Last year the UK government-backed nature impact fund temporarily stopped fundraising after the withdrawal of one of its fund managers.
The UK Nature Impact Fund has been relaunched with a renewed £30m (€35m) cornerstone investment from the UK government into the Big Nature Impact Fund, the England-focused strategy within the broader UK Nature platform, which aims to mobilise private investment in biodiversity and nature recovery.
Finance Earth has taken over sole management of the fund following the withdrawal of Federated Hermes late last year over commercial concerns.
The fund will focus exclusively on England and aims to raise £120m in total, primarily targeting woodland creation, peatland restoration, and Biodiversity Net Gain (BNG) projects.
Speaking to Impact Investor, Finance Earth said that the strategy has been designed to maximise positive environmental and social impacts whilst delivering financial returns.
“The fund’s returns are driven by revenues generated predominantly from the sale of carbon credits and biodiversity units. Each carbon credit represents 1 tonne of CO2e emissions either reduced by restoring peatlands or sequestered by growing trees.
“Each biodiversity unit sold represents an improvement in biodiversity achieved through the restoration or creation of a habitat. We will be looking to maximise revenues in order to deliver returns, and so, to an extent, financial returns are aligned to impact by the nature of the investment strategy,” said Finance Earth.
Secretary of State for the Department for Environment, Food & Rural
Affairs (Defra), Steve Reed MP, and Minister for Nature Mary Creagh announced the fund relaunch at a recent Green Finance Roundtable, marking the recommitment of public capital in a “first loss” position intended to de-risk the fund and catalyse institutional investment.
Finance Earth also confirmed a £2m investment from its own balance sheet.
Richard Speak, co-founder of Finance Earth, said: “The UK faces a critical funding gap for nature recovery. This fund gives investors access to a diversified portfolio of investible projects that can deliver measurable environmental and social impact alongside financial returns.”
The fund has been designed to align with the UK’s Nature Markets Principles, through independent verification under the Woodland Carbon and Peatland Codes.
Looking ahead, the UK Nature platform’s wider ambition is to extend the model across all UK nations.
A pipeline of future regional funds is expected to follow the fund’s close which is anticipated in late 2025.
Furthermore, the UK Nature Accelerator, a technical assistance programme is scaling the platform by helping local projects become investment ready.
“Learnings generated through the Accelerator will help build project developer capacity and create replicable blueprints for nature restoration projects. This approach is key to unlocking more nature-based solution (NbS) investments in England and the rest of the UK and enables the fund to scale its impact beyond individual projects and contribute to the growth of UK nature markets,” Finance Earth added.
