Demystifying Biodiversity Finance

How can biodiversity conservation and restoration attract meaningful investment without losing sight of ecological integrity and social justice?

A new review led by Harrison Carter explores the rapidly evolving landscape of biodiversity finance, unpacking the mechanisms increasingly being used to fund conservation and restoration through private investment. The paper examines bonds, loans, equity and biodiversity credits, alongside the commercial, ecological and social risks that shape their success or failure.

Published in Nature Reviews Biodiversity, the review aims to bridge the gap between conservation practitioners and the financial sector by explaining complex financial mechanisms in accessible language and highlighting where ecological expertise is essential to their design and scrutiny.

The paper argues that return-seeking biodiversity finance will only deliver meaningful outcomes if ecological and social risks are treated as central, rather than secondary, to commercial performance. It also stresses that public funding and philanthropy will remain critical, even as new market-based approaches continue to emerge.

The review covers:

• loans, bonds and equity as mechanisms for raising up-front finance for conservation and restoration
• biodiversity and forest carbon credits as revenue-generating approaches
• ecological risks, including weak metrics and uncertain outcomes
• social risks relating to land rights, equity and local participation
• the challenges of scaling biodiversity finance while maintaining credibility and integrity

The paper was led by researchers from the University of Oxford’s Nature-positive Hub, WildCRU and the Leverhulme Centre for Nature Recovery, alongside collaborators from Monash University, Bangor University and Utrecht University.