Building a path to finance
the biodiversity framework
In the context of the Luxembourg-GLF Finance for Nature Platform
We must finance a future where nature and people thrive together, with finance that is fair, equitable, and impactful. These six building blocks are key to securing long-term protection for biodiversity and the communities that depend on it.
Though there is not a ‘one-size fits all’ approach, these building blocks contribute to reaching the Target 19 of the Kunming-Montreal Global Biodiversity Framework, mobilizing $200 billion annually for biodiversity. Any financing approach must be holistic, tackling the interconnectedness of biodiversity, climate change, and desertification.
Building block 1: Recognizing and rewarding the values of nature
A future where nature’s contributions to humanity are widely acknowledged, valued and safeguarded through robust financial and policy incentives.
Goal: Recognize the diverse values of nature and establish systems that incentivize protection and sustainable use of ecosystems.
Approach: Mechanisms such as Payments for ecosystem services (PES), tax rebates and biodiversity certification programs are designed to encourage restoration and conservation.
Frameworks that integrate biodiversity into national and corporate accounts support fair and better-informed decisions, fostering a culture that values ecosystem services.
The wider adoption of PES approaches reward individuals, communities and companies that adopt biodiversity-positive practices and deliver products and services that enhance biodiversity.
Biodiversity-friendly labels and certification schemes for sustainably produced goods also help recognize and promote sustainable practices.
To do list:
- Raise awareness on the diverse values of biodiversity and ecosystem services and support policy reforms to ensure their meaningful inclusion in decision-making.
- Establish national and corporate frameworks to value natural assets and services, enabling more comprehensive ecosystem accounting that nurtures planning and development strategies.
- Reward conservation through more ambitious PES approaches, with financial incentives like tax rebates and certification programs, and non-financial incentives like institutional support and technical assistance.
- Create education partnerships to integrate biodiversity conservation into school curricula, fostering early awareness.
- Engage Multilateral Development Banks, Public Development Banks, and International Financial Institutions to develop nature- and climate-aligned policy loan instruments for national governments to better understand and integrate risks into their public policy, related to infrastructure planning, protected areas, and broader economic development.
Key initiatives and organizations to follow, engage with and support (non-exhaustive):
Building block 2: Financing local communities and Indigenous stewards
Conservation, sustainable resource use and restoration depend significantly on the contributions and traditional knowledge of local communities and Indigenous Peoples. Equitable access to long-term funding and benefits needs to be ensured.
Goal: Work with local communities and Indigenous Peoples in conservation efforts, providing financial support and fair benefits for their biodiversity stewardship.
Approach: Frameworks that ensure communities benefit directly through fair access to resources and decision-making processes better conserve biodiversity.
Community-managed funds, access and benefit-sharing under the Nagoya Protocol, sustainable value chains including eco-tourism opportunities and direct financial support, strengthen local initiatives.
Financing fosters sustainable livelihoods by linking local economies to conservation, creating long-term incentives for protecting natural resources.
To do list:
- Decolonize funding by co-designing community-managed funds that enable local groups to lead biodiversity projects.
- Increase and developer further small-grant opportunities, small loans (microfinance), as well as microinsurance schemes
- Implement access and benefit-sharing policies and mechanisms that provide countries, communities and sub-national entities with fair compensation for their conservation work.
- Strengthen capacity-development and -sharing to align funding structures and mechanisms with traditional knowledge systems, values and practices.
- Promote eco-tourism and other biodiversity-based income sources and provide market access for sustainably produced goods.
- Adopt technology to facilitate governance, access and transparency to information and resource mobilisation that is locally responsive for Indigenous Peoples and local communities in their landscapes.
Key initiatives and organizations to follow, engage with and support (non-exhaustive):
Building block 3: Integrating landscape-based solutions for broader impact
Effective biodiversity finance addresses conservation challenges holistically, bridging agriculture, forestry, water management and urban development to create integrated, large-scale solutions for nature and people.
Goal: Build landscape-level finance solutions for biodiversity and foster cross-sectoral cooperation across all levels, including international, regional, national and sub-national.
Approach: Landscape-based financing strategies encourage collaboration across different sectors and align with international agreements while increasing efficiency of financing solutions. Involving agriculture, forestry, tourism, water and urban planning, can embed biodiversity-friendly practices in land use planning and resource management.
Landscape-level platforms and partnerships can enable the sharing of resources, knowledge and policy support to maximize conservation and climate impact. Cross-sectoral synergy creates efficient pathways to holistically address pollution, promote sustainable practices and restore fragmented ecosystems.
To do list:
- Establish multi-sector collaborations and governance processes to integrate conservation into agriculture, forestry and urban areas.
- Create frameworks that unify multilateral environmental agreements (MEAs) and support cross-sectoral funding.
