SI-Debatte

SI Debate: How to go from biodiversity science to financial products?

One of the most fundamental debates in SI is how to connect sustainability science to commercially appealing investment products. It’s easy to align portfolios with sustainability metrics, but much harder to make a meaningful connection to real-world targets without diluting either the impact or the returns potential.

Autoren/Autorinnen

    Head of Sustainable Alpha Research
    Sector Lead

Zusammenfassung

  1. Biodiversity measurement and investing is more complex than climate
  2. Science is clear, but uptake of biodiversity products has been limited
  3. More innovation and policy interventions are needed to highlight merits

The topic of biodiversity has grown in significance over the past decade as awareness of both the impacts and dependencies of businesses on nature has grown. The recent Business and Biodiversity Assessment by IPBES – the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services - highlighted that financial flows damaging nature amount to around USD 7.3 trillion per year, while the spend on activities that restore nature amounts to just USD 220 billion per year.

The critical challenge with measuring biodiversity is that impacts and dependencies are highly localized, while financial products typically are highly standardized, relying on broad data sets, straightforward benchmarks, and preferably short-term liquidity. This should not be a major issue, if the right measurement methods are chosen for the right purpose.

No single metric for biodiversity

For climate change, we have a single measure of carbon emissions that is universally agreed on. Whether it is the most useful metric from a real-world perspective or not, it can be used across economic and global activities and incorporated into cross-asset class solutions.

Simplicity is often valued highly versus complex scientific accuracy in scalable investment products. But we do not have a single metric or market that biodiversity products can convene around.

Even straightforward SI approaches like positive screening or exclusions seem difficult to apply to biodiversity, as so few economic activities with positive cash flows are intrinsically positive for nature. Thematic approaches such as the Robeco Biodiversity Equities strategy tend to focus on transition of biodiversity-intensive economic sectors, using methodologies such as the Robeco Traffic Light to separate leaders from laggards.

As opposed to climate change, the effects of which can be seen in the news every day, the concept of biodiversity loss and the resulting financial risk is still relatively abstract today.

Biodiversity Equities D EUR

performance ytd (31-7)
5.81%
Performance 3y (31-7)
4.57%
morningstar (31-7)
2 / 5
SFDR (31-7)
Article 9
Ertragsverwendung (31-7)
No
Fonds ansehen
Frühere Wertentwicklungen, Simulationen oder Prognosen sind kein verlässlicher Indikator für die zukünftige Wertentwicklung.Annualisiert (für Zeiträume, die länger als ein Jahr sind). Die Performance-Zahlen sind abzüglich Gebühren und basieren auf den Transaktionspreisen.

It’s hard to gauge interest

These challenges have limited the market for pure biodiversity-themed products, and made it difficult to gauge asset owner interest in biodiversity alone. Combining climate and nature makes for a more scalable product today.

Direct financing also offers potential at the moment. Blended finance can combine private capital with public or philanthropic capital that absorbs initial losses in order to fund location-specific projects that may otherwise have unattractive returns for private investors.

However, blended finance flows specifically dedicated to biodiversity and nature-based solutions (NBS) represent a very small fraction of the broader sustainable finance market, typically running at USD 1.5 billion to USD 3 billion annually.

Meanwhile, transition-focused debt markets can link bond issuance to KPIs related to the transformation of the highest impact activities. Yet, even at the project level, few biodiversity projects have clear revenue streams beyond grants, or are able to tie nature benefits directly to cash flows.

Building Bridges in Geneva

The IPBES report makes the case for a supportive enabling environment that combines both public incentives and policy alignment. How we get there is another question. We will be addressing this debate in the Action Events program at Building Bridges in Geneva in October 2026.

This is the annual conference bringing together decision makers, investors, policymakers, corporate leaders, and civil society to align finance with sustainability and foster high-impact partnerships. Robeco will host a roundtable workshop on how to connect the science to scalable investment products in different asset classes and over time, with contributors from across the industry.

In the long run, we believe that investments in biodiversity will stand on their own commercial merits. But in the meantime, we need policymakers and the finance industry to collectively drive innovation to make this happen.

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