Putting a Price on Nature through Environmental Asset Ratings

Let’s start with the basics. 

What is a rating system?

In finance, a rating system is a structured method to assess the creditworthiness or reliability of a country, company, or financial asset. Ratings distill complex economic, financial, and political information into a score that helps investors understand the risk associated with lending or investing.

For example, sovereign credit ratings evaluate a country’s economic and political stability. Corporate ratings assess the financial health of companies and securities. Global agencies like Moody’s, Standard & Poor’s, and Fitch assign these ratings, and they are fundamental to investment decisions and market confidence.

How did rating systems emerge?

Rating systems have deep roots. In the 1800s, the rapid expansion of the U.S. railroad system created enormous capital needs. As companies rushed to finance infrastructure, a boom in railroad bond issuance followed, outpacing even sovereign debt markets by the early 1900s.

With this surge came new risks-especially for transatlantic investors who lacked reliable information. Traditional networks of trust were no longer enough. Investors needed standardized, independent evaluations.

In 1849, Henry Varnum Poor began publishing financial data on railroad companies, laying the groundwork for transparent corporate finance. In 1909, John Moody took it further, issuing the first modern credit ratings. By 1924, Fitch introduced the familiar AAA to D scale. These early systems made markets more transparent and investable.

Crises and the Strengthening of Ratings

Every major financial crisis has reinforced the need for reliable, independent ratings.

• The 1929 stock market crash highlighted the dangers of unchecked risk, driving widespread adoption of bond ratings. By 1931, U.S. regulators recognized ratings as formal measures of bond quality for banks.
• The 1970 Penn Central Railroad default reignited the demand for objective risk assessments. This spurred the rise of the issuer-pays model and the creation of Nationally Recognized Statistical Rating Organizations (NRSROs) by the SEC in 1975.
• The 2008 financial crisis exposed failures in the system. Credit Rating Agencies were criticized for inflated AAA ratings on risky mortgage-backed securities, which fueled the subprime meltdown. In response, regulations like the Credit Rating Agency Reform Act (2006) and Dodd-Frank (2010) tightened oversight in the U.S., while Europe created its own supervisory frameworks, including ESMA.

The lesson: transparent, auditable ratings are essential to protecting investors and safeguarding markets.

Why Environmental Assets Are Still Invisible

Environmental assets have not been treated the same as financial ones, despite their critical role-providing services like air quality improvement, climate stabilization, carbon sequestration, water purification, and soil fertility.

Why? Several reasons:

1. Intangibility and Complexity: Natural assets are multi-dimensional, localized, and difficult to standardize.
2. Lack of Scalable Data: Until recently, large-scale, reliable environmental data was scarce.
3. Public Good Dilemma: Ecosystem services often have no price because they benefit everyone, making markets hard to establish.
4. Fragmented Regulation: Unlike finance, environmental governance has been voluntary and inconsistent-though frameworks like TNFD, CSRD, and ISSB are changing that.
5. Perceived Low Investability: Nature was seen as a cost to protect, not an asset generating measurable returns or reducing risk.

And yet, nature’s economic importance is undeniable. The World Economic Forum (2020) estimates that $44 trillion-over half of global GDP-is moderately to highly dependent on nature.

Early Efforts to Value Nature

Early on, environmental economics provided important valuation methods - such as hedonic pricing, contingent valuation, and ecosystem service pricing - to assign monetary values to natural assets and their benefits. These approaches laid the theoretical foundation for integrating nature into economic decision-making.

Building on this groundwork, initiatives like the Natural Capital Coalition (now Capitals Coalition) launched the Natural Capital Protocol, offering a structured framework for businesses to identify, measure, and value their dependencies and impacts on natural capital.

At the same time, companies like Kering pioneered Environmental Profit & Loss (EP&L) accounts, assigning monetary values to environmental impacts across their supply chains, bringing natural capital valuation into corporate accounting and strategic planning.

These were important first steps, but they faced challenges:

• Manual, expensive data collection.
• No common standards for comparability.
• Limited market and regulatory incentives.

Today, the landscape is changing.

Advances in digital Monitoring, Reporting, and Verification (dMRV), satellite imagery, AI-driven modeling, and growing regulatory pressure are making it possible to systematically measure and rate environmental assets.

