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Workstream 3: Access to Finance and Innovative Finance Mechanisms Matt Rayment Consulting Director at ICF International and Workstream leader Brussels,

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Presentation on theme: "Workstream 3: Access to Finance and Innovative Finance Mechanisms Matt Rayment Consulting Director at ICF International and Workstream leader Brussels,"— Presentation transcript:

1 Workstream 3: Access to Finance and Innovative Finance Mechanisms Matt Rayment Consulting Director at ICF International and Workstream leader Brussels, 21/11/2014 Context and objectives

2 EU Business and Biodiversity Platform Workstream objectives  Identify and profile biodiversity investment opportunities (e.g. pro-biodiversity business/certified products; biodiversity offsetting and habitat banking, PES schemes and bio-carbon markets, financial services);  Identify funds and financial instruments providing investment in biodiversity in the EU and worldwide.  Identify key actors in the financial sector championing integration of biodiversity into investment decisions. Objectives Approach Key findings Further work

3 EU Business and Biodiversity Platform Approach and method Objectives Approach Key findings  Call for evidence from members, observers and representatives (4/4 – 15/5)  Analysis of responses to the call for evidence, and further contextual research. –Focusing on the three sub-themes of investment opportunities, investment funds and finance sector champions –Supplementing examples from members with wider experience  Development of finance case studies  Draft and finalise report on the Finance Workstream, in discussion with Commission and members, observers and representatives.  Showcase report and case studies on website. Further work

4 EU Business and Biodiversity Platform 18 submissions were received from Platform members, resulting in 15 case studies Objectives Approach Key findings  Biodiversity Investment Opportunities –Sinergiae Ambiente: adding value through certification. –CDC Biodiversité: exploring long-term opportunities for biodiversity offsets. –CDC Biodiversité: developing payments for ecosystem services in the water sector –SAR Consult : supporting catchment-scale actions. –European Green Roof Association: maximising the potential of urban green roofs. –Green4Cities: securing new forms of finance for urban Green Infrastructure. –Ecoacsa: growing the market for biodiversity offsets in Spain. –EDF: exploring innovative financing mechanisms for biodiversity & ecosystem services  Biodiversity Funding Mechanisms –The Nature Conservancy: tapping impact investment for natural capital. –PIRAEUS Bank Group: providing targeted conservation finance for Natura –VCA Platform: Investing in verified conservation  Finance Sector Champions –Sumitomo Mitsui Trust Holdings: pioneering pro-biodiversity investment products. –CDP: mobilising shareholders for pro-biodiversity investment. –WWF China: integrating sustainability in the Chinese financial sector. –CoP FINC: building financial sector sustainable investment capacities. Further work

5 EU Business and Biodiversity Platform Key findings – Biodiversity investment opportunities Objectives Approach Key findings  Action for biodiversity creates investment opportunities in: –Certified goods and services; –Biodiversity offsetting and habitat banking; –Green infrastructure; and –Payments for ecosystem services and bio-carbon markets.  Platform members are involved in each of these areas  This is creating new demand for finance and innovative financing models  Members identify a range of actions that would facilitate investment opportunities, including: –Regulation –Harmonisation of standards –Piloting new projects and financing methods –Improved evidence, information and awareness Further work

6 EU Business and Biodiversity Platform Key findings – finance for biodiversity Objectives Approach Key findings  Demand for finance is increasing  Biodiversity investments are often novel, complex, uncertain, poorly understood and/or perceived to be risky  Specialist instruments are emerging – venture capital, banking services, green bonds, specialist funds  New EU Natural Capital Financing Facility offers opportunity to develop and demonstrate new sources of finance  Public/private/NGO partnerships creating new opportunities  Members identify a range of actions that would facilitate finance, including: –Co-operation and partnerships – NGOs, public and finance sectors –Government support to pilot new approaches, lever-in private finance –Information and advisory services Further work

7 EU Business and Biodiversity Platform Key findings – finance sector champions Objectives Approach Key findings  Biodiversity considerations are increasingly being integrated into financial decisions. Key areas of progress include: –Financial sector standards –Advisory, information and training services –Reporting –Associations of sustainable investors –Stock market indices  Members identify a range of actions, including: –Partnerships between conservation and finance communities to harmonise and promote standards –Working groups to strengthen integration of biodiversity –Specialist guidance and toolkits –Development of indicators and performance measures Further work

8 EU Business and Biodiversity Platform Possible work for 2015 Objectives Approach Further work  Exploring opportunities provided by EU finance, including the Natural Capital Financing Facility, Horizon 2020, other EU grants and financial instruments  More detailed mapping of financing initiatives and instruments for biodiversity in the EU, examination of funding gaps, needs, opportunities and possible enabling actions.  More detailed analysis of financial needs and opportunities in key areas of biodiversity action (certified products, offsets, GI, PES, biodiversity friendly businesses)  Analysis of key tools and enabling actions at EU level to integrate biodiversity into financial decisions – e.g. information, guidance, standards, collaborative approaches, common EU standards and guidelines Key findings

