{"id":21138,"date":"2018-08-04T13:46:04","date_gmt":"2018-08-04T17:46:04","guid":{"rendered":"https:\/\/test.greenmoney.com\/2025\/?p=21138"},"modified":"2018-10-01T15:49:31","modified_gmt":"2018-10-01T19:49:31","slug":"conservation-of-nature-2","status":"publish","type":"post","link":"https:\/\/test.greenmoney.com\/2025\/conservation-of-nature-2\/","title":{"rendered":"Impact Investing:<\/strong> Aligning Capital with the Conservation of Nature"},"content":{"rendered":"
>> Back to August\/September 2018 Issue<\/a><\/div>\n

\"\"(First published Sept 2015)<\/em>\u00a0 Today’s environmental challenges are bigger than ever. And a rapidly growing population coupled with climate change will only exacerbate current threats. Big challenges like these will require bold solutions. The environmental movement must try new approaches and scale up our work so it\u2019s bigger, better and faster.<\/p>\n

Although our usual sources of funding\u2014traditional philanthropy and government grants\u2014are critically important, those sources can only take us so far. That\u2019s why we\u2019re excited about impact investing, a new conservation strategy that could have a tremendous impact in the environmental arena.<\/p>\n

Impact capital\u2014money invested in projects that provide a return on investment while driving positive societal impacts\u2014is taking off in areas ranging from childhood education to clean tech. Although it’s still an emerging way to finance conservation, impact investing could unlock significant environmental progress\u2014and significant returns for investors looking to align their portfolios with their values. Investors receive a below-market financial return coupled with a measurable environmental return. Together, the two pieces add up to a robust return on investment. Meanwhile, investees put the capital to work on large-scale, replicable conservation projects.<\/p>\n

A year ago, my organization The Nature Conservancy (TNC), joined forces with JPMorgan Chase to launch NatureVest, an impact capital initiative that bridges the gap between conservation projects and potential investors. The conservation field is ripe with opportunities for impact investing\u2014activities that offer cash flows, adequate risk-to-return ratios, solid track records and broad impacts. Projects range from sustainable timber and ranching to water and carbon offset markets. NatureVest and other groups are now building a robust pipeline of projects that wouldn’t be possible without impact capital.<\/p>\n

For example, NatureVest’s first project was a traditional land transaction taken to a whole new scale\u2014a 165,000-acre, $134 million acquisition in Washington’s Cascade Mountains and Montana’s Blackfoot River Valley. The deal is enormously strategic. It links millions of acres of wildlife habitat, protecting privately owned parcels that were dispersed among public lands and at risk of being developed, fragmenting the habitat. The lands also preserve the headwaters of the Yakima River, an important source of drinking water for the region.<\/p>\n

It would have been very difficult to accomplish a deal with such a high price tag through traditional philanthropy alone. That’s where impact investments came in. Through NatureVest, impact investors provided 95 percent of the capital for the deal, allowing TNC to act quickly to purchase the lands. The bulk of the capital was provided at very attractive terms, as low-cost, long-term financing.<\/p>\n

And it’s not just traditional land conservation that can benefit from impact investments. In northern Kenya\u2019s rangelands, NatureVest is investing in cattle herding communities who agree to improve grazing practices. Through a $13 million deal\u2014a combination of philanthropy and impact investment\u2014we\u2019re scaling up a program launched by Northern Rangelands Trust that buys cattle directly from herders at reasonable prices, feeds the cattle on sustainably grazed, nutrient-rich grasses, then processes the meat to sell to the Nairobi market at higher prices than the herders would have received on their own. The initiative generates positive financial, social and conservation outcomes. A portion of the additional profits received at the market goes directly to the herding communities for conservation, healthcare, education and anti-poaching security measures.<\/p>\n

Here in the U.S., there\u2019s a big opportunity for impact investment as cities turn to nature to manage storm water runoff, a major source of pollution for local waterways. Natural solutions such as rain gardens, green roofs and artificial wetlands soak up runoff, slowing the water’s flow and reducing its volume before it reaches already-stressed sewer systems.<\/p>\n

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