Nature remains invisible in most financial decision-making, while climate has only just come onto the agenda. Understanding the degree to which financial flows are aligned or misaligned with nature is vital if we are to deliver net zero, nature positive goals.
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Total estimated global financial flows (IMF 2022)
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Global finance analysed by our Tool to date
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of public finance analysed strongly aligned with nature
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of private finance analysed strongly aligned with nature
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of development finance analysed strongly aligned with nature
About the Nature-Finance Alignment Tool
The Nature-Finance Alignment Tool has been designed to work with all types of financial flows, from private equity and risk to public expenditure and development finance, and provide an Index score based on country and sector exposure.
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How to use the Tool & Get Involved
Financial actors have started to recognise a nature positive, net zero transition as an essential part of doing business- the Nature-Finance Alignment Tool can help plan this transition in an integrated way, including quantifiable alignment with the Post-2020 Global Biodiversity Framework and the Paris Agreement.
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The Tool complements a wide range of related initiatives which support nature-positive, net-zero pathways, including the Task Force for Nature-related Financial Disclosures (TNFD) Beta framework. Its development to date draws on valuable guidance, expertise and data from numerous partners.
Partners & Resources
FAQs
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A. The extent to which private and public financial flows are consistent, or inconsistent, with achieving the goals of agreed international frameworks for transition to a nature positive world, including the UN Convention on Biological Diversity’s Post-2020 Global Biodiversity Framework (GBF). The Index score provides an indicator of potential risks associated with a financial institution’s lack of alignment and failure to price that into its portfolio management and forward planning.
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A. The Alignment Tool is designed to fit within the broader international policy framework under the UN CBD and UNFCCC, including the post-2020 Global Biodiversity Framework, as well as work being developed on nature positive by leading scientific organisations such as IUCN. The approach also draws on a range of existing frameworks and standards to provide a significant addition to current alignment efforts. It complements wider work on green finance, such as the TNFD’s nature-related risk management and disclosure framework. The Tool itself draws on a range of existing assessment frameworks, including SBTN, ENCORE. GGGI, and GFN.
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A. The approach assesses nature alignment underlying both public and private financial flows, including government expenditure, bonds, loans, grants and subsidies, nature markets, bilateral and multilateral aid, other donor funding, private financial investments, asset portfolios, company balance sheets, insurance and other financial products. Non-financial businesses can also use the approach to assess the nature alignment of their corporate investment activities.