OA and Project-Level Finance

TG-1.8 Section 1: Using Ocean Accounts in Decision-Making Applied Draft

Circular ID	TG-1.8
Version	8.0
Badge	Applied
Status	Draft
Last Updated	February 2026

1. Outcome

1After reading this Circular, conservation finance practitioners and project developers will be able to use Ocean Accounts to structure, verify, and report on project-level finance instruments, including debt-for-nature swaps, blue bonds, and payments for ecosystem services. The guidance explains how accounting frameworks strengthen the design and impact reporting of ocean-focused financial instruments. Decision-makers can then evaluate project-level interventions using internationally standardised baseline information.

2The 2025 System of National Accounts recognises sustainable finance as a measurement domain, defining ESG (Environmental, Social, Governance) finance and green finance as components of financial instruments that sustain or improve environmental and social conditions.¹ Ocean Accounts operationalise these concepts for marine contexts by providing the structured data needed to assess ocean-related risks, dependencies, and opportunities. Sustainable ocean finance directly supports SDG 14 (“Life Below Water”) targets, including Target 14.7 on increasing economic benefits from sustainable use of marine resources.² The Kunming-Montreal Global Biodiversity Framework Target 15 calls on businesses and financial institutions to regularly monitor, assess, and transparently disclose their nature-related risks, dependencies, and impacts, a requirement that Ocean Accounts can support.³

3Decision Use Cases

4Project-level finance decisions supported by Ocean Accounts include:

1. 5

   Cost-benefit analysis for restoration projects — Using ecosystem service values from Ocean Accounts to assess whether expected benefits of mangrove restoration, seagrass rehabilitation, or coral reef protection exceed project costs over the relevant time horizon.⁴

2. 6

   TNFD-aligned impact reporting — Demonstrating changes in ecosystem condition, extent, and service provision resulting from financed activities, meeting TNFD disclosure requirements for nature-related impacts and dependencies.⁵

3. 7

   Project ROI assessment — Calculating return on investment for blue economy projects by quantifying multiple ecosystem service benefits (carbon sequestration, coastal protection, fisheries habitat, tourism amenity) using comparable monetary valuation methods from TG-1.9 Safe Usage of Monetary Valuation.⁶

4. 8

   Baseline and counterfactual scenarios — Establishing pre-project conditions and projected no-action baselines against which project impacts can be measured, enabling additionality demonstration required by carbon credit standards and impact investors.⁷

9This Circular is relevant to project developers, conservation finance practitioners, sovereign debt managers, development finance institutions, and account compilers supporting sustainable ocean finance initiatives. The guidance builds on the multilateral finance context described in TG-1.7 OA and Multilateral Development Finance, the valuation methods presented in TG-1.9 Safe Usage of Monetary Valuation, and the ecosystem asset foundations in TG-3.1 Assets. It also supports the ecosystem-specific accounting methodologies in TG-6.2 Mangrove and Coastal Wetland Accounting and TG-6.3 Seagrass Ecosystem Accounting, which provide blue carbon measurement foundations relevant to many of the finance instruments discussed here.

2. Requirements

1Essential prerequisites:

• 2TG-0.1 General Introduction to Ocean Accounts — for the conceptual framework and key components of Ocean Accounts
• 3TG-1.7 OA and Multilateral Development Finance — for the multilateral finance context and how development finance institutions engage with ocean accounting

4Helpful background:

• 5TG-1.9 Safe Usage of Monetary Valuation — for appropriate valuation methodology selection and the exchange value hierarchy
• 6TG-3.1 Assets — for ecosystem asset accounting foundations and natural capital measurement
• 7TG-2.6 Ocean-related Investment — for investment indicator compilation using the GFCF framework
• 8TG-6.2 Mangrove and Coastal Wetland Accounting — for blue carbon accounting in mangroves and coastal wetlands
• 9TG-6.3 Seagrass Ecosystem Accounting — for seagrass carbon and ecosystem services measurement
• 10TG-6.9 Offshore Energy Thematic Methods — for project-level accounting in offshore renewable energy developments

11Framework Position

12This Circular addresses how ocean accounts support project-level ocean finance by quantifying asset-level monetary flows, project contributions to social conditions, and ecosystem service returns on investment. In the Ocean Accounts Framework (TG-0.1 Figure 0.1.2):

Edge	Direction	Description
E3	FG1↔SG1	Monetary flows between assets and economic sectors
E5	FG1→SG2	Economic contributions to social conditions
E9	SG3→FG1	Ecosystem services to economy

3. Guidance Material

3.1 Blue Bonds and Ocean-Linked Securities

1Blue bonds are debt instruments where proceeds are earmarked for ocean conservation, sustainable marine resource management, or ocean-based climate adaptation.⁸ Ocean Accounts provide the foundational information architecture needed to structure, monitor, and verify blue bond instruments.

2Structuring Blue Bonds with Account Data

3Ocean Accounts support blue bond structuring in several ways:

1. 4

   Baseline establishment. Ecosystem extent and condition accounts establish pre-project baselines for marine natural capital assets such as mangroves, seagrass meadows, coral reefs, and fish stocks. These baselines are essential for defining conservation targets and measuring additionality.⁹

2. 5

   Service quantification. Ecosystem service flow accounts quantify the value of services such as coastal protection, carbon sequestration, and fisheries production that blue bond proceeds aim to protect or enhance. The SEEA EA provides internationally recognised methodologies for valuing these services using exchange value concepts consistent with national accounts.¹⁰

3. 6

   Verifying use of proceeds. Physical supply and use tables track how marine resources and ecosystem services are used, supporting verification that bond proceeds support intended ocean-positive activities.

4. 7

   Measuring outcomes. Time-series account data records changes in ecosystem extent, condition, and service delivery, providing the basis for impact reporting to bondholders and regulators.

