Investing in environmental conservation

Investing in natural capital
Making biodiversity investments

Context

Article 11 of the Convention for Biological Diversity entitled "Incentive Measures" states: Each Contracting Party shall, as far as possible and as appropriate, adopt economically and socially sound measures that act as incentives for the conservation and sustainable use of components of biological diversity.

Implementation

A scheme in the Netherlands allows Dutch citizens to put their savings or investments into green funds run by commercial banks. The interest on loans from these funds are exempt from tax as long as the money is invested in green projects. Starting in 1998, the funds will be able to invest in a selection of countries outside of The Netherlands. This is because the funds have attracted far more capital than can be invested in green projects within the country. This approach shows how a well-targeted 2% tax subsidy can generate billions of dollars of private finance for biodiversity.

Claim

Economic incentives can enable governments and the private sector to support national conservation objectives more efficiently than traditional regulatory approaches.

The elements now exist that will reverse the trend toward the biotic impoverishment of the world. Novel approaches, new financial mechanisms, and new policies need to be applied at the appropriate level of responsibility to translate the new approaches into a reality of improved human well-being and secure biotic heritage. New partners in conservation need to be found, involving all ministries, departments and private institutions that are directly dependent on biological resources. National parks departments, for example should be joined in habitat management by a wide range of other institutions to represent all interests. Furthermore, other line agencies need to develop the capacity to manage biodiversity of particular relevance to their respective missions.