The Principles for Responsible Banking introduce industry-first guidance on nature target setting
The Principles for Responsible Banking introduce industry-first ... UNEP Finance Initiative
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Release of Principles for Responsible Banking Nature Target Setting Guidance
Today marks the release of the new Principles for Responsible Banking (PRB) Nature Target Setting Guidance, aimed at helping the banking industry align with the Kunming-Montreal Global Biodiversity Framework (GBF) and address nature and biodiversity loss. Developed with 34 PRB signatories and key external stakeholders, the industry-first guidance aims to integrate nature considerations into the core practices and processes of banks while mobilising financial resources to bridge the annual $700 billion biodiversity finance gap.
The Importance of Nature for the Economy
Nature is crucial to our economic system, with approximately $58 trillion of economic value generation being moderately or highly dependent on it (PWC, 2023). The nature target setting guidance sets a clear mandate to align financial flows with the collective mission of the monumental Kunming-Montreal Global Biodiversity Framework (GBF): to halt and reverse nature loss by 2030 and achieve the vision of living in harmony with nature by 2050.
Development of the Guidance
The guidance, developed by 34 PRB signatories with input and technical support from the Taskforce on Nature-related Financial Disclosures (TNFD), UNEP-World Conservation Monitoring Center (WCMC), the Science Based Targets Network (SBTN), the Convention on Biological Diversity (CBD) Secretariat and the Finance for Biodiversity Foundation (FfB), provides a systemic approach for banks to set and achieve nature targets, ensuring consistency with emerging nature frameworks, including the final TNFD Recommendations. The diversity of the banks developing the guidance, both in type and geographic contexts, also ensures the guidance is practical and effective for all, while addressing the complexity of nature target setting.
Flexible Approach to Target Setting
The PRB Nature Target Setting Guidance adopts a flexible approach to target setting, acknowledging the evolving nature of the field and recognising that banks are at different stages of the process. Headline targets and priority actions are provided to encourage progressive action without compromising ambition, while recognising the material financial risk posed by inaction on nature and biodiversity loss.
Interconnectedness of Nature and Climate Action
The guidance also highlights the interconnectedness of nature and climate action, with credible science telling us that 37% of solutions to the Paris Climate Agreement are coming from nature. By prioritising efforts to avoid harming nature through finance and integrating nature-related risks and targets, banks can also contribute significantly to climate goals.
Advancing Nature Action in the Banking Sector
Following this guidance, the Principles for Responsible Banking will continue working to advance the banking sector’s efforts on nature action, supporting signatories in implementing the guidance, through training and furthering efforts on impact targets and common metrics between financial industries. This guidance is a first step to enabling the financial sector to move at a faster pace towards positive impact, supporting the transition from a nature-negative to nature-positive economy.
- To read the executive summary, with key messages and summary of recommended targets & actions for banks to address nature loss, click here.
- To download the full guidance, click here.
- Read our series of 15+ case studies from 10 banks to showcase existing practices in nature-related finance, policies, strategy and client engagement, here.
- Access a consolidated list of key sectors for nature, based on existing nature sector mappings, including recommendations and guidance to assist with next engagement steps for priority sectors, here.
SDGs, Targets, and Indicators
1. Which SDGs are addressed or connected to the issues highlighted in the article?
- SDG 15: Life on Land
- SDG 13: Climate Action
The article discusses the need to address nature and biodiversity loss, which is directly connected to SDG 15 – Life on Land. It also highlights the interconnectedness of nature and climate action, which relates to SDG 13 – Climate Action.
2. What specific targets under those SDGs can be identified based on the article’s content?
- Target 15.5: Take urgent and significant action to reduce the degradation of natural habitats, halt the loss of biodiversity, and protect and prevent the extinction of threatened species.
- Target 13.3: Improve education, awareness-raising, and human and institutional capacity on climate change mitigation, adaptation, impact reduction, and early warning.
The article emphasizes the need to halt and reverse nature loss by 2030 and achieve living in harmony with nature by 2050. This aligns with Target 15.5 under SDG 15. Additionally, by integrating nature-related risks and targets, banks can contribute significantly to climate goals, which relates to Target 13.3 under SDG 13.
3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?
Yes, the article mentions the following indicators:
- Economic value generation dependent on nature
- Material financial risk posed by inaction on nature and biodiversity loss
- Percentage of solutions to the Paris Climate Agreement coming from nature
The article states that approximately $58 trillion of economic value generation is moderately or highly dependent on nature. This can be used as an indicator to measure progress towards Target 15.5. The article also highlights the material financial risk posed by inaction on nature and biodiversity loss, which can be used as an indicator to assess progress in addressing this risk. Additionally, the article mentions that 37% of solutions to the Paris Climate Agreement are coming from nature, indicating the contribution of nature to climate goals.
4. Table: SDGs, Targets, and Indicators
| SDGs | Targets | Indicators |
|---|---|---|
| SDG 15: Life on Land | Target 15.5: Take urgent and significant action to reduce the degradation of natural habitats, halt the loss of biodiversity, and protect and prevent the extinction of threatened species. | – Economic value generation dependent on nature – Material financial risk posed by inaction on nature and biodiversity loss |
| SDG 13: Climate Action | Target 13.3: Improve education, awareness-raising, and human and institutional capacity on climate change mitigation, adaptation, impact reduction, and early warning. | – Percentage of solutions to the Paris Climate Agreement coming from nature – Material financial risk posed by inaction on nature and biodiversity loss |
Behold! This splendid article springs forth from the wellspring of knowledge, shaped by a wondrous proprietary AI technology that delved into a vast ocean of data, illuminating the path towards the Sustainable Development Goals. Remember that all rights are reserved by SDG Investors LLC, empowering us to champion progress together.
Source: unepfi.org
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