13.5 Conclusion

Biodiversity is the source of our common livelihood. The loss and degradation of biodiversity comprises a major threat to the sustainability of our society. Presently, the vast majority of financial decision makers are not aware of biodiversity-related problems. In particular, fund managers have limited ideas about the concept of biodiversity and as a result most of them do not consider it relevant enough for incorporating these concerns in investment decisions. History repeats itself, as a similar pattern could be observed with climate change five years ago. In contrast, nowadays a fund manager would estimate the value of a European utilities company by taking into account the European Emission Trading Scheme.1 Price changes in the carbon market can influence the fund manager's decisions to buy or sell. Whereas global warming dominates the headlines today, ecosystem degradation will do so tomorrow.2 Biodiversity loss should also be the concern of today's investor in order to avoid that the negative consequences of ecosystem degradation for human economies will become irreversible. That is one of the reasons why 2010 has been proclaimed by the UN as the 'International Year of Biodiversity.'

This chapter has offered insight into a wide spectrum of new market based approaches to nature conservation. 'Biodiversity business' is commonly explained as business conducted by a commercial enterprise that generates profits via activities which conserve biodiversity and ecosystems (BES), use biological resources sustainably, and share the benefits arising from this use equitably. Various emerging BES markets were briefly outlined in this chapter, illustrated with examples. They include: (1) sustainable forestry; (2) nature conservation (wetland banking and biodiversity offsets); (3) eco-tourism; (4) watershed management; and (5) agricultural carbon sequestration and REDD. It showed that innovative mechanisms are being explored for channelling private funds to ensure the protection of BES. At the same time, the chapter demonstrated that these emerging markets offer new opportunities to business entrepreneurs and investors, in particular to institutional investors with a long-term perspective. Although the business case for biodiversity is still developing, certain sectors like eco-tourism, forest products and watershed management are already being earmarked as prospective business opportunities. These sectors have aspects of biodiversity that are marketable and which are in fact currently being marketed.3

Subsequently, the main barriers to investing in pro-biodiversity business have been identified in a general way. Further research would be necessary to identify sector-level constraints. The obstacles mentioned are mostly related to a lack of knowledge and entrepreneurial spirit. The innovative approaches presented in this chapter and engagement in partnerships with other stakeholders can help overcome them. If the financial sector would succeed in seeing biodiversity, which used to be a risk and a liability problem, as a business opportunity, they could increase value not only in respect of Profit, but also in the other two dimensions Planet People.