NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, February 8, 2017

From sustainable “blue economy” projects to restoration projects for wetlands, streams, and animal habitats, conservation-related projects have been drawing a significant amount of investor money in recent years. Investments that produce a financial return and a “measurable environmental result” climbed 62% from 2013-2015, a new report found, indicating that traditional divisions between conservation, philanthropy and for-profit finance may be withering.

“I think it’s a mixture of both redefined conservation money—perhaps originally intended for philanthropy—and new sources of finance that are entering this space,” says Kelley Hamrick, author of the report, in an interview with Co.Exist. “We are seeing more foundations and public organizations turn to impact investing as a way to stretch their dollars. [They] play a large role in incentivizing private investment, either through guarantees, taking first loss, or providing in-kind support.”

The analysis comes from Forest Trends, a Washington D.C. nonprofit, and is based on data from 128 banks, companies, fund managers, family offices, foundations, and nonprofits involved in conservation investing. Sustainable food and fiber—like timber production projects, for example—accounted for the greatest share of capital committed between 2004 to 2015 ($6.5 billion) followed by habitat conservation ($1.3 billion) and water ($400 million).