Periodic Reporting for period 1 - BIOFIN (PROTECTING AND RESTORING BIODIVERSITY USING MAINSTREAM FINANCE (BIOFIN))
Période du rapport: 2024-01-01 au 2025-06-30
BIOFIN-EU is a 3-year research project focused on unlocking financial flows essential for protecting and reversing biodiversity loss. The project aims to drive transformative change by extending knowledge on how biodiversity and ecosystems data is considered across a range of settings within mainstream finance, including; bank lending, institutional and individual investment decisions, commodity trading, asset management. It further provides guidance on how existing nature-related data and ecological expertise can be deployed within these settings so that financial flows are redirected in support of Environmental Objective 6 of the EU’s Sustainable Finance Taxonomy. BIOFIN-EU draws on several learning sites to identify how Nature-based Solutions (NbS) can access mainstream finance and the project analyses the implications for both ownership and control when deploying mainstream finance to support the green transition.
BIOFIN-EU is using a multi-actor approach to create impact through a science-led dashboard for nature positive financial decision support. Built with, and for, six key groups: ecologists, data scientists, financial and accounting experts, citizens, providers of nature-based solutions (NbS) as well as investors (e.g. financial institutions, non-financial companies (NFCs), State-Owned Enterprises (SOEs)), the Dashboard will help actors navigate large-scale financing challenges and to develop, replicate, scale out and strengthen NbS-investment. The dashboard and broader research within BIOFIN-EU contribute to a more complete understanding of the gaps in existing financial and environmental policy and their implementation, the preferences of institutional and individual investors and the system and skills limitations that exist in financial institutions and non-financial corporations. Project outcomes will support policy formation through evidence-based recommendations, and co-design pathways for skills and knowledge accelerators in the European financial services industry.
Context and overall objectives
Nature is the foundation of human existence, underpinning our quality of life and the stability of society. Both directly and indirectly, we depend on biodiversity and ecosystem services for survival. Yet the global financial system, as currently designed, has amplified humanity’s capacity to extract natural resources, shaping modern economies in ways that often overlook environmental limits. BIOFIN-EU focuses on real-world financing scenarios, helping stakeholders navigate conventional investment decisions while aligning with the EU’s policy objectives in relation to nature restoration and the protection of ecosystems. This work is critical to realizing the EU’s Biodiversity Strategy for 2030 and achieving climate neutrality by 2050.
BIOFIN-EU is using a multi-actor approach to create impact through a science-led dashboard for nature positive financial decision support. Built with, and for, six key groups: ecologists, data scientists, financial and accounting experts, citizens, providers of nature-based solutions (NbS) as well as investors (e.g. financial institutions, non-financial companies (NFCs), State-Owned Enterprises (SOEs)), the Dashboard will help actors navigate large-scale financing challenges and to develop, replicate, scale out and strengthen NbS-investment. The dashboard and broader research within BIOFIN-EU contribute to a more complete understanding of the gaps in existing financial and environmental policy and their implementation, the preferences of institutional and individual investors and the system and skills limitations that exist in financial institutions and non-financial corporations. Project outcomes will support policy formation through evidence-based recommendations, and co-design pathways for skills and knowledge accelerators in the European financial services industry.
Context and overall objectives
Nature is the foundation of human existence, underpinning our quality of life and the stability of society. Both directly and indirectly, we depend on biodiversity and ecosystem services for survival. Yet the global financial system, as currently designed, has amplified humanity’s capacity to extract natural resources, shaping modern economies in ways that often overlook environmental limits. BIOFIN-EU focuses on real-world financing scenarios, helping stakeholders navigate conventional investment decisions while aligning with the EU’s policy objectives in relation to nature restoration and the protection of ecosystems. This work is critical to realizing the EU’s Biodiversity Strategy for 2030 and achieving climate neutrality by 2050.
Work Performed:
An evaluation system for NbS was proposed with potential applications in financial settings. This system would assess different types of NbS, tools, and standards, including biodiversity tracking, natural capital measurement, and valuation of ecosystem benefits.
This preliminary work was complemented by research into measurement of the value of biodiversity and ecosystem services (ES). The latest tools for assessing ecosystem services and NbS were presented, showing their impacts. Several studies focused on NbS governance and the economic value of the benefits NbS deliver.
