About  |   Contact  |  Mongabay on Facebook  |  Mongabay on Twitter  |  Subscribe
Rainforests | Tropical fish | Environmental news | Blog | For kids | Madagascar | Photos | Non-English languages | Tropical Conservation Science | Jobs
SHARE:




Can wildlife conservation banking generate investment returns?
Rhett A. Butler, mongabay.com
November 27, 2007




A commercial venture in the Malaysian rainforest will seek to generate competitive returns on investment by protecting wildlife. The scheme -- signed by the Sabah government and Sydney-based New Forests Pty Ltd -- will establish a wildlife habitat conservation bank to manage the 34,000 ha Malua Forest Reserve on the island of Borneo.

Using money from its asset management business, New Forests will to fund rehabilitation and protection of Malua Forest Reserve, a tract of rainforest that supports orangutans and other endangered species. To generate financial returns for investors, New Forests will sell the value of the "forest conservation outcomes" as biodiversity protection credits to palm oil developers, energy firms, and other businesses seeking to provide consumers with environmentally sustainable products including eco-friendly biodiesel. New Forests says the program -- modeled after the U.S. endangered species banking market -- is the first-of-its-kind in Borneo.


Rainforest in Sabah on the island of Borneo. Photo by Rhett Butler
"The objective of the Sabah Government and New Forests is to create a winning situation for all: palm oil companies can help protect rainforest, private investment can make a return from rainforest rehabilitation and conservation, and the Government can offer a solution to current concerns around oil palm plantation," said David Brand, Managing Director of New Forests. "We hope that via a commercial approach to conservation, we may be able to contribute to a sustainable landscape on Borneo that includes palm oil, timber production and wildlife conservation all being managed on a commercial basis in harmony."

Environmentalists say Malaysia's rapid expansion of oil palm plantations over the past decade have come at the expense of biodiverse rainforests that are store large amount of carbon and are home to endangered orangutans, rhinos, and forest elephants. Facing criticism from green groups and potential sanctions in consumer markets, some palm oil producers are working to clean up their operations. Last week the industry-led Round Table on Sustainable Palm Oil (RSPO) announced new criteria for "greener" palm oil production.

The new initiative will give palm oil producers another option in protecting regional biodiversity and forests. It may also provide attractive returns for investors. Mr. Brand says that from a financial standpoint, conservation could be competitive with other types of land use.

"The conservation banking business in the USA is a private equity style business and seeks returns in the 15-25% real IRR range," Mr. Brand told mongabay.com. "We expect if we are successful here we can generate similar or better returns, which should be competitive with the alternative land uses such as palm oil plantations. In fact that is central to what we have argued to the government--that conservation may ultimately become as if not more commercially attractive than conversion of the forest.





CITATION:
Rhett A. Butler, mongabay.com (November 27, 2007). Can wildlife conservation banking generate investment returns?. http://news.mongabay.com/2007/1127-palm_oil.html


Tags:
environment ecosystem services ecological services forests rainforests asia borneo malaysia bold and dangerous ideas that may save the world environmental economics economics wildlife conservation rainforest conservation saving rainforests biodiversity green

print


News index | RSS | News Feed | Twitter | Home


Advertisements:


Organic Apparel from Patagonia | Insect-repelling clothing




Mongabay Store
Wildlife of Madagascar T-shirt
Wildlife of Madagascar T-shirt
Bold and Dangerous - Pygmy tyrant t-shirts
Bold and Dangerous - Pygmy tyrant
Love me before I'm gone - Gladiator frog t-shirts
Love me before I'm gone - Gladiator frog
Licking this frog may make you crazy t-shirts
Licking this frog may make you crazy





WEEKLY NEWSLETTER
Email:





SUPPORT
Mongabay.com seeks to raise interest in and appreciation of wild lands and wildlife, while examining the impact of emerging trends in climate, technology, economics, and finance on conservation and development (more)

Help support mongabay.com when you buy from Amazon.com



POPULAR PAGES
Rainforests
Rain forests
Amazon deforestation
Deforestation
Deforestation stats
Why rainforests matter
Saving rainforests
Deforestation stats
Rainforest canopy

News
Most popular articles
Worth saving?
Forest conservation
Earth Day
Poverty alleviation
Cell phones in Africa
Seniors helping Africa
Saving orangutans in Borneo
Palm oil
Amazon palm oil
Future of the Amazon
Cane toads
Dubai environment
Investing to save rainforests
Visiting the rainforest
Biomimicry
Defaunation
Blue lizard
Amazon fires
Extinction debate
Extinction crisis
Blackwashing
Industrial deforestation
Save the Amazon
Rainforests & REDD
Brazil's Amazon plan
Malaysian palm oil
Avatar story
New Guinea
Sulawesi
Amazon ranching
Madagascar
Borneo

News topics
Amazon
Biofuels
Brazil
Carbon Finance
Conservation
Climate Change
Deforestation
Energy
Happy-upbeat
Indonesia
Interviews
Oceans
Palm oil
Rainforests
REDD
Solutions
Wildlife
MORE TOPICS



Non-English Sites
Chinese
French
German
Greek
Indonesian
Italian
Portuguese
Spanish
Other languages

Search








Photos
Alaska photos
Alaska

Argentina photos
Argentina

Australia photos
Australia

Belize photos
Belize

Brazil photos
Brazil

Cambodia photos
Cambodia

China photos
China

Colombia photos
Colombia

Costa Rica photos
Costa Rica

Deforestation photos
Deforestation

Frog photos
Frog

Gabon photos
Gabon

Grand Canyon photos
Grand Canyon

Honduras photos
Honduras

India photos
India

Indonesia photos
Indonesia

Kenya photos
Kenya

Laos photos
Laos

Lemur photos
Lemur

Madagascar photos
Madagascar

Malaysia photos
Malaysia

Monkey photos
Monkey

New Zealand photos
New Zealand

Panama photos
Panama

Peru photos
Peru

Peru photos
Rainforest


Sunset

Suriname photos
Suriname

Tanzania photos
Tanzania

Thailand photos
Thailand

Uganda photos
Uganda

United States photos
United States

Venezuela photos
Venezuela



HIGH RESOLUTION PHOTOS / PRINTS


CALENDARS
  • Mount Kenya
  • East Africa Safari Wildlife
  • Kenya's Turkana People
  • Peru
  • African Wildlife
  • Alaska
  • China
  • Madagascar Chameleons


    CANVAS BAGS

  • Hallucinogenic frog bag
  • Madagascar wildlife bag








  • Copyright mongabay 2010

    Carbon dioxide (CO2) emissions generated from mongabay.com operations (server, data transfer, travel) are mitigated through an association with Anthrotect,
    an organization working with Afro-indigenous and Embera communities to protect forests in Colombia's Darien region.
    Anthrotect is protecting the habitat of mongabay's mascot: the scale-crested pygmy tyrant.