COP 15 preview: the “Paris moment” for nature?

We expect biodiversity to be a major theme for investors in 2023, after the recent COP 27 formally acknowledged the link between the climate and biodiversity crises – as underscored by severe weather events this year. We hope that the upcoming COP 15 – a conference dedicated to biodiversity – will agree a global biodiversity framework for the coming decade that will live up to high expectations.

Key takeaways
  • The focus of this year’s COP 15 is to adopt a globally agreed framework – the post-2020 global biodiversity framework – which could be a unique opportunity to reverse biodiversity loss and support climate action.
  • While hopes are high that COP 15 could be the “Paris moment for nature” – echoing the progress made on climate in the Paris Agreement of 2015 – there are challenges to overcome around the mobilisation of finance for nature restoration.
  • The good news is that a successful COP 15 could be a springboard for greater integration of natural capital into investment decisions and opportunities.

While COP 27, the better-known climate conference, has seized the headlines recently, attention will soon turn to COP 15, the dedicated conference on biodiversity. The first part of the CBD COP 15 (to give it its full name) took place virtually from 11-15 October 2022 and focused on the development of the post-2020 global biodiversity framework. The ambition is to put the world on a path that secures nature for future generations. The Kunming Declaration1, a political declaration aimed at demonstrating political ambition, was adopted during the high-level segment of the conference.

The second part of the CBD COP 15 will take place in Montreal, Canada from 7-19 December, under the Chinese COP presidency in coordination with the Canadian government. The conference will see a gathering of representatives from 196 governments.

What is COP 15?

COP 15 stands for the 15th Conference of the Parties (COP 15) of the Convention on Biological Diversity (CBD). Adopted in 1992, the CBD is the first global agreement to cover all aspects of biological diversity, focusing on three main objectives:

  • The conservation of biological diversity
  • The sustainable use of the components of biological diversity
  • The fair sharing of the benefits arising out of the utilisation of genetic resources

Why is COP 15 so important?

Biodiversity is integral to the “planetary boundaries” topic, which addresses how we will sustain our global population in a higher temperature world. This topic is one of Allianz Global Investors’ three core sustainability themes (together with climate change and inclusive capitalism). Natural capital – the world’s stock of natural assets – is being harmed by human activity at an unprecedented rate, impacting the functioning of ecosystems and the ability to provide basic life-support services.2

The primary aim of COP 15 is to adopt a globally agreed framework known as the post-2020 global biodiversity framework. This move would represent the most significant event for the natural capital agenda this decade.

The first draft of this framework was published in July 20213 and was built on the lessons learned from the failure of the Strategic Plan for Biodiversity 2011-2020 and its Aichi Biodiversity Targets. Those targets were not fully met, and natural degradation accelerated. The intention is to create the nature equivalent of the Paris Climate Agreement, with an ambitious plan to halt and reverse biodiversity loss by 2030 and achieve net targets by 2050.

The post-2020 framework differs from its predecessor in being more “outcome-orientated”, with four long-term 2050 goals related to conservation, sustainable use of biodiversity, fair benefit-sharing and adequate means of implementation of the vision. In addition, there are 21 action-orientated targets for 2030. See some examples of the targeted outcomes below.

Examples of goals of the post-2020 global biodiversity framework
  • Protecting at least 30% of the planet’s land and marine areas by 2030, especially areas of particular importance for biodiversity.
  • Preventing or reducing the rate of introduction and establishment of invasive alien species by 50%.
  • Reducing nutrients lost to the environment by at least half and pesticides by at least two-thirds and eliminating plastic waste discharge.
  • Using ecosystem-based approaches to contribute to mitigation and adaptation to climate change.
  • Redirecting, repurposing, reforming or eliminating incentives harmful for biodiversity in an equitable way, reducing them by at least USD 500 billion per year.

Biodiversity intersects with many other sustainability topics, such as the impact that land loss has on communities. Reflecting these social factors, the framework acknowledges the need for appropriate involvement and empowerment of women and youth, and recognition of the crucial role indigenous peoples and local communities play in the implementation of the framework.

What are we hoping for at COP 15 – or expecting?

We think the three thematic days covering biodiversity themes at COP 27 set the scene rather than advanced the cause. At COP 15, we hope for – and, indeed, expect – a positive final agreement on the framework to halt biodiversity loss.

However, a key question, and one where regulation may play a part, is around the financing of biodiversity conservation and restoration. Today, it is estimated that the public and private financial flows that are harmful to biodiversity are at least five to six times higher than the finance for preserving biodiversity.4 This topic will also extend to the direction and redirection of subsidies, especially for low-income countries.

To achieve a progress in this area, clear guidance will be needed on how companies can operate while being nature-positive – or at least not nature-negative. We believe this guidance will be framed by the evolution in biodiversity data, risk identification and management, disclosures and possibly regulation.

This year has already seen the introduction of formal biodiversity screening and reporting requirements into investments. A successful COP 15 should propel biodiversity into greater focus for 2023, where the measurement and screening for biodiversity – as well as the engagement around this topic and its integration into investment decisions – will likely evolve rapidly and significantly. This is likely to be reinforced by recommendations from the Taskforce on Nature-related Financial Disclosures, which are scheduled to be released next year and aim to enable organisations to report and act on naturerelated risks.

