Introduction

This report aims to gather feedback from the financial sector on a model to help financial institutions contribute to the global Nature Positive goal. It outlines a framework guiding the private financial sector in adopting strategies for biodiversity restoration and conservation. The Nature Positive concept aligns with the Global Biodiversity Framework (GBF) to halt biodiversity loss by 2030 and achieve full recovery by 2050.

The report seeks to mobilise $700 billion annually to close the biodiversity finance gap and calls for financial institutions to mitigate negative impacts on nature while contributing to its recovery. It targets financial institutions, including banks, asset managers, and asset owners, helping them implement nature-positive strategies while minimising risks like greenwashing.

The nature positive global goal

The Nature Positive goal aims to halt and reverse biodiversity loss by 2030, using a 2020 baseline, and achieve full biodiversity recovery by 2050. Financial institutions must avoid harm, reduce negative impacts, and generate positive biodiversity outcomes. The report emphasises the need for measurable improvements in biodiversity metrics.

Definitions and working model for financial practices

Nature positive finance aims to deliver measurable positive biodiversity outcomes. The working model offers a three-level framework: compliance with the mitigation hierarchy, transformative actions for GBF implementation, and governance strategies. The report also stresses the importance of nature positive finance transition plans, which need board-level approval and should be integrated into organisational strategies.

Strategies for shifting finance away from negative impacts and towards positive outcomes

Four key strategies are recommended: avoid negative activities, reduce biodiversity loss drivers, generate biodiversity gains, and support system-scale changes. Financial institutions should phase out harmful activities, such as deforestation, and invest in biodiversity-positive projects like nature-based solutions. Sector-specific guidance for industries such as agriculture, forestry, and extractives is highlighted as crucial for aligning investments with nature-positive goals.

Private financial sector needs to further contribute to the nature positive goal

The private financial sector must enhance data collection, improve measurement, and focus on transparency. Key focus areas include tracking financial flows, reducing barriers to nature conservation financing, and aligning finance with policy transformation. Financial institutions are encouraged to adopt global standards for disclosure and target-setting, in line with the GBF, to ensure their contributions are impactful. However, the report also notes the lack of a global model for measuring financial portfolio alignment with biodiversity goals, recommending tools such as Life Cycle Assessment (LCA) and biodiversity-specific indicators like Mean Species Abundance (MSA) and Potentially Disappeared Fraction of Species (PDF).

Recommendations for good practices towards finance for nature positive

Financial institutions should integrate sustainability-linked criteria into financial products and ensure traceability of funds. Setting clear targets, monitoring biodiversity outcomes, and ensuring board-level approval for strategies are essential steps. Quantitative indicators should measure biodiversity at site or landscape levels. The report also discusses the importance of using financial tools such as sustainability-linked bonds, private equity, and project finance to integrate biodiversity gains into financial transactions.

Barriers to investment and overcoming them

Concrete barriers to financing nature conservation, such as a lack of bankable business models and the high cost of restoration projects, are identified in the report. It recommends public-private partnerships, blended finance approaches, and impact investment tools as ways to overcome these barriers and scale up biodiversity-positive finance.

Conclusion and next steps

The report urges financial institutions to adopt the working model and engage in consultations to refine the approach. It highlights the importance of collaboration between financial institutions and environmental organisations to align financial flows with biodiversity goals, recommending further research and development of measurement tools to enhance the effectiveness of nature-positive finance strategies.