26 May 2021, 23:00:00
The Climate-Nature Nexus
Implications for the Financial Sector
‘The Climate-Nature Nexus’ takes a practical look at where climate- and nature-related risks and opportunities do and don’t overlap; what that means for the investment potential of different sectors and solutions; and how much of the nature problem financial institutions address if they cover climate well. It offers recommendations on how the private financial sector can adapt its climate approaches to address nature and be robust to nature-related risks; and on how the policy community can support the financial sector to do so.
The report is primarily intended for financial market practitioners seeking to advance their respective institutions in their handling of material risks and opportunities at the nexus of climate and nature. In addition, it seeks to synthesise evidence in an accessible way for the growing number of initiatives supporting practitioners at this nexus. In addition, it seeks to synthesise evidence in an accessible way for the growing number of initiatives supporting practitioners at this nexus. Notably, this includes the two main risk disclosure platforms, the Task Force for Climate-related Financial Disclosures (TCFD) and the Taskforce for Nature-related Financial Disclosures (TNFD), as well as their counterpart at the financial system level, the Network of Central Banks for Greening the Financial System (NGFS). It also informs the growing number of policy and regulatory initiatives at the nexus, such as financial sector engagement under UNFCCC COP26 and CBD COP15, the EU taxonomy, and efforts to advance due diligence obligations that cross over nature and climate impacts. Finally, it also informs major initiatives designed to bridge the nexus such as voluntary carbon markets, sustainable data platforms, and sustainable investor networks.
Reflecting Finance for Biodiversity’s (F4B) mission and theory of change, this report aims to help the growing body of work at the climate-nature-finance nexus achieve exposure and impact. As such, it synthesises and showcases evidence in the space, draws connections between different pieces of work, and presents the material within an accessible and cohesive framework.
This report is funded by the Gordon and Betty Moore Foundation through The Finance Hub, which was created to advance sustainable finance.