What We’re Reading – Landscape Finance Edition – Spring 2022

by | May 25, 2022 | 1000L News, Finance and Economics, Finance Team Newsletter

Activity continues to bubble over in the world of landscape finance, with related fields such as place-based investment, conservation finance and systems-change finance, making it challenging to keep up with all of the most relevant reports and news. With the 1000L Finance Solutions Design Team working on system change, we think it’s important to stay well-informed about the latest innovations and actors operating in the space. We’re happy to continue our finance-focused newsletter, a resource to help all gain more perspective on landscape finance. 

These are the landscape finance-related developments and reports that caught our eye in the Spring of 2022. 

News & Developments

LandScale Platform Goes Live in April

LandScale, a collaborative initiative co-led by Rainforest Alliance, Verra and Conservation International, unveiled the live version of its platform in April. By enabling users to monitor sustainability outcomes, the platform aims to improve assessment teams’ ability to collaborate on building landscape assessments and reports. 

Chile Becomes the First Country to Issue a Sustainability Linked Bond

Chile’s US$2 billion, 20-year bond drew high demand across across diverse geographic regions and investor profiles. The bond is linked to two key performance indicators: absolute greenhouse gas emissions and share of renewable energy in the national electricity system. The bond’s adherence to the Paris Agreement on climate change helped fuel investor demand. 

World Bank Sells First Wildlife Conservation Bond for Rhino Conservation

The World Bank issued a pay-for-success bond that funds conservation efforts for the black rhino population in South Africa. The $150 million, five-year wildlife conservation bond will provide a return between 3.7%-9.2% if the rhino population increases over the five-year period.  

Finance for Biodiversity (F4B) Announces Global Task Force on Nature-Related Markets

The task force seeks to strengthen finance-related efforts to make nature the center of a net zero economy, with a focus on market-driven, policy and regulatory developments. In addition, the group will identify examples of innovations, share recommendations and create initiatives.  

Global Fund for Coral Reefs Receives $125 million in Funding

The Green Climate Fund (GCF) and Pegasus Capital Advisors announced $125 million of adaptation funding for the Global Fund for Coral Reefs. The fund seeks to raise and invest $625 million (through a blend of public and private institutions) to finance initiatives supporting coral reefs and coastal communities. The GCF will absorb the first economic losses if the underlying assets lose value.

African Forest Landscape Restoration Initiative (AFR100) Announces Financing for Land Restoration Enterprises

TerraFund for AFR100 announced it will finance (what it views as) the top 100 African nonprofit community organizations and for-profit businesses that are restoring trees in African landscapes. Innovators will have the opportunity to receive grants or loans ranging between $50,000 to $500,000. 

“Business Case” Deforestation Initiative to Include Focus on Finance Mechanisms

A new public-private partnership seeks to develop innovative finance mechanisms to mobilize $30 million from companies and investors over the next five years. Led by investment advisory firm Clarmondial, the initiative also includes assistance on multi-stakeholder action plans and enabling access to data on landscape performance.

Countries Jointly Pledge More than $5 Billion to Global Environment Facility

Recognizing the increasing need for collaborative effort, 29 countries collectively pledged a record $5.25 billion in April to the Global Environment Facility (GEF). The funding strengthens GEF’s efforts to protect biodiversity and counter threats from climate change, toxic chemicals and plastics. 

Reports

Study Explores How Blended Finance Can Best Unlock Additional Private Finance

This report highlights the value of multi-project financing across landscapes, as well as the potential of agricultural supply chains to leverage private finance in supporting landscape solutions. The authors explain how both of these opportunities require “early and sustained” efforts to reach the scale that would attract mainstream investors. Furthermore, more tailored insurance and guarantee products could represent a powerful tool to de-risk transactions and unlock further investment.

Report Details Why Financial Sector Must View Climate and Nature Impacts Together

An F4B Initiative report emphasizes the importance of financial institutions to understand material climate and nature risks. Authors share the implications for the agriculture, fisheries and forestry sector and offer four key recommendations, including educating investors on the importance of accounting for nature-driven risks in cash flow projections. 

De-risking Smallholder Farmer Investments in Integrated Landscape Management

Case studies of financial value chains shed light on strategies to increase the participation of smallholders and communities. The report addresses reducing risks of selected financial flows for investors, intermediaries and recipients. Released by the ECOTRUST (The Environmental Conservation Trust of Uganda) in 2021, this report is still a timely and important read.

Food Systems Summit Dialogues Publishes Fourth Synthesis Report

This recent report includes discussion around pathways that have encouraged development of investment plans, as well as strategies for long-term technical, commercial and financial cooperation.

Attracting Private Investments for Sustainable Landscapes: A Guide

This toolkit provides guidance for project organizers in identifying landscape finance projects and supporting project developers to attract investments. The IDH – Sustainable Trade Initiative and World Wildlife Fund  collaborated on the publication, which outlines requirements from fund managers, banks and other commercial investors. 

ISEAL Offers Guidance for Companies On Investing in Landscape Approaches

This report covers the background and process information companies need to best select landscape approach initiatives and monitor progress. ISEAL also reveals steps companies can take in using landscape approaches to supply chain management to scale up and accelerate sustainability.

We hope you’ve found this newsletter helpful and welcome your feedback. 

We also invite you to share insightful reports and news developments as you come across them by reaching out to dhecht@ecoagriculture.org.

 

Author

  • David Hecht is a finance intern at EcoAgriculture Partners. He supports research on innovative landscape finance mechanisms and the work of the 1000 Landscapes for 1 Billion People Finance Accelerator team.

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