2DII will support the mainstreaming of investment in NBS by leading research on how to better incentivise investment in NBS and ensuring appropriate orientation of financial flows by identifying and quantifying most promising investment opportunities. Our efforts will also improve understanding and awareness of investments in NBS through work on reporting, labelling and developing education and information tools for private investors.
Interconnection between climate change and biodiversity loss
Biodiversity and climate change are two interconnected issues:[3]
- First, climate change is detrimental to biodiversity. It is one of the main direct drivers of biodiversity loss[4] and exacerbates indirect drivers of biodiversity loss (e.g.rising temperatures can lead to spread of invasive species that threaten biodiversity).[5]
- Second, biodiversity provides the ecosystem service of climate regulation though carbon stores such as forests, peatlands and wetlands. Biodiversity loss has negative effects on climate change through degrading sources of carbon storage and releasing carbon emissions.[6]
- Third, biodiversity is an important resource for increasing resilience to negative impacts of climate change. It can provide protection against extreme climate and weather events such as unexpected rainfalls, droughts, storms etc.
Conservation actions related to climate change and biodiversity can entail synergies and trade-offs. For example, actions to protect biodiversity can simultaneously contribute to climate change mitigation (e.g. conservation of forests or mangroves results in sequestration of carbon). On the other hand, actions to mitigate climate change can result in biodiversity loss (e.g. land use to install clean energy infrastructure without taking into consideration local biodiversity factors may be detrimental to local ecosystems).[7]
As highlighted by the IPCC and the IPBES, limiting global warming and protecting biodiversity are mutually supporting goals, and achieving both goals is essential for sustainably and equitably providing benefits to people.[8]
IPCC and IPBES also underline that addressing either the climate or the biodiversity loss crisis without considering the other could lead to a failure on both fronts[9]. Therefore, it is clear that both issues should be addressed in a coordinated manner.
Global and EU targets related to interactions between climate and biodiversity
At the global level, the Kunming-Montreal Global Biodiversity Framework[10] takes into account the interconnection between climate and biodiversity.
Target 8 of the framework relates to minimising the impact of climate change and ocean acidification on biodiversity and increase its resilience through adaptation, and disaster risk reduction actions. The target then refers to nature-based solutions and/or ecosystem-based approaches as mitigation, adaptation, and disaster risk reduction actions.[11]
Target 11 aims at restoring, maintaining and enhancing nature’s contributions to people, including ecosystem functions and services, such as the regulation of climate, as well as protection from natural hazards and disasters. Here again nature-based solutions and/or ecosystem-based approaches are mentioned as adapted actions.[12]
Finally, Target 19 relates to substantially and progressively increasing the level of financial resources from all sources to mobilise at least $200 billion per year by 2030. One of the means mentioned by the target is optimizing co-benefits and synergies of finance targeting the biodiversity and climate crises.[13]
The EU Biodiversity Strategy[14], in line with the Kunming-Montreal Global Biodiversity Framework, also takes into account interactions between climate and biodiversity. A whole set of actions is related to win-win solutions for energy generation which includes prioritising renewable energy solutions favourable to biodiversity. The EU also plans to invest a significant portion of the EU budget dedicated to climate action in biodiversity and nature-based solutions.[15]
Mainstreaming investment in nature-based solutions
NBS are “actions to protect, conserve, restore, sustainably use and manage natural or modified terrestrial, freshwater, coastal and marine ecosystems, which address social, economic and environmental challenges effectively and adaptively, while simultaneously providing human well-being, ecosystem services and resilience and biodiversity benefits.” [16]
NBS can help with climate mitigation, adaptation and resilience, for example:
- Restoring coastal ecosystems and protecting forests can help climate change mitigation through carbon sequestration;
- Creating green roofs and walls and planting trees in cities can help climate change adaptation through reducing the impacts of heatwaves;
- Restoring and protecting forests and wetlands can improve adaptation and resilience by protecting communities and infrastructure from floods or other natural disasters. [17]
When implemented properly NBS will also help conserve and restore biodiversity. Here it is important to note that not all NBS are automatically beneficial for biodiversity. For instance, afforestation with non-native monocultures may have low biodiversity value[18].
