With USD 700 billion needed each year to protect and restore nature[1] and over half of global economic value generation moderately or highly dependent on natural systems,[2] closing the nature finance gap presents both a significant challenge and a major opportunity for the finance sector. For banks, insurers and investors, action on nature can reduce material risks, strengthen sustainability strategies, and unlock innovative, investable projects. Within this context, UNEP FI supports its members in addressing nature‑related risks and opportunities as a key dimension of sustainable finance. As 2026 shapes up to see important moments for nature conservation and restoration, this article looks at what to look out for in nature finance over the coming months.
Mobilizing finance on the road to the next UN Biodiversity conference – COP17
This year, momentum on nature is expected to continue to build, culminating at COP17 of the Convention on Biological Diversity (CBD), taking place in October in Yerevan, Armenia. Following the Resource Mobilization Plan agreed by governments at the resumed COP16 negotiations in 2024, this year’s global biodiversity conference will focus on assessing progress and accelerating action, with a strong emphasis on finance to deliver on the Kunming–Montreal Global Biodiversity Framework (GBF) goals. Ambassador Mher Margaryan, Special Envoy for the COP17 Armenian Presidency, noted that the conference will aim to “create the conditions so that the world will progress and accelerate with finance as a central pillar.” During this milestone meeting, UNEP FI will host Finance Day at COP17, a dedicated space for dialogue on aligning financial flows with National Biodiversity Strategies and Action Plans (NBSAPs), strengthening public–private collaboration, and translating global commitments into bankable action on the ground.
Financing the restoration and protection of oceans and forests
Forests and oceans sit at the heart of global efforts to tackle climate change, biodiversity loss, and pollution. Yet they remain vastly underfinanced. In 2026, progress on these topics is expected to build through two key intergovernmental moments: the UN Forum on Forests and the UN Water Conference. The year should also see the uptake and operationalization of several large-scale, UN-supported financing initiatives and new public–private mechanisms aimed at restoring and protecting these critical ecosystems. Among them, the Tropical Forests Forever Facility (TFFF), launched at UNFCCC COP30, will use investment returns to value the global public services provided by tropical forests. The One Ocean Finance Facility, a new public-private development finance mechanism launched by UNEP and partners in 2025, will also offer new opportunities by channeling underutilized capital from ocean-dependent industries through a global platform that blends public and private finance. In parallel, the High Seas Treaty, officially the BBNJ Agreement — the world’s first treaty to recognize and protect international waters, which cover nearly half the planet’s surface — took effect this month, marking a turning point for global ocean protection and an important moment for environmental multilateralism. While its impact will depend on cooperation and enforcement across other international frameworks, the Treaty is expected to provide a clearer legal and governance framework and support the growth of ocean finance instruments.
Building on this momentum, ocean finance instruments such as blue bonds are rapidly expanding; UNEP FI and partners developed the ICMA Blue Bond guidance, an industry-leading publication that has already been applied by market participants such as the Development Bank of Latin America and the Caribbean (CAF) for its Blue LAC Bond issued in 2025. The Ocean Investment Protocol published last year by UNEP FI and UN Global Compact complements these efforts by helping financial institutions, policymakers, and industry leaders design credible and investable pipelines for sustainable blue economy projects.
An equitable and inclusive approach to nature technologies and innovations
The growing recognition of the role of Indigenous Peoples and Local Communities (IPs and LCs) in biodiversity conservation marked an important milestone in recent years. This shift is visible in the establishment of a permanent Indigenous Peoples’ group under the CBD and in new funding mechanisms such as the Cali Fund, which earmarks at least 50% of its resources for direct disbursement to IPs and LCs. This reflects a deeper understanding of the connections between finance, nature, and Indigenous rights, and the risks of exclusionary approaches to nature investment. It also aligns with the direction set at COP30, where the climate crisis was underscored as a social crisis, and global leaders reaffirmed that both climate and nature action must put people and communities at the centre.
The rapid expansion of nature‑related technologies and data tools makes 2026 a pivotal year for embedding people‑centred, equitable approaches into nature finance. In practice, this requires respecting and operationalizing free, prior and informed consent, ensuring fair and transparent benefit‑sharing, and establishing long‑term partnerships with IPs and LCs. These priorities are highlighted in a 2024 UNEP FI report that financial institutions can use to integrate social equity into strategic decision-making. This year, UNEP FI will continue to integrate Indigenous rights considerations into nature-related guidance, convene dialogues between financial institutions and Indigenous representatives, and promote best practices for inclusive investment structures.
From emerging risk to mainstream financial practice
Biodiversity loss is increasingly recognized as a macro-economic, financial stability and national security concern, reflected in legislation and policy discussions worldwide, and exemplified in the UK’s 2026 national security assessment on global biodiversity loss, ecosystem collapse and national security. While international and national frameworks continue to evolve, financial sector action on nature is accelerating, driven not only by moral responsibility but also by a clear business case. Many financial institutions are moving ahead of formal mandates or regulations, building internal capabilities, integrating nature into risk management frameworks, and aligning strategies proactively. The rapid uptake of the recommendations of the Taskforce on Nature-related Financial Disclosures (TNFD), already adopted by 620 organizations, including several UNEP FI members, demonstrates that change often starts from within institutions.
In Europe, UNEP FI member Lloyds Bank is exploring nature-related bond structures, building on strong client interest in blue bonds. In Latin America, Davivienda is leveraging its experience with green and sustainability bonds and has used the online ENCORE tool, co-developed by UNEP FI, to develop nature- and biodiversity-linked financing instruments. Together, these developments signal that nature finance is moving from niche innovation into the capital markets mainstream, a trend reflected across the Principles for Responsible Banking (PRB) community, where more than 350 signatory banks are now taking action on nature, for example through the PRB Nature Community of Practice. In 2026, UNEP FI will remain focused on implementation, with planned initiatives including a Nature Journey, that will provide banks with a practical roadmap to integrate nature into governance, risk management, strategy, and decision-making, alongside continued capacity-building, peer exchange, and alignment with TNFD and GBF objectives.
Expanding nature action to an overlooked yet vital system: Fungi
While often invisible, fungal ecosystems form the connective tissue of natural systems, linking soils, plants, water, and carbon through vast mycelial networks. These networks underpin key financed sectors such as agriculture, forestry, real estate, and infrastructure by supporting soil health, nutrient cycling, water retention, and ecosystem resilience. As financial institutions adopt more holistic, systems‑based approaches to nature, fungi represent an emerging frontier for understanding previously overlooked risks and opportunities. UNEP FI and partners recently hosted a public webinar to highlight first‑mover opportunities and provide practical guidance on integrating fungal ecosystem indicators into credit risk analysis, underwriting, and portfolio management. The webinar’s recording is available here.
As systemic change continues to unfold, UNEP FI will keep working with its vast network of over 550 members and wide range of partners to strengthen the interconnected threads between natural and financial systems, close the biodiversity finance gap, redirect capital toward sustainable pathways, and strengthen the enabling policy environment needed to unlock private finance for nature. Read more about our nature work here.
[1] The Nature Conservancy (2020). Financing Nature: Closing the Global Biodiversity Financing Gap. Available at: nature.org/en-us/what-we-do/our-insights/reports/financing-nature-biodiversity-report
[2] PwC (2023). Managing Nature Risks: From Understanding to Action. Available at: pwc.com/gx/en/issues/esg/nature-and-biodiversity/managing-nature-risks-from-understanding-to-action.html