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Bold steps needed to bail out nature

Sustainable finance

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Finance Watch publishes landscape paper on natural capital and ecosystem services

Brussels, 22 May 2019 – Avoiding climate and environmental breakdown will require more than current efforts to scale up conservation finance, according to a report published today by Finance Watch, the public interest association working to make finance serve society.

This month, IPBES warned of an unprecedented decline in nature and accelerating rates of species extinction. It also makes clear that meeting this challenge requires changes in production and consumption models. Changes in financial systems are needed as well.

Finance Watch’s Secretary General, Benoît Lallemand, said:

“Nature is the ultimate too-big-to-fail; if it goes, the economy and our societies go with it. We found trillions to save the banks, surely nature deserves the same attention. Our landscape paper describes what a ‘bail-out plan for nature’ might contain: redirecting public subsidies on energy, agriculture and fisheries; mandating companies and private finance to take account of long-term environmental impacts; and dramatically upscaling public and mission-oriented financing.”  

The author of the report, Ludovic Suttor-Sorel, said:

“Natural capital accounting can help companies and investors to internalize the costs of their activities on nature. But nature is a public good, which puts an inherent limit on how far we can go with market-based approaches. The debate needs to include scaling up public banks via their capitalization, mandate, and governance; using monetary and macroprudential tools; and promoting mission-oriented, purpose-driven financial institutions such as ethical and stakeholder banks.”

On 6th May 2019, the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) warned that human activity is putting a million species at risk. In October 2020, the 15th Conference of the Parties (COP) to the Convention on Biological Diversity (CBD) will take place in Beijing.

Finance Watch’s landscape paper maps the efforts made so far in conservation finance and suggests some policy ideas ahead of the 2020 COP:

  • Central banks should add environmental risk to the macro-prudential framework
  • A new task force should be created on corporate and financial disclosure of environmental risks
  • Agree common methodology and implement natural capital accounting
  • Companies should be required to first assess and then disclose their interactions with natural capital and ecosystem services
  • Governments should use natural capital valuations in their policy making
  • Governments should mandate and capitalise public banks and actively promote other forms of mission-oriented finance
  • Recommendations to promote longer-term investing should be implemented at company, investor and supervisory levels

ENDS

For further information or interview requests, please contact:

Charlotte Geiger, Senior Communications Officer at Finance Watch, at charlotte.geiger@finance-watch.org or at 0032/(0) 2 880 0441.

 

NOTES TO EDITORS

 

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