Empowering Financial Institutions for a Nature Positive Global Economy by 2030

Empowering Financial Institutions to Shape a Nature-Positive Global Economy

With the recent global agreement on biodiversity, which ms for the halt and reversal of biodiversity loss by 2030, governments are being tasked with eliminating harmful subsidies, aligning financial flows towards nature conservation, and requiring the private sector to disclose risks related to nature. As global leaders like Antonio Guterres have emphasized, we must our destructive battle agnst nature.

This landmark Kunming-Montreal Global Biodiversity Framework GBF provides a guiding star for actions on biodiversity akin to the 1.5°C target set for limiting climate change outlined in the Paris Agreement. Implementation at national and sectoral levels will necessitate actions from companies, financial institutions, investors, and other stakeholders.

For those who are unsure about how these developments translate into practical steps, there are four key priorities that can help leverage opportunities to shape a nature-positive global economy:

1. Integrate Nature in Transition Plans

The dual challenge of climate change and biodiversity loss is intertwined such that tackling one effectively requires investment in the other. The $4.1 trillion funding gap that needs to be filled means we need to scale up our efforts on nature restoration and protection.

Instituting clear transition plans, backed by science-based targets that outline pathways for reducing impact, can help navigate this challenge. These plans should focus on specific areas like phasing out subsidies for fossil fuels and transitioning towards renewable energy sources in line with the principles outlined in the Framework.

2. Enhance Transparency Through Nature-Related Financial Disclosures

The Taskforce on Climate-Related Financial Disclosures TCFD has been successful in promoting transparency around climate risks, but it's now time to build on this momentum by introducing the Taskforce on Nature-related Financial Disclosure framework. Tools like the WWF Biodiversity Risk Filter can help companies and investors identify and manage emerging nature-related risks across various aspects of their operations.

For instance, industries heavily reliant on commodities such as soy, beef, and palm oil should be vigilant about deforestation and conversion pressures from their supply chns. Following guidelines established by the Accountability Framework is essential for promoting sustnable practices among producers, traders, and smallholders alike.

3. Incorporate Nature into Financial Regulation

The integration of nature-related risks in financial regulations can significantly accelerate investment towards a nature-positive future. By recognizing and prioritizing actions aligned with the GBF goals, financial regulators can provide clarity and stability to markets.

Moreover, replacing investments in environmentally damaging activities with those that support nature conservation efforts is crucial. This could involve leveraging private investment for public goods such as improved health infrastructure, climate resilience measures, and restoration projects.

4. Advocate for Improved Financial Governance

The world's leading financial institutions need to be held accountable for their environmental impact by embracing broader reforms within the financial system. The International Monetary Fund IMF and World Bank should align their governance and objectives with global sustnability goals, ensuring they reflect the economic potential of emerging markets.

By advocating for stronger financial governance and supporting global initiatives that promote nature conservation, these institutions can play a pivotal role in facilitating the transition to a nature-positive economy.

As we race agnst time to address climate breakdown and ensure a just transition towards a sustnable future, empowering financial institutions with tools, knowledge, and regulatory support becomes more critical than ever. Embracing a nature-positive approach means investing not only for profit but also for preserving the planet's health and biodiversity.

To learn more about WWF's pioneering work on sustnable finance, how you can collaborate with us in shaping a nature-positive economy, or to contribute your support, please contact [email protected]. Join us in the quest to sustn our natural world for the benefit of people and nature together.

Nature Positive by 2030 #TheRaceIsOn

WWF
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