If 2019 was the year that climate finance went mainstream, 2020 promises to finally give nature a seat at the green finance table.
Massive biodiversity loss was flagged as one of the top five global threats at this year’s World Economic Forum in Davos, where businesses were called upon to start disclosing nature-related risks. Meanwhile investors such as BNP Paribas and AXA are now moving ‘beyond carbon’ to assess firms’ biodiversity impacts. And cognizant of the real economic threats of ecosystem destruction and degradation, central bankers and regulators around the world are working on a nature-focused expansion to the influential Task Force on Climate-related Financial Disclosure (TCFD) framework.
Given the usual focus on climate mitigation, it is encouraging to see the financial industry acknowledge the intersectionality of our ecological crisis. With the current rate of plant and animal species extinction up to 100 times greater than the average over the past 10 million years, biodiversity both exacerbates and is exacerbated by the climate emergency. Healthy, functioning ecosystems are the foundation of the biosphere upon which all of life depends. But initiatives to restore biodiversity face serious funding challenges. A report by McKinsey found that conservation projects need up to $400 billion a year yet receive only $52 billion, most of which comes from philanthropic and public funding.