8Sustainability-Linked Bond Structures

9Beyond use-of-proceeds bonds, Ocean Accounts support sustainability-linked bonds (SLBs) where bond characteristics such as coupon rates are tied to achieving pre-defined sustainability performance targets.¹¹ Account data can inform key performance indicators (KPIs) for ocean-linked SLBs, including:

• 10Changes in marine protected area extent (from extent accounts)
• 11Improvements in reef or mangrove ecosystem condition scores (from condition accounts)
• 12Sustainable fisheries catch rates relative to maximum sustainable yield (from flow accounts)
• 13Blue carbon sequestration rates (from carbon accounts)

14In the Ocean Accounts Framework (TG-0.1), these project-level monetary flows correspond to Edge E3 (monetary flows between assets and economic sectors). The 2025 SNA recommends compilation of supplementary measures for sustainability-linked debt securities as “of which” items within the financial accounts framework, which facilitates monitoring of these instruments.¹² For the multilateral finance context of SLBs and the blue bond KPI framework, see TG-1.7 OA and Multilateral Development Finance, Section 3.6.

15Blue Bond KPI-Account Mapping

16Table 1: Blue Bond KPI-Account Mapping

KPI Category	Example KPI	Account Source	Measurement Frequency
Biodiversity	Coral cover (%)	Condition accounts	Annual
Water quality	Nutrient loading	Residual flow accounts	Quarterly
Carbon	Blue carbon sequestration	Carbon stock accounts	Annual
Livelihood	Fishing employment	Economic accounts	Annual

17This mapping enables issuers to draw directly on compiled Ocean Accounts when preparing bondholder impact reports. For guidance on compiling the underlying condition and extent accounts referenced in Table 1, see TG-3.1 Assets.

3.2 Debt-for-Nature Swaps

1Debt-for-nature swaps involve the restructuring of sovereign debt in exchange for commitments to conservation investments and outcomes. Ocean Accounts provide the technical foundation for quantifying conservation commitments, monitoring implementation, and verifying outcomes in marine debt swaps.

2Quantifying Conservation Commitments

3When structuring debt-for-nature swaps, parties must agree on the nature and scale of conservation commitments that justify debt relief. Ocean Accounts support this process by providing:

1. 4

   Asset Valuation: Monetary ecosystem asset accounts estimate the present value of expected ecosystem service flows from marine natural capital.¹³ These valuations inform negotiations over the conservation value being exchanged for debt relief. For guidance on appropriate valuation methods, see TG-1.9 Safe Usage of Monetary Valuation.

2. 5

   Spatial prioritisation: Spatially explicit extent and condition accounts help identify priority areas for conservation investment, so that debt swap proceeds target areas of highest ecological and economic value.

3. 6

   Commitment Specificity: Account structures provide the precision needed to define specific, measurable, achievable, relevant, and time-bound (SMART) conservation commitments, such as protecting a defined area of mangroves or achieving specified improvements in reef condition scores.

7Monitoring and Verification

8Post-swap monitoring requires systematic tracking of conservation outcomes over time. Ocean Accounts provide:

• 9Physical Accounts: Track changes in ecosystem extent (hectares of seagrass protected), condition (coral cover percentage), and flows (fish biomass sustained)
• 10Monetary Accounts: Quantify the economic value of ecosystem services protected or restored, enabling comparison with the cost of debt relief
• 11Governance Accounts: Document changes in protected area designation, management effectiveness, and enforcement capacity

12Recent Debt-for-Nature Swap Experience

13Recent debt-for-nature swaps demonstrate the growing scale and sophistication of these instruments, and the extent to which their design relies on systematic environmental data. The Seychelles debt-for-nature swap (completed 2015-2016) restructured approximately USD 21.6 million of sovereign debt in exchange for marine protected area commitments covering 30 per cent of the country’s exclusive economic zone. Belize (2021) completed a debt conversion that retired USD 553 million of sovereign debt (repurchased at a discount) and refinanced through a USD 364 million blue bond, committing the country to expanding marine protection to 30 per cent of its ocean area and maintaining a marine conservation endowment fund. Ecuador (2023) executed the largest debt-for-nature swap to date, repurchasing approximately USD 1.6 billion (face value) of commercial bonds through a new USD 656 million loan, with conservation commitments for the Galapagos Islands marine reserve. In each case, the structuring and ongoing monitoring of conservation commitments relied on systematic spatial and biophysical data that Ocean Accounts produce: ecosystem extent baselines, condition indicators, and protected area management effectiveness metrics.

14Example: Blue Carbon in Debt Swaps

15Coastal and marine ecosystems including mangroves, seagrass meadows, and salt marshes store large quantities of carbon in biomass and sediments.¹⁴ Debt-for-nature swaps increasingly incorporate blue carbon commitments, where Ocean Accounts track:

• 16Extent of blue carbon ecosystems protected (extent accounts)
• 17Carbon stock density and sequestration rates (carbon accounts)
• 18Avoided emissions from prevented ecosystem degradation (flow accounts)
• 19Economic value of carbon storage services (monetary accounts)

20For detailed methodology on blue carbon accounting, see TG-6.2 Mangrove and Coastal Wetland Accounting and TG-6.3 Seagrass Ecosystem Accounting.

3.3 Payments for Ecosystem Services

1Payments for Ecosystem Services (PES) schemes create financial incentives for maintaining or enhancing ecosystem service provision. In marine and coastal contexts, PES schemes may target services including coastal protection, water quality regulation, fisheries habitat, and carbon sequestration.¹⁵ Ocean Accounts provide the measurement foundation for designing and operating effective ocean PES schemes.

2Valuation Foundations for PES

3The SEEA EA establishes a hierarchy of valuation methods appropriate for accounting purposes, with a preference for methods based on observable market prices or revealed preferences.¹⁶ For ocean PES schemes, relevant valuation approaches include:

1. 4

   Directly Observable Prices: Where ecosystem services are already traded in markets (e.g., recreational fishing licences, dive permits), observed prices provide exchange values for accounting and PES pricing.

2. 5

   Resource Rent Methods: For provisioning services like fisheries, resource rent calculations estimate the ecosystem contribution to production by deducting labour, capital, and intermediate input costs from gross output value.¹⁷

3. 6

   Replacement Cost Methods: For regulating services like coastal protection, replacement costs estimate what it would cost to provide equivalent protection through engineered infrastructure.¹⁸

4. 7

   Productivity Change Methods: For supporting services that enhance economic production (e.g., nursery habitat supporting commercial fisheries), production function approaches estimate the marginal contribution of ecosystem inputs.¹⁹

8For detailed guidance on valuation methodology selection, see TG-1.9 Safe Usage of Monetary Valuation.

