How ESG can help NFPs understand impact
Posted on 22 Jul 2026
For many people, ESG sounds like corporate and business jargon. For not-for-profits, it might be…
Posted on 19 Aug 2025
By Nick Place, journalist, Institute of Community Directors Australia
Even as debate continues over plans to put a renewable energy terminal into protected wetlands in Victoria, a new study has suggested restored wetlands might be Australia's little-known secret weapon in the fight against climate change.
The study, published in the Journal of Environmental Management, not only shows reviving floodplain wetlands can cut carbon emissions by 39 per cent and restore critical ecosystem functions, but says the benefits can be seen within 12 months.
Lead author and research fellow in environmental sciences Dr Lukas Schuster, from RMIT University’s Centre for Nature Positive Solutions, said the scale and pace of ecosystem benefits revealed within a year of restoration provided a clear case for action.
“We found managing freshwater wetlands for carbon benefits also boosts flood and drought resilience, highlighting the mutual benefits of restoration,” he said. “We’ve shown wetland restoration pays off, so we hope this study will inform future land management policies.”
Floodplains, or riparian wetlands, comprise more than half of the world’s wetlands, but are often overlooked because of their lower carbon storage, Schuster said, when compared to peatlands, the more widely recognised carbon sinks. The problem is that peatlands can produce up to 530 per cent more methane after restoration, potentially offsetting any short-term climate benefits.

By contrast, reviving floodplains can slash emissions by 39 per cent without that methane spike, the study found.
Freshwater wetlands cover less than 10 per cent of the Earth’s surface yet contribute up to 25 per cent of global methane emissions, which is why this new discovery, indicating they could hold real potential as long-term carbon sinks, is exciting.
Speaking to the Advocate after the study’s release, Schuster said a goal of the authors “was to promote the science but also (hopefully) inform national and international policies and raise awareness among the public”.
“The reality is that there is not a lot known about the benefits of restoring non-peat wetlands, like floodplain wetlands, both in Australia and globally,” he said. “Most studies and restoration efforts to date have focused on peatlands like bogs since those are known for their significant carbon sequestration and storage potentials. But non-peat wetlands, despite typically storing less carbon, provide other important ecosystem services like water purification and flood and drought mitigation – and our restored wetlands showed increased nitrogen cycling and they retained more soil moisture after drying up, which is indicative of the reinstatement of such critical ecosystem services within just one year of restoration.
“We’re hoping that our findings are a bit of a wake-up call for policymakers, so that more effort will be put into restoring but also protecting these critical ecosystems in Australia and around the world.”
The study’s release coincidentally coincided with the Victorian National Parks Association pushing for further protection for important wetlands in Hastings, where Australia’s Environment Minister Murray Watt has just announced plans for a planned energy terminal to be declared “a controlled action” under federal nature laws.
The Minister’s decree means the project must now undergo a comprehensive environmental assessment to decide whether it can be built without damaging endangered wildlife and habitats in the Ramsar-listed wetlands.
The VNPA is still not entirely happy, saying even with the newly reduced scope of dredging and wetland loss, the Victorian Renewable Energy Terminal was still being planned in the wrong place.
“We are still yet to be presented with convincing rationale for why this terminal must be built in the heart of a UNESCO Biosphere reserve and Ramsar-listed wetland,” said VNPA marine campaigner Shannon Hurley.
“We want certainty that the project can be done in a way that doesn’t cause unacceptable harm to the Western Port wetlands, and we aren’t confident that has been achieved yet.”
“We’re hoping that our findings are a bit of a wake-up call for policymakers, so that more effort will be put into restoring but also protecting these critical ecosystems in Australia and around the world.”
While not involved in that debate, Lukas Schuster said his study showed clearly the need to protect what’s left, given the damage to Australian wetlands over the past 250 years.
“We have lost a lot of important wetlands since the European settlement of Australia, with the majority being drained and converted for agricultural purposes,” he said. “Given their critical role in mitigating climate change and its impacts, such as flood and drought mitigation, as well as in supporting biodiversity, any remnant wetlands should be immediately protected to avoid further loss. From what we know, restoration can reinstate critical carbon and other ecosystem services to some extent fairly quickly, but it takes a really long time, sometimes hundreds of years, to reach the functional levels of pristine wetlands. Any existing wetlands are thus critical and should be protected.”
Summarising the study, Schuster said while rewetting and revegetation reduced carbon emissions by 39 per cent, net carbon emissions from unrestored control wetlands increased by 169 per cent over the monitoring period.
Restored wetlands retained more water, with soil moisture levels increasing by 55 per cent, even after the wetlands themselves had dried, showing drought mitigation potential, he said. That increased water retention was linked to improved surface carbon storage in the restored wetlands.
“We observed a vital link between carbon dynamics and ecosystem function,” he said. “Wetlands are nature’s purification system, removing nitrogen from waterways and carbon from the atmosphere.”
The study saw environmental scientists compare three degraded and three restored wetlands along Victoria’s Loddon River, measuring native plant cover, carbon cycling and ecosystem function.
It was funded by the federal government’s Future Drought Fund, Deakin University’s Blue Sky Fund and the Australian Research Council, and featured researchers from RMIT’s Centre for Nature Positive Solutions, and from the Arthur Rylah Institute for Environmental Research.
Read the full study here
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