A key takeaway from COP16 is that mobilizing private finance will play a crucial role in determining the scale of progress in the coming years; however, it cannot achieve this alone.
Anita de Horde, co-founder and executive director of the Finance for Biodiversity Foundation, emphasized in a FinextraTV Unplugged Interview the need to move away from relying solely on philanthropy for funding.
"You see in many discussions at COP16 the focus on biodiversity credits and blended finance instruments. However, we need to address the larger issue of shifting that 99% and identifying viable solutions. This conversation is essential, though it is often more complicated than simply transferring funds from north to south and expecting results."
In addressing the challenges of engaging the private sector, de Horde highlighted the importance of collaboration with local governments and the necessity of obtaining more qualified data.
"The private sector cannot act in isolation; government support is vital to de-risk and facilitate investments. Collaboration is crucial in this context, and we also require asset managers with significant exposure to listed equity and corporate bonds to leverage big data to understand how they can realign their investments."
The private sector has begun to engage more since the establishment of new targets, with a notable increase in participation at each COP event.
"Following COP15, we witnessed a significant shift, with the finance sector gaining visibility at the CBD COP—evidence suggests there was only one banker present at COP14, while COP15 attracted hundreds. At COP16 in Cali, Colombia, representation has grown even further, demonstrating that biodiversity is becoming increasingly mainstream."
However, many participants still feel uncertain about how to effectively mobilize their efforts. Companies require more robust, data-driven insights to optimize the use of their resources.
"They need data to assess their impacts—both negative and positive. Scalable data and de-risking strategies are essential for ensuring that investment in nature-related solutions can thrive. Additionally, in developing countries, securing funds is crucial for meeting Global Biodiversity Framework targets and goals."
As the discussion surrounding biodiversity expands into the mainstream, private finance’s role continues to evolve. De Horde emphasizes that as interest and funding partnerships increase, collaboration with governments and the availability of detailed investment data must keep pace to achieve meaningful outcomes.