9Designing Account-Based PES Schemes

10Ocean Accounts support PES scheme design by:

1. 11

   Identifying Beneficiaries: Supply and use tables identify economic units that benefit from marine ecosystem services, informing who should pay for service provision.

2. 12

   Quantifying Services: Physical ecosystem service flow accounts measure the quantity of services provided (e.g., tonnes of carbon sequestered, hectares of shoreline protected), informing payment amounts.

3. 13

   Targeting Payments: Spatial accounts identify where ecosystem services are produced and consumed, enabling geographic targeting of payments to providers.

4. 14

   Monitoring Outcomes: Time-series accounts track whether service provision is maintained or enhanced under PES schemes.

15Limitations and Considerations

16Account compilers should note that the SEEA EA cautions against using PES payment data directly to estimate ecosystem service prices in accounts (para 9.31). In practice, many PES payments function as income support or restoration funding rather than as price signals for specific services, which further limits their direct use in accounting.²⁰

3.4 Carbon and Blue Carbon Finance

1Blue carbon ecosystems, particularly mangroves, seagrass meadows, and tidal marshes, sequester carbon at higher rates per unit area than many terrestrial ecosystems. Kelp forests are also highly productive, whilst their role in long-term carbon sequestration remains under active investigation.²¹ Carbon finance mechanisms including voluntary carbon markets, compliance markets, and results-based climate finance increasingly target blue carbon. Ocean Accounts provide essential measurement infrastructure for blue carbon finance.

2Account-Based Carbon Quantification

3Carbon accounts within the Ocean Accounts framework measure:

1. 4

   Carbon Stocks: Total carbon stored in ecosystem biomass and sediments, measured in tonnes of carbon per ecosystem type and location.

2. 5

   Sequestration Flows: Annual carbon uptake and storage by blue carbon ecosystems, providing the basis for calculating annual carbon credits.

3. 6

   Emission Flows: Carbon releases from ecosystem degradation or destruction, informing avoided deforestation/degradation (REDD+) style crediting approaches.

4. 7

   Net Carbon Balance: The difference between sequestration and emissions, indicating whether an ecosystem is a net carbon sink or source.

8Verification Requirements

9Carbon credit issuance requires measurement, reporting, and verification (MRV). Ocean Accounts contribute to MRV by:

• 10Establishing baselines against which additionality can be assessed
• 11Providing standardised methodologies for carbon quantification aligned with IPCC guidelines
• 12Enabling independent verification through transparent, replicable account compilation
• 13Supporting permanence monitoring through time-series tracking of carbon stocks

14When selecting a crediting standard, project developers should ensure that the chosen methodology aligns with the carbon quantification approaches used in the underlying Ocean Accounts. Several major voluntary carbon market standards have developed or are developing blue carbon methodologies, including the Verified Carbon Standard (VCS, administered by Verra), the Gold Standard, and the American Carbon Registry. These standards differ in their requirements for baseline setting, additionality demonstration, permanence buffers, and leakage assessment. Account compilers can support project developers by ensuring that the physical carbon stock and flow data compiled in Ocean Accounts are structured to meet the data requirements of the relevant crediting standard, whilst maintaining the methodological consistency needed for national-level reporting.

15Integration with Ecosystem Service Accounts

16Blue carbon ecosystems provide multiple ecosystem services beyond carbon sequestration, including coastal protection, fisheries habitat, and water quality regulation.²² Ocean Accounts enable integrated valuation across multiple services, informing decisions about:

• 17Stacking carbon credits with payments for other services
• 18Prioritising restoration investments based on total service value
• 19Avoiding perverse incentives that might optimise carbon at the expense of other services

20For ecosystem-specific carbon accounting guidance, see TG-6.2 Mangrove and Coastal Wetland Accounting.

3.5 Disclosure and Verification Requirements

1Project-level ocean finance increasingly operates within disclosure frameworks that require systematic reporting on nature-related risks, dependencies, impacts, and opportunities. Ocean Accounts provide the data foundation for meeting emerging disclosure requirements.

2TNFD Alignment

3The TNFD (September 2023 recommendations) specifies 14 disclosures covering governance, strategy, risk and impact management, and metrics and targets for nature-related issues.²³ Ocean Accounts support TNFD-aligned disclosure by providing:

1. 4

   Location Data: Spatial ecosystem extent accounts identify where business activities interact with ocean ecosystems, supporting TNFD Strategy Disclosure D on locations of assets in priority areas.²⁴

2. 5

   Dependency Assessment: Ecosystem service supply and use tables quantify business dependencies on marine ecosystem services, informing Strategy Disclosure A on nature-related dependencies.

3. 6

   Impact Measurement: Physical flow accounts track pressures on marine ecosystems from economic activities, supporting Risk & Impact Management disclosures.

4. 7

   Metrics and Targets: Account-derived indicators provide standardised metrics for nature-related disclosure, including ecosystem extent, condition, and service flow indicators.

8The TNFD explicitly recognises the value of sustainable finance instruments, including Additional Global Disclosure Metric A16.0: “Value of green finance instruments used, such as green bonds and sustainability-linked bonds.”²⁵ The TNFD has also published sector-specific guidance relevant to ocean industries, including guidance for aquaculture, fisheries, and marine transport sectors. These sector pathways identify priority metrics related to water quality, biodiversity impacts, and resource use that can be populated using data from Ocean Accounts.

9IFRS Sustainability Standards

10IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information) and IFRS S2 (Climate-related Disclosures) establish a global baseline for sustainability disclosure.²⁶ Ocean Accounts support IFRS-aligned disclosure by:

• 11Providing climate-related data on blue carbon stocks and flows
• 12Quantifying material dependencies on marine natural capital
• 13Enabling scenario analysis of nature-related risks
• 14Supporting targets and transition planning for nature-positive outcomes

15Verification and Assurance

16Third-party assurance of sustainability disclosures requires verifiable underlying data. Ocean Accounts compiled according to international statistical standards provide:

• 17Transparent methodologies that can be independently reviewed
• 18Documented data sources and quality indicators
• 19Time-series consistency enabling trend verification
• 20Spatial precision supporting site-specific assurance

3.6 Downward Connections to Accounts, Indicators, and Data

1Account Components Supporting Project Finance

2Project finance instruments draw on multiple Ocean Account components:

3Ecosystem Condition Accounts: Provide baseline and monitoring data for ecosystem health indicators referenced in bond covenants, PES agreements, and debt swap commitments. Condition indicators include species richness, structural complexity, water quality parameters, and functional state metrics. For methodology, see TG-3.1 Assets.

