Sustainable finance and biodiversity: Here we go!

The financial sector is increasingly concerned by Environmental, Social and Governance (ESG) issues. Since the Paris Agreement in December 2015, the fight against climate change has become a priority in Europe, where it is supported in particular by growing regulation and supervision. We are also seeing the first steps in the same direction in the rest of the world with the voluntary standards of the International Sustainability Standard Board (ISSB) published in July 2023.

Protecting biodiversity (or nature) has also become a priority:

–  at European level, where it forms part of the Green Deal alongside climate change and other environmental objectives (water, circular economy, pollution);

–  at international level, where the Kunming-Montreal Agreement signed in December 2022 is the biodiversity equivalent of the Paris climate agreement.

Protecting biodiversity is also part of the solution to climate change, as biodiversity strengthens the carbon absorption capacity of the earth and the oceans.

This new priority is beginning to apply to the financial sector and will do so increasingly in application of European regulations and the implementation at international level of the recommendations of the Taskforce for Nature-related Financial Disclosures (TFND), the final version of which was published in September 2023.

The first challenge for financial and non-financial companies is to measure their impact on biodiversity, using tools that are being developed. The second is to significantly increase the level of investment, mainly through private funding.