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4 October 2023 |

Report supports increase community benefits

A feasibility study published today by SCDI supports the creation of a not-for-profit organisation that will deliver greater benefits for rural communities from the growing private investment in restoring Scotland’s natural environment.

Funding for Scotland’s natural environment has been increasing, including from private investors in projects that generate carbon credits with which to offset carbon emissions. However, concerns remain about a large gap between the funding available and what will be needed, and that the current corporate-led investment model in land and projects will limit opportunities for communities to own and have a say over local land, and to benefit from higher investment.

The Scottish Government is working to mobilise responsible private investment in Scotland’s natural environment and a range of business models are at varying stages of development. The study – on which SCDI partnered with Community Land Scotland, Forestry and Land Scotland, John Muir Trust, NatureScot and the Scottish Land Commission – explored the creation of a distinctive and innovative community focused vehicle to scale up investment.

The vehicle’s strength would be its working partnerships with communities and investors to catalyse nature-based solutions and empower people to solve deep-rooted local problems. This would de-risk the market for responsible investors, communities and the natural world.

Sara Thiam, Chief Executive of SCDI, said: “SCDI’s Rural Commission made clear the need to nurture and harness Scotland’s abundant natural assets to address the challenges rural communities face. Responsible, private investment is one of the vital ways in which funding can be increased, however there is concern that the current model of carbon offsetting projects will not build sustainable local economic prosperity. The proposed vehicle would catalyse changes in local energy, housing, skills, enterprise and supply chains that build community wealth, repopulate places and unblock rural areas’ full contribution to our national prosperity.”

Cabinet Secretary for Rural Affairs, Land Reform and Islands Mairi Gougeon, added:

“We welcome SCDI’s report and we will look closely at the evidence and recommendations within it. We agree that public and responsible private investment in Scotland’s natural capital will be essential to meeting our climate and nature targets.

“As set out in our new Programme for Government, we are committed to taking forward our distinctive natural capital market vision in Scotland – a market for responsible investment that contributes to a just transition by benefitting the environment and supporting communities.

“We want to work with our partners and stakeholders, including SCDI, to shape the emerging green finance market in Scotland and deliver the best outcomes for people and nature.”

The not-for-profit, non-governmental organisation would attract responsible investments from a range of private investors, and blend this with other sources of funding, in order to:

  • Buy land in Scotland on the market with the potential to deliver positive solutions
  • Sell, lease or transfer assets on the land to communities and local organisations
  • Invest in high-integrity, nature-based solutions on the remaining land which would:
  • Be sold on the market to individuals, organisations and businesses
  • Deliver lasting benefits to the local economies and environments
  • Deliver financial returns and wider outcomes for investors and the vehicle