The natural environment provides society with essential services—such as clean air and reliable flows of clean water—which are increasingly being valued in financial terms. Environmental markets—some regulatory and others voluntary—are now trading credits as well as derivatives. Regulatory environmental markets are operating in Europe, the U.S., Australia and other countries around the world. Voluntary markets and business-to-business "payments for environmental services" (PES) deals are also underway, in both industrialized and developing countries. These markets and transactions are sending price signals about environmental values. The result is that businesses can place a financial value not only on environmental compliance, but also increasingly on voluntary actions.
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