COP16: key takeaways from the global biodiversity summit

The 16^th Conference of the Parties to the United Nations Convention on Biological Diversity (“COP16”) was held in Cali, Columbia from 21 October until 2 November 2024. 

COP16 was the first opportunity for governments to come together and collectively review their progress towards the targets and commitments established in the Global Biodiversity Framework (“GBF”) which was adopted at COP15 in 2022. According to the event organisers, COP16 was also intended to help make nature and biodiversity as important to governments and businesses as climate change and the energy transition. 

In this blog post, we explore what was intended for COP16, what was in fact achieved, and what this means for clients.  

What COP16 was intended to achieve

At COP15, the 196 nations to the Convention on Biological Diversity made a commitment to halt and reverse the decline of nature by 2030. This commitment was set out in the GBF and underpinned by 23 more specific targets including conserving 30% of the world’s land and 30% of the world’s ocean by 2030 (the “30by30 target”), boosting finance for the protection and restoration of nature, cutting pollution from pesticides and plastics, sustainably managing agriculture, and reforming subsidies that harm nature (see our previous blog post for an overview of the GBF and COP15). 

One of the key aims of this year’s COP16 was for nations to put together a plan on how they would reach the GBF goals and. in particular, finance and monitor progress towards the GBF. 

What in fact occurred at COP16 

Mixed progress was made at COP16. 

On the one hand, a new fund was announced, which will collect funds from companies that profit from digital sequence information and redistribute the funds to developing countries and indigenous communities to help them to protect nature and biodiversity. On the other hand, governments failed to reach consensus on financing and monitoring progress towards the GBF goals. 

Breaking it down, at COP16:

• Governments failed to agree on how to finance the goals of the GBF. At COP15, nations had agreed to increase the total finance for nature protection and restoration to US$200 billion a year by 2030, with wealthy nations providing an annual US$30 billion in support to developing nations by the same date. A fund was set up under the Global Environment Facility (“GEF”) after COP15 to hold the funds and facilitate financing the GBF goals. However, as of October 2024, only US$396 million, from 12 countries, had been pledged to the fund. At COP16, developing nations voiced concerns that the GEF is too heavily influenced by wealthy nations and called for the creation of a new fund with governance that better reflects the priorities of all nations. Other financing options were also discussed, but ultimately no final agreement on how to finance the goals of the GBF was reached and nations will have to pick up discussions next year. 
• Nations agreed to set up a new fund which businesses that use digital sequence information will be encouraged to voluntarily contribute to. At COP15, nations had agreed to establish a multilateral fund for benefit sharing from the use of genetic resources. The mechanism was agreed in principle at COP15, but many key details remained to be agreed, including whether the fund would be mandatory, who would be required to pay into it, how much contributors should pay, and who should receive funding. At COP16, it was agreed that companies in sectors that “directly or indirectly benefit” from the use of digital sequence information (“DSI”) (i.e. genetic information sequenced from the natural world used to create medicines, vaccines and other products) should contribute 1 percent of their profits to the fund, which will be called the Cali Fund. Contributions will be voluntary, but companies which meet two out of three criteria (US$20 million in assets, US$50 million in sales and US$5 million in profit) will be expected to contribute. The Cali Fund will be used to support further use of DSI and the conservation and sustainable use of nature. The COP16 text invites governments to take legislative or other measures to “incentivise contributions” from companies, opening the door to potential mandatory requirements. The UK government has announced that it will work with industry on developing a voluntary mechanism for supporting the Cali Fund. The Fund is unusual in that payments will be made entirely by the private sector, and it relies significantly on reputational impacts to encourage contributions. 
• Nations agreed to include Indigenous peoples and local communities in the COP process. For more than 20 years, Indigenous peoples and local communities have had an informal working group which has contributed to the UN’s biodiversity discussions. At COP16, this was upgraded to a permanent body, meaning that Indigenous peoples and local communities can contribute to COP negotiations in future without being reliant on invitations from governments. It was also agreed that a significant amount of the Cali Fund will be used to support Indigenous people and local communities to protect and restore nature.
• Nations failed to agree a way to monitor progress toward the GBF goals. Ahead of COP16, nations were required to prepare biodiversity action plans explaining how they plan to implement the goals and targets of the GBF, but only one-fifth did. Countries that had not submitted national biodiversity plans were permitted to instead submit national targets aligned with the GBF, which over 100 nations, including the UK, did. At COP16, nations wanted to establish ways to monitor progress towards the targets. However, they failed to reach an agreement, leaving the approach for tracking progress undecided.
• Nations adopted a decision on ecologically or biologically significant marine areas. This decision establishes a new framework for mapping and updating marine areas based on scientific criteria. This will help to monitor progress towards the GBF goals and paves the way for the Global Oceans Treaty to be ratified by June next year. 

