18 February 2014 | Environmental finance has always been something of a double-edged sword.
On the one hand, mechanisms like species banking, forest-carbon crediting, and investments in watershed services draw finance away from environmental destruction and into conservation, and they do so based not on something as fickle as philanthropy, but on the fundamental recognition that our civilization depends on clean air, clean water, and resilient ecosystems.
On the other hand, narrow payments explicitly focused on specific ecosystem values favor those that can be measured and verified, which means they run the risk of leaving a whole symphony of ecosystem services unaccounted for and unsupported.
Scientifically, that never made sense. Forests feed rivers, which feed farms, which feed us. It all links together. But our economic and regulatory systems weren’t designed with nature in mind. “Landscapes Thinking” aims to fix this flaw by nurturing our planet’s living ecosystems holistically rather than in their component parts.
Recognizing The Obvious
The challenge is great, but not as revolutionary as it may seem. After all, in practice the holistic and the simplistic have always linked together. The most successful REDD projects don’t work by putting a fence around a forest, for example. They work by helping rural poor develop sustainable land-use practices that take pressure off the forest. The outcomes may be measured in the amount of carbon stored in trees or the cleanliness of water coming into a lake or stream, but the actions have always focused on people, places, and procedures.
The simple fact is that even nominally fragmented financing mechanisms work best when they support holistic land-management strategies, and organizations employing those strategies have increasingly tapped into these financing mechanisms to achieve goals that were unachievable in the past. This reality has slowly come into focus in our annual State of the Forest Carbon Markets reports, which show that private conservationists using forest-carbon financing mechanisms today are managing an area larger than all the forests of the Democratic Republic of Congo combined.
There’s always been a sense that a more formalized holistic approach would deliver even better benefits, and that philosophy took center stage at year-end climate talks in Warsaw, with Forest Day giving way to Landscapes Day, a Dutch consortium launching the BEE REDD+ Initiative to better bring biodiversity values into REDD, and the US, UK, and Norway launching a REDD finance mechanism under the World Bank focused on saving forest by supporting climate-safe agriculture.
But the landscapes approach isn’t just about scaling up or broadening narrowly-focused but effective mechanisms like REDD. It’s about redirecting finance flows across the entire global agricultural economy, with the actual environmental payments acting as catalysts or being used to fine-tune the more broad-based activities. Implementing something as massive as sustainable landscapes requires the cooperation of major agriculture players, policy makers, and financial institutions, as well as scientific experts in deforestation, water, and biodiversity.
Two Global Katoomba Meetings – one in March and one in April – will bring these diverse stakeholders together as part of an ongoing effort to accelerate this change. The aim is to harvest efforts already underway for lessons-learned, and jump-start new initiatives based on the best knowledge we have.
The March meeting will take place on the 19th and 20th at Iguazú Falls, on the border of Brazil and Argentina, under the banner “Scaling Up Sustainable Commodity Supply Chains”.
The April meeting will take place in Lima, Peru, over four days – from the 22nd through the 25th – and its working motto is “Climate, Forests, Water, and People: A Vision for Alignment in Tropical America”.
Ecosystem Marketplace Coverage of Katoomba Season 2014
Over the next two months, our coverage will focus heavily on the issues to be covered at these two major events. We will begin by examining the perils and promise of sustainable commodity supply chains, then explore issues of governance, and then move into ways that specific mechanisms are impacting the landscape in Peru’s San Martín region and across the Amazon.
Katoomba Brazil: Laying the Foundation
When you talk agriculture in Brazil, you’re talking soybeans in the Cerrado and cattle in the Amazon. Both are major drivers of land-use change, and both generate products that find their way into nearly everything we consume – from tofu and hamburgers to leather sofas and shoes. That demand is what’s killing the forest, but it’s also what’s feeding the companies that drive the destruction. Inform the demand, the thinking goes, and you can reduce the damage.
