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Biodiversity Investment Rating Agency

Overview

All Investments

About

The BIRA initiative initially focused on developing a viable investment assessment tool that offered guidance to interested actors. However, we want our work to be additive and not duplicative. As such, our mission has pivoted towards helping overlay an investor lens on existing tools and scaling the reach of these tools. Through our engagement with over 30 stakeholders, including investors and fund managers, we now understand how BIRA needs to make a strong case for biodiversity investments, and demonstrate real-life use of measurement tools, to bring onboard financial actors.
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Investment Details

Name

Biodiversity Investment Rating Agency

Tagline

Measuring, communicating, and tracking biodiversity impact and unlocking investments to promote and safeguard biodiversity.

Sector

Nature

Location

Africa

In portfolio since

2022

Our role

We are currently in the initial stages of Phase 2, which builds on the work in the earlier phase by 1) further understanding the overall suitability of prioritised tool developers, including assessing their tools’ scientific underpinning, and 2)developing the Investor Guide explaining why investors should prioritise biodiversity and how investors can use existing shortlisted tools for financial purposes. During Phase 2, we seek to address the following questions:
  • How can the prioritised tools be further adapted to meet investor needs?
  • What would a financial module that meets investor needs look like in practice?
  • How can investors be engaged through case studies and short courses to better understand the tools and their applicability?
  • What is the scientific underpinning of the prioritised tools? And of the proposed financial modules?
  • Have the tools undergone credible peer review? If so, what was the tools’ rating?
  • How robust is the science and technology on which the tool is based?
  • What is the tool developers’ ability to scale the reach of their tool?
By the end of this phase, we will have created a bridge between existing tools and financial investors’ current and planned needs. We are currently developing a “financial module” that can serve as this bridge, as well as engaging investors to enhance their understanding of potential solutions. After this phase of work, we will discuss options to institutionalise our learnings within existing tool developers, educational institutions, and/or through an independent Biodiversity Investment Rating Agency.

Our investment

Committed Capital

  • Grant: US$ 400,000

Purpose and target market

  • While funders understand the magnitude of the funding need, their level of activity is not commensurate with this understanding, and funding is lagging behind the required commitment. On the one hand, financial investors, fortunately, understand the need for their involvement in biodiversity.
  • In a Credit Suisse report, 84% of finance asset owners and managers were concerned about biodiversity loss, and 1 in 2 believe it is an urgent issue that should be addressed in the next 24 months.
  • However, investors have not yet backed up their concerns with action; for instance, 9 out of 10 financial actors surveyed in the Credit Suisse study do not have measurable biodiversity-related targets.
  • As a result, their participation is limited, which results in the biodiversity funding lag. Specifically, the funding gap for biodiversity conservation and restoration stands at over US$ 700 billion.
A critical opportunity lies in developing tools, applicable across asset classes and conservation-focused business models, that combine rigorous metrics and verification, allowing effective fund deployment.

Impact to date

  • We have gained a thorough understanding of the biodiversity investment landscape, explored existing tools being used to assess biodiversity outcomes, and shortlisted existing tool developers (i.e., Ecosulis, IBAT Alliance, Natural State, and PlanVivo).
  • The tool developers were shortlisted based on five criteria: 1) whether their tools are designed with investors and funders in mind, 2) credibility of the tool developer, 3) applicability within different spheres of biodiversity, geographies, and sectors, 4) quantitative and comparable output to facilitate investment decision making, and 5) whether the tool is readily available and usable with no need for extensive technical expertise.

Investee contacts

Devang Vussonji
Partner,
Dar es Salaam Dalberg Advisors
devang.vussonji@dalberg.com

Richard Vigne
Executive Director
Africa Leadership University School Of Wildlife Conservation
rvigne@alueducation.com

FSD Africa contact

Anne-Marie Chidzero
Chief Investment Officer (CIO)
FSD Africa Investments
anne-marie@fsdafrica.org

Updated: September, 2023

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