All in all, COP16 was a success for Indigenous peoples and local communities and moved the needle on compensation for DSI. However, discussions on finance have been left unfinished and will need to be picked up next year. 

What else has happened outside of COP16?

Whilst nations were busy negotiating in Cali, several organisations, businesses and other bodies made significant announcements relating to nature and biodiversity topics. In particular: 

• TNFD and GFANZ launched consultations on transition plans. The Taskforce on Nature-related Financial Disclosures (“TNFD”) and the Glasgow Financial Alliance for Net Zero (“GFANZ”) launched separate consultations on nature and transition plans at COP16. The GFANZ consultation, which is open until 27 January 2025, will explore how nature can be integrated into climate transition planning as part of the existing GFANZ Transition Plan Framework. In particular, it will explore how nature-related emissions can be reduced in alignment with the Paris Agreement, how nature can be used for climate mitigation, and how both factors should be included as part of financial approaches and planning. A final paper will be published by GFANZ in Q1 2025. The GFANZ consultation complements the TNFD consultation which is focusing on nature transition plans more broadly and is open for consultation until 1 February 2025. The TNFD has released draft guidance on nature transition plans which broadly defines nature transition plans as plans laying out “goals, targets, actions, accountability mechanisms and intended resources to respond and contribute to the transition implied by the Kunming-Montreal Global Biodiversity Framework, where biodiversity loss is halted and reversed by 2030 to put nature on a path to recovery by 2050”. The TNFD is expected to publish the final guidance in 2025.
• More companies have signed up to be TNFD adopters. Abrdn, Banco de Bogotá and the world’s largest natural capital investor Manulife Investment Management are among the latest financial institutions to sign up to be TNFD adopters, bringing the total to 129, representing around $US17.7 trillion in assets under management. By signing up, institutions signal their intention to begin adopting the TNFD’s recommendations and publishing TNFD-aligned disclosures as part of their annual corporate reporting for FY2024 (or earlier) or FY2025. Notable new non-financial sign-ups include KPMG, Qantas, Philips, Eletrobras, EDP and Sainsbury’s. Overall, TNFD now has over 502 adopters from 54 countries, a significant increase from 320 announced in January 2024. For more information on the TNFD, see our previous blog posts here and here.
• Nature Action 100 released the results of its first assessment of its target companies’ progress on nature and found that none meet its expectations. Nature Action 100, an initiative which sees investors (who represent over US$30 trillion in assets under management) collectively engage with 100 companies with the greatest impact on nature and biodiversity loss, has found that most of the initiative’s target companies disclose a commitment to protect nature, but are largely only in the beginning stages of addressing their nature-related impacts and dependencies. Nature Action 100 expects that companies will make more progress on nature as the financial risks of nature loss and the economic benefits of restoring nature materialise. 
• SBTN announced the first adopters of science-based targets for nature. Luxury goods group Kering, pharmaceuticals giant GSK and building materials company Holcim have become the first adopters of science-based targets for nature, having each adopted science-based targets for freshwater and/or land. This announcement follows a year-long pilot programme run by the Science Based Targets Network (“SBTN”), which saw 60% of participants receiving validation for some or all of their targets. Pilot companies with validated targets that have not yet proceeded with publicly adopting the targets have until 10 January 2025 to do so. SBTN will publish a corporate target tracker on its website in early 2025, to provide transparency on the targets set. For more information on the SBTN, see our previous blog post.
• TNFD launched a discussion paper on how to improve access to high-quality nature-related data. Investors seeking to understand nature-related risks often cite a lack of data as a key obstacle. The TNFD has launched a discussion paper on how to improve access to nature data, which includes its plan for a free-to-use data facility. The paper is open for comments until 17 February 2025. It is hoped that, after principles are defined and a data facility is piloted, it can be launched in the first quarter of 2026.
