By Pajani Singah, Co-founder and Investment Director at AIV
As the world looks back on what many agree was an underwhelming COP27, another conference crucial to the future of the planet is currently underway.
While it may not grab as many headlines as its climate-based equivalent, the UN Biodiversity Conference (COP15), taking place in Montreal, Canada between 7 and 19 December, is a vital forum for addressing the accelerated habitat and species loss that threatens humanity and the planet.
Having not met for several years due to the COVID-19 pandemic, COP15 is a critical edition of the conference. COP15 brings together representatives of 196 governments, joined by delegates from a wide range of stakeholders such as the business and finance community, scientists and academics, indigenous peoples and local communities, and youth representatives. As some have pointed out, it’s a once-in-a-decade opportunity to halt the natural world’s destruction. There have been calls for world leaders to attend the conference and place equal importance on biodiversity talks as COP27, despite many not being officially invited.
With COP15 being so important, there are a few key discussion points and resolutions that observers should look out for, particularly when it comes to biodiversity loss due to deforestation and how the right funding, particularly in the hands of indigenous and local communities, can help.
In order to understand why COP15 comes at such a critical time, it’s important to take a deeper look at just how alarming current levels of biodiversity loss actually are.
According to the World Wildlife Foundation’s Living Planet Report, released earlier this year, wildlife populations have declined by an average of 69% in the past 50 years. Much of that loss is due to habitat destruction, with an average of 10 000 acres a day lost in the Amazon alone since 1988. Unsurprisingly, species loss is highest in Latin America, reducing and endangering the critical value of the Amazon as an ally in the fight against climate change.
The losses to biodiversity are not only devastating for the Amazon’s ecosystem but also stand to have a profoundly deleterious effect on the global economy. The World Economic Forumfound that more than half of the world’s economy is highly or moderately dependent on nature. This supports the findings of a report from the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) report that concluded biodiversity is crucial to global financial stability.
Emerging market funding as part of the solution
When it comes to turning habitat loss around and protecting the global economy, funding will be key.
The Global Biodiversity Framework (GBF) that will be discussed at COP15 will prove critical in how we respond to the challenges outlined above. The framework can largely be seen as split into revolving around two inter-linked focus areas: the first being halting biodiversity decline and the second being mobilising resources to reverse the damaging situation we currently face and implementing systems that will protect biodiversity. Subsidy reform will be particularly important for halting the decline, given that many of the industries that have the worst impact on biodiversity – from fossil fuels to farming and fishing – also enjoy the largest government subsidies. There must be a rapid prevention of incentives that facilitate degradation.
In their 2022 white paper The WEF, in collaboration with PwC China, outlined 6 key trends that will help ensure the GBF’s targets can be achieved. These trends are well aligned with our business model at Amazonia Impact Ventures (AIV), where we are striving to halt deforestation and have a positive impact socially and environmentally in the Amazon. Mobilising finance to emerging market countries to help reduce deforestation, similar to the kind that we provide at AIV, helps ensure that they’re in the best possible position to fight biodiversity loss. Commitments to deforestation-free supply chains and supply-chain due diligence is critical alongside funding. We currently work in Peru, Colombia and Ecuador, providing impact finance to Indigenous Peoples and local communities businesses that already have proven sustainable track-records and have the ability to protect the rainforest, and its biodiversity, further.
Fortunately, the convenors of COP15 have realised that the participation of indigenous peoples and local communities is of utmost importance to halting and reversing biodiversity loss. That recognition comes off the back of extensive research which shows that lands managed by indigenous people have levels of biodiversity equal to (and often greater than) those in dedicated conservation areas managed by federal and other governments.
Significant movement on this front is something we are passionate about at AIV. We’ve long been advocates for empowering indigenous people and forest communities. The best way of doing so is to provide them with the funding and access they need to operate their businesses as fairly, sustainably and successfully as possible. This process of regenerative agriculture helps contribute to and cultivate a growing global bio-economy.
There will, of course, be other discussions and solutions to the challenges we are facing due to the scale of the problem. Biodiversity credits are an interesting proposition that provide both excitement and confusion when considering how to protect areas such as the Amazon. Significant consideration of the intricacies of how these credits will work in action will be critical to deciding whether they will be able to produce a tangible positive impact on global biodiversity.
It is important that investing from the private sector to improve conservation in critical areas is enabled and greenwashing is prevented, avoiding the contentious problems associated with carbon credits at times. COP15 will provide an important space for these issues to be ironed out.
Delivering on commitments
Ultimately, however, the important work will begin once COP15 draws to a close. However ambitious a framework the attending parties agree on, it will need to be enacted and enforced to be effective. That will require governments, businesses, and other players in the sector to resist the temptation to focus on a single solution, such as biodiversity credits, and focus on ensuring that a series of related, and interlocking, solutions are given the best possible chance of success. And at all times, the people most affected by biodiversity loss must be viewed as part of the solution.