4Ecosystem Extent Accounts: Track changes in spatial coverage of marine habitats resulting from conservation or restoration investments. Extent changes enable verification of protection commitments in debt-for-nature swaps and blue bonds. Spatial data should be compiled in formats compatible with project boundaries defined in finance agreements.

5Ecosystem Service Flow Accounts: Quantify physical and monetary flows of provisioning, regulating, and cultural services. Service flow accounts provide the basis for valuing project benefits in cost-benefit analysis and for structuring PES payment schedules.

6Asset Accounts: Record opening stocks, additions, reductions, and closing stocks of marine ecosystem assets. Asset accounts enable net present value calculations used in restoration project appraisal and in valuing conservation commitments for debt swaps.

7Key Indicators for Project-Level Decisions

8Table 2: Project Finance Indicators from Ocean Accounts

Indicator	Account Source	Application	Typical Unit
Mangrove extent baseline	Extent accounts	Debt swap commitment definition	Hectares
Coral condition trend	Condition accounts	Blue bond KPI monitoring	Index (0-1 or 0-100 depending on national convention)
Blue carbon sequestration rate	Carbon flow accounts	Carbon credit issuance	tCO2e/year
Coastal protection value	Service flow accounts (monetary)	Restoration project CBA	Currency/year
Fishery resource rent	Provisioning service accounts	PES payment calculation	Currency/tonne
Tourist expenditure (marine)	Cultural service accounts	Tourism concession valuation	Currency/year
Water quality (nutrient load)	Residual flow accounts	Pollution control bond KPI	kg N, P/year

9Data Requirements and Sources

10Effective project-level application requires fit-for-purpose data at appropriate spatial and temporal resolution:

• 11

  Spatial resolution: Project boundaries typically range from <1 km² (local restoration sites) to 10,000s km² (large marine protected areas). Account data should be compiled at Basic Spatial Unit (BSU) resolution that enables aggregation to project scales.

• 12

  Temporal frequency: Finance instruments require baseline measurements (pre-project), implementation monitoring (annual or more frequent), and ex-post evaluation (typically 3-10 years post-project). Account compilation cycles should align with financing instrument reporting requirements.

• 13

  Data sources: Combining remote sensing (for extent and some condition indicators), field surveys (for detailed biophysical parameters), administrative data (for economic activity and regulatory enforcement), and scientific studies (for service flow quantification and valuation coefficients).

3.7 Worked Example: Mangrove Restoration Project Cost-Benefit Analysis

1This section presents a synthetic worked example demonstrating how Ocean Accounts data support cost-benefit analysis for a coastal mangrove restoration project. The example is entirely illustrative and uses simplified assumptions to demonstrate accounting logic. Actual project appraisals would draw on site-specific biophysical and economic data.

2Project Context

3A coastal state proposes to restore 200 hectares of degraded mangrove habitat in a coastal lagoon system. The restoration involves hydrological reconnection, seedling planting, and management of invasive species over a 5-year implementation period. Project costs are estimated at USD 3 million (capital costs) plus USD 200,000 per year (ongoing management) over a 20-year evaluation horizon.

4Account-Based Baseline

5Ocean Accounts provide pre-project baseline data:

Account Component	Baseline Condition	Source
Ecosystem extent	50 ha remnant mangrove (severely degraded); 150 ha former mangrove (mudflat/bare ground)	Extent accounts, BSU aggregation
Ecosystem condition	Condition index = 25/100 (severely degraded remnant); 0/100 (lost areas)	Condition accounts, field surveys
Carbon stocks	20 tC/ha in remnant (below reference of 150 tC/ha); 0 tC/ha in lost areas	Carbon accounts
Coastal protection service	Limited wave attenuation; property at risk from storm surge	Service flow accounts (physical)
Fisheries nursery service	Low juvenile fish density (10% of reference condition)	Service flow accounts (biological surveys)

6Project Scenario: Ecosystem Changes

7Post-restoration trajectory based on comparable restoration projects (Years 0-20):

Metric	Year 0 (Baseline)	Year 5	Year 10	Year 20 (Mature)
Restored extent	0 ha	180 ha	195 ha	200 ha
Condition index (restored area)	0	40	65	85
Carbon stock (restored area, tC/ha)	0	40	80	130
Fisheries nursery service (% reference)	10%	45%	70%	90%

8Ecosystem Service Valuation

9Using methods from TG-1.9 Safe Usage of Monetary Valuation and the SEEA Valuation Guidelines:

10Coastal Protection Service (Avoided Damage Cost Method, Tier 5)

11Mangrove restoration reduces flood risk to 150 coastal properties. Based on flood risk modelling, expected annual damages decline from USD 400,000 (baseline) to USD 100,000 (post-restoration). Annual benefit = USD 300,000/year (reached at Year 10; linear increase Years 0-10).

12Blue Carbon Sequestration (Directly Observable Prices, Tier 1)

13Restored mangroves sequester carbon at an average rate of 2.5 tC/ha/year over the 20-year horizon (an optimistic assumption reflecting productive restoration sites, whilst typical rates may be 1.0-2.5 tC/ha/year depending on species and site conditions). At 200 ha and a carbon price of USD 15/tCO2e (voluntary market), annual carbon benefit = 200 ha × 2.5 tC/ha/yr × 3.67 tCO2e/tC × USD 15/tCO2e = USD 27,500/year (Years 5-20, zero Years 0-5 due to establishment lag).

14Fisheries Productivity Enhancement (Productivity Change Method, Tier 3)

15Production function analysis indicates that each 10% improvement in nursery habitat quality increases local fishery catch value by USD 25,000/year. From baseline (10%) to mature condition (90%), the fishery benefit reaches USD 200,000/year (linear increase over 20 years).

