European Business & Biodiversity Campaign - News

New Study from OroVerde and Global Nature Fund

Private capital for nature conservation: Could impact investments be a solution?

A major issue at international conferences on climate and nature conservation is how to finance forest and biodiversity conservation. Since more and more funding is needed for nature conservation, the private sector is being assigned a key role in providing finance. Investments in nature conservation are made through various financial instruments, which not only provide a financial return but are also meant to have a positive social and ecological impact. Such investments are called "Impact Investments.

In this context, the tropical forest foundation OroVerde and the Global Nature Fund analysed the design of a number of Impact Investments with emphasis on their contribution to the conservation of biodiversity. Using local case studies and a list of criteria, an investigation was carried out looking at the ecological and social impact as well as accompanying risks, returns, impact measurement and other aspects of five existing Impact Investments in Latin America.

The results show that there are still only relatively few projects related to the conservation of biodiversity, despite a growing demand for investments in nature conservation. From retail investors to pension funds, and wealthy private individuals, investors are increasingly concerned about the impact of their investments. Impact Investments offer an alternative to classical forms of investment: they focus not only on the rate of return and the risks involved but also on the social and/or ecological impact. Such Investments also promote sustainable business models and industrial sectors and provide capital recipient easier access to capital and markets.
The study is available under: