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Banking and Financial Services

About this sector

The finance industry constitutes the largest group of companies in the world. Banking is the largest financial services sector (24% of total assets in 2005), followed by securities (21%), insurance (18%), pensions (17%) and government related services (13%)168. The role of the sector in biodiversity loss and, indeed, in its conservation is increasingly being recognised. By providing financing to projects and companies, the sector has an indirect reliance and impact on biodiversity and ecosystem services.

Impacts

  • Indirect impacts through investment/ provision of financial services to company’s which mismanage biodiversity.
  • Potential for positive impact through incentivising development of biodiversity related products e.g. biodiversity offsets, offsets, REDD, payments for ecosystem services.

Opportunities/Risks

  • Development of new financial products e.g. carbon credits or biodiversity offsets.
  • Differentiation and branding e.g. HSBC’s Climate Partnership.
  • New investment opportunities e.g. biodiversity banking.

Case Studies


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Handling of the Yamato River water quality improvement support time deposit “Yamato River Time Deposit”

Handling of the Yamato River water quality improvement support time deposit “Yamato River Time Deposit”

This project is based on the “Yamato River time deposit”, a product marketed by Yamato Shinkin Bank and designed to improve the water quality of the Yamato River, which flows through the basin of Nara. Additional interest is paid to deposits when prescribed improvements are seen in water quality, specifically the BOD (biological oxygen demand) levels.

Testing the first habitat banking project in Europe

Testing the first habitat banking project in Europe

New market mechanisms targeting biodiversity conservation are emerging worldwide, and among others, the biodiversity offset market size is expected to increase in the coming years. The French company CDC Biodiversité has seized this opportunity and is testing the first habitat banking project in Europe.

Utilizing financing mechanisms to protect Japanese satoyama biodiversity

Utilizing financing mechanisms to protect Japanese satoyama biodiversity

Aware of the role finance has to play in the field of biodiversity projects funding, Sompo Japan has developed a loan mechanism that fosters investments in ecological housing and finances a charity fund dedicated to Japanese specific landscape protection.

Yogyakarta Special Province Wildlife Reserve Restoration and Recovery

Yogyakarta Special Province Wildlife Reserve Restoration and Recovery

This project is designed to restore a natural reserve that has been ravaged by illegal logging and, over the long term to contribute to the local economy through the planting of trees. This has resulted in the planting of some 300,000 trees across nearly 350 hectares of highland area.


Tools and Mechanisms


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Biodiversity Neutral Initiative

Biodiversity Neutral Initiative

http://www.business-biodiversity.eu/default.asp?Me...

Biodiversity Neutral Initiative (BNI) helps companies assess biodiversity impacts, implement best practices with respect to the biodiversity mitigation hierarchy and then offset net residual damage to become biodiversity neutral. Biodiversity Neutral Initiative (BNI) is global in scope, collaborating with major international conservation groups, energy and mining companies, socially responsible investors, auditing and certification companies, and government regulators.
Business for a better world

Business for a better world

http://www.bsr.org/

Business for a better world helps companies integrate ecosystem services into corporate decision making, risk assessment, and supply chain management processes. It has produced an analysis of the environmental markets and is investigating ecosystem services assessment tools.
Green Economy Initiative

Green Economy Initiative

http://www.unep.org/greeneconomy/

The Green Economy Initiative is designed to assist governments in “greening” their economies by reshaping and refocusing policies, investments, and spending towards a range of sectors such as clean technologies, renewable energies, water services, green transportation, waste management, green buildings, and sustainable agriculture and forests.
WWF Finance Lab

WWF Finance Lab

http://www.wwf.org.uk/what_we_do/changing_the_way_...

WWF has come together with the Institute of Chartered Accountants in England and Wales, Reos Partners, and the Said Business School to launch an exciting new programme – the Finance Lab.  The Finance Lab is a collaborative initiative endeavouring to re-think the financial system and take practical action to stimulate transformational change, so that finance serves the interests of society and the environment.
Eurosif

Eurosif

http://www.eurosif.org/

Eurosif (the European Sustainable Investment Forum) is a pan-European network and think-tank whose mission is to Develop Sustainability through European Financial Markets. Current Member Affiliates of Eurosif include institutional investors, financial service providers, academic institutes, research associations, trade unions and NGO's. The association is a not-for-profit entity that represents assets totalling over €1 trillion through its affiliate membership.

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Banking and Financial Services

Case studies
Tools and Mechanisms