1. Building Biodiversity Business
Report of a Scoping Study
Joshua Bishop, Sachin Kapila, Frank Hicks, Paul Mitchell
Presentation to Conservation CEO’s
11th October 2006

2. Progress on protected areas but much more
needed to stem biodiversity loss
Growth in PA numbers and area Red List Index for birds
Source: Chape, S., Harrison, J., Spalding, M., Adapted from: Butchart, S.H.M., Stattersfield,
and Lysenko, I. 2005. “Measuring the extent A.J., Baillie, J., Bennun, L.A., Stuart, S.N.,
and effectiveness of protected areas as an Akçakaya, H.R., Hilton-Taylor, C., and Mace,
indicator for meeting global biodiversity targets” G.M. 2005. “Using Red List Indices to measure
Phil. Trans. R. Soc. B, 360, 443–455. progress towards the 2010 target and beyond”
Phil. Trans. R. Soc. B, 360, 255–268.

3. The biodiversity financing gap and
mainstreaming opportunities

4. Booming global 30,000
carbon markets: 25,000
- A wave to ride 20,000
US$ Millions
ETS CDM & other
and guide 15,000
- A model for 10,000
biodiversity?
5,000
0
120
2003 2004 2005 2006
(Projected)
100
80
US$ Millions
60 Start of European ETS
40 (Jan 2005)
20
0
1998 1999 2000 2001 2002
Total value of carbon contracts, US$ millions, reported by Natsource; IETA; World Bank (2005); Point Carbon (2006)

5. How to stimulate biodiversity
conservation by the private sector?
• Sticks Increase the penalty for
damage / loss of habitat
Increase the reward for
• Carrots
conservation effort
• Flexibility Consumers choose how much
based on preferences
Producers choose level of
performance based on costs

6. Scoping Study - Terms of Reference
Take a “snap-shot” of the current biodiversity business
landscape
Review existing policy, legal and fiscal frameworks that
enable biodiversity businesses to grow and develop
Assess the level of technical knowledge and material
available with regards to biodiversity business tools
Analyse a range of approaches to financing biodiversity
businesses

7. The process so far
• Scoping study: Jan-Sep 2006
• Interviewed ~160 people in >50 orgs.
• Expert workshop: May 2006
• Draft report under-going review (>1000
people)

8. Findings 1: Sector Analysis
Sector What Status & Where Key What is Gaps &
is it? Trends is it? players working / opportunities
not?
Indirect
• Agriculture
• Forestry
• Fisheries
• NTFPs
• Biocarbon
• Watershed payments
Direct
• Bioprospecting
• Biodiversity offsets
• Biod. mgmt. services
• Ecotourism
• Sport hunting & fishing

9. Findings 2: Mechanism analysis
• Enabling policy
– Voluntary as well as mandatory
– Corporate, local, national, international
• Business tools
– Product development, quality control, supply-chain
management, marketing, biodiversity reporting
• Financing instruments
– Grants, debt, equity

10. Help NFTP producers over-
come regulatory hurdles to
register their products and Assist NTFP producers with
enter new markets new product development,
quality control, marketing
Support independent and supply chain mgmt.
certification of NTFP
sustainability
Enabling Business
policy Provide investment capital to
tools
NTFP enterprises that adopt best
management regarding
sustainable harvesting and local
community support
Finance

11. The BBF Review &
evaluation of Business development
business tools assistance
Think Tank Match Maker
Policy
Legal
Certification Pipeline
Metrics Fund identification
Debt / equity
investments

12. Workshop recommendations
(Wye River, 30-31 May 2006)
• Enlist other partners
• Enabling policy is critical
• Focus on large-scale, systemic change
• Aim to ‘kick-start’ the biodiversity market
• Nurture a BBF on the back of a few ‘best bets’
• Sell-on successful pilots to bigger investors
• Develop clear targets and indicators of success
• Focus on constraints to biodiversity business

13. Selecting ‘best bets’ for
potential pilot projects
• Biodiversity benefit
• Pro-poor rating
• Internal rate of return
• Scalability
• Timing
• Risk
• Relevance to IUCN, Shell & others

14. Best bet 1: Conservation Carbon
What?
• Expand market for biodiversity-friendly
carbon offsets to mitigate climate change
How?
• Develop models, metrics and standards for
large-scale land use change
• Mobilize buyers of carbon credits through
forest, wetland and/or soil conservation

15. Best bet 2: Biodiversity Offsets
What?
• Provide site-based conservation to compensate
for the residual, unavoidable habitat loss caused
by projects with a direct ‘footprint’ on land or sea
How?
• Develop policy, tools and capacity to ensure
credible biodiversity offsets (BBOP)
• Set up private conservation bank(s) for voluntary
and compliance markets
• Promote a biodiversity “no net loss club”
– Site-level pilots and information sharing (BBOP)
– Biodiversity reporting and compensation targets
– Group-level offset policy with 3rd party verification

16. Best bet 3: Sustainable Biofuels
What?
• Develop markets for biodiversity-friendly and
pro-poor biofuels
How?
• Develop meta-standard and multi-commodity
certification protocols for biofuel feed stocks
(oil palm, sugarcane, soya, etc)
• Stimulate supply via direct investment in
sustainable producers and marketing
• Research and development on biofuel
technology (e.g. perennial feed stocks)

17. Best bet 4: Biodiversity
Management Services
What?
• Support improved biodiversity management in
private companies and public agencies
How?
• Set up commercial consulting firm(s) targeting
leadership companies
• Promote best-practice biodiversity management
tools, capacity-building, verification services

18. Next steps
• Revise and publish Phase 1 report
• Agree TOR and funding for Phase 2
• Build core team and partnerships
• Business development phase
– Business plans for ‘best bets’
– Pilot projects to test concept

19. Are we on the right track?
• Choice of best bets (Conservation
carbon, Biodiversity offsets, Bio-fuels,
Biodiversity management services)
• Process (scoping, reporting, business
planning, pilots, eventually a ‘facility’)
• Partners (IUCN and Shell, with Forest
Trends and others)

20. Thank you!

22. Contemporary challenges of
biodiversity conservation
• Over-exploitation of biological resources
• Under-supply of ecosystem services
• Unfair distribution of costs and benefits
• Inadequate government response

23. Biodiversity conservation
must become…
• Bigger From US$10 Billion/year to
$100 Billion/year or more?
From 12% of land area to
15% plus marine PAs
• Better More cost-effective
Socially equitable
Wealth enhancing
• Faster Keep pace with land use
change, biotechnology,
climate change, public
preferences