The purpose of this programme is to explore the gaps and integration between the financial system and biodiversity.
The programme will establish a virtual hub and spoke networks that will convene and catalyse a multi-stakeholder community and support this integration. Recognising this integration is complex, driven by the financial services community and rapid development of public policy. It will require underpinning academic data and knowledge of different scales, from local to international.
This opportunity is designed to drive the development of knowledge, tools and a skilled community to incorporate reporting on biodiversity for all business sectors.
To address this challenge, the hub and spoke networks will be responsible for delivering:
- community networks across academic, business and policy, with common understanding, aims and linked approaches to embed biodiversity value into financial decision-making
- a robust suite of standardised, accessible, and verifiable data and metrics, tools, methods and frameworks that incorporate biodiversity into financial services
- a common framework and language to incorporate biodiversity as an asset that recognises value differs between audiences.
The environmental science community has the capacity to fill knowledge gaps, and provide environmental data and evidence to develop tools to incorporate biodiversity, as an asset or value, into private finance. In doing so, the community and financial sector can work together to help reverse the global trend of biodiversity depletion. This will be achieved through a change in business and consumer behaviour for a nature-positive future.
Expectations
Nature Positive Future programme awards are expected to complement and draw on the current NERC-led Economics of Biodiversity (EoB) programme.
The EoB programme explores the multiple values of biodiversity to many sectors of society using a broader economic (rather than financial) perspective. This includes both the ‘Synthesising evidence in economics of biodiversity’ and ‘Improve understanding of the economics of biodiversity’ funding opportunities and award holders.
Awards will also draw on the NERC and Innovate UK ‘Climate and environmental risk analytics for resilient finance (CERAF)’ programme, including the UK Centre for Greening Finance and Investment (UKCGFI), which is developing a platform for climate and environmental analytics for resilient finance.
In building on these programmes, the Nature Positive Future awards will:
- harness the strong environmental sciences research base
- build on the tools and data from these and previous NERC investments, such as the Valuing Nature Programme.
The Nature Positive Future programme is core to NERC’s ambitions to deliver environmental solutions and provide knowledge, capability and tools that link academic research to business needs.
All proposals are expected to have at least one project partner from the financial sector or business community and demonstrate strong engagement with this partner and relevant
stakeholders outside of academia. International collaborators can be included where there is clear value to the proposed project.
Overall programme outcomes
The Nature Positive Future programme will:
- achieve better understanding of the complex interlinkages between biodiversity, finance and society and what it means for resilience (environmental and economic) and economic prosperity to support a roadmap to ‘net zero biodiversity loss’
- deliver robust models and scenarios, leading to a more sustainable financial services industry in anticipation of a developing regulatory system (for example, UK firm-level net zero transition plans)
- develop new or merge existing datasets that link research to business and build biodiversity into a next generation of financial instruments
- raise the profile of UK leadership to leverage developing international initiatives
- mitigate risks and highlight opportunities to address interacting stressors simultaneously, for example biodiversity interacting with climate change and driving ambitions for net environmental gain.
Programme format
NERC will invest £5 million (at 80% full economic cost) in the Nature Positive Future programme in two phases.
Phase one
Phase one will fund pilot activities that will bring the biodiversity and finance communities together to begin to resolve key integration issues. This could include, for example, evidence from a knowledge and challenge synthesis activity to align business strategy with fast-moving initiatives, including the update of the UK Green Finance Strategy.
Phase one also includes the opportunity to form a coordination and integration function across pilot awards. This will integrate outcomes in real-time and develop a proposal for the creation of the hub and spoke network, which will be funded as part of phase two.
This virtual hub and spoke network funded as part of the second phase of the programme will be expected to:
- provide evidence led by private finance ambitions on Green Finance (and net zero)
- inform investment for new research to fill knowledge gaps as the sector develops.
Scope
This phase one (£1.5 million) opportunity will provide funding for pilot activities to:
- create integrated research, business and policy communities
- scope challenge details and identifying approaches to deliver research and baseline information (for example through themed workshops or hackathon type events on key topics)
- develop syntheses of current knowledge and research gaps.