16Cost-Benefit Analysis Results

17Table 3: Project CBA Summary (20-year horizon, 4% discount rate)

Item	Total (NPV, USD millions)	Annualised (USD/year)
Costs
Capital costs (Years 0-5)	3.0	—
Management costs (Years 0-20)	2.7	200,000
Total Costs	5.7	—
Benefits
Coastal protection (avoided damages)	3.8	300,000
Blue carbon revenue	0.3	27,500
Fisheries productivity	2.1	200,000
Total Benefits	6.2	—
Net Present Value	+0.5	—
Benefit-Cost Ratio	1.09	—

18Interpretation

19The positive NPV indicates the project generates net economic benefits over the 20-year horizon. The benefit-cost ratio of 1.09 suggests the project is economically viable but not strongly profitable, which is typical for ecosystem restoration where non-monetised co-benefits (biodiversity, cultural services, resilience) are material but not captured in exchange-value-based CBA.

20Sensitivity to Valuation Assumptions

21Project viability is sensitive to key assumptions. Sensitivity results reflect re-discounting all benefit and cost streams at the alternative rate:

• 22Discount rate: At 3% (lower rate reflecting long-term social preference), NPV increases to USD 1.2 million. At 6% (higher rate), NPV becomes negative (-USD 0.8 million).
• 23Carbon price: At USD 30/tCO2e (premium voluntary market), carbon benefit doubles to USD 0.6 million, increasing BCR to 1.19.
• 24Coastal protection: If storm surge damages are underestimated and true baseline risk is USD 600,000/year, coastal protection benefit increases to USD 5.7 million, yielding NPV of USD 2.4 million.

25Account Integration

26This CBA draws entirely on Ocean Accounts components:

• 27Extent and condition baselines establish the “no action” counterfactual.
• 28Carbon accounts provide sequestration rates consistent with IPCC methodologies.
• 29Service flow accounts (coastal protection, fisheries nursery) provide the physical and monetary valuation basis.
• 30Spatial accounts enable allocation of benefits to specific beneficiary groups (coastal property owners, fishing communities).

31Project developers preparing finance proposals for multilateral development banks or impact investors can reference this account-based CBA structure to demonstrate alignment with international statistical standards whilst meeting MDB economic analysis requirements described in TG-1.7 OA and Multilateral Development Finance.

3.8 Application Procedure for Project Developers

1Step 1: Define Project Scope and Boundaries

2Identify the geographic extent, temporal horizon, and intended outcomes of the financed activity:

• 3Map project boundaries to Ocean Accounts spatial units (Basic Spatial Units or aggregated zones)
• 4Specify project timeline (implementation period, monitoring duration, benefit accrual period)
• 5List intended conservation, restoration, or sustainable use outcomes in measurable terms

6Step 2: Establish Account-Based Baselines

7Extract pre-project baseline data from Ocean Accounts or compile project-specific accounts:

• 8Ecosystem extent and condition for relevant habitat types (mangroves, seagrass, coral reefs, etc.)
• 9Current ecosystem service flows (provisioning, regulating, cultural services)
• 10Economic activity levels (fisheries extraction, tourism, coastal development)
• 11Carbon stocks and sequestration rates (for blue carbon projects)

12Consult TG-3.1 Assets for extent and condition account methodology and relevant ecosystem-specific circulars (e.g., TG-6.2 Mangrove and Coastal Wetland Accounting) for detailed measurement guidance.

13Step 3: Define Counterfactual and Project Scenarios

14Develop “without project” and “with project” scenarios:

• 15Counterfactual (baseline): Project ecosystem trajectories under business-as-usual (e.g., continued degradation, stable but low condition, regulatory-driven slow improvement)
• 16Project scenario: Project ecosystem trajectories with intervention (e.g., extent increase from restoration, condition improvement from management, service flow enhancement)

17Scenario development should be grounded in scientific evidence from comparable projects and ecological understanding of recovery trajectories.

18Step 4: Value Ecosystem Service Changes

19Apply valuation methods from TG-1.9 Safe Usage of Monetary Valuation to quantify project benefits:

• 20Identify ecosystem services affected by the project (e.g., coastal protection, carbon sequestration, fisheries habitat)
• 21Select appropriate valuation methods following the SEEA preference order (directly observable prices > resource rent > replacement cost > avoided damage)
• 22Calculate annual ecosystem service values under counterfactual and project scenarios
• 23Compute incremental benefits as the difference between scenarios

24For project-level cost-benefit analysis submitted to multilateral development banks, supplement exchange values from accounts with welfare values as described in TG-1.7 OA and Multilateral Development Finance Section 3.2.

25Step 5: Structure Finance Instrument

26Design the finance instrument drawing on account data:

27For blue bonds:

• 28Define KPIs linked to account indicators (e.g., extent protected, condition index change, service flow targets)
• 29Establish KPI measurement protocols consistent with account compilation cycles
• 30Specify reporting frequency and verification mechanisms

31For debt-for-nature swaps:

• 32Quantify conservation commitments using monetary ecosystem asset accounts (NPV of service flows)
• 33Translate commitments into SMART targets (e.g., “protect 10,000 hectares of mangrove with condition index >60 by Year 5”)
• 34Define monitoring frameworks using account structures

35For PES schemes:

• 36Identify service beneficiaries using supply and use table structures
• 37Set payment levels based on ecosystem service values from accounts
• 38Design payment triggers linked to account-measurable outcomes (extent maintained, condition improved, service delivery verified)

39Step 6: Establish Monitoring and Reporting Framework

40Align project monitoring with Ocean Accounts compilation:

• 41Schedule monitoring activities to coincide with national account compilation cycles where feasible
• 42Use consistent methodologies for extent, condition, and service flow measurement
• 43Adopt spatial data formats compatible with national Ocean Accounts (enable aggregation of project data into national totals)
• 44Prepare for third-party verification by documenting data sources, methods, and quality indicators

45Step 7: Prepare Disclosure Documents

46Prepare project disclosure materials aligned with TNFD and IFRS standards:

• 47Location disclosure: Map project area in relation to priority biomes and protected areas
• 48Dependency disclosure: Identify and quantify project dependencies on marine ecosystem services using supply and use table logic
• 49Impact disclosure: Quantify positive impacts (ecosystem extent increase, condition improvement) using account metrics
• 50Target disclosure: Specify quantitative targets for ecosystem outcomes using account-derived indicators

51Consult TNFD sector guidance for ocean industries to identify sector-specific disclosure metrics relevant to the project.