  • Disclaimer
    Investing involves risk. The value of an investment and the income from it will fluctuate and investors may not get back the principal invested. Past performance is not indicative of future performance. This is a marketing communication. It is for informational purposes only. This document does not constitute investment advice or a recommendation to buy, sell or hold any security and shall not be deemed an offer to sell or a solicitation of an offer to buy any security.

    The views and opinions expressed herein, which are subject to change without notice, are those of the issuer or its affiliated companies at the time of publication. Certain data used are derived from various sources believed to be reliable, but the accuracy or completeness of the data is not guaranteed and no liability is assumed for any direct or consequential losses arising from their use. The duplication, publication, extraction or transmission of the contents, irrespective of the form, is not permitted.

    This material has not been reviewed by any regulatory authorities. In mainland China, it is for Qualified Domestic Institutional Investors scheme pursuant to applicable rules and regulations and is for information purpose only. This document does not constitute a public offer by virtue of Act Number 26.831 of the Argentine Republic and General Resolution No. 622/2013 of the NSC. This communication’s sole purpose is to inform and does not under any circumstance constitute promotion or publicity of Allianz Global Investors products and/or services in Colombia or to Colombian residents pursuant to part 4 of Decree 2555 of 2010. This communication does not in any way aim to directly or indirectly initiate the purchase of a product or the provision of a service offered by Allianz Global Investors. Via reception of his document, each resident in Colombia acknowledges and accepts to have contacted Allianz Global Investors via their own initiative and that the communication under no circumstances does not arise from any promotional or marketing activities carried out by Allianz Global Investors. Colombian residents accept that accessing any type of social network page of Allianz Global Investors is done under their own responsibility and initiative and are aware that they may access specific information on the products and services of Allianz Global Investors. This communication is strictly private and confidential and may not be reproduced. This communication does not constitute a public offer of securities in Colombia pursuant to the public offer regulation set forth in Decree 2555 of 2010. This communication and the information provided herein should not be considered a solicitation or an offer by Allianz Global Investors or its affiliates to provide any financial products in Brazil, Panama, Peru, and Uruguay. In Australia, this material is presented by Allianz Global Investors Asia Pacific Limited (“AllianzGI AP”) and is intended for the use of investment consultants and other institutional/professional investors only, and is not directed to the public or individual retail investors. AllianzGI AP is not licensed to provide financial services to retail clients in Australia. AllianzGI AP is exempt from the requirement to hold an Australian Foreign Financial Service License under the Corporations Act 2001 (Cth) pursuant to ASIC Class Order (CO 03/1103) with respect to the provision of financial services to wholesale clients only. AllianzGI AP is licensed and regulated by Hong Kong Securities and Futures Commission under Hong Kong laws, which differ from Australian laws.

    This document is being distributed by the following Allianz Global Investors companies: Allianz Global Investors U.S. LLC, an investment adviser registered with the U.S. Securities and Exchange Commission; Allianz Global Investors Distributors LLC, distributor registered with FINRA, is affiliated with Allianz Global Investors U.S. LLC; Allianz Global Investors GmbH, an investment company in Germany, authorized by the German Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin); Allianz Global Investors (Schweiz) AG; in HK, by Allianz Global Investors Asia Pacific Ltd., licensed by the Hong Kong Securities and Futures Commission; ; in Singapore, by Allianz Global Investors Singapore Ltd., regulated by the Monetary Authority of Singapore [Company Registration No. 199907169Z]; in Japan, by Allianz Global Investors Japan Co., Ltd., registered in Japan as a Financial Instruments Business Operator [Registered No. The Director of Kanto Local Finance Bureau (Financial Instruments Business Operator), No. 424], Member of Japan Investment Advisers Association, the Investment Trust Association, Japan and Type II Financial Instruments Firms Association; in Taiwan, by Allianz Global Investors Taiwan Ltd., licensed by Financial Supervisory Commission in Taiwan; and in Indonesia, by PT. Allianz Global Investors Asset Management Indonesia licensed by Indonesia Financial Services Authority (OJK).


Recent insights

Embracing Disruption

The “Internet of Things” (IoT) has made strong progress over the past decade, with connected devices now commonplace across both households and industry. However, in terms of the promises of IoT translating into tangible productivity gains, we have seen some bumps in the road to wider adoption, not least among systems providers seeking sustainable models for monetizing this quickly developing technology.

Discover more

Navigating Rates

Many of the major central banks (excluding Japan) are beginning or set to begin interest rate-cutting cycles this year. Here are four fixed income themes we believe could present investors with opportunities during the remainder of 2024.

Discover more

Modi’s victory, and the continuation of the reform agenda his government has embraced, should further strengthen the trajectory towards an ‘Emerging New India.

Discover more

Allianz Global Investors

You are leaving this website and being re-directed to the below website. This does not imply any approval or endorsement of the information by Allianz Global Investors Asia Pacific Limited contained in the redirected website nor does Allianz Global Investors Asia Pacific Limited accept any responsibility or liability in connection with this hyperlink and the information contained herein. Please keep in mind that the redirected website may contain funds and strategies not authorized for offering to the public in your jurisdiction. Besides, please also take note on the redirected website’s terms and conditions, privacy and security policies, or other legal information. By clicking “Continue”, you confirm you acknowledge the details mentioned above and would like to continue accessing the redirected website. Please click “Stay here” if you have any concerns.