Devex Invested: Can codifying a nature target get companies' attention?

Happening now: Our annual flagship event Devex World is currently ongoing, and soon, I'll be moderating a panel on mobilizing finance to reach net-zero climate targets. Please join the livestream here.

Having a clear global target and standards has helped align business and finance around a set of climate objectives. But biodiversity has lagged, lacking any goal or standards against which companies and investors can measure themselves.

Efforts are underway to change that. The Taskforce on Nature-related Financial Disclosures, or TNFD, recently released the second draft of its framework, which aims to be a risk management and disclosure tool that organizations can use to report and act on nature-related risks.

• The past few years have seen a greater focus on nature and biodiversity, as well as a growing recognition of nature loss as a business or economic risk, Elizabeth Mrema, the executive secretary at the Secretariat of the Convention on Biological Diversity, tells me. What’s at stake? A 2020 World Economic Forum report found that half of the world’s GDP is dependent on nature.

• “Climate and nature are now considered risks to the economy,” Marco Lambertini, the director general at WWF International, tells me. “That’s why we are advocating for this nature- positive global goal — a global goal that can tell companies they have to look at their operations and their supply chains and make sure … they are generating a net-zero loss of nature or, even better, a net-positive gain. That needs to be codified now.”

• That moment may come later this year at the U.N. Biodiversity Conference — which, after numerous delays due to COVID-19, is set for Dec. 5-17 in Montreal, Canada. The conference, which was moved from China, will convene governments to agree on a new set of goals about nature for the next decade.

• The TNFD can help give companies a way to evaluate and assess their impact on nature and act accordingly, Mrema says, adding that the task force plans to help businesses understand biodiversity in a new way through training and capacity building. The ultimate goal is “mainstreaming nature in their operations,” she says.

Read: Where do efforts stand on a nature-based finance standard?

A turnup for the books

British International Investment, the United Kingdom’s development finance institution, reported record commitments last year, according to an annual report it released last week. BII, which until April was known as CDC Group, made nearly £1.9 billion in new commitments in 2021, up 50% from the previous year.

CEO Nick O’Donohoe calls 2021 the “busiest year yet” based on not just that top-line figure but various other metrics as well. BII committed £479 million in climate finance — the most in a single year since the institution began tracking that number. It also increased its mobilization of private capital to a record amount of nearly £1.5 billion in 2021, O’Donohoe says.

Read: A record year for BII ahead of transition to new name, strategy

Background reading: Devex Pro members can learn about the British Investment Partnerships, a new development strategy that encompasses BII and other initiatives and programs, and is designed to be the U.K.'s geopolitical trade and investment vehicle. Not yet gone Pro? Sign up now and start your 15-day free trial.

Plus: To learn more about BII, tune in to Devex World, where we’ll be featuring a live conversation with Nick O’Donohoe soon.

Thank you, Captain Obvious

The results of a recent IMF staff survey that reported employee complaints about “undue influence” weren’t much of a surprise to some, as IMF expert Daniela Gabor pointed out on Twitter.

Want to know more about the survey? My colleague Shabtai Gold has the full story.

Now or later?

The World Bank kicked off a new International Development Association funding cycle at a meeting in Senegal last week, Shabtai reports. African leaders gathered to launch the rollout of $93 billion in funding for the lowest-income nations over the next three years.

The pandemic forced the World Bank to draw down IDA resources and start this cycle a year early. The first projects are expected to be approved in the coming days, and a World Bank official says that up to $5 billion of the new funding may be brought forward to address spiking food costs and rising poverty.

Also of note: African leaders at the meeting asked for changes to debt sustainability analysis models to more accurately reflect country-specific conditions and risks. Hannah Ryder, the CEO of Development Reimagined, has a great Twitter thread explaining why this unprecedented call for debt assessments to reflect the quality of debts is important.

Read: World Bank warns of 'unprecedented' crises, rolls out new IDA funding

Investments of interest

• IFC organized a €90 million ($90.4 million) investment in Wave, a West African mobile money company. The institution’s own €25 million loan, along with funding from other groups, aims to help the company grow its operations in Côte d'Ivoire and Senegal.

• It’s not a single deal, but the Global Innovation Fund is opening an office in Singapore in an effort to make more social investments in the Indo-Pacific region.

What we’re reading

Ghana finally launches its new development bank, first announced in 2017. [African Business]

A new paper looks at how sustainable investing has affected stock returns since 2001. [Netspar]

Food and energy inflation has pushed 71 million people into poverty, says the U.N. Development Programme. [Devex]

Does the U.S. International Development Finance Corporation need to refocus on its core development mission? [Center for Global Development]