Sustainable Finance, Forests and Biodiversity
Our ThinkForest webinar on 29 April focused on the links between finance and forest biodiversity, in the context of the EU Taxonomy. The EU taxonomy is a complex topic, and the event aimed to bring clarity on how to set biodiversity indicators and potential thresholds that will lead to greener investments.
Prof Gert-Jan Nabuurs from Wageningen University and Research presented highlights from a forthcoming EFI science-policy study on Sustainable Finance and Forest Biodiversity Criteria. He explored how to make forest biodiversity operational within the context of the EU Taxonomy – forest-related activities have been addressed under the Taxonomy’s climate change mitigation and adaptation criteria, but are yet to be included in the protection and restoration of biodiversity and ecosystems objectives.
The study proposes a set of 26 quantitative indicators for biodiversity and provides examples for thresholds, together with monitoring and compliance options. However, Prof Nabuurs emphasised that there cannot be a one-size fits all threshold for indicators – there has to be some flexibility due to forest diversity and variation of biodiversity over space and time.
This was echoed during a panel discussion which dived into the opportunities – biodiversity is becoming more and more interesting for investors – and some of the challenges. Our speakers represented different viewpoints: investment perspectives from Cornelia Frentz (European Circular Bioeconomy Fund) and Wendelin von Gravenreuth (MEAG); science expertise from Esa-Jussi Viitala (LUKE); and forest owners from Fanny-Pomme Langue (CEPF).
The discussion highlighted again that biodiversity criteria need to be ambitious yet flexible, to take account of differing environmental and social conditions, including the motivation of forest owners. The feasibility, accuracy and costs of monitoring, and the timeline of some activities should be considered – it is essential that all pieces of the puzzle are easily implementable, and that it fits with other policies and standards and their reporting requirements.
However, there are also opportunities to leverage private funding for biodiversity enhancement. This could be short-term investment in innovations that help forests to protect against pests, for example, rather than longer-term activities.
Summing up, EFI’s Assistant Director for Policy Support Helga Pülzl reiterated that the coordination of policy instruments is key to decreasing the barriers for investment in forest biodiversity. Stronger policy integration (at national and EU level) may help to decrease uncertainty and risks for investment, especially for long-term issues such as biodiversity protection.
Watch the recording https://www.youtube.com/watch?v=9LZRQK9jZGo
