Environmental Incentives
Environmental Incentives

Pay for Performance

Pay for measurable conservation outcomes, not actions

Conservation projects often lack meaningful incentives that are tied to project success. Further, rigid procurement processes can hamper the ability to reward cost-efficient, effective projects. As a result, donors and funders are at risk of directing resources to projects that are inefficient or ineffective, and they lack assurance that their investments will generate meaningful outcomes. With limited funding available, successful programs must create accountability and leverage procurement approaches that creatively target resources toward the most meaningful actions.


a scientist analyzes stream water in the alpine

Flexibility enables innovation and efficiency

Focusing project stakeholders on the end goal of habitat, water quality, or community sustainability—rather than prescribing project designs and implementation practices—motivates them to create and implement cost-effective solutions that achieve desired results.

Local farmers fix fencing around their land

Empower and engage local partners

Tapping into working landowners’ and partners’ unique understanding of their local landscape enables innovation and projects that creatively achieve conservation goals and create partnerships, rather than conflicts.

landowner works with an environment company to build sustainability into their ranch

Building Trust Through Clear Return on Investment

Structuring procurement and payment terms around outcomes allows funders to clearly demonstrate a return on investment, building confidence in their constituencies that programs are achieving intended results and the political will to continue conservation efforts.

Explore sample contract terms and guidance


Pay for performance toolkitPerformance-Based Funding Strategies and Contracts

We help programs identify the appropriate pay for performance strategy that suits their local context and needs. Then we work with managers and procurement staff to create contract terms that align the incentives between funded entities and overall program goals.

Through a Natural Resources Conservation Service grant, we developed a Pay for Performance Toolkit to help conservation, water quality, and community sustainability programs achieve better outcomes. The Toolkit provides a central hub of resources with information on when to use and how to select different pay for performance strategies, along with customizable contract templates and real examples of how pay for performance is addressing a spectrum of environmental issues.


a grouse in its natural habitat in Nevada$2 million dollars invested in Nevada sage-grouse habitat using pay for performance contracts

The Nevada Conservation Credit System uses pay for performance contracts to bring ranchers, industry, and the state together to improve critical sage-grouse species habitat and create a market for mitigation credits.



I did not think of my agency as a conservation buyer before attending Environmental Incentives' Pay for Performance workshop. It would be beneficial to think more about conservation returns from our investments and to use performance contracting.”

Kevin Prior, Chief Administrative Officer, California Tahoe Conservancy

In 2015, Nevada committed $2,000,000 to incentivize landowner conservation efforts, improve sage-grouse habitat and create a supply of compensatory mitigation credits for the State’s market-based Conservation Credit System. Environmental Incentives was instrumental in helping design a system that worked for Nevada. They also helped us develop the performance-based contracts which motivate credit developers to maximize project outcomes, and limit the risk of our public funds being spent on projects that perform lower than expectations."

Jim Lawrence, Deputy Director, Nevada Department of Conservation and Natural Resources

Talk to Our Experts


Katie Riley
Senior Associate


Shelly Hicks
Adaptive Management Specialist Team Lead

Andrew Alexandrovich

Andrew Alexandrovich
Director of Finance and Operations