3.10 Expanded Taxonomy of Blue Financial Instruments

1Blue bonds. Blue bonds are fixed-income securities whose proceeds are earmarked for ocean-related expenditures that deliver environmental benefits. They follow the structure of green bonds (as described by the ICMA Green Bond Principles) but are specifically directed towards marine and coastal outcomes. Ocean Accounts support blue bond issuance by providing the baseline natural capital data needed for use-of-proceeds frameworks, the impact indicators required for annual reporting, and the time-series monitoring data that demonstrate ongoing environmental outcomes. Blue bonds can be issued at sovereign, sub-sovereign, or corporate levels, with sovereign blue bonds of particular relevance to SIDS and coastal developing countries. For guidance on sovereign natural capital in the context of blue bonds, see TG-1.7 OA and Multilateral Development Finance, Section 3.12.

2Parametric insurance. Parametric (or index-based) insurance instruments provide rapid payouts when predefined environmental parameters are triggered, without requiring traditional loss assessment. For ocean contexts, parametric insurance can cover coral reef damage from hurricanes (with payouts triggered by storm intensity thresholds), fisheries losses from harmful algal blooms (triggered by chlorophyll concentration), or coastal flood damage (triggered by sea level or storm surge measurements). Ocean Accounts contribute to parametric insurance design by:

• 3Providing historical baseline data on ecosystem condition that informs the selection of trigger parameters
• 4Quantifying the economic value of ecosystem services at risk, which determines appropriate coverage levels
• 5Documenting the relationship between ecosystem condition changes and economic losses through supply and use table analysis
• 6Supporting post-event assessment of ecosystem recovery using time-series condition accounts

7Blue carbon instruments. Blue carbon credits are generated by projects that enhance carbon sequestration or reduce carbon emissions in marine and coastal ecosystems, primarily mangroves, seagrass meadows, and tidal marshes. Ocean Accounts support blue carbon instruments by providing the carbon stock accounts that establish baselines, the flow accounts that track sequestration rates, and the extent accounts that verify the area under management. For additional detail, see Section 3.4 above.

8Blended finance structures. Blended finance uses catalytic capital from public or philanthropic sources to mobilise additional private capital for sustainable development. In ocean contexts, blended finance structures typically involve concessional debt or first-loss guarantees from MDBs or philanthropic foundations, combined with commercial investment from private investors. Ocean Accounts support blended finance by providing the common evidence base that all parties in the capital stack can reference: concessional providers use account data to justify the development rationale, whilst commercial investors use the same data for risk assessment and return estimation.

9Debt-for-nature swaps. In a debt-for-nature swap, a portion of a country’s external debt is forgiven or restructured in exchange for commitments to conservation expenditure. Ocean Accounts are well-suited to debt-for-nature swaps because they provide the monitoring framework that creditors require to verify that conservation commitments are being honoured. Ecosystem extent accounts demonstrate that protected areas are maintained, condition accounts indicate that ecosystem quality is preserved or improving, and economic accounts confirm that conservation expenditures are being made. For a broader perspective on how these instruments connect to multilateral frameworks, see TG-1.7 OA and Multilateral Development Finance. For guidance on how these instruments interact with broader indicator frameworks, see TG-2.10 Multilateral Environmental Agreement Indicators.

Instrument	Risk Profile	Typical Tenor	Key Account Inputs	Primary Outcome Metric
Blue bond	Low-medium	5-15 years	Monetary asset accounts, service flow accounts	Use-of-proceeds verification, KPI achievement
Parametric insurance	Event-driven	Annual renewal	Condition accounts, service flow baselines	Trigger parameter exceedance
Blue carbon credit	Medium	20-30 years	Carbon stock accounts, extent accounts	Verified emission reductions (tCO2e)
Blended finance	Varies by tranche	5-20 years	Full suite of accounts	Development impact indicators
Debt-for-nature swap	Sovereign	10-20 years	Extent accounts, condition accounts	Conservation commitment compliance

3.11 Investment-Readiness Scoring Methodology

1Scoring rubric. The investment-readiness score is based on six dimensions, each scored from 0 (not addressed) to 4 (fully developed):

Dimension	Score 0	Score 1	Score 2	Score 3	Score 4
Baseline data	No baseline	Ad hoc data, no accounting framework	Partial accounts compiled (extent only)	Extent and condition accounts compiled	Full suite: extent, condition, service flow, and monetary accounts
Counterfactual	No counterfactual	Qualitative narrative only	Trend extrapolation from limited data	Time-series accounts with trend analysis	BACI design with control sites and multi-period accounts
Impact targets	No targets	Aspirational targets, no metrics	Targets with metrics but no account linkage	Targets linked to specific account indicators	Targets with account-derived metrics, thresholds, and adaptive triggers
Monitoring plan	No plan	Plan without data sources	Plan with data sources but no schedule	Scheduled plan aligned with financial reporting	Fully specified plan with BACI design, quality assurance, and feedback loops
Financial structure	No structure	Concept-stage instrument design	Instrument identified with preliminary terms	Terms negotiated, accounts integrated into covenants	Instrument structured, accounts embedded in legal documentation
Disclosure alignment	No disclosure plan	Awareness of frameworks	Partial alignment with one framework	Aligned with TNFD or IFRS	Aligned with multiple frameworks (TNFD, IFRS, CBD Target 15)

2Threshold scores. Based on the scoring rubric, projects can be classified into readiness categories:

• 3Score 0-8: Not investment-ready. Substantial gaps in evidence base and financial structuring. Requires further account compilation and capacity building before approaching investors.
• 4Score 9-14: Emerging readiness. Core elements are in place but important gaps remain. Targeted technical assistance can address specific weaknesses.
• 5Score 15-19: Investment-ready with conditions. Evidence base is substantially complete. Financial structuring may require refinement. Suitable for engagement with concessional finance providers and blended finance structures.
• 6Score 20-24: Fully investment-ready. Complete evidence base from Ocean Accounts, sound financial structuring, and full disclosure alignment. Suitable for engagement with commercial investors and capital markets.

