How can the UK implement the Global Biodiversity Framework’s finance goals?

Finance is a major structural driver of biodiversity loss, but potentially could also be a big part of the solution.

It is estimated that around $7 trillion (per annum) of financial flows are damaging the environment, including via harmful subsidies (UNEP 2023). At the same time, we see a significant ‘nature-finance gap’, estimated at 5-7 times current spending on biodiversity conservation globally (approximately $200 billion pa; Deutz et al. 2020).

This is acknowledged in the Kunming-Montreal global biodiversity framework (GBF) with Targets 14, 15, 16, 18 and 19 all targeting the tackling of harmful subsidies, the need of businesses and financial institutions to assess and address their impacts, risks and dependencies on nature, and upscale nature-positive investment. The GBF recognises therefore that reducing harm and addressing the nature finance gap will require a mix of ‘greening finance’ and ‘financing green’ approaches. However these goals are aspirational, and there remain critical evidence gaps about how to achieve them in practice.

In this Sprint, we aim to address three major evidence gaps, through high-impact, novel research with direct policy relevance, conducted in collaboration with policymakers:

1. how to reduce the biodiversity impacts of UK foreign investments and align UK international financial flows with the ambitions of the GBF through greening finance (reducing the UK private finance share of the $7 trillion pa);
2. how to scale up private finance for financing green to help close the ‘nature-finance’ gap and achieve these overall goals; and
3. how interventions aimed at greening finance and financing green can work synergistically together to achieve overall goals of the Kunming-Montreal agreement.

Together, these research streams aim to combine to deliver the first empirically-grounded, detailed picture of how mechanisms for greening finance and financing green can interact to support a country’s contributions to meeting the goals of the GBF. This will provide key information to Defra looking to help facilitate the UK’s and other countries’ implementation of the GBF, as well as inform their policy on global financial architecture.

Why this SPRINT? Why now?

Global biodiversity continues its long-term decline, and yet despite decades of rhetoric, many of the structural drivers of biodiversity loss remain unabated. Yet we are running out of time to start implementing real solutions; the Earth system is demonstrating preliminary signs of severe stress that may well eventually cause catastrophic economic damage to humanity.

If the Sprint is successful, we want to be the first team and set of policy institutions to have credible answers to how to achieve the finance targets of the Global Biodiversity Framework, as far as possible based on real data. This will enable Defra’s international team to share empirically-derived advice with LMICs and partners in the global south, and allow countries in the EU and globally to learn from the UK’s experience in their development of their national implementation and finance strategies which are a mandatory component of the forthcoming EU Restoration Law. Importantly, the evidence from the Sprint will also include social considerations (in the Oxfordshire case study) and investigate empirically how to make sure the investment generated by nature markets ends up in the right places to also achieve community-inclusive development and support the SDGs and align with domestic agendas such as Levelling Up. This is key to avoiding internationalising nature markets which exacerbate social inequities, which is currently a very real possibility.