The agreement was signed at COP16 with the aim of building resilience by developing nature-based solutions to face the twin crises of climate change and biodiversity loss.
The European Investment Bank (EIB) and the WWF have signed an accord to accelerate climate adaptation in Europe by developing nature-based solutions that will help societies and economies across the continent to build resilience against the worsening impacts of the climate and biodiversity crises.
The signing of the memorandum of understanding (MOU) took place during the United Nations Convention on Biodiversity COP16 held in the city of Cali in Colombia. It is a positive development from a conference that has been widely reported as a mixed bag of outcomes for biodiversity protection and restoration aims.
The four-year partnership will focus on ecosystem restoration projects linked to sectors such as agriculture, energy, and urban resilience. The EIB said these would harness the power of nature to strengthen climate adaptation in Europe, including against the rising threat of droughts and flooding as recently witnessed in Spain, where flash floods have led to the deaths of more than 200 people in the region around Valencia.
Speaking to Impact Investor, Stephen Hart, financial adviser at the EIB, said: “The purpose of this MOU is to establish large scale projects involving nature-based solutions. This is about acting at a sufficient scale for a financier such as the EIB, and at a sufficient scale to make major impacts in terms of climate adaptation.”
Hart explained that the climate and nature emergency has to be addressed at a landscape level alongside local interventions, giving the example of hydrology, which relates to the movement, distribution and management of water sources.
“We’re trying to address issues such as the flow of water across landscapes and how they impact downstream communities but also more upstream rural areas, looking for example, at ways of mitigating the impacts of flooding from rivers,” said Hart. “When you intervene at a wider scale to address these problems you also need to interact with a lot of other issues relating to society or economic development in which you have many stakeholders and multiple beneficiaries within any given territory. This is what defines landscape-level intervention.”
Hart said EIB financing would take the form of loans, the size of which would be agreed on a project-by-project basis.
Incubation facility
Under the agreement, WWF will establish an incubation facility to develop a pipeline of around 10 nature-based solutions from origination until they are investment-ready, while the EIB said it would provide guidance on mobilising public and private funding for them. Hart said these could include projects that supported sustainable farming or urban greening but that no projects had yet been identified.
“The projects will revolve around locations in Europe where there are real societal and climatic challenges,” said Hart, explaining the main risks that the projects will address will relate to water.
The partnership fills a gap in Europe’s response to climate adaptation challenges, according to Hart.
“In the venture space, people are familiar with the raising of seed capital for projects. But the equivalent, in terms of resources and assistance, is not really available when trying to develop these landscape projects and partnerships,” said Hart.
“The idea with this accord was to try to match the capacities of two different types of institutions in which the WWF would develop these very local initiatives and their own incubation capacity, that in turn would be complementary to our advisory and financing role.”
Hart said the EIB will also assist with project identification, development and financial structuring.
“The meal ticket for this is that there is a line of sight towards something that is of sufficient scale and the right policy fit for us to provide financing.”
The accord follows the European Commission’s announcement to work on a European Climate Adaptation Plan, which will support building preparedness and planning with regular science-based risk assessments and a European Water Resilience Strategy.
It also comes after the EU Nature Restoration Law was adopted in August 2024. This regulation combines an overarching restoration objective for the long-term recovery of nature in the EU with binding restoration targets for specific habitats and species.
Hart also said early proposals have been made for a Europe-wide funding mechanism for biodiversity, though no agreement has been reached.
Outlook for Europe
Earlier this year, a report published by the Copernicus Climate Change Service (C3S) and the World Meteorological Organization (WMO) found that Europe was the fastest-warming continent on Earth and a recent WWF Living Planet Report found that species populations have declined by 35% on average in Europe and Central Asia since 1970.
“Europe has virtually no wild areas left in the true definition of the word and the most telling thing, is that even 50 years ago, things [both in terms of climate and biodiversity], were palpably better. It is astonishing how much biodiversity in particular, has been lost in our lifetimes ” said Hart.
The EIB said that by investing in enhancing the health of ecosystems, the projects would also help to reverse nature loss on the continent.
“Working on climate resilience and related societal risks is a very good entry point to raise questions about the role that nature can play and raise awareness of the nature-based solutions that exist to mitigate these risks,” said Hart.
“This is largely about re-establishing the natural dynamics that were there before but it is also about making landscapes multifunctional, serving as a source of food, climate resilience as well as diverse habitats and ecosystems.”
Lack of awareness
The EIB said that nature-based solutions faced significant obstacles including a lack of awareness among investors and a need for consensus building among a wide range of local players.
“We need non-public sources of capital. In the first instance, this is likely to be led by impact-oriented capital that is happy to engage in more emergent business models that have adopted nature-based solutions, where the risk returns are not really what institutional investors are looking for,” said Hart.
“But the capital itself is not a problem-solving element. The key to all this is consensus building and getting buy-in for these projects from stakeholders locally by proposing solutions that people believe will work and at a fair price.”
