CPIC Semi-Annual Meeting, Workshop and Panels Report Out

The Coalition for Private Investment in Conservation would like to thank the European Investment Bank for graciously hosting this summer’s CPIC semi-annual meeting and related events on June 5 and 6 in Brussels. The Steering Committee would also like to thank CPIC members who were in attendance, making for insightful and productive meetings during the two days. From the discussions, it is evident that CPIC has been making strong progress and that there are more exciting developments coming in the near future.

Metrics Workshop Recap

CPIC organized a metrics workshop for its members in the morning of June 5, focused on non-financial valuation in conservation finance. The workshop was chaired by John Tobin of Cornell University, who gave an overview of the current impact measurement and management practices, noting IRIS,GRIGIIRS and SDGs frameworks and a recent GIIN report regarding the State of Impact Measurement and Management. Seth Olson presented an impact-based framework for metric selection in conservation finance, developed with a team of Cornell Environmental Finance and Impact Investing Fellows, to help investors and project developers find a match for achieving their intended impacts, and to help measure and manage it.

Frank Hawkins gave a road test demonstration of the Biodiversity Return on Investment Metric (BRIM) being developed by IUCN to measure the contribution that an investment can make to reducing species extinction risk. Helen Crowley described the approach that Kering takes to measure business impacts and risk on biodiversity and ecosystems, utilizing its Environmental Profit & Loss (EP&L) tool developed in 2014, and planning to launch a beta version of its Biodiversity Impact Metric this July. CPIC members discussed whether CPIC can be useful to help move towards a common approach to metrics, valuation and reporting, in order to avoid chaos, while also keeping ‘functional diversity’ to avoid a ‘one size fits all’ approach.

Panel Discussion Recap

Two panel discussions were organized by CPIC and EIB in the afternoon of June 5, with key senior leaders sharing insights regarding recent finance policy developments in the EU that have global implications for sustainable development and conservation.

Daniel Calleja-Crespo, the Director-General for Environment in the European Commission, headlined the panel discussion regarding the Non-Financial Reporting Directive, which starting this year requires disclosure in company annual statements as part of fiduciary duty and modern day risk management. The panel was moderated by Eva Mayerhofer, Lead Biodiversity Specialist at EIB, and fellow panel speakers considered the implications and opportunities for natural capital and biodiversity, with diverse perspectives represented by Martin Lok, the Program Manager of Natural Capital at the Netherlands Ministry of Agriculture, Nature and Food Quality, and by Milena Bertram, the Director of External Relations at Finance in Motion. The emphasis was placed on utilizing the new regulations as tools for businesses to be successful in the long-term and highlighting the business opportunity that sustainable development represents.

Martin Spolc, Head of Capital Markets at Directorate-General for Financial Stability, Financial Services and Capital Markets Union (DG FISMA), headlined the panel discussion regarding expanding the taxonomy of green finance to nature and ecosystems services, based on the recently released final report on “Financing a Sustainable European Economy” from the High-Level Expert Group on Sustainable Finance (HLEG) of the European Commission. Fellow panel speakers included Helen Crowley, Head of Sustainable Sourcing Innovation at Kering, and Eva Mayerhofer, Lead Biodiversity Specialist at EIB with intervention from Chris Knowles, Associate Director of Operations Directorate at EIB, and moderated by Frank Hawkins, CEO of IUCN-US. The discussion focused on how the recommendations to the financial system can spur on the transition toward a more sustainable economic model. The first key recommendation of the HLEG is to develop a classification system for sustainable assets by 2020, with the climate mitigation part to be ready by 2018, in order to provide market clarity on what is ‘sustainable.’

Jonathan Taylor, Vice-President of the EIB, welcomed over 70 attendees to the two panels, and noted in the opening remarks the growing awareness of the business implications of the risk management and fiduciary duty aspects of environmental sustainability. Jonathan suggested that the Task Force on Climate-Related Financial Disclosures (TCFD) could be broadened to include more information on natural capital and enhance the transparency of reporting. The panel discussions were closed with remarks by Fabian Huwyler, Head of Green Solutions at Credit Suisse, who noted that smart regulations can help move the significant capital capacity present in the private sector to help address the urgent need for funding to protect natural capital and ecosystems, and to build green sectors. Fabian noted that a well-designed taxonomy can provide clarity for investors to understand what products they can invest in, and that a reduction of complexity in the product distribution criteria could benefit the promotion of green assets.

As the Non-Financial Reporting Directive continues to develop, CPIC members are welcome to participate in the dialogue and to contribute their collective expertise in conservation investing, natural capital valuation, and transaction structuring.

CPIC Semi-Annual Members Meeting Recap

The CPIC semi-annual members meeting held on June 6, which was attended by over 50 members and welcomed 7 new member organizations since the last meeting, including Blue Forest Conservation, Boma Investments LLC, Delta Institute, Geopolicity, New Forests, Quantified Ventures, and the United Nations Development Program.

Chris Buss and Frank Hawkins of IUCN gave an overview of the Blended Finance Facility being developed with the support of the Global Environment Facility (GEF) non-grant funding and The Rockefeller Foundation (TRF) grant funding, for a total of 10M USD. CPIC members are encouraged to be in touch with the CPIC Steering Committee to help review and provide input to the final proposal to be submitted to the GEF CEO (original PIF can be accessed here). In addition to this source of potential funding focused on transactions in the economically developing countries, there is a need to identify sources of funding for working groups to develop the pipeline of blueprints and to hire a third-party professional Secretariat to support CPIC. Members are also encouraged to invite additional financial organizations and project developers to join CPIC and to help grow the coalition effort.

The second part of the meeting was focused on working groups’ report-outs regarding the first set of blueprints that were developed and presented at the financial structuring workshop organized in conjunction with the last semi-annual meeting. George Taylor of the U.S. State Department – who, over six months, is conducting a pro-bono economic practicum for CPIC to develop blueprints — described the transaction structures of the current draft blueprints. The working group co-leads further described their progress to develop a pipeline of transactions and the process to identify high-priority models to draft blueprints with George. The blueprint template and the full blueprint guide can be downloaded on the CPIC website. Members are encouraged to reach out to working group co-leads to share input and recommendations, and to join or to invite guest speakers for the group calls. The following is the current list of working group co-leads:

 

  1. Forest Landscape Conservation & Restoration: Jane Feehan, European Investment Bank (EIB)
  2. Green Infrastructure for Coastal Resilience: Shannon Cunniff, Environmental Defense Fund (EDF)
  3. Green Infrastructure for Watershed Management: Aaron Vermeulen, World Wildlife Fund (WWF)
  4. Landscape Approaches: Frank Hawkins, International Union for the Conservation of Nature (IUCN)
  5. Sustainable Agricultural Intensification: Helene Roy, Rainforest Alliance (RA), and Mohamed Bakarr, Global Environment Facility (GEF)
  6. Sustainable Coastal Fisheries: Romas Garbaliauskas, Conservation International (CI), and Fabian Huwyler, Credit Suisse (CS)