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Advancing More, Better and Faster Financing for Biodiversity and Ecosystem Services

Innovative financial mechanisms

Indicator:
"Number of initiatives, and respective amounts, supplementary to the financial mechanism established under Article 21, that engage Parties and relevant organizations in new and innovative financial mechanisms, which consider intrinsic values and all other values of biodiversity, in accordance with the objectives of the Convention and the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of the Benefits Arising out of Their Utilization;" --- Decision X/3, paragraph 7(14)

2008 Strategy for resource mobilization

Goal 4 - “Explore new and innovative financial mechanisms at all levels with a view to increasing funding to support the three objectives of the Convention”

Strategic objective 4.1 - “To promote, where applicable, schemes for payment for ecosystem services, consistent and in harmony with the Convention and other relevant international obligations."

Strategic objective 4.2 - “To consider biodiversity offset mechanisms where relevant and appropriate while ensuring that they are not used to undermine unique components of biodiversity."

Strategic objective 4.4 - “To explore opportunities presented by promising innovative financial mechanisms such as markets for green products, business-biodiversity partnerships and new forms of charity."

Strategic objective 4.5 - “To integrate biological diversity and its associated ecosystem services in the development of new and innovative sources of international development finance, taking into account conservation costs."

Strategic objective 4.6 - “To encourage the Parties to United Nations Framework Convention on Climate Change and its Kyoto Protocol to take into account biodiversity when developing any funding mechanisms for climate change."

Decision XI/4, paragraph 19
"Recognizing that the Convention’s strategy for resource mobilization calls for the exploration of new and innovative financial mechanisms at all levels with a view to increasing funding to support the Convention and its Strategic Plan for Biodiversity 2011–2020, and that some of those mechanisms are already being applied, and recalling decision X/3, reiterates that any new and innovative financial mechanisms are supplementary to and do not replace the financial mechanism established under Article 21 of the Convention"

Decision XI/4, paragraph 20
"Takes note of the synthesis on innovative financial mechanisms (UNEP/CBD/COP/11/14/Add.3), which is based on submissions made in response to decision X/3, paragraph 8 (c), and highlights activities related to innovative financial mechanisms that have taken place since the tenth meeting of the Conference of the Parties, and the discussion paper on safeguards for scaling-up biodiversity finance and possible guiding principles (UNEP/CBD/COP/11/INF7); recalls the outcome of the United Nations Conference on Sustainable Development (Rio+20), which encourages the further exploration and use of innovative sources of financing, alongside traditional means of implementation; notes the reports of the informal seminar dialogue on scaling up biodiversity finance held in Quito, Ecuador, from 6 to 9 March 2012, including the proposal on a net avoided emissions mechanism, and the workshop on financing mechanisms for biodiversity: examining opportunities and challenges, held in Montreal, Canada on 12 May 2012; requests the Executive Secretary to further develop the discussion paper on safeguards, based on comments from Parties and other relevant stakeholders, for submission to the fifth meeting of the Ad Hoc Open-ended Working Group on Review of Implementation of the Convention; and requests the Working Group, at its fifth meeting, to prepare a recommendation for consideration by the Conference of the Parties at its twelfth meeting"

Decision XI/4, paragraph 21
"Invites Parties and other relevant stakeholders to submit views and lessons learned on possible risks and benefits of country-specific innovative financial mechanisms, including on possible principles and safeguards for their use, in time for consideration by the Ad Hoc Open-ended Working Group on Review of Implementation of the Convention at its fifth meeting; requests the Executive Secretary to compile this information, taking into account the discussion paper contained in document UNEP/CBD/COP/11/INF/7 and building on previous submissions and initiatives, including the Quito seminar and the Montreal workshop referred to in paragraph 20; and requests the Working Group, at its fifth meeting, to discuss this for consideration by the Conference of the Parties at its twelfth meeting"

Innovative financial mechanisms explore supplementary yet more sustainable financial and economic approaches to human interaction with biodiversity and ecosystem services. Based upon the modern financial and economic methods, innovative financial mechanisms seek to develop financial and economic solutions to the current biodiversity crisis and to transform the prevailing financial and economic systems that have been distortionary in sustaining life on earth, thus avoiding unsustainable commodification of the nature. Innovative financial mechanisms are considered as important instruments to mobilize new and additional financial resources for achieving the Convention‘s objectives, and explored in the broad context of innovation for biodiversity while recognizing the close synergies between conserving biodiversity, combating desertification, and mitigating and adapting to climate change. As the only innovation process under the Convention, further work on innovative financial mechanisms will likely be organized around the following four priorities for national and international action:

  • Empower Parties and relevant stakeholders to explore innovative financial mechanisms through education and training events, and foster appropriate skills and attitudes needed for innovative financing;
  • Mobilize private funding through innovative financial mechanisms by fostering biodiversity entrepreneurship and enabling biodiversity entrepreneurs to experiment, invest and expand creative economic activities that contribute to addressing biodiversity challenges;
  • Facilitate efficient knowledge development and flows through the development of networks and markets which enable the creation, circulation and diffusion of knowledge;
  • Explore and apply innovative financial mechanisms to address global and social challenges as related to biodiversity loss, including through the development of international mechanisms to provide finance and incentives to address global challenges through innovation in developed and developing countries.

Further readings

Resource mobilization information digest No. 502: National Experience and Perspectives in Innovative Financial Mechanisms. This digest provides a compilation of the submissions from Canada, Costa Rica, Ecuador, European Union, India, Japan, Mexico, Moldova, Norway, and Russian Federation with respect to innovative financial mechanism in 2012 in preparation of the eleventh meeting of the Conference of the Parties.

Policy Options Concerning Innovative Financial Mechanisms (UNEP/CBD/WG-RI/3/8, 15 February 2010) (ar en es fr ru zh)

Innovative Financial Mechanisms: Report of the proceedings of the International Workshop on Innovative Financial Mechanisms (UNEP/CBD/WG-RI/3/INF/5, 6 May 2010) (en) (workshop website)

  • United Nations
  • United Nations Environment Programme