Just like financial ratings simplify complex corporate risk, environmental ratings can turn ecosystem conditions into investment-grade information. Natural capital assets can-and should-be evaluated across three dimensions:

• Extension (area),
• Quantity (volume), and
• Quality (functionality).

Why does this matter? Because the ecosystem services they provide-carbon storage, water filtration, resilience to drought-depend on these attributes.

A Practical Example

Imagine two farms applying for a loan:

• Farm A has healthy, carbon-rich soils and high biodiversity, making it more resilient to climate shocks.
• Farm B has degraded, low-organic soils and minimal biodiversity, increasing its vulnerability.

Both might appear identical based on traditional credit data-land title, crop type, assets-but Farm A carries lower agronomic and financial risk and probably also a lower carbon credit potential.

Yet today, natural capital risks and opportunities are not factored into loan risk assessments. Why?

1. Natural capital is not formally recognized as a financial asset.
2. There is no scalable, standardized system to measure and rate it-yet.

Why Environmental Ratings Matter?

A strong environmental asset rating system does three critical things:

1. Simplifies complexity: Distilling multi-dimensional nature data into an understandable score that links environmental assets to financial risks and opportunities.
2. Creates comparability: Allowing investors and institutions to benchmark across geographies and projects.
3. Drives behavior: Influencing financial terms, regulatory incentives, and market preference toward sustainability.

Finance doesn’t need reinventing - it needs completing. We already have sophisticated, scalable financial systems. What’s missing is a single layer that links investments to natural capital: environmental asset ratings.

For centuries, structured ratings have fueled capital markets. Now, by embedding nature’s ratings into existing frameworks, we can link environmental degradation directly to compliance, physical, financial, reputational, and transition risks.

In short, rating nature can unlock a financial system that recognizes natural capital as real capital-pricing risk properly and rewarding those who steward ecosystems wisely.

LandPrint Ratings: Turning Nature into a Financial Asset

At LandPrint, we believe unlocking the value of nature requires more than reporting - and more than new financial structures. It requires measuring environmental assets and rate them through a clear risk and opportunity lens that the financial sector can easily relate to. While frameworks like TNFD, CSRD, and ISSB are advancing disclosure standards, they focus on what should be reported - not how to measure natural capital or link those measurements to physical and financial risks and opportunities in actionable terms.

True standardization remains elusive. As with credit ratings over 150 years ago, the path forward may be regulatory decrees backed by the private sector - with environmental asset ratings leading the way.

This is precisely where LandPrint delivers a breakthrough.

We develop modular, evolutive measurement systems that adapt to local conditions. Our ratings measure the natural assets that result from the adoption of regenerative farming practices and translate them into productive resilience - the capacity to maintain economic performance in a rapidly evolving climate and market landscape. By connecting practices to natural capital improvements and economic outcomes, we provide clear signals: what farmers and entire supply chains are doing, how they are restoring natural systems, and how that strengthens financial resilience. 

We start with public datasets to meet baseline compliance needs - for instance, integrating 17 key environmental databases in Brazil - and expand from there, building higher-accuracy layers with ground and satellite data tailored to the partner’s operations. Together, we assess existing data, refine its quality, and build a centralized infrastructure that evolves over time - improving efficiency, compliance, and strategic value. 

We begin with a standardized foundation to ensure data homogeneity and also compatibility with reporting standards, but our approach remains highly customizable to address the unique needs of each partner. We combine consolidated and proprietary methodologies with the best available data sources and have the in-house expertise to develop bespoke measurement protocols - designed for partners committed to valuing nature as real capital.

Through this journey, we gradually connect natural capital from compliance data to financial, physical, reputational and transitional risks. Working closely with our partners, we create a dynamic model that strengthens as information accumulates. Over time, this enables them to demonstrate clear causality between farm management, natural capital regeneration and reduced investment risk, while also building customized business intelligence that improves the production system and puts a tangible value on nature. We build data infrastructures not just for compliance, but to actively reshape risk and opportunities profiles and unlock new financial value.

Our environmental assets ratings are not static snapshots. They are dynamic benchmarks: we measure where supply chains are today, where they could go, and what resources are needed to get there - all grounded in measurements and/or science-based models of ecosystem potential.

In short, LandPrint ratings turn nature into a real, investable asset - one customized journey at a time.

If you’re ready to transform nature from a reporting burden into an investment-grade asset, let’s talk!