Releasing new funding streams to restore the world's forests and landscapes
The United Nations has declared the new decade as the Decade of Ecosystem Restoration, and there is a growing global enthusiasm to restore our world's forests and landscapes. Yet, funding falls short and to reach global restoration commitments we need to unlock novel streams of finance.
Growing up a stones throw from a natural reserve on an island in the Stockholm archipelago, my love for nature was cemented at an early age. Only later did I become fascinated with economic systems and the massive power they execute over literally everything in our societies and on our planet. Many ecologists share an (arguably) healthy aversion against our capitalist system and its inherent social and environmental inequalities. Capitalist actors acting under capitalist rules have been core drivers of environmental destruction globally, and climate change and environmental degradation are text book examples of market failures.
With the ever-increasing urgency of addressing land degradation and climate change, the void between the financial sector and the environmental community is more problematic than ever. Private financial actors are continuously financing activities that drive land degradation, but it is also with the private sector that the hope to realize global restoration goals lie. One of the core barriers to reaching our global restoration pledges is lack of funding, and as public funding will far from suffice the only way forward is to motivate private actors to fund restoration interventions. About a year ago, I started drafting a PhD proposal on how this could be done, with the support from my supervisors Jaboury Ghazoul (co-author of this paper) and Rachael Garrett. Our aim is to understand how and from where funding can be released to realize global restoration goals by 2030.
In a swiss mountain hut on our lab’s yearly retreat last February, Jaboury encouraged me to turn the main outcomes of the research I had done for my proposal into a paper. This paper, titled “Private funding is essential to leverage forest and landscape restoration at global scales” was published in Nature Ecology and Evolution in November 2019. In the paper we discuss how different sources of private funding can be released for different restoration projects, and how this can be done in a way that does not compromise social and environmental restoration objectives.
In the discussions on financing options for restoration there is a lot of focus on how to make restoration projects “bankable”, meaning how to mold restoration projects into profit-generating business cases. This narrative is, I believe, very dangerous. If we try to attract funding for restoration only through traditional business models we are at best going to fail, and at worst we risk having private profit objectives drive global restoration trajectories in an ecologically and socially detrimental manner.
Some restoration projects do, however, have the potential to yield traditional return on investments. As discussed in our article, this can for example be sustainable timber plantations or agroforestry projects. However, the restoration interventions that may hold the greatest ecological and social potential, such as natural forest regeneration, tend to lack a traditional return-on-investment profile. Trying to adjust these interventions so that they yield direct financial return will likely come at great social and environmental costs. Instead, we need to look at less conventional business motivations to fund restoration beyond those that directly boomerang back with return on investments. In our article we discuss several such finance streams that could be leveraged, such as corporate funding for sustainable branding positioning or insetting strategies. We are excited to explore this further in our ongoing research projects. The key issue is how to release new types of finance to restoration, shift funding away from degradation, and doing so in a manner that ensures that social and environmental objectives of restoration remain core.
Managing all of this in the upcoming decade is obviously a massive undertaking. However, there is hope in the fact that sustainability awareness is increasing amongst financial actors. Big corporations are approaching scientists asking for support on how to execute restoration interventions, and asset managers are increasingly looking towards restoration projects with hesitant curiosity. The role of the environmental science community is to support this interest, and to provide insights that enable finance to be steered towards restoration in a socially and ecologically sound manner. We hope our paper will be of use on that quest.