New network to integrate biodiversity in the financial system

The sun shining through the leaves of a tree.

A research and innovation programme that will embed biodiversity into the financial system has launched a network and hub to deliver its second phase.

Incorporating biodiversity impact in financial decision-making is critical to ensure we can reduce the global economy’s damage to the planet and improve sustainability.

The £7 million programme is funded by the Natural Environment Research Council (NERC) and Innovate UK, part of UK Research and Innovation (UKRI).

Enabling green economic growth

The programme’s new network and strategic coordination hub have received £3 million of that investment to utilise the outcomes delivered in the first phase of the programme.

This multi-stakeholder community will build knowledge, tools, collaboration and capacity that can support this goal. The network will connect with the financial services sector as well as business, public and third sectors.

Restoring our biodiversity

The Integrating Finance & Biodiversity for a Nature Positive programme has three flagship initiatives:

Financing green sector transitions

This initiative supports the agricultural sector, which accounts for over 70% of landcover, to restore nature.

Greening finance for nature

This initiative addresses how decision-making processes in financial institutions such as banks and asset management companies impact nature.

Financing biodiversity

This initiative delivers investment in biodiversity conservation.

Better financial decisions

Professor Louise Heathwaite, Executive Chair of NERC, said:

This NERC funding will empower financial decision makers in the financial, agricultural and public sectors to consider the impact of biodiversity in their investments.

The research will support the transition to a more nature-positive global financial system, and it expands NERC’s growing Green Finance portfolio of investments.

Tackling biodiversity loss and climate change

The finance system has a key role in shaping how the global economy responds to the intertwined challenges of biodiversity loss and climate change.

According to the Nature of Business Survey, the majority of business leaders want to take steps to tackle biodiversity loss, but progress has been slow due to a lack of data.

Closing the knowledge gap

Dr Nick Wells, Principal Investigator of the network and Director of Impact and Innovation at UK Centre for Ecology & Hydrology (UKCEH), said:

Our vision is to build national capability bridging scientific, finance, policy and third sector communities, harnessing and catalysing world-leading science to enable the greening of finance for nature and mobilisation of capital for nature recovery.

Emily McKenzie, the Technical Director of The Taskforce on Nature-related Financial Disclosures (TNFD), said:

To close the financing gap for nature and biodiversity protection and recovery, businesses and financial institutions need to begin to measure and disclose their impacts on nature and their dependencies on the many vital services that nature provides. This is at the core of the recommendations of the Taskforce on Nature-Related Financial Disclosures.

To achieve this, companies and financial institutions urgently need to be able to access robust data, models and tools to assess their nature-related dependencies, impacts, risks and opportunities.

I’m delighted to welcome  UKRI’s Integrating Finance and Biodiversity for a Nature Positive Future Programme, which will play an important role in filling the data and knowledge gaps and help accelerate progress.

Rhian-Mari Thomas, Chief Executive of Green Finance Institute, said:

The financial sector will be a key part of the ambition to transition to an economy that values and invests in nature – as will the research sector. The NERC Integrating Finance and Biodiversity programme will play a critically important role, bridging the UK’s world-leading research base and our unique position as a key global Green Finance Centre, to develop the new data, frameworks and financial products to support the mobilisation of private finance into nature restoration and positive nature outcomes.

At the Green Finance Institute, through our work with the finance sector, and as host to the Group of Financial Institutions for Nature (G-FIN) we are delighted to support the NERC Integrating Finance and Biodiversity network to strengthen meaningful engagement between financial institutions and UK nature finance, facilitating transformative impact driven by evidence-based academic research.

Find out more about the first phase of the programme and research projects.

Further information

The UK Financial Institutions for Nature Group, established by the Green Finance Institute, will act as the network’s independent advisory group. This group of 20 financial organisations will provide guidance on emerging research challenges, feedback on outputs and dissemination, and programme delivery.

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