The maintenance of biodiversity is essential for our survival. However, climate crisis has accelerated the factors that lead to the loss of biodiversity, even compromising our ability to sequester carbon and mitigate the effects of climate change.
according to World Economic Forum, more than half of the global economy – about US$ 44 trillion – depends, moderately or highly, on the nature. This means that if natural systems collapse, our economic and financial systems will follow suit. It is therefore a question of a challenge that concerns us all.
Given this scenario, How can we ensure that resources are effectively directed towards protecting and restoring nature? The answer may lie in the financing for biodiversity.
Financing for biodiversity
As important as the climate finance, O financing for biodiversity brings together public, private, philanthropic or hybrid financial mechanisms aimed at conservation, restoration and sustainable use of nature. Your goal is mobilize resources to protect ecosystems and ensure ecosystem services fundamental to life, such as clean water, pollination and climate regulation.
The Kunming-Montreal Global Biodiversity Framework, approved in 2022 during the Biodiversity COP, set ambitious goals: to mobilize at least US$ 200 billion per year by 2030, being US$ 30 billion from developed countries to developing countries, in addition to eliminate US$ 500 billion in subsidies that harm biodiversity.
One of the most relevant commitments is theGoal 19, which proposes substantially increase the volume of financial resources available for biodiversity, including domestic, international, private and philanthropic capital. This challenge raises debates about the limits and synergiesbetween finance, climate and biodiversity.
The financing gap and the role of the private sector
Despite the advances, biodiversity remains drastically underfunded. It is estimated that there is an annual gap greater than US$ 700 billion between what is invested today and what is needed to maintain the integrity of ecosystems until 2030. Data points to that by December 2022, the governments were responsible for 83% of the resources mobilized – but tight budgets and national priorities make unlikely that they will be able to make up for this difference alone.
This is why the call is growing for the private sector participate more actively in financing of nature-positive initiatives. The conservation of natural ecosystems not only protects the biodiversity, as well as contributing to the capture of greenhouse gases and increasing resilience to climate change.
Nature-based solutions – such as conservation, restoration and sustainable management of ecosystems – have the potential to represent up to a third the emissions reductions needed to keep global warming below 2°C. It will not be possible to achieve the 1.5°C target without profoundly transforming our relationship with nature. Implementing the goal of conserving at least 30% of the planet’s land, oceans and waters by 2030 can play a decisive role in both protecting biodiversity and tackling the climate crisis.
The transition to a nature-positive economy can generate up to US$10 trillion in business and create 395 million jobs by 2030. This will be possible through the transformation of sectors that currently account for almost 80% of nature loss: food, infrastructure, energy and extractives.
To accelerate this transition, it is essential to provide strategic information that helps the private sector integrate risks and opportunities related to nature in planning, strategic management and resource allocation. The more organizations understand the benefits of nature-based solutions, more will opt for them to the detriment of environmental overexploitation.
How to speed up this agenda?
THE Sitawi is an organization that works to unlock features and develop financial solutions that maximize positive impact for people and nature. Based on an in-depth reading of socio-ecological contexts, the organization develops innovative mechanisms such as:
- Structures of blended finance, which combine different financial sources and instruments;
- Payment for Environmental Services (PES) Schemes;
- Biodiversity and additionality credits associated with carbon credits.
With this approach, Sitawi enhances synergies between finance, climate, biodiversity and social development, contributing to a more resilient and sustainable future.
Furthermore, the Sitawi is one of the pioneering organizations to carry out a pilot study of Taskforce on Nature-related Financial Disclosures (TNFD) in Brazil. The TNFD is a global, market-led initiative with the mission to develop and provide a management and disclosure framework for organizations to report and act on their nature-related risks and opportunities. Therefore, the Sitawi developed experience in adapt the platform to the national context, aiming participate in and conduct assessments of risks and opportunities related to nature, if companies are committed to moving forward with mobilizing resources to build territorial programs or financial solutions for the nature conservation.
Are you interested in implementing a biodiversity project? Contact and we can think of a customized solution for you!
