Social and development impact bonds

A public-private partnership or performance-based financial tool that allows private (impact) investors to provide upfront capital for traditionally public projects that deliver social and environmental outcomes. If the project succeeds, the investors are repaid by the Government (Social Impact Bonds), an aid agency, or other philanthropic funder (Development Impact Bonds) with capital plus interest. If the project fails, the interest and part of the capital is lost. While commonly referred to as a "bond", the solution replicates in essence a payment-for-results scheme. It cannot be compared to commercial bonds, green bonds or other impact bonds as an instrument except in that it seeks to repay capital and provide interest. The approach is also referred to as pay-for-success in the United States and as a social benefit bond in Australia. It can be applied to conservation.

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Generate

Any existing or innovative mechanism that can generate and/or leverage financial resources for biodiversity.

Generate

Type

Debt/Equity

Any solution that invovles an obligation or liability to make a payment and/or the acquisition of ownership rights (equity, property or financial asset).

Debt/Equity

Fiscal

Any solution that involves a fiscal reform, i.e. changes in taxation or the modification of a subsidy's regime.

Fiscal

Grant

Any solution that invovles the allocation of a grant. This includes private donations and Official Development Assistance.

Grant

Risk

Any solution that invovles the transfer of risks between two or more parties, e.g. a guarantee.

Risk

Public/Private
Public

Public

Private

Private

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Countries:

Wildlife impact bond

A social and development impact bond where resources are linked outcomes featuring the protection or conservation of wildlife.

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Generate

Any existing or innovative mechanism that can generate and/or leverage financial resources for biodiversity.

Generate

Type

Debt/Equity

Any solution that invovles an obligation or liability to make a payment and/or the acquisition of ownership rights (equity, property or financial asset).

Debt/Equity

Grant

Any solution that invovles the allocation of a grant. This includes private donations and Official Development Assistance.

Grant

Market

Any solution that involves a market transaction, e.g. ecosystem services and carbon markets.

Market

Public/Private
Public

Public

Private

Private

Sector

Protected Areas

Protected Areas

Tourism

Tourism

Development impact bond (payment for results)

A social and development impact bond where resources are linked to a development outcome. 

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Generate

Any existing or innovative mechanism that can generate and/or leverage financial resources for biodiversity.

Generate

Type

Debt/Equity

Any solution that invovles an obligation or liability to make a payment and/or the acquisition of ownership rights (equity, property or financial asset).

Debt/Equity

Grant

Any solution that invovles the allocation of a grant. This includes private donations and Official Development Assistance.

Grant

Market

Any solution that involves a market transaction, e.g. ecosystem services and carbon markets.

Market

Public/Private
Public

Public

Private

Private

Sector

Finance

Finance

Tourism

Tourism

Conservation impact bond (payment for results)

A social and development impact bond where resources are linked to a conservation outcome. 

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Generate

Any existing or innovative mechanism that can generate and/or leverage financial resources for biodiversity.

Generate

Type

Debt/Equity

Any solution that invovles an obligation or liability to make a payment and/or the acquisition of ownership rights (equity, property or financial asset).

Debt/Equity

Grant

Any solution that invovles the allocation of a grant. This includes private donations and Official Development Assistance.

Grant

Market

Any solution that involves a market transaction, e.g. ecosystem services and carbon markets.

Market

Public/Private
Public

Public

Private

Private

Sector

Energy

Energy

Finance

Finance

Forests

Forests

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Green banks

State or donor-sponsored financial entity that works in partnership with the private sector to increase investments into green businesses and markets that are underserved by commercial finance. The backing from a Government (or donor) guarantee the Bank can catalyze private investments and introduce new financial products. While the emphasis has traditionally been on renewable energy, the focus of green banks can extend to other environmental areas including conservation and biodiversity.

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Generate

Any existing or innovative mechanism that can generate and/or leverage financial resources for biodiversity.

