State of Finance for Nature – Tripling investments in nature-based solutions by 2030

State of Finance for NatureTripling investments in nature-based solutions by 2030


27 May 2021 :: 65 pages     ISBN: 978-92-807-3865-0


Executive Summary [excerpts]

:: Nature loss is at the heart of many societal challenges, while nature-based solutions hold the potential to address interlinked crises: The pace of species extinction, global warming, the growing number of extreme weather events and zoonotic diseases like Covid-19, have further reinforced the need to invest in sustainable action that enhances the resilience of ecosystems and addresses societal challenges, such as food security, climate change, water security, human health and enhanced resilience to disaster risk.

:: Our livelihoods depend on nature. Our collective failure to date to understand that nature underpins our global economic system, will increasingly lead to financial losses. More than half of the world’s total GDP is moderately or highly dependent on nature. Agriculture, food and beverages and construction are the largest sectors that are dependent on nature and these generate USD 8 trillion in gross value added.

:: The integrity of the Earth’s ecosystems has been significantly compromised as a result of human activity and the paradigm that has prioritised short-term economic growth. In order to ensure that humanity does not breach the safety limits of the planetary boundaries, we need a fundamental shift in mindset, transforming our relationship with nature. Currently, the majority of the essential benefits of nature have no financial market value, despite underpinning our current and future prosperity. From government policies related to procurement, taxation, trade and regulation, to the way businesses and financial institutions make decisions on investment, risk and disclosure, it is vital that we hardwire into our economic system the value of nature in a profound way.

:: Knowledge on capital expended and needed for NbS remains limited…

:: The report finds that approximately USD 133 billion/year currently flows into NbS (using 2020 as base year), with public funds making up 86 per cent and private finance 14 per cent…

:: Looking to the future, investment in NbS ought to at least triple in real terms by 2030 and increase four-fold by 2050 if the world is to meet its climate change, biodiversity and land degradation targets…

:: The compilation of data on capital investment in nature across all sectors and for all major economies has proven challenging and the estimates are highly uncertain…

:: The public sector plays a fundamental role in creating opportunities and demand for investment in NbS…

:: NbS poses an opportunity for private sector investment in pursuit of sources of revenue, to reap the benefits of increased resilience, to reduce costs and to enhance reputation and purpose..

Main Report  [excerpt]

1.2 Definition of NBS [p.12]

This report uses the global standard developed by the International Union for the

Conservation of Nature (IUCN) for nature-based solutions. NbS are defined as “Actions

to protect, sustainably manage, and restore natural or modified ecosystems, that address societal challenges effectively and adaptively, simultaneously providing human wellbeing and biodiversity benefits”. The goal of nature-based solutions is “to support the achievement of society’s development goals and safeguard human well-being in ways that reflect cultural and societal values and enhance the resilience of ecosystems, their capacity for renewal and the provision of services; nature-based solutions are designed to address major societal challenges, such as food security, climate change, water security, human health, disaster risk, social and economic development”.

The following preliminary principles are to be considered with the NbS definition:

  1. NbS embrace nature conservation norms (and principles);
  2. NbS can be implemented alone or in an integrated manner with other solutions to societal

   challenges (such as technological and engineering solutions);

  1. NbS are determined by site-specific natural and cultural contexts that include traditional,

   local and scientific knowledge;

  1. NbS produce societal benefits in a fair and equitable way in a manner that promotes

   transparency and broad participation;

  • NbS maintain biological and cultural diversity and the ability of ecosystems to evolve over time;
  • NbS are applied at a landscape scale;
  • NbS recognize and address the trade-offs between the production of a few immediate economic benefits for development and future options for the production of the full range of ecosystem services; and
  • NbS are an integral part of the overall design of policies, and measures or actions, to address a specific challenge.
  • NbS emphasize solutions. Such solutions address the multifaceted environmental crises and broader societal challenges affecting humanity today, including climate change,  biodiversity loss, land degradation, human health, migration, natural hazards and human-induced disaster, food and water security and biochemical imbalances.