Investors, lenders and insurers have called on governments to require that companies and financial institutions develop meaningful nature transition plans, based on sectoral transformation pathways, alongside their climate transition plans.

They said that although climate transition plans must incorporate nature, there is a specific need for dedicated nature transition plans.

The recommendation is one of several set out by the Finance for Biodiversity (FfB) Foundation in a paper on how governments can take to align financial flows with the Kunming-Montreal Global Biodiversity Framework (GBF).

This was adopted at the 2022 summit (COP15) of the UN Convention of Biological Diversity (CBD), which marked the first time that countries agreed to set a target for the alignment of financial flows.

The next UN biodiversity summit, COP16, is scheduled for October-November this year, with countries supposed to submit national biodiversity strategies and action plans before then.

Made in Marseille – The framework for a global biodiversity strategy

The next UN biodiversity summit is scheduled for October-November this year,

A key message from the FfB Foundation is that countries should take a “whole-of-government approach” to mobilise voluntary action and commitments from the private sector.

This should include a sectoral approach, “setting clear boundaries and clear boundaries and promoting innovation in the most impactful sectors on nature like the food sector, chemicals and mining through policy tools such as regulation, tax reform, and subsidies”.

Sonya Likhtman, who works in the engagement and stewardship team at Federated Hermes and is the co-chair of the FfB public policy advocacy working group, said the success of the GBF comes down to national implementation.

“Governments should take steps to create an enabling environment for investors to effectively manage their nature-related risks and opportunities,” she said.

“We hope these recommendations will support the much-needed shift from ambition to implementation, and look forward to continuing the dialogue with key stakeholders in the run up to COP16.”

Emine Isciel, head of climate and environment at Storebrand Asset Management, and the other co-chair of the FfB public policy advocacy working group, said the report was “a powerful call from investors for governments to strengthen, broaden and accelerate their national biodiversity policies and strategies”.

Speaking during a webinar today, Markus Lehmann, senior programme management officer in the UN CBD Secretariat, said seven countries had so far submitted national biodiversity strategies and action plans but cautioned against reading too much into that as more submissions were expected by COP16.

The FfB Foundation is an observer to the Convention of Biological Diversity. Established in March 2021, it has nearly 80 active members across 26 countries, including asset managers, pension funds, banks and insurers. Membership is open to financiers who have signed the Finance for Biodiversity Pledge, which now has some 170 backers representing around €22trn in assets under management since being launched in 2020

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