Finance 4 Biodiversity plans sustainable sovereign debt facility as part of rebrand

Global Nature Positive Alignment Index also being developed as African leaders call for commitment of 1% of GDP for biodiversity restoration.

The Finance 4 Biodiversity (F4B) initiative is set to host what it claims is a first-of-its-kind sustainable sovereign debt facility, as part of an upcoming rebrand. 

Launched in 2019, F4B aims to increase the materiality of biodiversity in financial flows and decision-making. It is supported by the MAVA Foundation, as well as the Children’s Investment Fund Foundation, and its work is guided by a leadership group of experts and practitioners in the field.​

From October, it will have its first official base in Geneva and will be renamed NatureFinance.

A spokesperson told Responsible Investor that the motivation for the rebrand is the steadily expanded scope and ambition of F4B’s work since its inception in 2019.

The sovereign debt facility is being established to assist the development and scaling of nature and climate performance-linked sovereign debt through the provision of technical support. This will include ensuring effective verification of KPIs and supporting the development of enabling standards.

It will be governed by an advisory board including representatives of key stakeholders, and a small oversight board.

“The facility will create an inclusive cooperative space which brings together the actors from the entire spectrum of the sovereign sustainability-linked bonds universe. It will support new debt issuance over the longer-term, while offering a vehicle for short-term action in new debt issuance linked to debt restructuring and refinancing,” the spokesperson said.

In June, F4B published a report warning that biodiversity and nature-related risks can have significant impacts on sovereign credit ratings, default probability and the cost of capital. 

The rebrand will also see the non-profit develop nature-focused investment opportunities to address climate, food security, equity and broader sustainable development goals, as well as the creation of “the world’s first” Global Nature Positive Alignment Index.

F4B’s spokesperson told RI: “We are developing [the index] to understand how far financial flows are aligned, or misaligned, with nature-positive, equitable outcomes. A web-based, interactive alignment dashboard will allow users to disaggregate the index by country, sector and type of financial flow.”

Africa biodiversity call

In related news, government leaders and experts from across Africa have called for an urgent increase in financing to protect biodiversity at the Africa Nature Finance Forum. 

At the forum, which was held on 20 June, world leaders were recommended to support, and commit to, the African proposal that all nations commit 1 percent of GDP to address the biodiversity finance gap and protect our planet’s future. 

“We are not begging for you to give us the money to protect our biodiversity. We are committing 1 percent of our GDP – you also should do the same in your countries, as well as the overseas development aid that flows down to developing countries,” said Sikeade Egbuwalo, desk officer for the Convention on Biological Diversity at Nigeria’s Federal Ministry of Environment.