Table 2.

Approaches to addressing the theoretical and practical challenges of applying the mitigation hierarchy, with particular focus on the offsetting step, based on practical experience to date (as articulated in, e.g., Bull et al. 2013, BBOP 2012).

Challenge	Description	Current project-level best practice recommendations	Conceptual examples of global-level best practice
Additionality	Whether an intervention has an effect, when the intervention is compared to a baseline	Only biodiversity benefits that are additional to a baseline scenario count as valid offsets.	Nations required to account for offset-funded biodiversity protection (alongside associated biodiversity losses that triggered offset) separately from biodiversity protection going toward existing global conservation commitments (e.g., CBD Aichi target 11; Maron et al. 2015b).
Compliance and monitoring	Noncompliance with mitigation hierarchy; insufficient compensation resulting in lack of incentive; legislative changes during development	Ensure relevant authorities follow up with monitoring to ensure compliance.	No net loss impact to biodiversity targets are made legally binding where possible (e.g., for all UN fisheries through UNCLOS, requiring stipulation of defined baselines, indicators, and best-practices implementation); global-level monitoring and evaluation program created; requirements for national-level reporting to international body (e.g., CBD).
Biodiversity indicators	Unitary measures of biodiversity lost, gained, or exchanged	Use multiple or compound indicators; incorporate measure of ecological function as well as biodiversity.	Use established mechanisms to develop and test indicators (e.g., the Biodiversity Indicators Partnership, which evaluates the CBD Aichi targets and biodiversity SDGs): www.bipindicators.net.
Equivalency	Demonstrating equivalence between biodiversity losses and gains	Encourage “in-kind” or like-for-like trades, and prevent “out-of-kind” trading unless “trading up” from losses that have little or no conservation value; ensure that there are requirements for spatial constraints within which biodiversity offsets will and will not be considered.	An international governing body, such as the United Nations, stipulates that biodiversity offsets are restricted to “in-kind” trades implementable within a predetermined radius of the impact site, based on ecologically meaningful scales for the biodiversity concerned.
Least cost	Guiding actions economically by costs so that efficiency dictates that each hierarchical step be undertaken to the point at which marginal costs are equalized	Ensure offset cost is set at a sufficient level to incentivize adherence to avoidance and minimization steps higher up in the mitigation hierarchy.	Evidence that alternate scenarios representing actions higher up the mitigation hierarchy have been investigated, and their ruling out is justified prior to any offsets commencing. Require this to be recorded in Environmental and Social Impact Assessments and submitted by all signatory nations to the international governing body. Free public access to reports is granted.
Longevity	The length that an offset scheme should endure	Offsets should last the length of the negative impacts at a minimum; offsets should be adaptively managed in the light of ongoing external change.	Nations are required to adopt the stipulated time period for agreed-on global biodiversity goals and to enforce regulation that ensures the longevity of biodiversity offsets. Failure to successfully manage offsets for their necessary lifetime would result in censure.
Multipliers	A factor that increases the amount of biodiversity gains required by an offset	Calculation of multiplier is based on various factors (e.g., discount rate for future biodiversity gains and uncertainty in definition and measurement of biodiversity).	Legal requirements are put in place to ensure that appropriate biodiversity offset calculators are used for all offset projects, ensuring a minimum biodiversity offset multiplier accounts for the time discounting, additionality, and permanence of the project (e.g., Laitila et al. 2014).
Reversibility	Defining a development's reversibility	Ensure all biodiversity losses are reversible; otherwise, categorize the affected biodiversity as a no go.	Nations’ goals for preventing species extinction and ecosystem collapse would be required to map onto international goals, with international reporting requirements concerning compliance and monitoring.
Substitutability	The degree to which the “value” of a certain biodiversity type influences demand for one or more other biodiversity types	Base the value of biodiversity types on national legislation and societal value.	Clarify and justify when one ecosystem, species, or population is seen as equivalent to another and therefore tradable.
Thresholds	Areas or components of biodiversity that should not be compensated for because they are too important	Define explicit thresholds for biodiversity losses and gains that cannot be offset.	Internationally recognized no-go zones for biodiversity offsets such as the Protected Area network, Key Biodiversity Areas, crisis ecoregions, and the Wildlife Conservation Society's Last of the Wild places; consideration is also given to aspects of human development, which should not be traded off because of their contribution to the future of humanity, such as adequate safe water for all.
Time lag	Deciding whether to allow a temporal gap between development and offset gains	Incorporate a preoffset step in the form of mitigation banking.	A preimpact conservation gain requirement could be built into international funding for economic development.