F4B's project on greening sovereign debt has articulated the case for development of a new instrument: Nature Performance Bonds. There is increasing interest in linking sovereign debt and nature, but practice to date that can be characterised as small-scale and ad-hoc.
While many opportunities for innovation exist, there is a risk of confusion, inefficient use of resources and slow progress from uncoordinated efforts. By consolidating knowledge and expertise the development of these instruments can be accelerated.
F4B has been convening key organisations to explore the potential to create common approach across multiple initiatives.
We have now established the ‘Working Group on Debt and Nature’ which includes key individuals from organisation including Agence Française de Développement, the Children’s Investment Fund Foundation, the Climate Bonds Initiative, the Inter-American Development Bank, the Institute for International Finance, the International Finance Corporation, the International Institute for Environment and Development, the Global Environment Facility, The Nature Conservancy, the Paulson Institute, the United Nations Development Programme, the World Bank, and the Worldwide Fund for Nature.
The group has begun working together to set out the design, and encourage development of a Nature and Climate Sovereign Bond Facility. The facility aims to lay the foundations for a practical way of scaling up the integration of nature and climate into global sovereign debt markets