Consultation with the finance and business community and other key stakeholder groups (for example a Green Finance Business Breakfast, COP15 workshop and an externally commissioned independent report) highlighted key challenges, including the following (noting that these should not lead or limit the scope and ambition of applications):
- the importance of highlighting an inter-relationship between climate and biodiversity, and the danger of treating each in isolation (trade-offs or conflicts) and the failure to recognise the inherent complexity of biodiversity and ecosystems
- how to recognise and quantify the contribution of biodiversity, such as through nature-based solutions and net zero goals
- moving beyond indicator species and reference communities towards understanding properties of biodiversity, and how to chase moving targets as climate change progresses
- defining the issues and the ‘system’ and establishing agreement on the (causal) linkages between biodiversity and business and finance, for example:
- the benefits and limits of environmental impact assessments (EIAs), and how the health of ecosystems (or other manifestations of biodiversity) can impact the operations and financial health of corporations more broadly than at an individual site (where EIAs are typically done)
- how the actions of decision makers (in business, finance and policy) impair or strengthen ecosystems
- a lack of ‘decision grade’ data and applicable methodologies and an often-cited barrier in financial services for performing functions, such as accurately assigning biodiversity to supply chains and accounting for biodiversity in statutory valuations (particularly financial statements)
- linked to the above, bridging the gap between academia and business including recognising the value of the expertise of the financial services sector in the use of scenario analysis or similar methodologies to support the incorporation of biodiversity into the analysis of business and financial risk, and expanding or improving these methodologies to incorporate biodiversity related issues
- understanding the role of biodiversity valuation in implementing renewables pathways.
Coordination and integration funding
Phase one will also provide an additional £250,000 of funding post-award for an integration and coordination function to:
- coordinate activity across the pilot awards
- integrate the outcomes from these awards in real time
- develop an understanding of both the gaps in knowledge and the potential for broader user engagement than the partners brought in through the pilot
- work collaboratively across the awards to develop the full bid for the hub and spoke for phase two funding.
It is expected that this key coordination and secretariat function will be led by at least one of the successful award holders in phase one. However, all successful award holders are required to engage with this overarching integration and coordination function.
Successful award holders will be invited to bid into this fund. Further details will be provided to phase one award holders once the awards have been selected.
Phase two funding
Phase two will bring the phase one awards together into a system that is user informed and accessible.
£3.5 million of funding will be available from January 2024 to bring phase one awards together into a virtual hub and spoke or distributed networks. The network will provide leadership by delivering and supporting a portfolio of activities informed by and built on phase one outcomes.
These outcomes could include:
- awards for pilot research
- the generation of skills and capability through fellowships
- feasibility testing
- translation and impact-generating activities linking to user needs such as a repository or live portal of clearly described and broadly accessible case studies to complement the theory.
Phase two is limited to phase one award holders. However, other organisations and areas of work can be incorporated as advised by the pilot work and outcomes of the phase one coordination and integration activity. Further details of this will also be provided to phase one award holders once the awards have been selected.
Funding available
We will support costs of building interdisciplinary research communities, including but not limited to:
- investigator salaries, plus associated indirect and estates costs
- travel and subsistence
- events
- workshops
- secondments
- horizon scanning
- feasibility studies and pump priming activities
- minor equipment
- administrative support.
NERC will not fund associated PhD studentships under this opportunity.
We will award 80% of the full economic costs of the project, and your organisation must agree to find the remaining balance.
NERC expects to fund a maximum of £150,000 per award for pilot activities. There will also be an additional funding of up to £250,000 available for one or two of the successful phase one award holders to undertake a coordination and integration function for awards made in phase one. Further details on this function will be provided once the phase one awards have been selected.
Awards will be made for a 12-month duration.
Projects must start by 3 January 2023.
Requests for equipment above £10,000 are not allowed as part of this funding opportunity. Smaller items of equipment (individually under £10,000) should be requested under consumables (other directly incurred costs).
NERC facilities
If NERC services or facilities are needed, then please contact researchfacilities@nerc.ukri.org to discuss your requirements. NERC can liaise directly with the specified service or facility to check if the request can be accommodated.
There is no guarantee that the service or facility will be able to accommodate the request for a technical assessment and quote in the timescale of the funding opportunity.
Programme management
NERC will establish a Programme Executive Board (PEB) to oversee the programme.
Programme engagement
Funded grants would be expected to attend a kick-off meeting, PEB meetings and to engage fully with the integration and coordination function.
Knowledge exchange and impact
Knowledge exchange is vital to ensure that environmental research has wide benefits for society and should be an integral part of any research.
Public engagement is a key part of knowledge exchange, and a route to increasing the impact of research.
All funded projects will be required to engage with programme-wide integration and coordination activities. They will also be expected to engage with other relevant NERC investments such as Economics of Biodiversity and the CERAF programme investments, including the UK Centre for Greening Finance and Investment.
