This is about systemic change. This is about redirecting the cash flow of the world economy. Imagine trillions of dollars being invested in a green and sustainable way. WWF aims to help redirect global financial flows away from activities that harm nature, and towards those that help it thrive.
All of our money is managed by banks and asset managers. Savings, pension funds, corporate capital and even the national treasury. Financial institutions invest and lend this money. This way, they decide which companies and projects get support. These are investments with potentially major consequences. It can lead to more nature loss or, conversely, to conservation and restoration. This is how the financial sector can make a huge difference in our fight to stop climate change.
Dutch financial institutions have invested more than 500 billion euros in companies that are highly dependent on nature, according to the Dutch Central Banks and the Netherlands Environmental Assessment Agency. Increasing loss of nature thus means an increasing risk to companies, and those that invest in them. Therefore, investing in a more sustainable manner does not just benefit our planet, it also has a direct impact on the revenue of financial institutions.
But it’s not just about the Netherlands. We are in this together. Over half of the world’s total GDP is dependent on nature, estimated by the World Economics Forum. This amounts to roughly 44 trillion dollars. Extreme weather, biodiversity loss and ecosystem collapse pose immediate and long-term risks to the world economy.
But crisis can be turned into opportunity. Food, infrastructure and energy are the industries responsible for almost 80 percent of global loss of nature. If we start investing in the transition of these industries towards nature-positive behaviour, 400 million jobs and $10 trillion in business opportunities are there for the taking.
The more nature-positive financing, the better. We work towards directing more investment towards restoration and regeneration, while also ensuring that nature is adequately safeguarded in mainstream finance. WWF does this largely in two ways:
From the inside out by changing the way the financial sector works. We provide insight into the risks that institutions run when they invest in practices that cause biodiversity loss.
By promoting bankable nature solutions we help financial institutions connect to investible projects that focus on nature and climate impact, and societal benefit.
WWF provides insight into the various ways companies depend on nature and what impact their activities have on biodiversity. And where the risks, but also where the opportunities lie. The Taskforce on Nature-related Financial Disclosures (TNFD) helps us do this.
This is a new framework that provides insights, knowledge and guidelines. WWF also enters into (temporary) partnerships with financial institutions such as Rabobank and Robeco. This way we can make the sector more sustainable from within. During this process we are always upfront, to the point and critical. We want a green, sustainable world, as soon as possible. We make this clear in all our advice.
WWF also helps financial institutions invest in green projects and organizations worldwide. One of the ways this is done, is through the Dutch Fund for Climate and Development (DFCD). The fund invests in climate adaptation projects in developing countries while ensuring and supporting local socio-economic development. This is accomplished through the fund’s impact themes like gender equality and social inclusion, food and nutrition security, and biodiversity. Thus making the most vulnerable communities and ecosystems more resilient to the consequences of climate change.
The fund already contains €160 million thanks to the Dutch Ministry of Foreign Affairs. We want to attract another half a billion in private capital for various projects.
We also participate in Mobilising More for Climate. In this program we work together with local companies and organizations on projects that have a positive impact on people and nature in Cameroon, Ghana, Indonesia, Mozambique and Uganda, among others.
On the Indonesian island of Flores, PT Indobamboo cooperates with local farmers who together manage 10,000 hectares of bamboo forest in a sustainable way. FSC-certified products are made from this bamboo.
After an initial DFCD grant of €350,000, the project attracted the attention of several investors. The company is now working on a long-term plan. Bamboo can store up to 50,000 tons of CO2 per hectare every year. The forests also ensure healthy soil by gradually releasing millions of liters of rainwater during dry season.
The Indian company Ranipur Biomass converts sugar cane waste into raw materials for biodegradable cups, plates, cutlery and food packaging. Thanks to a DFCD grant of €274,500, a pilot plant can be built.
Eventually, Ranipur needs €20 million for a larger facility so that they can prevent the loss of 2.7 million tons of biomass, 1.6 million trees from being felled and the release of 183,000 tons of CO2 over the next 10 years. It also brings 20,000 hectares of agricultural land under sustainable management and creates 500 jobs.
In Tanzania, the Chanzi company uses fly larvae to convert food waste into nutritious protein for animal feed and organic fertilizer. This reduces overfishing and dependence on soy cultivation. A DFCD grant of €349,060 has been used to invest in research and development.
Chanzi wants to expand to 50 locations across 5 countries within 4 years. A loan of €10 million is required for this. The current 6 facilities already prevent 85 tons of CO2 emissions every day. Farmers also earn more because the animal feed is cheaper. And it has created jobs for young people and women in particular.
Financoop is a cooperative financial institution in Ecuador that provides a credit line to people who are switching to sustainable agriculture. A DFCD grant of €235,000 made it possible to test and monitor their new financial offerings.
The cooperation needs an investment of €10 million so that they can introduce green credit nationally. Then 28,000 hectares of agricultural land can be managed sustainably, making approximately 14,000 farmers more resilient to the consequences of climate change.
At WWF we aim to support the systemic transition of the financial sector. This means that mainstream financers stop doing harm and start investing in companies and projects that actively do good. We need all hands on deck, and you can help support by asking your bank or pension fund which green options they offer.
Changing banks is not always necessary. The aim is to get as many people and companies as possible to switch to a nature-inclusive economy. The more customers ask for green alternatives, the more important it becomes for the bank or insurer to get started.
More and more financial institutions are recognizing the importance of biodiversity and nature restoration. It reflects in their products. For example, Robeco set up a biodiversity fund for business clients. This way, your money can contribute to a sustainable world.
WWF’s conservation work is grounded in science. We develop innovative approaches and apply the best available information to efforts directed at meeting the needs of both nature and people in a changing world. We also rely on the scientific process to ensure that our on-the-ground conservation programs are effective and produce measurable results.
