Financial heavyweights, including Abrdn, Aviva and Federated Hermes, are among the initial participants of a new initiative that will seek to support the flow of private capital towards nature recovery in the UK.
Launched on Friday by the Green Finance Institute’s (GFI) nature programme, the UK Financial Institutions for Nature group will “identify barriers” hindering private sector finance from supporting the UK government’s ambitions on nature.
It will also provide feedback and input where relevant on key government initiatives, including the development of high-integrity domestic nature markets; the recommendations on the UK’s green taxonomy by the GFI hosted Land, Nature and Adapted Systems Advisory Group; and the UK uptake of the Taskforce on Nature-related Financial Disclosures (TNFD) framework.
On whether the group will provide feedback on how the government can implement the Kunming-Montreal Global Biodiversity Framework (GBF), Helen Avery, GFI’s director of nature programmes and the GFI Hive, told Responsible Investor that it will if there was appetite from the government and if the group felt it would be impactful.
The GBF is the landmark biodiversity agreement signed by 196 governments in December, designed to halt and reverse biodiversity loss by 2030.
Any financial institution “engaged in UK nature finance” is free to sign up to the UK Financial Institutions for Nature group.
Its launch comes as investor stewardship on biodiversity grows in importance with companies across a range of sectors increasingly scrutinised for how they are mitigating their risks, dependencies and impacts on ecosystems.
Investors have already started weighing in on policy. Before and during COP15 in Montreal, investors were proactively involved in the negotiations of the Kunming-Montreal framework and an upcoming initiative from the Principles for Responsible Investment (PRI) targeting corporates over their political activities will likely expand to engagement with policymakers.
“No single actor or sector is going to be able to fill the £44 billion ($57.6 billion; €51.4 billion) to £97 billion finance gap for nature in the UK alone,” GFI’s Avery stressed. “Nature restoration and recovery is going to be a cross-sector, cross-society effort.”
But, she added, “Financial institutions engaging with policymakers and corporates is absolutely critical if we are going to transition to an economy that values and invests in the natural environment and the ecosystem services it provides.”
Avery added that it would be great to see other committed, outcomes-focused, national-level groups.
“Global frameworks are critical to signal the direction of travel, but ultimately nature outcomes are delivered at the local level,” she told RI. “Therefore, national sector-specific groups identifying barriers and unlocking them are going to be the pathway to delivering the global biodiversity framework.”