Accelerating business solutions for climate and nature – Report I: Mapping nature-based solutions and natural climate solutions
The New WBCSD report launched yesterday aims to help remove the hurdles to nature-based solutions by clarifying definitions, while supporting the alignment of natural climate solutions (NCS) with nature-based solutions (NbS) in order to accelerate investments at scale.
In addition, the report helps business to navigate the nature and climate agenda by mapping the key initiatives, platforms and conventions for collective action.
For several years now, business has been applying nature-based solutions (NbS) and in particular developing natural climate solutions (NCS) for climate mitigation and adaptation. As governments and business develop recovery plans, momentum is building to include these solutions as part of efforts to build forward better.
NbS have a key role in sequestering carbon from hard-to-abate emissions and in mitigating climate change. But it is also necessary to scale them up to protect high-value ecosystems and reverse nature loss.
These solutions will be a focus area in UN conferences: for climate in the UNFCCC COP26 in Glasgow, UK, for biodiversity at the CBD COP15 in Kunming in China, to ensure land degradation neutrality at the Convention to Combat Desertification (UNCCD) COP15 in Bonn, Germany, and to help transform food systems (which significantly contribute to both drivers of, and risks from, climate change and nature loss) at the UN Food Systems Summit in New York, USA. In Table 2: the Key global policy conventions: UNCCD, CBD and UNFCCC.
Ultimately, business and stakeholders must come together to accelerate actions and investments in solutions that are good for climate and nature, as well as for people and economies
- To achieve scale and guide investments in nature-based solutions, businesses must overcome several barriers, including the lack of clarity on both the risk faced by different sectors as well as opportunities, and a means to measure impact and communicate to different stakeholders.
- As the public and private sectors investigate solutions that contribute to a post-COVID-19 recovery, they must include NbS to achieve corporate goals, particularly climate goals aimed at net-zero emissions, in addition to their decarbonization efforts.
However, the lack of clear consensus on what constitutes a natural climate solution, what defines a nature-based solution, and the minimum expected performance from each, is slowing investment and potentially limiting the supply of credible projects.
- If the minimum expectation is set too low, it could result in a large quantity of projects that deliver in one area, such as climate, but fail to protect or enhance biodiversity and in turn have significant adverse impacts (e.g., loss of water resources or adverse societal impacts due to changes in income sources).
Business has a critical role to play in accelerating projects and investments that support climate, nature and people. While the risks of inaction are significant and well documented, the benefits to both business security and growth are very compelling.
- To unlock investment and ensure credible, high-quality projects receive funding, there must be a common understanding of what defines a nature-based solution and a natural climate solution.
Alignment between NbS and NCS. Developing and delivering high-quality NbS and NCS will help drive a race to the top and support the achieving of nature and biodiversity goals. It will also provide opportunities for business to invest in positive asset class investments.
- Nature-based solutions (NbS) are actions based on functioning ecosystems that deliver value to society by addressing societal challenges and benefit nature by enhancing biodiversity and ecosystem services.
- Natural climate solutions (NCS) are nature-based solutions for climate – meaning solutions specifically aimed at delivering climate benefits.
At a minimum, both nature-based solutions and natural climate solutions should ensure zero net loss for biodiversity. Regulatory and investment criteria that promote or reward high-quality NbS and NCS over lower quality single benefit options are also necessary.
More from the Key takeaways:
Overcoming obstacles to financing nature-based solutions
- It is estimated that major ecosystem conservation and restoration work could contribute up to 37% of the solutions needed by 2030 to reduce greenhouse gas emissions and stabilize global warming to below 2°C.11
- However, the amount of public finance spent on NbS for climate, as a percentage of all climate finance, was only 3% in 2015-2016 and only 8% in 2017-2018, leading to claims that NbS is a forgotten solution.
- This NbS funding that has occurred to date has mainly been for climate, rather than the broader benefits such as biodiversity that NbS can deliver.
- Nature protection and restoration have suffered from a chronic lack of financial resources: estimates show that there is currently an annual funding gap for nature of USD $711 billion between now and 2030 (less than 1% of global GDP).
- The current slow growth in NbS investment will not unlock the full potential of nature-based solutions.
- To attract more capital to NbS projects, investors need to better understand and internalize the material risks and opportunities associated with nature
WBCSD is contributing to the development of tools led by the Task Force on Nature-related Financial Disclosures that will help make these risks visible and make it possible to measure and report.
Business is stepping up its climate & nature ambitions
NbS and NCS are affordable, scalable and available right now. Business plays a key role in adopting and integrating these solutions into their core activities as a way to do good for the planet, as well as people and prosperity. Many WBCSD members have announced ambitious actions, using science-based targets, to contribute to global climate, biodiversity and development goals:
- Business for Nature has identified over 1,200 examples of companies taking action for nature, including many WBCSD members.
- Walmart recently pledged to achieve zero emissions by 2040 without carbon offsets, while also committing to protect and restore at least 50 million acres of land and 1 million square miles of ocean by 2030.
- Microsoft pledged to offset all its historical emissions and become net-negative by 2030.
- Unilever is setting aside EUR €1 billion to fund nature regeneration projects, including achieving a deforestation-free supply chain, promoting regenerative agriculture, and transitioning to biodegradable ingredients by 2023. For more commitments from WBCSD members, including Nestlé, GSK, LafargeHolcim and Shell, please refer to WBCSD website
- New Nature Economy Report II. The Future Of Nature And Business
- Nature Risk Rising: Why the Crisis Engulfing Nature Matters for Business and the Economy (full pdf)
- The Future of Nature and Business: Policy Companion. Recommendations for policy-makers to reset towards a new nature economy(full pdf)