Sustainable Finance Design and Valuation of Ecosystem Services: An Expert Stakeholder Analysis

Optimising the balance between the ecosystem services provided by agriculture and those provided by forestry has been a challenge for stakeholders and policymakers across Europe. While afforestation supports several ecosystem services, existing market structures and government policies have failed to effectively support afforestation. To overcome this challenge, novel financial instruments are needed to compensate for the opportunity cost of transitioning land from agriculture to forestry. This study leverages expert knowledge via a Delphi survey to identify effective financial mechanisms for the promotion of native afforestation which go beyond the existing government forestry subsidy programs. The results of this study suggest that land-use stakeholders recognise the local and national environmental benefits of native afforestation, while also understanding the economic and financial challenges which currently hamper native forestry growth. These results identify a need for novel financial supports to make the land-use transition to native forestry financially feasible and economically attractive to landowners over the long term.