Generate

Type

Debt/Equity

Any solution that invovles an obligation or liability to make a payment and/or the acquisition of ownership rights (equity, property or financial asset).

Debt/Equity

Market

Any solution that involves a market transaction, e.g. ecosystem services and carbon markets.

Market

Public/Private
Public

Public

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Financial and operational mergers

Merging two or more organizations can produce economies of scale and allow public and private organizations to substantially reduce operational and financial costs. For example, operational costs can be reduced by merging environmental trust funds and protected areas authorities with similar mandates. While not specific to biodiversity, these measures can and should be considered by conservation organizations. The resources saved can be reinvested in conservation.

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Type

Regulatory

Any solution that involves a regulatory reform, i.e. the imposition of a certain behaviour through the law or a regulation.

Regulatory

Public/Private
Public

Public

Private

Private

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Countries:

Environmental risk insurance

Insurance schemes that cover against environmental liabilities (i.e. the financial risk associated with environmental pollution and contamination) in exchange for a premium. In addition to preventing future expenditures and thus reducing business risks, they can provide contingent resources for immediate remedial action in the event of an environmental disaster.

Result

Avoid

Any measure that can prevent or reduce future investment needs by eliminating/amending existing counter-productive policies and expenditures (e.g. taxes on sugar content or tobacco).

Avoid

Type

Risk

Any solution that invovles the transfer of risks between two or more parties, e.g. a guarantee.

Risk

Public/Private
Public

Public

Private

Private

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Enterprise challenge and innovation funds

Funding instrument that distributes grants (or concessional finance) to profit-seeking projects on a competitive basis. It subsidizes private investment in developing countries where there is an expectation of commercial viability accompanied by measurable social and/or environmental outcomes. Challenge funds can mitigate market risks, while spurring innovation to fight poverty and reduce environmental degradation.

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Generate

Any existing or innovative mechanism that can generate and/or leverage financial resources for biodiversity.

Generate

Type

Debt/Equity

Any solution that invovles an obligation or liability to make a payment and/or the acquisition of ownership rights (equity, property or financial asset).

Debt/Equity

Grant

Any solution that invovles the allocation of a grant. This includes private donations and Official Development Assistance.

Grant

Market

Any solution that involves a market transaction, e.g. ecosystem services and carbon markets.

Market

Public/Private
Public

Public

Private

Private

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Result based budgeting

Planning and strategic management tool seeking to link budget allocations with anticipated results. The introduction of result based budgeting (RBB) contributes to achieving cost-savings and better defining priorities in the allocation of scarce public or private resources. While considered a best practice world wide, only a few countries fully implement result based budgeting. It can also be referred to as performance based budgeting or outcome-based budgeting. Its introduction in conservation can help to mobilize additional public resources as well as to increase spending effectiveness.  Results based budgeting is defined as a budgeting process which revolves around a set of predefined objectives and expected results, which, in turn, justify the resource requirements linked to outputs, and where actual performance is measured using objectively verifiable indicators. 

Result

Avoid

Any measure that can prevent or reduce future investment needs by eliminating/amending existing counter-productive policies and expenditures (e.g. taxes on sugar content or tobacco).

Avoid

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Realign

Any measure that can re-orient and realign existing financial flows towards biodiversity conservation. 

Realign

Type

Fiscal

Any solution that involves a fiscal reform, i.e. changes in taxation or the modification of a subsidy's regime.

Fiscal

Regulatory

Any solution that involves a regulatory reform, i.e. the imposition of a certain behaviour through the law or a regulation.

Regulatory

Public/Private
Public

Public

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Effective procurement

Cluster of cost-effectiveness measures that can enhance an organization's procurement practices and thus free resources for programming. Typical measures include central procurement, digital procurement, process flow analysis, supplier optimization, green procurement, etc. While not specific to biodiversity, these measures can and should be considered by conservation organizations to optimize their spending practices. The resources saved can be reinvested in conservation.

Result

Avoid

Any measure that can prevent or reduce future investment needs by eliminating/amending existing counter-productive policies and expenditures (e.g. taxes on sugar content or tobacco).

