Abstract

The report examines why existing climate and biodiversity finance remains insufficient and proposes integrating mission-oriented policy with Global Public Investment (GPI). It argues that fragmented, loan-heavy, and donor-centric systems fail to mobilise the scale, quality, and equity of finance required, particularly for the Global South, and outlines a new framework for coordinated global public investment.

Introduction: Blockages in climate & biodiversity financing

Climate change and biodiversity loss are framed as interconnected global public challenges with severe economic and social consequences. Over half of global GDP is moderately or highly dependent on nature, yet ecosystems are rapidly degrading. Financing gaps are substantial: climate mitigation and adaptation require around USD 2.4 trillion annually by 2030, while nature finance must rise to over USD 536 billion per year by 2050. Low- and middle-income countries face disproportionate impacts alongside rising debt burdens, high capital costs, and limited access to concessional finance.

Current approaches to financing are not working

Existing approaches rely heavily on voluntary pledges, fragmented funds, and private finance. Climate finance commitments of USD 100 billion annually were repeatedly missed and, when met, were dominated by loans rather than grants. Around 80% of climate finance is debt-based, contributing to a “climate debt trap”. Biodiversity receives only about 3% of international aid, while nature-negative public and private finance approaches USD 7 trillion annually. High transaction costs, donor-driven governance, and siloed development and climate funding reduce effectiveness and predictability.

Global public investment for global missions

The report proposes combining mission-oriented policy with GPI. Mission-oriented approaches set clear, time-bound objectives that mobilise cross-sectoral innovation and public investment to shape markets, rather than merely correct failures. GPI reframes international finance around three principles: all benefit, all contribute, and all decide. This replaces donor–recipient models with shared responsibility, statutory contributions, and inclusive governance, ensuring Global South countries have decision-making power alongside access to stable, long-term finance.

Unblocking finance for climate & biodiversity

Integrating missions with GPI can unlock finance by mobilising additional public resources, reducing volatility, and catalysing private investment aligned with public purpose. Public finance is positioned as a lead investor in high-risk, long-term areas such as biodiversity protection and climate adaptation. The approach emphasises grants and concessional finance over loans, fair risk-reward sharing, and reinvestment of public returns. Regional mission examples, such as a just transition for the Amazon, illustrate how coordinated public investment, procurement, and innovation can deliver environmental and development outcomes.

Recommendations

The report recommends three actions. First, establish a “Marshall Plan for Climate & Biodiversity”, with all countries committing a fair share of national income to global missions. Second, reform climate and biodiversity funds to align with GPI principles, embedding inclusive governance, transparency, and Global South leadership. Third, redesign debt-for-nature swaps using mission-oriented principles, ensuring meaningful debt relief, lower transaction costs, strong local governance, and measurable environmental and social outcomes.