State of Finance for Nature 2026 | UNEP

#Sustainability, #Trends

Redirecting Global Capital Toward a Nature-Positive Economy: Closing the Multi-Trillion Dollar Finance Gap for Biodiversity and Climate Stability

The global economy stands at a decisive moment as financial flows continue to move in the wrong direction for nature. In 2023, US$7.3 trillion was directed toward activities that directly harm ecosystems, while only US$220 billion supported nature-based solutions (NbS). This 30-to-1 imbalance illustrates how capital allocation remains misaligned with biodiversity, climate and land restoration goals, despite growing recognition that nearly half of global GDP depends on nature.

Public environmentally harmful subsidies reached US$2.4 trillion in 2023. Fossil fuels represented the largest share, followed by agriculture and water use. At the same time, private finance amounting to US$4.9 trillion flowed into high-impact sectors such as utilities, industrials, energy and basic materials. These investments reinforce extractive economic patterns and increase exposure to systemic environmental risk, locking economies into degradation rather than resilience.

Finance for nature-based solutions shows gradual progress but remains insufficient. Total NbS finance reached US$220 billion in 2023, reflecting a 5 percent increase from the previous year. Public domestic expenditure accounted for US$190 billion, while Official Development Finance reached US$6.8 billion. Private NbS finance totaled US$23.4 billion, with biodiversity offsets, certified supply chains and sustainable bonds representing the main channels.

To meet international commitments under the Rio Conventions, annual investment in NbS must increase to US$571 billion by 2030. This requires scaling finance by more than two and a half times within five years. However, scaling positive flows alone is not enough. The report introduces the Nature Transition X-Curve, emphasizing the parallel need to phase out nature-negative finance while accelerating nature-positive investment.

The transition is fundamentally economic. Reforming harmful subsidies, integrating nature-related risk disclosure into financial systems and embedding biodiversity into fiscal planning can redirect trillions toward productive and regenerative sectors. More than 730 organizations have adopted frameworks to assess nature-related dependencies, impacts, risks and opportunities, signaling structural change in financial markets.

Building a trillion-dollar nature transition economy demands coordinated leadership from governments, investors and corporations. Redirecting capital toward regenerative agriculture, ecosystem restoration and resilient infrastructure can strengthen competitiveness and long-term prosperity. Turning the financial system toward nature-positive outcomes is essential to secure ecological stability and sustainable growth.

Read the full report for deeper insights: https://www.unep.org/resources/state-finance-nature-2026