The accelerated degradation of biodiversity today represents a major systemic risk, affecting not only ecosystem resilience but also global economic and financial stability. The impacts are multiple: declining agricultural productivity, depletion of fishery resources, instability in supply chains, and increased costs associated with natural disasters.
Although biodiversity is now recognized as a key pillar for the sustainability of our economic system, its financing remains insufficient. The question is no longer why it is necessary to finance biodiversity, but rather how to sustainably mobilize private actors, beyond regulatory requirements and traditional incentive policies.
Economically, biodiversity constitutes a non-substitutable natural capital, providing essential ecosystem services for the functioning of societies and human well-being. Pollination, climate regulation, water purification, soil fertility, and the supply of biological resources are just some examples of services whose value remains largely invisible in market mechanisms.
This invisibility, linked to Garrett Hardin’s “Tragedy of the Commons,” poses a fundamental problem in our relationship with nature. Most of these services are treated as positive externalities, not reflected in prices or investment decisions. The result is a chronic undervaluation of nature and a structural tendency toward overexploitation, illustrated by deforestation, overfishing, or the growing artificialization of land.
This dynamic is reinforced by what Dan Pauly (1995) called the “shifting baseline syndrome,” whereby each generation normalizes a higher level of ecological degradation than the previous one. Progressive degradation thus becomes invisible to policymakers and civil society, leading to collective underestimation of ecological urgency and weakening demand for ambitious conservation policies.
From a financial perspective, this invisibility translates into the absence of biodiversity consideration in accounting balances. Benefits linked to its preservation do not generate immediate financial flows, while destruction provides quick economic gains, reinforcing short-termism. According to an EY report (2025), although 93% of companies mention nature in their annual reports, only 26% actually measure their impacts according to recognized standards, revealing very limited integration of biodiversity into financial information.
It is therefore necessary to rethink financial, accounting, and fiscal instruments to incorporate ecological value into investment decisions. This is a challenge that ecological accounting methods such as the CARE model aim to address.
Barriers to valuing biodiversity are not only economic but also political and institutional.
Public Choice theories (Buchanan & Tullock, 1962) have shown that decision-makers often prioritize immediate, tangible, and electorally attractive benefits over environmental investments whose effects are diffuse, uncertain, and delayed over time. In France, this manifests in the limited implementation of measures that are ecologically relevant, such as allocating 10% of local tourism taxes to fund natural parks (IGF/IGE, 2022). This mismatch between ecological relevance and political attractiveness illustrates the difficulty of integrating biodiversity into public and private trade-offs.
Globally, The Dasgupta Review (2021) highlights the blindness of modern economic systems to natural capital. By treating nature as a free and infinite resource, conventional economic indicators such as GDP or corporate balance sheets send biased signals, masking natural capital depletion. This critique aligns with work by Robert Costanza (1997, 2014), who estimate that the annual value of ecosystem services exceeds global GDP, underscoring the scale of under-accounting for nature.
In response to these challenges, a gradual structuring of biodiversity finance governance has emerged. The Kunming-Montreal Global Biodiversity Framework, adopted at COP15 in 2022, marks a major milestone by explicitly positioning finance as a central lever for conservation. Target 19 sets an ambitious goal of mobilizing $200 billion per year by 2030, with a significant share expected from the private sector. Target 18 calls for the reform of $500 billion in biodiversity-harming subsidies, redirecting them toward sustainable mechanisms that support conservation, ecosystem restoration, and nature-compatible uses. This approach is further reinforced by Target 20, which aims to strengthen institutional and technical capacities for the effective implementation of these objectives.
International institutions such as the World Bank are mobilizing dedicated funds, including the Global Environment Facility (GEF) and the Global Biodiversity Framework Fund (GBFF), to support biodiversity finance.
At the same time, initiatives such as the Taskforce on Nature-related Financial Disclosures (TNFD) aim to standardize the measurement, disclosure, and management of nature-related risks, promoting systematic integration of biodiversity into financial strategies.
Despite growing awareness, the path forward remains uncertain. In France, the Corporate Sustainability Reporting Directive (CSRD) was weakened by the adoption of the Omnibus Law, which relaxed initial sustainability reporting requirements. This reform lowered regulatory expectations, delaying effective integration of biodiversity into materiality analyses. The ESRS E4 on biodiversity lost 91 reporting data points, weakening the signal sent to companies and investors about the centrality of biodiversity in long-term strategy and performance.
Most companies perceive biodiversity loss as a long-term risk, rarely integrated into daily operational decisions. Internal expertise on biodiversity management is scarce, and dedicated governance is almost nonexistent, reinforcing a defensive posture and a short-term decision-making horizon.
Although international biodiversity finance grew 112% between 2015 and 2022 to exceed $15 billion, this growth came mainly from public sources and remains far from the $200 billion per year target of Target 19. OECD Development Assistance Committee members account for ~70% of flows, mostly via official development aid, while multilateral institutions represent ~30%, mainly in the form of non-concessional loans. Private finance, though increasing, remains minor: private philanthropy accounted for $700 million in 2022, and private flows mobilized by public interventions reached $1.8 billion, representing 72% of total private biodiversity finance. The majority of biodiversity finance thus remains public.
Despite these obstacles, several structuring dynamics are emerging, enabling a gradual increase in private investment in biodiversity. The first lever lies in the growing recognition of economic dependence on nature. The European Central Bank estimates that over 70% of non-financial European companies rely directly on at least one ecosystem service (ECB, 2024).
At the same time, the adoption of sectoral standards, labels, and reliable measurement tools helps reduce information asymmetries and enhances the credibility of projects led by committed companies. Current tools such as the Global Biodiversity Score, ENCORE, STAR, or BiodiverCity represent key initiatives to objectively assess biodiversity impacts and dependencies, in a context still marked by the lack of fully harmonized standards.
Finally, the emergence of new financial instruments, such as biodiversity impact funds, specialized private debt funds, or voluntary biodiversity credits, demonstrates the growing capacity to mobilize private capital without privatizing ecosystems, while ensuring real, equitable, and measurable conservation outcomes.
Biodiversity is increasingly recognized as a strategic asset, whose degradation directly impacts portfolio value, operational performance, and supply chain resilience. Structural barriers remain significant, but recent standardization efforts provide concrete levers to translate ecological awareness into meaningful capital allocation.
In this context, ecological accounting is a key tool to overcome the limits of traditional financial frameworks by reintegrating the value of natural capital into economic and investment decisions. Ultimately, widespread adoption of these approaches will make biodiversity an integrated component of sustainable finance, on par with climate, and mobilize the private sector to preserve and regenerate life.
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