Caroline is an Associate Director in the Environment team at Osborne Clarke, working with clients from a wide range of sectors on all aspects of environmental and sustainability law, with a particular focus on natural capital.
Having recently had the pleasure of visiting a nature-based project delivered via an EnTrade environmental market, it seemed a good moment to reflect on what is working well in UK legislation and policy relating to nature markets and what the current gaps are.
Biodiversity net gain, nutrient neutrality and the TNFD
As an environmental lawyer working in the field of natural capital and biodiversity, there does seem to be more focus from business on its impact on nature. Legal requirements like biodiversity net gain (BNG) and nutrient neutrality are becoming more routine, whilst voluntary reporting of biodiversity impact is growing through the Taskforce for Nature-related Financial Disclosures (TNFD). The TNFD's Status Report from September 2025 confirms that by July 2025 620 organisations had publicly committed to getting started with reporting aligned with the TNFD recommendations, up from 320 in January 2024.
Although BNG has been slower to get off the ground than expected and some still have their reservations (https://www.wcl.org.uk/biodiversity-net-gain-one-year-on.asp), we are working on an increasing number of transactions that have a BNG element. It does seem that BNG and nutrient neutrality are increasingly understood by developers and gradually becoming just another part of the planning process.
Government policy on nature markets
There have also been some encouraging noises from the UK government, including its nature markets framework, published in March 2023, and the nature investment standards developed by the British Standards Institution in partnership with Defra, the devolved administrations and industry. The potential benefits of high integrity nature markets do seem to be recognised by policy-makers.
Policy uncertainty
In spite of the encouraging noises referred to above, the development of nature markets is currently being hampered by policy uncertainty. For example, the changes proposed in the Planning and Infrastructure Bill sow doubt in the legislative landscape, suppressing demand for credits and therefore delaying the development and proliferation of nature markets.
An incidental impact of this is that greater demand would lead more quickly to standardised documentation and greater sophistication amongst market participants. This in turn could bring down costs as agreements could be better understood and put in place more quickly.
Complex and fragmented legislation
UK law for the protection of nature is a complex area. One of the key original pieces of environmental legislation dates back to the post-war period, with the 1949 National Parks and Access to the Countryside Act, and since then the law in this area has evolved as a result of both EU influence and national drivers. An internet search shows not just how many different pieces of legislation there are but also that the legal landscape is continuing to change significantly, most recently with the Environment Act 2021 and with more change on the horizon should the Planning and Infrastructure Bill become law later this year, as many expect.
This fragmented approach creates a system that is complex to navigate and difficult to regulate. This was highlighted by Dan Corry in his review of whether Defra’s regulatory landscape (the regulators and regulations) is fit for purpose in driving both economic growth and nature recovery.
What needs to be done to catalyse the development and proliferation of nature markets in the UK is of course a highly complex area and this blog has a small word limit, so does not even scratch the surface. However, to quote Corry on next steps:
"While this review is not calling for major institutional change or for a bonfire of regulations, it is calling for a radical repositioning and repurposing of environmental regulation. As system theory shows us, if you can work out the key inhibitors and target them, then a group of ‘smaller’ changes can fundamentally change the way a system works."
To consider this in the context of high integrity nature markets, they are a ready-made mechanism that could enable the UK government to facilitate some of this system change. Nature markets can deliver projects with considerable benefits to the environment and market participants. A key part of the design of the EnTrade environmental markets is that they are accessible to small and large-scale landowners and developers and have also purposefully been designed to accommodate other types of environmental credit.
Perhaps as part of the changes brought about by the Planning and Infrastructure Bill, there will be a seat at the table for operators of high integrity nature markets so that the benefits they bring can be considered as a delivery method for projects that are better for nature and for those involved.
Caroline Bush (LinkedIn)
Associate Director, Osborne Clarke (LinkedIn)
October 2025
