Bank lending to value biodiversity

Equator Principles Association, World Wildlife Fund and Business and Biodiversity Offsets Program launch training program

Urban
Ecosystem

Energy & Utilities >

The Equator Principles Association, World Wildlife Fund (WWF) and the Business and Biodiversity Offsets Program launched a pioneering training program in November to help banks reflect the value of nature in their lending decisions.

The Biodiversity for Banks (B4B) program is designed to help financial institutions incorporate risks associated with biodiversity and ecosystem services – all of the valuable resources provided by nature including safe drinking water – into their lending decisions.

B4B originated in a discussion between Citi, the current chair of the Equator Principles Association, and WWF on the challenges posed by these issues for banks.

Courtney Lowrance, a Director of Environmental and Social Risk Management at Citi, said that when the International Finance Corporation revised its Performance Standard 6 for Biodiversity Conservation and Sustainable Natural Resource Management, Citi saw a rise in the need for capacity building within the financial sector.

"This created an important opportunity to provide a high-value program to increase awareness and commitment towards the management of biodiversity and ecosystem services," he added.

B4B is developing and will deliver a set of training materials to assist banks in addressing risks related to projects and broader client assessments. As part of this process, more than 20 banks from 15 countries, including Citi, met in late October at the WWF headquarters in Washington, DC, as part of an inaugural training workshop.

"This program allows banks to really delve into how they account for the value of nature over the course of a transaction, because conserving nature also means conserving the life-supporting services nature provides for people," said Mark Eckstein, WWF's head of International Finance. "Banks that are participating in this program recognize that biodiversity is a material issue in their lending decisions and [want to] enhance their ability to manage biodiversity risks and opportunities in their business."

The B4B training program includes a web-based resource center, a training course delivered through regional workshops, a training manual and a series of case studies across sectors and geographies. Regional workshops are open to any financial institution and are currently being scheduled for Sao Paulo, Johannesburg, Singapore, London and Beijing in 2012.