It’s that thinking that drove the Consumer Goods Forum (CGF) to vow zero deforestation in its supply chains by 2020. A collaboration of 400 major consumer goods companies and service providers with combined annual sales of over US$3 trillion, the CGF will respond to consumers – but only if those consumers are serious. Some companies have formed roundtables to coordinate efforts around specific commodities. And recent initiatives focused on building jurisdictional approaches (national, subnational, and municipal) could bring integrated, large-scale transformation to commodity supply chains.
Initiatives like these are critical, but they are all in early stages of development. If the challenge of increased agricultural production is to be met while also reducing deforestation in the next few years, new relationships, creative approaches, and sources of finance will be required to help companies and their suppliers achieve long-term sustainability while still meeting their bottom line.
Katoomba Peru: 20/20 Vision for a Global Climate Solution
This is the 20th Katoomba Meeting, and it’s designed to align international cooperation and development strategies for the region. In so doing, it will also provide clarity for the 20th Conference of the Parties (COP 20) to the United Nations Framework Convention on Climate Change (UNFCCC), which also takes place in Lima this year. The COP is the year-end climate talks, and this one is charged with delivering a global agreement on greenhouse gas emissions.
Katoomba 20 opens on Earth Day with the first two days taking place in Lima on the same grounds as the COP. There, the events will be open to a broad range of high-level participants, but the second two days take place in San Martin and are for expert practitioners only. They will be comprised of workshops designed to turn theory into practice.
The aim of both meetings is to identify opportunities for climate policy and finance to align with other public and private investments and commitments to ensure that forests and other ecosystems continue to provide critical support for stable climate and resilient societies.
The need for alignment becomes clear when we consider how climate change, forests, and water are deeply intertwined. Not only will climate change directly impact forests and the other natural systems that maintain critical water-related ecosystem services, climate impacts will be experienced largely through the medium of water – melting glaciers, changing rainfall patterns, increased water stress and drought from higher temperatures, more severe storms – resulting in increased water and food insecurity, and constraints on economic opportunities. Integrating climate policy, forest and biodiversity conservation, post-2015 sustainable development goals, water management, and agriculture and energy development will be critical to success.
Peru is positioned to lead the region and the world in undertaking this complex, but crucial, work. Critical sources of water, regulators of flow from Andean glaciers, and home to the country’s distinctive and well-known megadiverse flora and fauna, Peru’s forests are also under threat – and deforestation is the primary source of the country’s greenhouse gas emissions. Having committed to zero net emissions from deforestation by 2021, Peru’s new forestry and climate change strategy will be pivotal in realizing the country’s commitment to climate change and its very identity moving forward. Additionally, Peru has shown how to lead on ecosystem service-based approaches through its recent water sector reform, support for a national incubator of ecosystem services projects, the development of a national ecosystem services law, and new regulations requiring no net loss of biodiversity for large mining, agriculture, and infrastructure projects.
Beyond national leadership, this strategy’s success will largely depend on the commitment of Peru’s Amazonian regional governments. In that arena, several regional governments have demonstrated real interest in accessing finance for sustainably managing their natural resources – including Loreto, Madre de Dios, Ucayali, and San Martin, which have joined the Governors’ Climate and Forests Tasks Force and begun to develop jurisdictional REDD+ programs. San Martin stands out among these regional governments, as a leading “green region” with sincere commitment to aligning its economic, environmental, and social goals with a framework anchored in optimizing the ecological and economic value of its landscapes. As the home to several REDD+ projects, the first watershed services project in Peru, over a dozen conservation concessions, and a growing ecotourism industry, San Martin is poised to demonstrate how to align the financial, political, and cultural pieces necessary to achieve a thriving, productive, and sustainable society.
Successfully finding alignment will require efforts not only at these multiple levels of governance but also among scientists, financiers, business leaders, bilateral and multilateral donors, NGO leaders, and community leaders. Katoomba XX will convene these actors to help to forge alliances and mobilize momentum for a new vision of alignment for Tropical America.