The BIOFIN Approach
The BIOFIN Methodology
Available evidence and the decisions adopted by Parties to the Convention on Biological Diversity (CBD) indicate that a significant gap remains in finance for biodiversity management, for countries to drastically scale up their efforts and achieve the 20 Aichi Targets defined in the CBD’s Strategic Plan for 2011-2020. A preliminary assessment recently conducted under the auspices of the High-level Panel on Global Assessment of Resources for Implementing the CBD Strategic Plan estimated that the global investment required ranges between 130 and 440 billion US$ annually. While useful, this and similar other global estimates are based on extrapolations sensitive to the underlying assumptions. To define biodiversity finance needs and gaps with greater precision and to determine related challenges and opportunities for resource mobilization, detailed national-level (bottom-up) assessments are therefore required. In this context, UNDP in October 2012 launched the Biodiversity Finance Initiative – BIOFIN, as a new global partnership seeking to address the biodiversity finance challenge in a comprehensive manner – building a sound business case for increased investment in the management of ecosystems and biodiversity.
Guided by a steering committee representing the partners, BIOFIN works along two main axes:
I) Globally-led development of a new methodological framework
An entirely new methodological framework is being developed and piloted for undertaking national-level “bottom-up” analyses of the finance-relevant enabling context; for determining the current / baseline investment in biodiversity; for quantifying the full cost of meeting national biodiversity conservation targets and the resulting finance gap; and for assessing the suitability of financial mechanisms and developing national resource mobilisation strategies that are fully appropriated by national governments and other key in-country stakeholders. The methodologies applied in the project will be refined through regional and global learning, and made available more widely.
II) Adaptation and implementation of this new methodological framework at national level
To help countries increase the importance attributed to biodiversity and in consequence bridge the financing gap, the work at national level will be led by Ministries of Finance, Economics or Planning and the Ministry of Environment. It is articulated through the following components:
1. Analyze the integration of biodiversity and ecosystem services in sectoral and development policy, planning and budgeting
Participating countries will analyse the current policy and institutional frameworks affecting biodiversity and ecosystem services both positively and negatively, and quantify related investments through comprehensive reviews of past and current (baseline) public and private expenditures. Analyses of impact, effectiveness and coherence will provide key opportunities for mainstreaming, aimed at reducing the cost of biodiversity management, such as through the removal of perverse incentives.
2. Assess future financing flows, needs and gaps for managing and conserving biodiversity and ecosystem services
Participating countries will project anticipated future investment in biodiversity, and determine the financing needed to meet agreed national priorities reflecting the CBD Aichi Targets, building on and interacting with the NBSAP process, and taking into account cost-effectiveness and the effects of an improved enabling environment. The difference between the projected future investment and the required investment will enable the quantification of the finance gap.
3. Develop comprehensive national Resource Mobilization Strategies to meet the biodiversity finance gap
Following an assessment of the full range of potential financing mechanisms (traditional and innovative, national and international), each participating country will develop a strategy to address the finance gap, combining suitable and nationally-adapted mechanisms. The strategy will analyse opportunities, risks and barriers related to the implementation of these mechanisms and provide solutions and recommendations, including on the enabling environment and safeguards.
4. Initiate implementation of the Resource Mobilization Strategy at national level
Countries will begin implementing recommendations pertaining to a priority subset of the identified financing mechanisms – regarding aspects such as institutional requirements, laws and regulations, taxes and fees, identification of legal thresholds, removal of biodiversity-harmful incentives, further feasibility studies and implementation plans, certification processes, public-private-partnerships, voluntary agreements, etc.
As of November 2015, 30 countries participate in BIOFIN including: Botswana, Chile, Colombia, Costa Rica, Ecuador, Fiji, Guatemala, Indonesia, Kazakhstan, Malaysia, Mexico, Peru, Philippines, Seychelles, South Africa, Thailand, Uganda and Zambia. Further countries can be supported as additional resources are leveraged. Tools developed through BIOFIN will additionally be applied in the rest of the 45 countries that UNDP is supporting to develop “new generation” NBSAPs, and will be made available to all CBD Parties through the NBSAP Forum coordinated by UNDP together with UNEP-WCMC and the CBD Secretariat, and through on-going collaboration with the latter in particular such as on regional workshops on resource mobilisation. BIOFIN liaises closely with TEEB and WAVES, especially at national level in those countries where overlaps exist.
The BIOFIN Assessment Workbook
The BIOFIN Workbook provides guidance to countries on how to assess financial needs and how to mobilize the financial resources required to fully implement their revised NBSAPs, and thereby achieve the Aichi Biodiversity Targets at a national level. It is comprised of three parts:
Part 1 focuses on reviewing biodiversity-related policies, institutions and expenditures.
- Workbook 1a: Policy and practice drivers of biodiversity and ecosystem change: In this workbook, planners identify sustainable and unsustainable policies and practices, and analyze the factors that drive biodiversity and ecosystem change across a suite of different sectors.
- Workbook 1b: Institutional review: In this workbook, planners analyze a wide range of institutions across multiple sectors, identifying different roles in biodiversity finance, impacts and dependencies on biodiversity, the degree of alignment with national biodiversity goals, and overall levels of capacity.
- Workbook 1c: Public and private expenditure and effectiveness trends: In this workbook, planners identify national budgetary and expenditures trends across several years to gain a baseline overview of expenditures by institution and by major biodiversity strategy, project a future baseline scenario, and identify key issues, including ineffective and negative expenditures.
Part 2 focuses on calculating the costs of implementing each of the strategies within the revised NBSAP.
- Workbook 2a: Strategies, actions and costs: In this workbook, planners identify key strategies and actions from their revised NBSAPs, including mainstreaming and sustainable use, protection, restoration, ABS and implementation strategies, and assign realistic costs to these.
- Workbook 2b: Identifying finance gaps: In this workbook, planners summarize all costs, and identify finance gaps.
Part 3 focuses on developing a resource mobilization plan.
- Workbook 3a: Potential biodiversity finance actors, opportunities, mechanisms and revenue: In this workbook, planners identify a full suite of potential finance actors and opportunities; identify, screen and prioritize specific biodiversity finance mechanisms; and calculate how much revenue each mechanism might generate.
- Workbook 3b: Resource mobilization strategy and action plan: In this workbook, planners develop an operational plan for taking the necessary steps in implementing key financial mechanisms, and develop a timeframe and budget.
By completing the BIOFIN Workbook, countries will not only have a clear idea of how much it will cost to implement the NBSAP, they will also understand how to mobilize the resources required to implement the NBSAP. The goal of the BIOFIN Workbook is to enable partner countries to transform the trajectory of biodiversity, finance and development, and to chart a pathway to a sustainable future.
A PDF version of the BIOFIN workbook can be found here