- Implement landscape-level monitoring to assess investment impacts on biodiversity, land and climate, adapting strategies and portfolios as needed.
- Host landscape-level dialogues and exchanges at the national and regional-levels that bring together finance stakeholders and various sectors and countries for unified planning and action.
Key initiatives and organizations to follow, engage with and support (non-exhaustive):
Building block 4: Strengthening domestic financing and redirecting harmful subsidies
A financial system that prioritizes biodiversity by eliminating harmful subsidies and creating funding mechanisms for local conservation.
Goal: Develop robust domestic financing mechanisms and repurpose harmful subsidies to support biodiversity conservation, restoration and sustainable use.
Approach: Conservation trust funds, payments for ecosystem services (PES) and biodiversity-positive green fiscal reforms can strengthen domestic finance for biodiversity.
Governments play a central role by allocating budgets, creating policies that promote biodiversity-friendly initiatives, and redirecting harmful subsidies toward sustainable practices.
To do list:
- Create or enhance conservation trust funds to support long-term biodiversity financing.
- Develop PES schemes that reward communities and landowners for conserving biodiversity.
- Implement green fiscal reforms, such as biodiversity-positive taxes and fees, to fund conservation efforts while discouraging harmful practices.
- Redirect harmful subsidies, such as those for unsustainable agriculture or fossil fuels, toward conservation and restoration programs.
- Promote biodiversity budget tagging to ensure governments allocate specific resources for conservation.
- Introduce biodiversity offsets aligned with the “avoid-reduce-offset” mitigation hierarchy to finance restoration and conservation projects.
Key initiatives and organizations to follow, engage with and support (non-exhaustive):
Building block 5: Mobilizing private investments and promoting blended finance and other risk-mitigation strategies
A dynamic financial landscape where private investment supports biodiversity conservation and restoration at scale.
Goal: Engage the private sector to drive biodiversity financing through innovative financial instruments, blended finance and de-risking mechanisms.
Approach: Blended finance combines public and private resources to create attractive investment opportunities while minimizing risk. Biodiversity bonds, impact funds and credit enhancements incentivize private capital for biodiversity. Corporate social responsibility (CSR) programs can promote biodiversity-positive practices in private companies.
To do list:
- Create de-risking mechanisms, including guarantees, insurance and credit enhancements, to make biodiversity projects more appealing to financial institutions and investors.
- Improve and develop biodiversity-friendly financial instruments such as impact funds, to attract private investors for biodiversity-positive investments.
- Establish partnerships between governments, businesses and financial institutions to co-fund conservation initiatives.
- Develop guidelines and institutionalize examples to encourage financial institutions to integrate biodiversity into lending and investment products.
- Accelerate greening of the financial sector, supporting alignment of green financial products with biodiversity objectives
- Promote CSR programs and impact marketing focused on local biodiversity conservation.
- Carefully assess and define conditions for locally-relevant and -inclusive biodiversity credit approaches as one form of nature-stewardship credits, and offset credits with strict application of the mitigation hierarchy
Key initiatives and organizations to follow, engage with and support (non-exhaustive):
Building block 6: Increasing the ambition: we need more, better and faster
Development cooperation policies and a financial system that prioritize biodiversity by increasing funding for conservation initiatives.
Goal: Strengthen funding commitments that provide timely and direct support to landscape-level conservation and restoration finance solutions, especially in the Global South, and amplify their impact by bridging the Rio Conventions and adopting human-rights based approaches.
Approach: Global biodiversity funding commitments should be expanded to match the scale of international climate finance. Leveraging the synergies between the Rio Conventions — biodiversity, climate change and desertification — can make financing across all three more impactful. Simplifying funding processes can ensure easier direct access for Indigenous Peoples, local communities and developing regions.
To do list:
- Advocate for greater funding commitments from global organizations, development banks and donor countries.
- Support the ambition-raising of newly established mechanisms such as the Global Biodiversity Framework Fund (GBFF) and the Cali Fund capitalizing on DSI revenues.
- Simplify funding processes, reduce intermediaries and promote human-rights approaches to ensure efficient and direct resource allocation to national entities with direct access, as well as local communities and conservation projects.
- Establish training programs to help both donors and recipients design, navigate and utilize international and domestic funding mechanisms.
- Channel funds to finance solutions and large-scale ecosystem restoration projects in biodiversity hotspots.
Key initiatives and organizations to follow, engage with and support (non-exhaustive):
Ludwig Liagre (GLF), Dinara Akhmetova (World Bank), Heitor Dellasta (Sitawi), Francesca Randazzo (Luxdev), Juan Carlos Ramos (Ecoagriculture), Hannah Simmons (ERA), Daniel Zimmer (Climate-Kic) and Ermias Betemarian (CIFOR-ICRAF).
