Development finance offers a practical pathway to nature recovery and biodiversity gains

New joint briefing note, launched at COP17, highlights how Multilateral Development Banks (MDBs) can use existing due diligence processes to support nature recovery and biodiversity gains.

The world's leading multilateral development banks (MDBs) launched a joint briefing note highlighting how development finance can go beyond avoiding environmental harm and actively contribute to biodiversity conservation, restoration and enhancement.

The publication, Identifying Opportunities to Support Biodiversity Objectives Through MDB Operations, was unveiled at the seventeenth meeting of the Conference of the Parties to the UN Convention on Biological Diversity (CBD COP17) in Yerevan, Armenia.

Drawing on decades of experience in biodiversity risk management and environmental and social due diligence, the note demonstrates how the same processes used to identify and manage biodiversity risks can also help identify opportunities to conserve, restore and enhance nature. It sets out practical approaches through which development banks and their clients can integrate biodiversity considerations into project design and implementation, helping development investments contribute to nature recovery. British International Investment, the UK’s development finance institution, has also endorsed the approach, the first national development finance institution to do so, with the initiative open to others that wish to join.

The note presents three complementary pathways for achieving biodiversity gains: shaping project pipelines to support biodiversity objectives; leveraging environmental and social due diligence to identify opportunities for positive outcomes for nature; and promoting landscape- and system-level approaches that address broader environmental challenges.

The publication supports implementation of the Kunming-Montreal Global Biodiversity Framework, adopted in 2022, which calls for urgent action to halt and reverse biodiversity loss by 2030 and encourages financial institutions to align their portfolios with global biodiversity goals. By showing how biodiversity gains can be identified through existing project preparation and due diligence processes and measured using established approaches such as habitat quality-hectares and the pressure-state-response framework, the note aims to help translate global commitments into practical, measurable outcomes on the ground.

The note emphasises that robust environmental and social standards remain the foundation of MDB operations. MDB requirements to achieve no net loss of natural habitat and, where critical habitat is affected, a net gain in biodiversity outcomes provide the basis for responsible investment. Building on this foundation, the publication highlights how MDBs and their clients can further support client ambitions, national biodiversity priorities and global goals while safeguarding the independence and rigour of environmental and social risk management.

Fatoumata Bouaré, Vice-President and Chief Risk Officer at the European Bank for Reconstruction and Development (EBRD), said: “Nature loss is a global challenge that requires collective action. This joint initiative demonstrates the value of MDB cooperation in turning shared ambition into practical solutions that can be applied across sectors and countries. By working together, we can help clients identify opportunities not only to avoid harm but also to deliver measurable benefits for biodiversity. What is particularly powerful about this approach is its focus on real projects and real outcomes, showing how investments in infrastructure, energy, transport and other sectors can contribute to nature recovery while delivering sustainable development objectives.”