Posted on November, 06 2023

Colombia is a case in point. Over the last two decades, forest loss there exceeded 3 million hectares. In mid-2023, the Colombian Ministry of Environment and Sustainable Development announced deforestation had reduced by 29%, compared to the previous year, from 174.103 hectares in 2021 to 123.517 in 2022. But despite an improvement in most Amazonian departments, deforestation increased in the Andean and Pacific regions of the country. In the Chocó Department in the Pacific for example, deforestation rose by 23%. 
 
At the UN Biodiversity Conference (COP15) last year, the world striked an agreement to halt and reverse biodiversity  loss and collectively act to mobilize $US 200 billion yearly to conserve at least 30 percent of land, freshwater and oceans globally, eliminate harmful subsidies and increase financial support for conservation efforts by 2030. But weak language in critical areas of the agreement, such as protecting intact ecosystems or halting species extinctions, means national governments will need to proactively address this in their biodiversity conservation plans and policies. At the COP 15, Colombia, with the support of Germany, launched the “National Biodiversity and Action Plans (NBSAP) Accelerator Partnership (AP)”, a country-led initiative to advance in the implementation of the Kunming-Montreal Global Biodiversity Framework by acting as a neutral broker, providing better access to financial and technical support, and offering customized in-country facilitation. Currently, 21 countries and 8 institutions are members of the Partnership. With support from WWF, the Government of Colombia is now developing a strategy to finance its NBSAP.
 
Shifting the focus of finance to nature

Coordinated, large-scale action is needed to secure sufficient financial means to drive a sustainable, net zero, and nature positive economy. Until recently, the financial sector in Colombia merely focused its attention on productivity, not recognizing that our finance system is intrinsically connected to nature. Today, financial regulators - who oversee financial markets and companies-, and central banks and supervisors - who are responsible for supervising financial structures, financial institutions and securities market systems -are increasingly realizing that together with the government, they can mitigate climate change and reverse biodiversity and natural capital losses. 


© Fílmico Colombia/WWF-US

WWF´s Greening Financial Regulation Initiative (GFRi) and WWF Colombia supported the Superintendencia Financiera de Colombia (SFC, for its initials in Spanish) to get a clearer picture of the risks caused by climate change and biodiversity loss for financial stability, and what nature risk regulation could entail. In consultation with other external partners, WWF Colombia´s GFRi experts advised the SFC on how to frame the inclusion of biodiversity in the Colombian roadmap of Greening the Financial System Strategy. Taking into account the  specific situation of the country and its economy,  definitions based on best international practices, including standards, frameworks and regulation initiatives such as the Task Force on Climate-Related Financial Disclosures (TCFD), Sustainable Accounting Standards Board (SASB), and others including nature like the Taskforce on Nature-related Financial Disclosures  (TNFD) are now forming the pillar of its climate  strategy. WWF also organized a series of training sessions for financial supervisors and other SFC officials focusing on nature regulation, financial risks of biodiversity and natural capital losses, how nature loss can be measured through databases and measurement tools, and green investment opportunities for the financial sector.
 
Over the last year, some important further financial regulatory developments have been taking form in Colombia. Firstly, the SFC publicly committed to include nature in its Roadmap. This will affect all regulated institutions in Colombia including commercial banks, development banks, private capital funds, pensions funds, asset managers, owners and insurers. The SFC has also become an active member of the national consultation group of the TNFD. Private companies have started to pilot the TNFD framework, in collaboration with the Colombian Ministry of Environment and Sustainable Development, the Biodiversity Research Institution Alexander Von Humboldt, the UN Development Programme (UNDP) and WWF.
 
What next?
WWF is closely collaborating with the SFC, the Ministry of Environment and Sustainable Development, the Ministry of Finance and representatives from the financial institutions to strengthen regulation expectations based on nature and biodiversity as part of the NBSAP process. We are also working with the National Association of Businessmen of Colombia (ANDI), in the light of its alliance with "Business for Nature", a global coalition that brings together more than 85 organizations around the world, to address the challenges of the renewed global biodiversity agenda and how companies can drive credible business action and policy ambition to achieve a nature-positive economy for all by 2030.