Nature-based solutions: the challenge of scaling green initiatives that address the world’s challenges

Nature is the world’s greatest social and financial asset, says Monica Vasquez Del Solar. But we’re not yet making the most of its potential to mitigate climate change and address other global challenges. She examines the hurdles and possible solutions to developing the nature-based solutions market.

Monica VasquezClimate change, biodiversity loss and resource depletion are just some of the complex problems we face as a society that require profound changes in key systems such as transport, energy and agri-food, among others. To address these systemic changes, we need a comprehensive understanding of how the different parts of systems are connected in order to make broad, coordinated adjustments. 

This is precisely what nature-based solutions offer us: the opportunity to provide solutions while improving ecosystems, alongside human resilience and wellbeing. These solutions, which are inspired by nature or natural features, represent a vital approach to addressing global challenges such as climate change, biodiversity loss, and food and water security by managing, protecting and restoring ecosystems. 

However, despite significant global investment, with the 2021 UNEP State of Finance for Nature Report indicating that investment in nature has reached €113bn worldwide and €27bn in Europe, challenges persist in effectively mobilising capital. According to a recent article from the European Investment Bank, significant hurdles, such as dependency on grants, misalignment with commercial investors’ preferences and perceptions that investments are high-risk, continue to endure.


What is a nature-based solution?

Some great examples of nature-based solutions are those which protect plant resources from pest and disease outbreaks, use forest landscape restoration or address land tenure issues, and address food security challenges. However, technical proposals alone are not enough. We need to reconfigure policies, markets, infrastructure and culture. 

This approach was a cornerstone of the conversations at April’s Fi Gathering Zurich, organised by Social Nest Foundation and Elea, where we explored the concept of nature “as the world’s greatest social and financial asset”. 

The nature-based solutions market is still nascent, and tends to prioritise impact outcomes over financial returns. This, while positive, hinders scalability

More than half of global GDP is highly or moderately dependent on nature and its services, according to the European Investment Bank. Despite this, the majority of nature’s benefits currently lack financial market value. 

We need to build nature-based models that are impactful and financially sustainable, addressing the interests of multiple stakeholders. The nature-based solutions market is still nascent, and tends to prioritise impact outcomes over financial returns. This, while positive, hinders scalability. 

Additionally, projects based on these solutions rely heavily on public funding with minimal private sector investment, making most of them small in scale and vulnerable to barriers such as long timeframes for financial returns or lack of technical expertise. Therefore, it is necessary to use philanthropy and public funding to leverage private capital to meet financial return expectations.

The changes we propose tend to occur in non-linear processes resulting from the interplay of actions taken at three levels: through radical innovations in niches, through change of mindsets and practices at the organisational level, and in the interaction of them with the landscape represented by the wider context (culture, ideologies, macroeconomic patterns, etc). 

In the case of niches, where individuals such as business leaders, entrepreneurs, policy champions or change makers, and organisations, including corporates, regulators or NGOs deviate from traditional ways of thinking, create prototypes, iterate and validate models, we we can find examples of actors aligned in vision and values with these solutions.

At a startup level, we find Darwin, a participant in Scale the Impact, an acceleration programme promoted by the Social Nest Foundation and Danone. This company uses microorganisms to improve industrial processes and products, such as a probiotic used in a dairy product to improve mental health. 

Its core activity lies in bioprospecting, a meticulous process of searching for, selecting and optimising microorganisms from natural environments. These microbial gems, often overlooked, yet brimming with untapped potential, hold the key to developing innovative solutions across a wide spectrum of industries.

Darwin’s approach recognises the inherent power of nature to provide solutions. It harnesses the remarkable diversity and capabilities of microorganisms to develop sustainable alternatives to synthetic products and processes, contributing to a more environmentally conscious and resource-efficient future.

Its expertise extends beyond the laboratory, recognising the importance of collaboration in achieving sustainable solutions. It actively engages with local communities in biodiversity-rich regions, ensuring fair access to biological resources and equitable sharing of benefits.

Another example is Climate Farmers, a German startup seeking to mitigate climate change. The company aims to drive a systemic change in the agriculture and food sectors in Europe based on regenerative agriculture, moving away from traditional industrial farming. It uses a multilevel, multi-actor and systemic approach.

Another great example of a nature-based solution is Cities4Forests, a global organisation that is working with cities around the world to protect, conserve and restore forests. The organisation has demonstrated that nature-based solutions can be an effective way to improve the quality of life for urban residents. Furthermore, it emphasises the importance of partnerships between cities, civil society organisations and the private sector to promote nature-based solutions. By working together, these actors can help create a more sustainable and resilient future for cities.

Conversations at the Fi Gathering in Zurich echoed this sentiment, calling for collaboration by playing by the rules of the market: finding and making visible business models based on nature-based solutions, and creating incentives for different actors according to their interests.

Nature-related problems should be seen as business problems, and therefore it is necessary to find impact-driven business solutions.


The role of corporates

Forward-thinking companies are recognising the value of nature-based solutions, not only for environmental benefits but also for mitigating risks in their supply chains, enhancing brand reputation, and creating new business opportunities. 

In the food industry, General Mills is a pioneer in embracing nature-based solutions through its regenerative agriculture initiatives. Recognising the interconnectedness of environmental health and food security, the company has partnered with farmers to implement practices that enhance soil health, boost biodiversity and promote carbon sequestration. These regenerative practices not only contribute to a more sustainable agricultural system, but also deliver tangible benefits for General Mills’ supply chain. By improving soil quality, regenerative agriculture reduces the need for chemical inputs, leading to healthier crops and more resilient farms. Additionally, the increased biodiversity fostered by these practices enhances ecosystem services, such as pollination and pest control, further contributing to sustainable food production.

However, according to the United Nations Environment Programme’s (UNEP) State of Finance for Nature 2023 report, despite reaching $200bn by 2022, there is still a gap between the potential of nature-based solutions and current private sector investment. To bridge this gap, a multi-level perspective is crucial. Companies like L'Oréal, with its Fund for Nature Regeneration, showcase the potential of impact investing in nature-based solutions projects beyond its core business activities. This demonstrates how corporations can contribute to scaling nature-based solutions even without direct value chain integration. 

To mainstream nature-based solutions, it is essential to ensure, in the first place, transparency, measurability and enabling conditions for both public and private sector involvement. Additionally, there’s a need for a multilevel perspective that recognises the complex interplay of actors, dimensions and processes driving change to overcome the challenges faced by this market. This requires impact-driven actors to explore innovative strategies, forge collaborations, develop financial instruments and advocate for pertinent regulations to accelerate the growth of nature-based solutions.

During the FI Gathering in Zurich, we explored the myriad roles of stakeholders at the micro (individual), meso (organisational and interorganisational), and macro (institutional) levels, with the aim of facilitating system transformation in nature-based solutions contexts. By understanding the interdependence among innovative actors, regulatory frameworks and emerging practices, this multilevel approach seeks to foster the scaling of nature-based solutions interventions.

No single entity — whether a company, government, or NGO — can achieve the transformation needed alone. We need a multi-level, multi-actor, and multidimensional strategy to address these major global challenges. By harnessing personal capacities for disruptive change and calling for collective action, we can catalyse the establishment of new norms, rules and practices. This allows the examination on how to identify and seize opportunities within existing systems to drive the transformative shifts that the world needs.

Social Nest Foundation is hosting the second edition of The Gap in Between on 8 October in Valencia, Spain, with the aim of bringing together a diverse range of stakeholders to tackle systemic challenges.


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