7Application of the scoring methodology. Project developers can use this methodology as a self-assessment tool to identify gaps in their evidence base. MDBs and development finance institutions can use it as a screening tool to prioritise technical assistance. Financial institutions can use it as part of their due diligence process to evaluate the quality of environmental evidence underpinning project proposals. For guidance on broader quality assurance frameworks that support investment readiness, see TG-0.8.

3.12 From Ground-Level Projects to Investor Due Diligence

1A persistent challenge in ocean finance is the gap between ground-level project development and the information requirements of institutional investors. Ocean Accounts bridge this gap by providing a common measurement framework across project stages.

2Pipeline development. The project pipeline for ocean finance typically follows a progression from concept to bankability:

1. 3

   Concept stage: Ocean Accounts establish the baseline extent and condition of the target ecosystem and quantify the ecosystem services at stake.

2. 4

   Feasibility stage: cost-benefit analysis draws on monetary valuations of ecosystem services, physical flow data for carbon sequestration estimates, and economic activity data for employment and livelihood projections.

3. 5

   Preparation stage: the impact indicators embedded in financial covenants, the monitoring framework that will verify outcomes, and the baseline data against which performance will be measured all come from compiled accounts.

4. 6

   Transaction stage: account data are referenced in offering documents, prospectuses, or loan agreements. The investment-readiness scoring methodology (Section 3.11) can be used to confirm that the evidence base meets investor requirements.

7Bankability assessment. Financial institutions assess bankability against criteria that differ somewhat from development effectiveness criteria. Ocean Accounts contribute to bankability by:

• 8Providing auditable baseline data that reduces information asymmetry between project developers and investors
• 9Enabling standardised risk assessment through time-series condition and extent data
• 10Supporting revenue projections for ecosystem service-based revenue streams (e.g., carbon credits, tourism fees, fisheries royalties) using physical and monetary supply and use tables
• 11Creating a monitoring infrastructure that reduces the cost of ongoing investor oversight

12Aggregation for scale. Individual ocean projects are often too small to attract institutional investment directly. Ocean Accounts facilitate aggregation by providing a common measurement framework across projects: when all projects in a bundle use the same accounting classifications, spatial definitions, and reporting formats, the aggregated portfolio can be assessed and monitored using consolidated account data.

13The role of intermediaries. Project preparation facilities, conservation finance intermediaries, and national development banks can use Ocean Accounts as a quality standard, requiring that projects in their pipeline compile specified account types before proceeding to transaction stage. This approach ensures consistent evidence quality across the pipeline and reduces the risk of project failure due to inadequate environmental data.

3.13 GOAP Shared Investment Criteria

1To facilitate comparability and reduce transaction costs across the GOAP network, this section sets out shared investment criteria that participating countries can adopt when preparing ocean finance proposals. These criteria are grounded in Ocean Account data and designed to be applicable across different financial instrument types and country contexts.

2Common criteria.

Criterion	Description	Account Evidence Required
Ecosystem baseline	The proposal documents the current state of the target marine or coastal ecosystem	Ecosystem extent accounts and condition accounts for the project area
Service flow quantification	The proposal quantifies the ecosystem services that the project will maintain, restore, or enhance	Physical supply and use tables for relevant ecosystem services
Monetary valuation	The proposal includes monetary estimates of ecosystem service values and/or asset values	Monetary supply and use tables or monetary asset accounts
Additionality	The proposal demonstrates that the project will deliver environmental outcomes beyond what would occur without the intervention	Time-series accounts establishing the counterfactual trajectory
Monitoring commitment	The proposal includes a plan for ongoing account compilation to track project outcomes	Account compilation schedule with specified account types and data sources
Disclosure alignment	The proposal specifies which international disclosure frameworks the project will report against	Mapping of account-derived indicators to TNFD, IFRS, and/or CBD requirements

3Quality assurance. Shared investment criteria are only effective if the underlying data meet quality standards. The GOAP framework recommends that all account data used in finance proposals be compiled in accordance with the quality assurance principles described in the relevant TG circulars: adherence to official statistics principles (relevance, accuracy, timeliness, accessibility, coherence), use of internationally agreed classifications, and transparent documentation of data sources and methods.

4Applying common criteria across instrument types. The shared criteria are designed to be applicable regardless of the specific financial instrument being used. For blue bonds, the criteria ensure that use-of-proceeds frameworks are grounded in account data. For debt-for-nature swaps, the criteria provide the monitoring framework for conservation commitments. For results-based payment mechanisms, the criteria establish the measurement basis for performance verification. For blended finance structures, the criteria provide the common evidence base that aligns public and private investors around shared environmental objectives.

5Iterative improvement. The shared investment criteria should be treated as a living framework that evolves as implementation experience accumulates across GOAP partner countries. Countries are encouraged to share lessons through the South-South exchange mechanisms described in TG-1.7 OA and Multilateral Development Finance, Section 3.13.

3.14 Practical Implementation Considerations

1Institutional and Data Requirements for Account-Finance Integration

2Table 3.14.1: Roles in account-finance integration

Actor	Role
National Statistical Offices	Responsible for compiling accounts according to official statistics principles.
Environmental Agencies	Providing biophysical data on ecosystem extent, condition, and services.
Finance Ministries	Integrating account data into sovereign debt management and public finance.
Project Developers	Using account frameworks for project design and impact assessment.
Financial Institutions	Incorporating account data into due diligence and monitoring.