An overview of key functions within the global financial system was produced, identifying opportunities to integrate biodiversity data into decision-making processes. Research efforts from the first year of the BIOFIN-EU project were integrated, developing baseline knowledge through literature reviews and stakeholder analyses. Financial instruments, organisational structures, and system-wide processes were analysed to assess their capacity to support biodiversity protection and restoration. A Minimum Viable Product (MVP) of the NbS Dashboard was delivered and addresses two representative case studies. Communication activities to external audiences and current and prospective collaborators were undertaken and planning has commenced on how to enhance skills development among financial services professionals.
Main Achievements:
The development of a framework to align and integrate NbS approaches with financial decision-making was achieved, laying the groundwork for mainstream finance to support NbS initiatives. A comprehensive assessment of NbS was facilitated through the Integrated Assessment Chain, encompassing biodiversity monitoring, natural capital accounting, and ecosystem services valuation. Recommendations were made on how the Assessment Chain can build upon existing and commonly accepted tools and methodologies. This informed the design of the BIOFIN-EU NbS Dashboard which is a tool facilitate financial decision-making and support the development of new financial products and instruments oriented towards NbS.
Various economic approaches to valuing biodiversity and ecosystem services were identified and analysed. The implications of biodiversity for the valuation of ecosystem services and the funding of NbS were addressed. An overview of advanced assessment tools for ecosystem services and NbS was provided, emphasising their impacts. This research in environmental economics was extended by baseline knowledge in financial economics in order to understand how preferences can be more effectively reflected in financial institutions, markets and the instruments used to direct capital. The BIOFIN-EU project explored multiple pathways to align finance with biodiversity goals through targeted research, including: the design of financial instruments, data-drive regulation, institutional investment frameworks, market design requirements for NbS adoption and public sector leadership. Together, these efforts aim to identify the enabling conditions for scaling biodiversity-positive finance across public and private sectors.
An evaluation system for NbS was proposed with potential applications in financial settings. This system would assess different types of NbS, tools, and standards, including biodiversity tracking, natural capital measurement, and valuation of ecosystem benefits.
This preliminary work was complemented by research into measurement of the value of biodiversity and ecosystem services (ES). The latest tools for assessing ecosystem services and NbS were presented, showing their impacts. Several studies focused on NbS governance and the economic value of the benefits NbS deliver.
An overview of key functions within the global financial system was produced, identifying opportunities to integrate biodiversity data into decision-making processes. Research efforts from the first year of the BIOFIN-EU project were integrated, developing baseline knowledge through literature reviews and stakeholder analyses. Financial instruments, organisational structures, and system-wide processes were analysed to assess their capacity to support biodiversity protection and restoration. A Minimum Viable Product (MVP) of the NbS Dashboard was delivered and addresses two representative case studies. Communication activities to external audiences and current and prospective collaborators were undertaken and planning has commenced on how to enhance skills development among financial services professionals.
Main Achievements:
The development of a framework to align and integrate NbS approaches with financial decision-making was achieved, laying the groundwork for mainstream finance to support NbS initiatives. A comprehensive assessment of NbS was facilitated through the Integrated Assessment Chain, encompassing biodiversity monitoring, natural capital accounting, and ecosystem services valuation. Recommendations were made on how the Assessment Chain can build upon existing and commonly accepted tools and methodologies. This informed the design of the BIOFIN-EU NbS Dashboard which is a tool facilitate financial decision-making and support the development of new financial products and instruments oriented towards NbS.
Various economic approaches to valuing biodiversity and ecosystem services were identified and analysed. The implications of biodiversity for the valuation of ecosystem services and the funding of NbS were addressed. An overview of advanced assessment tools for ecosystem services and NbS was provided, emphasising their impacts. This research in environmental economics was extended by baseline knowledge in financial economics in order to understand how preferences can be more effectively reflected in financial institutions, markets and the instruments used to direct capital. The BIOFIN-EU project explored multiple pathways to align finance with biodiversity goals through targeted research, including: the design of financial instruments, data-drive regulation, institutional investment frameworks, market design requirements for NbS adoption and public sector leadership. Together, these efforts aim to identify the enabling conditions for scaling biodiversity-positive finance across public and private sectors.
By addressing the integration of biodiversity data and NbS project governance into financial processes, this project expects to have an impact by; identifying and exploring solutions and implementation barriers, engaging with stakeholders and identifying skill gaps in finance and providing tools and guidance to economic actors. The research conducted at each learning site holds significant value, not only for the advancement of the site itself but also for its potential influence on local development and, in certain cases, policy formulation.