Value of Nature: The Investment Case for Nature-based Solutions

Making the Value of Nature Visible: New Insights for Financing Nature-based Solutions

A new report, Value of Nature: The Investment Case for Nature-based Solutions, commissioned by the Dutch Ministry of Agriculture, Fisheries, Food Security and Nature (LVVN), explores a question at the heart of scaling NbS: how can we better translate the broad societal value of nature into financial and investment decisions?

As NbS continue to gain traction in policy and practice, a persistent challenge remains. While they generate significant benefits, from climate regulation and water management to biodiversity and human well-being, these benefits are often not reflected in financial flows. This creates a structural mismatch: those who invest in NbS are not always those who benefit the most.

The report highlights the role of Ecosystem Service Valuation (ESV) as a key tool to address this gap. By making visible the full range of ecosystem services, including regulating and cultural services, ESV helps clarify value creation, identify beneficiaries, and support more informed and transparent decision-making.

Drawing on case studies from the United Kingdom and Spain, the report demonstrates that NbS can significantly increase total economic value, particularly through services that are typically undervalued in conventional financial assessments. At the same time, it shows that many of these benefits are distributed across society and accrue over longer time horizons.

Importantly, the report also reinforces a key gap in the current discourse. As highlighted in the study, including a perspective from NetworkNature coordination:

"We need a study where we can really pick apart the harmful subsidies and how these affect NbS, and say this is the area where we could start, in order of how low hanging the fruit is. Because everyone talks about harmful subsidies, but I never really saw a serious study that deconstructs the subsidies, where would you start?"

This points to a broader challenge: while valuation is advancing, translating this into concrete shifts in financial and policy frameworks, including addressing harmful incentives, remains a critical next step.

One of the key insights is that scaling NbS is not only a financial challenge, but also a coordination challenge. Public–private partnerships emerge as a critical mechanism to align investment with value creation. In this context, ESV can serve as a common language, supporting the design of financing structures, clarifying who benefits, and helping to align governance frameworks.

For the NbS community, this reinforces the importance of moving beyond project-level thinking towards more systemic approaches that integrate ecological, financial, and governance dimensions. Early-stage valuation, in particular, can play a crucial role in shaping project design, stakeholder engagement, and investment logic.

As the demand for credible, comparable and decision-relevant data continues to grow, initiatives like this report contribute to advancing a more mature and investable NbS landscape.

Foundation for Sustainable Development