Private investment is a crucial piece of conservation finance funding gap
The nature conservation funding gap is estimated to be US$ 600-800 billion per year. Current levels of government and philanthropic funding are insufficient to address the conservation funding deficit to support conservation and restoration goals alone. However, if private investment capital becomes a significant part of the equation, it can materially contribute to narrowing the gap to address the conservation funding imperative.
To deliver the volume of investments needed to address the daunting scale of nature conservation challenges, we need investment opportunities that balance measurable, science-based conservation benefits and positive social impacts with delivering financial returns for investors.
Experience to date with private finance for nature suggests that, while there have been successes, the overall investment volumes have been small, adequate returns have not always been achieved, and the knowledge required to build scalable investment products is dispersed. –Elmedina Krilasevic, Programme Manager, IUCN
Nature+ Accelerator Fund offers viable and scalable investment opportunities through trusted partners
The Nature+ Accelerator Fund combines the unique set expertise of leading public and private institutions and platforms to address the conservation gap by attracting private finance to conservation. The Accelerator is anchored in IUCN’s global leadership in Nature-based Solutions (NbS), Mirova Natural Capital’s experience in investment management for NbS, and a trusted network of partners within the Coalition of Private Investment in Conservation (CPIC). The portfolio is anchored by funding from the Global Environment Facility (GEF).
The Accelerator will grow a conservation investment pipeline with adequate risk/return ratio by leveraging the initial US$ 8M risk-tolerant concessional finance from GEF. From there it will develop a US$ 200M in transformational, scalable, and financially viable project portfolio with significant positive outcomes for nature and society.
Expected outcomes by 2030
- A portfolio of up to 70 successful investment deals, attracting co-investment up to US$160M beyond the Nature+ Accelerator funding;
- Proof of concept of a suite of NbS, aligned to the IUCN Global Standard for Nature-based Solutions;
- Significant biodiversity and ecosystem conservation impacts, measurably reducing extinction risk of IUCN Red List threatened species and contributing towards national and global targets, including the Convention on Biological Diversity (CBD) post-2020 Global Biodiversity Framework;
- Measurable contribution towards the UNCCD Land Degradation Neutrality objectives and the UN Decade on Ecosystem Restoration;
- Climate change mitigation and adaptation impacts aligned to the 1.5oC global target set by the UNFCCC Paris Agreement; and
- Socio-economic impacts for local communities, including improved livelihoods and gender equity, contributing towards achievement of the Sustainable Development Goals (SDGs).
How it works
Project pipeline
Starting in 2021, the Accelerator Fund will offer financing (e.g., loans and equity) through the three financing windows:
We will source the project pipeline through an open application process and direct sourcing from project developers with support from the CPIC network. The selection process will start in 2021 after the fund’s first close. We expect that the Accelerator will support 70 investment deals through all windows.
Project selection criteria
In addition to demonstrating financial viability, the projects will be screened and selected competitively based on the criteria including:
- Contribution to globally significant biodiversity and improving sustainable land management in production systems;
- Equitable socio-economic impacts for local communities;
- Innovation (uniqueness, strategy, and robustness);
- Additionality, scalability, and replicability;
- Contribution to achieving gender equality; and
- Adequate management of environmental and social risks.
Projects focus areas, include:
- Marine, coastal resilience and fisheries;
- Forest protection and sustainable management;
- Forest landscape restoration (including agroforestry);
- Sustainable agriculture; and
- Freshwater and green natural infrastructure projects.
Each partner contributes to the Accelerator’s success
IUCN’s brings conservation expertise
IUCN is a membership union composed of governments, civil society organisations and indigenous peoples organisations. It harnesses the experience, resources and reach of its more than 1,400 Member organisations and the input of more than 15,000 experts. This diversity and vast expertise makes IUCN the global authority on the status of the natural world and the measures needed to safeguard it. IUCN provides the Accelerator with access to conservation/NBS expertise, ensuring high standards for conservation requirements, a high level of transparency, and access to public funds as a de-risking mechanism.
To ensure the rigor of conservation outcomes for both public and private investments, the Nature+ Accelerator Fund relies on the best practice and growing evidence from nature-based solutions approaches spearheaded by IUCN, its commissions and members. For instance, the accelerator will apply the newly created Global Standard for Nature-based Solutions and the IUCN Species Threat Abatement and Recovery (STAR) metric within its investment portfolio.
Mirova contributes fund management experience
Mirova has been selected to structure and operate the Nature+ Accelerator Fund, with the aim of maximising additionality and complementarities with existing funds and capital available for conservation finance. The fund will be managed through Mirova’s fully-owned subsidiary, Mirova Natural Capital, an experienced and recognised asset manager with an impact-driven approach to investment aligning strong financial returns with measurable environmental and social impact. Mirova is the product of the acquisition in 2017 of Althelia Ecosphere Ltd, a pioneer impact investor in the natural capital space, by Mirova, the leading European Responsible Investment platform, and is committed to be the leading global natural capital fund manager
GEF adds financial know-how and anchor funding
The Global Environment Facility was established on the eve of the 1992 Rio Earth Summit to help tackle our planet’s most pressing environmental problems. Since then, the GEF has provided close to $20.5 billion in grants and mobilized an additional $112 billion in co-financing for more than 4,800 projects in 170 countries. Through its blended finance initiative, the GEF has provided more than $800 million in support for 98 projects, mobilizing $8 billion.
CPIC’s provides a blueprint
The Coalition for Private Investment in Conservation is a global multi-stakeholder initiative focused on enabling conditions that support a material increase in private, return-seeking investment in conservation. This unique collaboration of major global institutions to advance investment in nature draws from the work of the CPIC, which supports the Accelerator through a working group focused on investment structuring. The Accelerator relies on investment blueprints from the 80+ member CPIC community (a group of leading civil society organisations, private and public sector financial institutions and academia working to deliver a material increase in private, return-seeking investment in conservation).
Learn more about the Accelerator from this launch webinar recording
Transparency and Accountability
To ensure a high level of integrity, best practice, and lessons learned for the entire sector, the fund will rely on the following tools:
- Best practice impact framework developed with stakeholders
- Regular reporting on financial performance and indicators
- Managing environmental and social risks following the IFC Environmental and Social Safeguards
For more information
Elmedina Krilasevic: elmedina.krilasevic@iucn.org
Edit Kiss: edit.kiss@mirova.com
