear rules and standards to allow farmers and buyers to participate with confidence.
4. Markets should be accessible across a range of farm sizes, tenures and business structures.
5. Farmers must be fairly rewarded for the delivery of environmental goods.

This NFU response is grounded in these five principles which must be met to deliver scalable investment in nature recovery.

In line with these principles, this NFU response focuses on:

1. A more strategic approach to natural flood management.
2. Defining the role of insetting to align economic incentives for food production with environmental delivery.
3. The role of a suitable governance framework to address leakage risk.
4. The importance of harmonised monitoring, reporting and verification protocols for multifunctional outcomes including for carbon, water and biodiversity.
5. The need to unlock the potential of stacking to improve the economic viability of projects.
6. Enhancing the ability to invest in positive outcomes for nature.
7. Establishing international trade standards to ensure lower standard imports do not undermine the environmental and economic case for investment.

»Ê¼Ò»ªÈËlooks forward to engaging further to support opportunities for private sector investment into nature.

Defra's call for evidence supports the further development of policies to increase private sector investment in protecting and improving nature. 

Written submissions were requested to be submitted by 11:59pm on 7 August 2025.

Visit