9 Workstream 3: Access to Finance and Innovative Finance Mechanisms Dimopoulos Dimitrios Head of Environment Unit Piraeus Bank Group Brussels, 21/11/2014 LIFE-Stymfalia: Sustainable Management and Financing of Wetland Biodiversity - The case of Lake Stymphalia

10 10 Environment Strategy: Climate and Biodiversity Home (our facilities) GREENbanking 4Life ( ) Neighbours (our clients and shareholders) GREENbanking 4Life Climabiz ( ) Society (our stakeholders) climabiz LIFE-Stymfalia ( )

11 11 LIFE-Stymfalia: The nature of business The aim of the project is the restoration of Lake Stymphalia and its long-term protection and management, through a systematic re-financing process, which will be ensured by the commercial utilization of the area’s biomass. LIFE12 NAT/GR/ Project funding Co-funded by the European Union “LIFE+ Nature and Biodiversity” Programme Total project budget€ EC financial contribution € (50%) Project durationOctober September 2017 Coordinating Beneficiary Piraeus Bank Associated Beneficiaries Piraeus Bank Group Cultural Foundation, Municipality of Sikyonion, OIKOM Environmental Studies Ltd, Society for the Protection of Prespa, Center for Renewable Energy Sources and Saving

12 12 Conservation Finance for Natura 2000 Enhancement of the conservation status of target-species and their habitats Institutional protection through management plan Local Management Unit Thematic exhibition at Environment Museum of Stymphalia (Piraeus Bank Group Cultural Foundation) Environmental interpretation path and bird watching hide Farmers’ network (responsible farming practices) Investment interest for biomass utilization → new green jobs.

13 Workstream 3: Access to Finance and Innovative Finance Mechanisms Caroline van Leenders Sustainable Transition Manager The Netherlands RVO Brussels, 21/11/2014 Community of Practice Financial institutes & Natural Capital

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15 The concept of CoP FiNC A Community of Practice for learning on reducing impact on NC, accelerating eco-positive practice and knowing systemic barriers on natural capital NC is the stock of ecosystems delivering a renewable stream of services and goods for companies 14 people (CSR-managers) of various financial companies: banks, pension funds, private equity, insurance companies and a crowd funder 4 private meetings a year with inspiring speakers, homework and exchanging practice in small groups The CoP decides on the theme of each meeting, government facilitates the process An expert group for changing system rules

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17 Strategy and business case Insights Most financials are unknown with the concept of NC and do not have clear policy Financials want to know materiality, business case and strategy Measuring impact : generic indicators for financials: CO2, water and land use (80%) and context depend issues waste, specific species and ecosystems (20%) Important to differentiate between asset classes for the business case and kind of players Impact investing and green bonds for niche players and familily funds Strategies: creating awareness by voting on shareholder meeting, engagement policy, exclusion, ESG screening, positive impact investing, new instruments (Green of Climate bonds) Obstacles Making NC measurable in terms of money and/or risks Limited scale of the investing possibilities Limited mandate of clients and regulators

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19 International coordination 11 December 2014 Dutch Green Deal on Transparency of Natural and Social Capital (with the Natural Capital Coalition) will host an international gathering of key public and private sector policy makers engaged in natural and social capital policy to 1.Share knowledge and experiences and to stimulate the discussion on transparency of natural and social capital amongst public and private sector practitioners 2.To scale up the international movement on social and natural capital valuation by bringing together parties from different countries. 3.To shape an international policy dialogue on social and natural capital policy

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22 Workstream 3: Access to Finance and Innovative Finance Mechanisms Lara Yacob Director of Corporate Engagement The Nature Conservancy Brussels, 21/11/2014 “NatureVest” initiative

23 H OW N ATURE V EST S ETS P ORTFOLIO P RIORITIES Global Conservation Strategy MappingCriteria for NatureVest Deals 1.Alignment with TNC global strategies 2.Critical role for private impact capital 3.Size of the conservation impact and investment opportunity 4.Replicability of the individual deals 5.Readiness to deploy capital 23 NATUREVEST STRATEGIES LAND Sustainable Agriculture Land Conservation Partnerships Mitigation Community Development CLIMATE Mitigation Sustainable Finance – Debt Restructuring Pay-for-Performance Green Infrastructure Carbon Offsets Insurance OCEANS Fisheries Reform Sustainable Finance – Debt Restructuring WATER Water Security Pay-for-Performance Green Infrastructure CITIES Water Security Pay-for-Performance Green Infrastructure Urban Forestry/Carbon Offsets

24 PORTFOLIO PRIORITIZATION NatureVest FY 2015 Priority Deal Activity 24 Conservation Partnerships Carbon Offsets Sustainable Agriculture Debt Restructuring Water Security Mitigation Green Infrastructure Fisheries Reform Community Development Insurance Short-term Within 18 months Longer-term Beyond 36 months Medium-term months

