Planting for Quality: The Shift to Native Species
One of the most debated topics in afforestation, reforestation and revegetation (ARR) carbon projects is the choice between planting native or non-native species. The stakes are high: the decision can determine whether a project delivers lasting environmental benefits or falls short of market expectations.
Commercially valuable non-native monocultures can generate revenue yet are often criticized for displacing biodiversity, altering water cycles and reducing soil carbon.1 Native species generally provide greater long-term carbon-storage potential and stronger ecosystem resilience, aligning with growing buyer demand for credits that deliver biodiversity benefits and other co-benefits alongside carbon removal.
The requirements in recognized protocols and standards vary widely. For example, Isometric’s Reforestation Protocol2 allows non-native species only when planting natives would pose greater ecological risk, while Ecosystem Restoration Framework requires only native species to be used in restoration projects. Verra’s Standard initially prohibited non-native monocultures but later loosened its rules.3
MSCI Carbon Markets data indicates that the ARR market is moving ahead of existing protocols and steadily shifting away from non-native monocultures. An analysis of more than 210 ARR projects and nearly 50 pipeline projects with an MSCI Carbon Project Rating shows a significant trend toward native species: Since 2000, the share of projects planting exclusively native species has risen from under 10% to around one-third. This suggests that developers are voluntarily going beyond minimum requirements, anticipating both tighter future standards and growing demand for biodiversity-rich credits.
For investors, native-species projects may offer the rare combination of financial upside and impact credibility — credits that store carbon reliably, command market premiums and deliver nature-positive outcomes.
Based on data from 2000 to 2025 for 260 ARR projects (210 registered and 50 in pipeline). Native projects are defined as projects planting over 75% native species, partial projects are defined as projects planting between 25% and 75% native species. Source: MSCI ESG Research
Subscribe todayto have insights delivered to your inbox.
State of Integrity in the Global Carbon-Credit Market
This report describes the methodology of the MSCI Carbon Project Ratings and finds that of the more than 4,000 projects assessed, fewer than 10% are rated in the AAA-A band. There are, however, some encouraging signs of a trend to increasing integrity.
Project and Country Risk — New Bedfellows of the Article 6 Market
We review the new MSCI Article 6 Integrity Framework, designed to help investors and buyers assess risks and opportunities specific to Article 6, an important part of the global credit market.
MSCI Carbon Project Ratings
Assess the integrity of more than 4,000 carbon projects with our independent, in-depth assessments used by investors, carbon credit buyers and developers market-wide. As of Sept. 18, 2024.
1 Alice Di Sacco, Katie A. Hardwick, David Blakesley et al. “Ten golden rules for reforestation to optimize carbon sequestration, biodiversity recovery and livelihood benefits.” Global Change Biology, Jan. 25, 2021.
2 Isometric is recognized as CCP-eligible according to the Integrity Council for the Voluntary Carbon Market (ICVCM), suggesting a high level of governance and credibility in the market.
3 “Verra Releases Version 4.6 of the VCS Standard,” Verra, March 21, 2024.
The content of this page is for informational purposes only and is intended for institutional professionals with the analytical resources and tools necessary to interpret any performance information. Nothing herein is intended to recommend any product, tool or service. For all references to laws, rules or regulations, please note that the information is provided “as is” and does not constitute legal advice or any binding interpretation. Any approach to comply with regulatory or policy initiatives should be discussed with your own legal counsel and/or the relevant competent authority, as needed.