Changing the Rules of the Game


CategoryGreen Finance

CategorySupply Chains

Reforming targets, regulations, and incentives to promote Nature Positive outcomes

In light of the adoption of the 2022 Kunming-Montreal Global Biodiversity Framework (GBF) (also known as the Biodiversity Plan – For Life on Earth), developing an ambitious and effective enabling environment for engaging business on action for nature is an essential component of achieving Nature Positive.

The current ‘rules of the game’ must be reformed and transformed to push economic systems towards being in harmony with nature and contributing to halting of biodiversity loss. To develop a roadmap for achieving Nature Positive, we first need to understand the current state of the policy landscape before we can change the guiding rules of our systems and enable business to be a part of truly transformative change.

Nature Positive refers to the Global Goal for Nature – a societal target of halting and reversing nature loss by the year 2030 against a 2020 baseline, achieving a full recovery of nature by 2050. To achieve Nature Positive, we must bend the curve of biodiversity loss, therefore going beyond Do No Harm (Figure 1). As biodiversity loss is ongoing, we can conclude that the current suite of instruments is not doing enough to halt biodiversity loss and not able to bend the curve.

What is the required mix of policy instruments to deliver Nature Positive?

The central research question of this paper is: What is the required mix of policy instruments to deliver Nature Positive? The aim is thus to provide policymakers and businesses with an understanding of what instruments can support achieving the Global Goal, and what instruments need reforming in order to build and accelerate the transition towards an economic system aligned with Nature Positive.

This paper analyses the policy landscape as a whole and on specific (predominantly EU-level) mechanisms to assess whether they will contribute to Nature Positive outcomes. For this assessment, we have performed desk research, developed an analytical framework based on the Nature Positive Principles (referred to as NPP 1 – 10), conducted interviews, and organized validation workshops with leading experts. From the 10 NPPs, we identified three key principles that distinguish between Nature Positive and Do No Harm aligned policy instruments:

• Positive Outcomes (across value chains).

• Going Beyond (the mitigation hierarchy).

• Dare to Transform (strategies and systems).

Key findings and recommendations

The key findings and recommendations of this study can be summarized as follows:

  • To achieve Nature Positive, nature harmful policies and incentives need to be eliminated or reformed, and a paradigm shift is needed from Do No Harm to Nature Positive, both in policy ambition and business action.
  • The business and financial communities have demonstrated proof of concept for approaches that contribute to shifting towards a Nature Positive future, policymakers must now break the deadlock of the Triangle of Inaction (see Figure 2) to shape this future by changing the rules of the game and mainstreaming Nature Positive across policy aims.
  • The three key Nature Positive principles (Positive Outcomes, Going Beyond, and Dare to Transform) need to be used to evaluate existing policy instruments and should be integrated into future policy development.
  • A Nature Positive future can only be achieved using a whole-of-government approach, meaning policies and instruments across all levels and policy areas must be evaluated and reformed.
  • Policy instruments should be assessed not only by their features but also by the specific properties thereof (such as enforceability, scope, and rigor), and on how they interact with other policy instruments.
  • In addition to government, the financial sector is a key enabler of transformative change. By shifting investments and risk management practices, financial organizations have the power to accelerate Nature Positive outcomes. This can be catalysed by the financial sector itself, but even more so by financial regulators, with the right policy framework in place.
  • To deliver on GBF Target 15, current disclosure regulation should be complemented with mandatory requirements to develop, disclose, and implement Nature Positive transition plans.

As this research shows, the current mix of mechanisms and policy instruments is not enough to achieve Nature Positive outcomes. We therefore need to change the rules of the game and reform targets, regulations, and incentives to promote Nature Positive outcomes. As a result, the answer to the research question is that there is a need for a mixture of voluntary and mandatory mechanisms, in the form of legislation, regulation, incentive frameworks, and voluntary target-setting and disclosure frameworks, to enable a Nature Positive transition. Policymakers can use the three key identified Nature Positive principles to help shift from a Do No Harm paradigm towards a Nature Positive future. When integrated into National Biodiversity Strategies and Action Plans (NBSAPs) and National Biodiversity Finance Plans (NBFPs), they can shape a Nature Positive future.

The policy landscape explained

Key principles of Nature Positive are a strict application of the mitigation hierarchy (Do No Harm), complemented with pro-actively restoring nature across sectors, landscapes, and supply chains.

This will often require transformative action. The goals of Nature Positive can be promoted by many mechanisms and instruments. This ‘landscape of action’ is highly diverse, not only in terms of types of instruments and enforcement but also in terms of addressed topics and the level of application.

Read more about the Policy Landscape in the report
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