3Data Requirements

4Effective use of Ocean Accounts for finance requires:

1. 5Baseline Data: Pre-project extent, condition, and service flow data against which changes can be measured
2. 6Monitoring Frequency: Account compilation schedules aligned with financial reporting cycles
3. 7Spatial Resolution: Data at scales relevant to project boundaries and impacts
4. 8Uncertainty Documentation: Clear communication of data quality and limitations

9Capacity Building

10Many countries require capacity building to compile and use Ocean Accounts for finance, including:

• 11Training for account compilers on finance-relevant account applications
• 12Guidance for financial institutions on interpreting and using account data
• 13Development of standardised indicators linking accounts to financial instrument requirements
• 14Establishment of institutional arrangements for ongoing account compilation and dissemination

15SDG 14 Indicator Linkages

16In the Ocean Accounts Framework (TG-0.1), socio-economic outcomes of ocean finance projects correspond to Edge E5 (economic contributions to social conditions), whilst ecosystem service returns correspond to Edge E9 (ecosystem services to economy). SDG indicator 14.7.1 (sustainable fisheries as a proportion of GDP) can be derived from the economic activity accounts by identifying the value added of sustainably managed fisheries relative to total GDP.²⁷ SDG indicator 14.a.1 (the proportion of total research budget allocated to marine research) can be compiled from government expenditure accounts classified by function. These indicators, when compiled through Ocean Accounts, provide standardised metrics that project-level finance instruments can reference in their impact reporting frameworks. For example, a blue bond whose proceeds support sustainable fisheries management can report on its contribution to SDG 14.7.1 using data compiled within the same accounting framework that underpins the bond’s KPI monitoring.

4. Acknowledgements

1This Circular has been approved for public circulation and comment by the GOAP Technical Experts Group in accordance with the Circular Publication Procedure.

2Authors: [To be confirmed]

3Reviewers: [To be confirmed]

5. References

Footnotes

1. 1

   United Nations et al. (2025). System of National Accounts 2025, Chapter 35: Measuring the sustainability of well-being, paras. 35.120-35.127. ↩

2. 2

   United Nations (2015). Transforming our world: the 2030 Agenda for Sustainable Development, A/RES/70/1, SDG 14 targets. ↩

3. 3

   Convention on Biological Diversity (2022). Kunming-Montreal Global Biodiversity Framework, CBD/COP/15/L.25, Target 15. ↩

4. 4

   NCAVES and MAIA (2022). Monetary valuation of ecosystem services and ecosystem assets for ecosystem accounting: Interim Version 1st edition, Chapter 4: Cost-based approaches and their role in project appraisal. ↩

5. 5

   Taskforce on Nature-related Financial Disclosures (2023). Recommendations of the Taskforce on Nature-related Financial Disclosures, Metrics and Targets pillar. ↩

6. 6

   United Nations et al. (2021). System of Environmental-Economic Accounting — Ecosystem Accounting (SEEA EA), Chapter 12: Applications of ecosystem accounting, paras. 12.16-12.18 on cost-benefit analysis. ↩

7. 7

   Verra (2023). VM0033 Methodology for Tidal Wetland and Seagrass Restoration, Version 3.0. Requirements for additionality demonstration and baseline scenario development. ↩

8. 8

   International Capital Market Association (2023). Green Bond Principles, Appendix 1: Green Bond Project Categories. ↩

9. 9

   United Nations et al. (2021). System of Environmental-Economic Accounting — Ecosystem Accounting (SEEA EA), Chapter 4: Ecosystem Extent Accounts. ↩

10. 10

    NCAVES and MAIA (2022). Monetary valuation of ecosystem services and ecosystem assets for ecosystem accounting: Interim Version 1st edition, Chapter 2: Foundations. ↩

11. 11

    International Capital Market Association (2023). Sustainability-Linked Bond Principles. ↩

12. 12

    United Nations et al. (2025). System of National Accounts 2025, Table 35.3: Reporting structure for ESG and green financial instruments. ↩

13. 13

    United Nations et al. (2021). System of Environmental-Economic Accounting — Ecosystem Accounting (SEEA EA), Chapter 10: Accounting for ecosystem assets in monetary terms. ↩

14. 14

    Macreadie, P.I. et al. (2021). Blue carbon as a natural climate solution. Nature Reviews Earth & Environment, 2, 826-839. ↩

15. 15

    OECD (2017). Marine Protected Areas: Economics, Management and Effective Policy Mixes, Chapter 5: Payments for ecosystem services. ↩

16. 16

    NCAVES and MAIA (2022). Monetary valuation of ecosystem services and ecosystem assets for ecosystem accounting, Chapter 3: Valuation methods. ↩

17. 17

    United Nations et al. (2014). System of Environmental-Economic Accounting 2012 — Central Framework (SEEA CF), Annex A5.1: The net present value method for valuation of stocks. ↩

18. 18

    NCAVES and MAIA (2022). Monetary valuation of ecosystem services and ecosystem assets for ecosystem accounting, Section 3.2.5.1: Replacement cost. ↩

19. 19

    NCAVES and MAIA (2022). Monetary valuation of ecosystem services and ecosystem assets for ecosystem accounting, Section 3.2.3.2: Productivity change method. ↩

20. 20

    United Nations et al. (2021). System of Environmental-Economic Accounting — Ecosystem Accounting (SEEA EA), para. 9.31. ↩

21. 21

    Mcleod, E. et al. (2011). A blueprint for blue carbon: toward an improved understanding of the role of vegetated coastal habitats in sequestering CO2. Frontiers in Ecology and the Environment, 9(10), 552-560. ↩

22. 22

    Barbier, E.B. et al. (2011). The value of estuarine and coastal ecosystem services. Ecological Monographs, 81(2), 169-193. ↩

23. 23

    Taskforce on Nature-related Financial Disclosures (2023). Recommendations of the Taskforce on Nature-related Financial Disclosures, Figure 1: TNFD’s recommended disclosures. ↩

24. 24

    Taskforce on Nature-related Financial Disclosures (2023). Recommendations of the Taskforce on Nature-related Financial Disclosures, Strategy Disclosure D. ↩

25. 25

    Taskforce on Nature-related Financial Disclosures (2023). Recommendations of the Taskforce on Nature-related Financial Disclosures, Annex 2: Additional disclosure metrics A16.0. ↩

26. 26

    International Sustainability Standards Board (2023). IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information; IFRS S2 Climate-related Disclosures. ↩

27. 27

    United Nations (2017). Global indicator framework for the Sustainable Development Goals, A/RES/71/313, Indicator 14.7.1. ↩