Introduction

Scaling up funding for nature is essential to support climate change adaptation, address biodiversity loss, and provide economic resilience. Investment in nature-based solutions (NbS) offers multi-dimensional benefits for climate mitigation and the protection of livelihoods. However, significant barriers to mobilising private finance persist, including large upfront capital requirements, perceived high risk, and limited monetisable returns on investment. This report addresses these gaps by analysing 54 nature investment vehicles, ranging from private equity and debt funds to special purpose vehicles (SPVs), which pool funds to channel finance into activities that benefit natural capital.

The state of nature finance and role of nature investment vehicles

The degradation of natural capital is increasingly recognised as a source of material economic risk, with approximately 55 per cent of global GDP moderately or highly dependent on nature. Despite this, finance continues to flow overwhelmingly towards nature-negative activities; an estimated US$7.3 trillion in public and private capital supported such activities in 2023. In contrast, annual investment in NbS was only US$220 billion, with a mere US$23 billion originating from private sources. To meet global targets by 2030, investment in nature must increase more than two-and-a-half times to roughly US$571 billion annually. Nature investment vehicles can overcome barriers by aggregating smaller projects into professionally managed portfolios of institutional scale.

Findings: state of nature investment vehicles

The analysis of 54 investment vehicles reveals a total target capital size of US$11 billion, with individual vehicles ranging from US$20 million to US$1 billion. The evidence shows that these vehicles are successfully attracting institutional and commercial private capital, with institutional investors involved in 68% of vehicles with disclosed financing sources. Furthermore, 13 vehicles are funded entirely by private capital. However, the market is developing unevenly. Investment remains concentrated in mature productive sectors with clear revenue streams, specifically forestry (54%) and agriculture (52%).

Geographical concentration is also evident, with 76% of vehicles investing in developing regions such as Latin America and the Caribbean (48%), Sub-Saharan Africa (35%), and East Asia and the Pacific (33%). Terrestrial ecosystems are targeted by 89% of vehicles, while freshwater and marine ecosystems remain underserved, addressed by only 31% and 28% respectively. Blended finance structures are dominant, outnumbering fully private vehicles by three to one. Public actors, such as the European Investment Bank (EIB) and the Dutch entrepreneurial development bank (FMO), play a concentrated role, appearing across multiple vehicles as repeat investors.

Case studies

The report provides five in-depth case studies illustrating diverse structuring and performance models. The Nature Equity Fund (cygnum Capital) targets the midstream of tree crop value chains in Africa and Southeast Asia. The Latin american green bond Fund (finance in motion) strengthens sustainable bond markets by investing in thematic bonds across 15 investments. Forestry Fund a (gresham house asset management limited) offers 18 years of operational history in UK commercial forestry, generating an average internal rate of return (IRR) of 10.1%. The Big nature impact Fund (finance earth) utilizes a blended structure to invest in nature restoration in England, leveraging Biodiversity Net Gain (BNG) regimes. Finally, the Nature based carbon Fund (climate asset management) generates voluntary carbon credits across emerging markets, achieving a target of US$445 million.

Vehicles rewarding nature performance: listed equity funds and the mainstreaming of nature-related risk

Publicly listed global equity funds, such as Robeco Biodiversity Equities and the Aviva Natural Capital Global Equity Fund, reward strong nature performance by investing in companies providing solutions or transitioning their operations. These funds seek to integrate nature-related risks and opportunities into investment decision-making, driven partly by the uptake of Taskforce on Nature-related Financial Disclosures (TNFD) recommendations. While these funds have sometimes underperformed against general benchmarks, the report notes a lack of accepted nature-specific benchmarks to judge their performance accurately.

Discussion and implications for practitioners

The report concludes that institutional-scale private investment in nature is feasible but requires targeted interventions to expand the investable frontier. Policymakers should strengthen enabling conditions and target public finance at market gaps rather than subsidising commercially viable segments. For practitioners, the diversification of revenue streams and early investment in partnerships, particularly with NGOs (involved in 74% of vehicles), are critical for success. Expanding into underrepresented ecosystems like marine realms and addressing drivers such as pollution and invasive species offer significant future opportunities. Standardised disclosure will be essential to identify what models work and to replicate them across the market.