The degradation of our planet’s natural ecosystems is undermining its ability to provide vital goods and services that enable our economies to thrive. Likewise, certain financial returns are inextricably linked to nature through the dependencies and impacts of economic activities they finance.
Financial institutions, therefore, have an important role to play in tackling nature loss and ensuring financial activities support rather than degrade ecosystem functionality.
This report calls for comprehensive and accurate data on nature-related impacts and dependencies that supports investment in natural capital and nature restoration, and helps investors align portfolios with planetary boundaries. While financial institutions face increasing exposure to nature risk, there are also promising investment opportunities to address rising societal demand for nature conservation.
Key recommendations for governments and financial institutions include:
- Establishment of a Task Force on Nature Impact Disclosures to promote open cross-sector and cross-border collaboration between investors and policymakers;
- Inclusion of material biodiversity considerations in ESG criteria and rating methodologies by non-financial rating agencies;
- Creation of an investment framework for analysing biodiversity risk and engaging businesses, especially the most damaging sectors;
- Public engagement through initiatives that highlight financial products that support nature; and
- Prioritisation and integration of nature protection and restoration in all decision-making.