Nature-based Solutions for socio-economic development: finance and impact at scale

25 July 2023

The mainstreaming of Nature-based Solutions (NbS) at global level reinforces the necessity of boosting the implementation of NbS interventions at scale. Currently, approximately 133 billion dollars are channelled into NbS interventions, and investments must at least triple by 2030 to achieve land degradation neutrality, climate change and biodiversity targets (UNEP, 2022). 

With having in mind the necessity of the financial uptake of NbS and directing financial flows to NbS at regional and global levels, IUCN with the support of the European Union, organized a two-day NetworkNature workshop a the IUCN Conservation Centre in Switzerland. This workshop brought together leading experts from the conservation and development sectors to discuss the key enablers and challenges and barriers of resource mobilization, and particularly in terms of finance, for scaling up NbS at national and regional levels. Experts from governmental agencies, international organizations, permanent representatives to the United Nations, multilateral development banks and private sector entities discussed the potential of NbS as a cost-effective enabler of Sustainable Development Goals through public and private investment and its opportunities and challenges. 

The workshop opened with opening remarks from Fleur van Ooststroom-Brummel, European Commission Policy Officer – Biodiversity and NbS. Fleur highlighted the importance of engaging the public and private financial entities – “When it comes to nature-based solutions, we must spend time on engaging every sector, including the finance sector, or we risk missing our chance to keep this planet liveable”. 

In his opening remarks, Stewart Maginnis, IUCN Deputy Director General – Programme highlighted the importance of breaking sustainability barriers through collaboration. Stewart also emphasised the necessity of inclusive finance, stating “Innovative finance that isn’t inclusive, is not innovative enough.” 

To promote openness of discussion and to allow free expression of opinions and arguments the workshop followed the “Chatham House” rules. Across six sessions laid out over two days, experts discussed the state of finance and market for NbS, took stock of existing reports, tools and investment mechanism for financing and investing on NbS, discussed the priority sectors and regions for investment and funding, shared examples of sectoral innovation and investments. Experts discussed the ways to address the existing finance gap, engaging the private sector and business and important factors for high-quality and credible bankable investments. The workshop participants also discussed the main barriers to the financial uptake of NbS: Financial and technical capacity building and increasing awareness for NbS, strengthening institutional and regulatory frameworks and providing revenue streams for NbS, for operation, implementation and maintenance. 

During the workshop, several topics were highlighted – the key takeaway messages are: 

  • Multiple benefits offered by Nature-based Solutions is a strong added value of this approach, also from a financial perspective – This calls for rethinking the way benefits, economic effectiveness and impacts of NbS interventions are assessed. 

  • To achieve successful and efficient investments, NbS interventions must be scaled up - Studies have shown that only a small percentage of NbS investments are large enough in terms of project size to be financially efficient. 

  • Private sector plays an important role in the uptake of NbS – currently the NbS finance and investment are dominantly sourced by the public sector. To address the existing gap, private sector entities' buy-in into NbS is crucial. 

  • It is important to integrate biodiversity into key decision-making processes – which could be addressed through the policy processes and policy-based financial instruments, creating financial and fiscal incentives, and enhancing regulatory oversight and tailored technical support. 

  • There is a for consistent and consensual frameworks and standardized metrics – There is a need for harmonizing frameworks and metrics for reporting and impact measurement. 

  • There is a lack of capacity: From creating a concrete evidence-base on the impact and effectiveness of NbS from technical and financial perspectives to completion of bankable and scalable NbS best practices and compendium of knowledge products and tools, there is an existing gap in capacity to ensure high-quality and high-integrity NbS that is sustainable in the long run and avoid the risk of misuse

  • Forming partnerships and collaboration is necessary to address the existing gaps and breaking down barriers – Partnerships are crucial to address the existing technical and financial gaps across different sectors and thematic areas. 

  • It is important to consider inclusive finance and Just Transition - It is important to ensure that uptake of NbS and transition to a more sustainable economy is just and the financial system is equitable and accessible to all. 

Representatives from the following entities participated in this workshop: Asian Development Bank - Bankers Without Borders (BwB) - European Commission - European Union Permanent Mission to the UN - European Investment Bank - Finance for Tomorrow - ICLEI Europe - International Organisation for Knowledge Economy and Enterprise Development (IKED) - Integrity Global Partners - International Union for Conservation of Nature (IUCN) - Lombard Odier – Mirova - Secretariat of the Convention on Wetlands (Ramsar) - Rebalance Earth - SURA Investment Management - Steinbeis-Europe - Swiss Agency for Development and Cooperation (SDC) - United Kingdom Foreign, Commonwealth & Development Office (FCDO) - United Nations Environment Programme Finance Initiative (UNEP FI) - United States Permanent Mission to the UN - The World Bank - World Wide Fund for Nature (WWF).