NBS represent a strategic approach to address the climate crisis and biodiversity loss, but their financing is currently limited.[19] According to a UN report dated 2022, “climate, biodiversity, and land degradation goals will be out of reach unless investments into nature-based solutions quickly ramp up to USD 384 billion/year by 2025, more than double of the current USD 154 billion/year”. The report also underlines the need to further mobilise the private sector. Indeed, currently, most NBS projects are financed by public and philanthropic funds. Private investors only represent 17% of total investments into NBS.[20]
Mainstreaming investment in NBS is therefore crucial. 2DII will support the mainstreaming of investment in NBS by leading research on how to better incentivise investment in NBS and ensuring appropriate orientation of financial flows by identifying and quantifying most promising investment opportunities. Our efforts will also improve understanding and awareness of investments in NBS through work on reporting, labelling and developing education and information tools for private investors.
As a conclusion, it is imperative that mainstreaming NBS is accompanied by the definition and implementation of ambitious transition plans for drastic and sustained reductions in greenhouse gas emissions. Indeed, the use of NBS cannot replace the needed transformation towards a cleaner economy.[21] Moreover, biodiversity conservation and restoration should not be seen solely as measures for climate change mitigation or adaptation. Benefits provided by nature go way beyond this. Nature provides human beings with all elements necessary for life on earth: food, water, air, health, physical and psychological well-being, and spiritual and cultural inspiration. It is clear and scientifically proven that biodiversity conservation and restoration helps to tackle issues linked to climate change, but one must not forget they are also goals in their own right[22].
[1] COP28 puts nature at ‘heart’ of climate action, Environmental Finance, 14 July 2023
[2] IPBES-IPCC Co-Sponsored Workshop on Biodiversity and Climate Change, 10 June 2021
[3] IPBES-IPCC Co-Sponsored Workshop on Biodiversity and Climate Change, 10 June 2021
[4] Convention on Biological Diversity, Climate change is a major and growing driver of biodiversity loss, 26 November 2018
[5] Beyond climate: addressing financial risks from nature and biodiversity loss, Inspire, Policy briefing paper 09, December 2022
[6] Beyond climate: addressing financial risks from nature and biodiversity loss, Inspire, Policy briefing paper 09, December 2022
[7] Beyond climate: addressing financial risks from nature and biodiversity loss, Inspire, Policy briefing paper 09, December 2022
[8]IPBES-IPCC Co-Sponsored Workshop on Biodiversity and Climate Change, 10 June 2021
[9]IPBES-IPCC Co-Sponsored Workshop on Biodiversity and Climate Change, 10 June 2021
[10] Kunming-Montreal Global Biodiversity Framework dated 19 December 2022
[11] Kunming-Montreal Global Biodiversity Framework dated 19 December 2022, Target 8
[12] Kunming-Montreal Global Biodiversity Framework dated 19 December 2022, Target 11
[13] Kunming-Montreal Global Biodiversity Framework dated 19 December 2022, Target 19
[14] EU biodiversity strategy for 2030, Bringing nature back into our lives, May 2021
[15] EU biodiversity strategy for 2030, Bringing nature back into our lives, May 2021
[16] Definition of the Resolution adopted by the United Nations Environment Assembly on 2 March 2022
[17] Nature-based Solutions Initiative, Good examples Nature-based Solutions
[18] Understanding the value and limits of nature-based solutions to climate change and other global challenges, Nathalie Seddon, Alexandre Chausson, Pam Berry, Cécile A. J. Girardin, Alison Smith and Beth Turner, October 2019
[19] Pathways to Unblocking Private Financing for Nature-based Solutions, World Resources Institute, 23 February 2023
[20] Doubling finance flows into nature-based solutions by 2025 to deal with global crises – UN report
[21] Resolution adopted by the United Nations Environment Assembly on 2 March 2022
[22] Biodiversité et changement climatique. L’ambivalence de la promotion européenne du concept de services écosystémiques, Droits européens 2017, pages 69 à 98