• Six global environmental organisations have partnered to help scale climate and conservation outcomes through sovereign debt conversions. Conservation International, the Nature Conservancy, the Pew Charitable Trusts, Re:wild, the Wildlife Conservation Society and World Wildlife Fund in the US have partnered to develop a shared pipeline of potential projects to finance through sovereign debt conversions (also known as “debt-for-nature swaps”). Sovereign debt conversions typically work by cutting a country’s debt in return for the country protecting nature and biodiversity. The coalition estimates that sovereign debt conversions could unlock up to US$100 billion in climate and nature finance. The NGOs also intend to develop practice standards to support sovereign debt conversions for nature and climate and expect to publish the standards in early 2025. 
• A framework for biodiversity credits was published. The International Advisory Panel on Biodiversity Credits, in collaboration with the Biodiversity Credit Alliance and the World Economic Forum, have launched a framework on biodiversity credits. The framework is made up of 21 high-level principles to define, guide and encourage the development of high-integrity biodiversity credits and credit markets. The framework does not support international biodiversity offsetting approaches. 
• EU Commission shared information on its explanatory work on biodiversity certification and nature credits. The EU Commission has stated that it is exploring biodiversity credits as part of its “innovative finance instruments toolbox for broadening sources of funding to mobilise resources, help companies set nature-positive goals, and reward those who protect and restore nature”.
• UNEP FI published guidance setting out actions banks can take to avoid and reduce impacts on nature. The United Nations Environment Programme Finance Initiative (“UNEP FI”) has published new nature sector guidance for Principles for Responsible Banking members covering the agriculture, forestry and mining sectors. The guidance, which has been developed with input from volunteer banks and in partnership with the Biodiversity Consultancy, sets out some suggested low-risk, value-creating, actions for banks to take to avoid and reduce their impact on nature. 
• UK government published an updated policy paper on delivering 30 by 30 on land in England. On 29 October 2024, the Department for Environment, Food and Rural Affairs (“Defra”) published an updated policy paper which sets out how the UK government will meet its 2020 target to protect 30% of the UK’s land for biodiversity by 2030. The policy paper sets out the criteria for land that can be counted towards the target. Defra has stated that it will develop detailed guidance on how the criteria should be interpreted and applied in practice and hope to publish that guidance next year. This policy paper supersedes the previous government’s 2023 policy paper on the same topic. 

What does this mean for clients?

Whilst COP16 did not achieve all that it set out to achieve, it is clear from the tone of these COPs, and from the mass of biodiversity announcements made during the conference, that there is momentum to make nature and biodiversity as important to governments and businesses as climate change. 

As more companies align themselves with voluntary initiatives such as the TCFD and start to comply with mandatory regimes such as the EU’s Corporate Sustainability Disclosure Directive (“CSRD”) and Corporate Sustainability Due Diligence Directive (“CSDDD”), we expect biodiversity and nature to become bigger priorities for businesses. 

We also expect to see more novel forms of financing to develop to help companies invest in nature and biodiversity-related projects. 

COP16 showcased the role of the private sector in helping halt biodiversity loss and protecting nature, with many praising the 3,000 or so businesses who attended.  It is clear from this turn out that businesses see promising financial opportunities in the space. The race is now on to identify opportunities that help halt the decline of nature as well as comply with upcoming regulations and ESG initiatives. 

For more information on nature and biodiversity, see our biodiversity materials.