25 NATUREVEST TRANSACTION PROFILE Grasslands and Livelihoods – Kenya Northern Rangelands 25 Conservation outcomes Convert 1.2 million acres of grasslands in a critical elephant corridor to sustainable management Provide sustainable livelihoods to 5,000 households Deal summary Support sustainable grazing practices that enhance wildlife habitat through rotational grazing that increases grass available to cows and wildlife by creating a market for cows from herders who meet grazing standards. Support community development with a per-head fee to a community conservancy. Pilot improved value chain product-to-market structure by scaling up a longstanding grant- funded program. Key partners Northern Rangelands Trading Ltd – operating partner Peter Hawkins Dobberpuhl Foundation – PRI lender SUSTAINABLE AGRICULTURE Financial Information (10/28/14) Deal size = $7 million Capital structureTargets PRI DebtFamily Foundation TNC Equity supported by philanthropy Family Foundation Structured Approved Committed Closed Milestones Announced at 2014 Clinton Global Initiative Location Northern Rangelands of Kenya Fully Subscribed

26 Workstream 3: Access to Finance and Innovative Finance Mechanisms Vera Enzi Green4Cities Brussels, 21/11/2014 Green4Cities: Urban Green Infrastructure Competence Center Rob Wolters, Chief Executive ECNC Land & Sea Group

27 |Westbahnstrasse 7, 1070 Vienna, AUSTRIA Brussels|B&B Platform Conference|21st. November 2014 |Vera Enzi CCO Green4Cities Urban Green Infrastructure Competence Center Who are we? Founded 2014 by Bernhard Scharf, Dr. Ulrike Pitha, Doris Schnepf and Vera Enzi Backgrounds: University of Life Sciences Vienna Research and Development in urban GI, Buildup and Development of innovative SME´s (Sustainability Sector), Teaching and Training in Green Infrastructure on University and Business Level, National and International Associations and Networks, Professional Project Application Selected Reference Projects: – Research: grünstadtklima.at, progreencity.com, schotterrasen.at, – Education: biosolarroof.com, greenroofcourse.com, grünaktivhaus.at – Guidelines: Austrian Green Wall Guideline, Guideline Green Infrastructure for Future Cities – Initiatives: Green Wall and Roof Funding Pots, Municipality Buildings go Green, Green Wall Event USP – 8 years of international recognized Research on measurable Benefits of urban GI Elements -> we have Arguments – Broad Background Network of GI Movers (Business and Public) -> there is NEED – Ability to and link Innovators, Investors and Community -> Integral Player Philosophy – Innovation to Market -> Implementation Focus

28 |Westbahnstrasse 7, 1070 Vienna, AUSTRIA Brussels|B&B Platform Conference|21st. November 2014 |Vera Enzi CCO Driver of Green Urban Infrastructure, safe and green Cities for the future, through: Research and Development – Innovation and Product Development, Strategical Project Development Innovation to Implementation, Guidance applying for Funding Education and Training – GI Training of Industry Professionals, Planners, Investors and Public (Trade- spanning Platform) Consulting and Certification – Project Consulting, Strategy Consulting, Sustainaility Assessment Consulting, Networks and Conferences – Strategical Events and Activities supporting Urban GI Implementation and Acceptance Focus Target Groups: SME´s, NGO´s, Public Bodies and Politicians, Investors and Real Estate Developers, Planners, Delivering Professionals and Citizens PHILOSOPHY: Bringing Nature, improved Climate and Quality of Life to every City Green4Cities Urban Green Infrastructure Competence Center What do we do?

29 |Westbahnstrasse 7, 1070 Vienna, AUSTRIA Brussels|B&B Platform Conference|21st. November 2014 |Vera Enzi CCO Green4Cities Urban Green Infrastructure Competence Center Where are we at, where do we go? Product Developments for Urban GI, focus LE´s (Green Wall and Roof Technology, Raingardens, Permeable pavements etc.) Development and Implementation of Communication Campaign and Tools (GI and Urban Ecosystem Services Campaign) Developing Online Platform for Education and Training Activities Initiating GI Strategy Conference Series (Start: Vienna, NOV 2015) Knowledge Exchange Activities amongst GI Movers (Pollinating Europes Cities) GI Implementation Showcase: LIFE Application Next Steps, Agenda Certification and GI Assessment until 2016: Finalizing Green Pass ® Technology Pushing Development of Finance Mechanisms Urban GI, Consulting Activities following Spreading EU GI Strategy

30 Workstream 3: Access to Finance and Innovative Finance Mechanisms Brussels, 21/11/2014 Panel discussion

31 Workstream 3: Access to Finance and Innovative Finance Mechanisms Brussels, 21/11/2014 Coffee Break


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