Avoid

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Type

Regulatory

Any solution that involves a regulatory reform, i.e. the imposition of a certain behaviour through the law or a regulation.

Regulatory

Public/Private
Public

Public

Private

Private

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Ecological fiscal transfers

Intergovernmental fiscal transfers redistribute tax revenues across government levels-from national and regional to local jurisdictions-according to agreed principles and priorities. Integrating ecological services means including conservation indices (e.g. size/quality of protected areas) in the fiscal allocation formula-thus rewarding investments in conservation and incentivizing the expansion of protected areas, forests or other natural capital.

Result

Avoid

Any measure that can prevent or reduce future investment needs by eliminating/amending existing counter-productive policies and expenditures (e.g. taxes on sugar content or tobacco).

Avoid

Realign

Any measure that can re-orient and realign existing financial flows towards biodiversity conservation. 

Realign

Type

Fiscal

Any solution that involves a fiscal reform, i.e. changes in taxation or the modification of a subsidy's regime.

Fiscal

Regulatory

Any solution that involves a regulatory reform, i.e. the imposition of a certain behaviour through the law or a regulation.

Regulatory

Public/Private
Public

Public

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Earmarking and retention of biodiversity revenues (self income)

Increasing the amount of taxes, fees, and other financial revenues derived (or not) from biodiversity related resources that are earmarked (ring-fenced), retained or returned for direct use on sustainable biodiversity management. The retention or return of these revenues can align incentives of various actors, increased funding available, and improve service provision. There is a risk that they produce an incentive to overuse resources for an organization's financial gain. This is often more politically feasible when revenue share partially goes to sustainable development. Examples - PA fees in Galapagos - all go to treasury then 50% back to municipalities, address livelihoods of artisanal fisheries to reduce pressure on biodiversity.

Result

Deliver

Any measure or strategy that can enhance cost-effectiveness/efficiency, synergies and/or favour a more equitable distribution of resources.

Deliver

Realign

Any measure that can re-orient and realign existing financial flows towards biodiversity conservation. 

Realign

Type

Fiscal

Any solution that involves a fiscal reform, i.e. changes in taxation or the modification of a subsidy's regime.

Fiscal

Regulatory

Any solution that involves a regulatory reform, i.e. the imposition of a certain behaviour through the law or a regulation.

Regulatory

Public/Private
Public

Public

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water

Remittances

Private transfers from a migrant worker (i.e. living in a foreign country for one year or longer) to a receiver (often but not limited to family) in his/her country of origin. When remittances are not used to respond to immediate consumption needs, they can be saved and invested at the benefit of the local economy/ community/ environment of the worker’s country of origin. Diaspora bonds, saving products and investments are all available instruments to channel resources towards conservation and other sustainable development investments.

Result

Generate

Any existing or innovative mechanism that can generate and/or leverage financial resources for biodiversity.

Generate

Realign

Any measure that can re-orient and realign existing financial flows towards biodiversity conservation. 

Realign

Type

Debt/Equity

Any solution that invovles an obligation or liability to make a payment and/or the acquisition of ownership rights (equity, property or financial asset).

Debt/Equity

Fiscal

Any solution that involves a fiscal reform, i.e. changes in taxation or the modification of a subsidy's regime.

Fiscal

Market

Any solution that involves a market transaction, e.g. ecosystem services and carbon markets.

Market

Regulatory

Any solution that involves a regulatory reform, i.e. the imposition of a certain behaviour through the law or a regulation.

Regulatory

Public/Private
Public

Public

Private

Private

Sector

Agriculture

Agriculture

Energy

Energy

Finance

Finance

Fishing

Fishing

Forests

Forests

Infrastructure

Infrastructure

Manufacturing

Manufacturing

Mining

Mining

Other

Other

Protected Areas

Protected Areas

Tourism

Tourism

Trade

Trade

Transport

Transport

Water

Water