Financing Biodiversity: Moving Beyond Firm-Centric Business Models

In the years since, biodiversity finance has increasingly been framed around nature premia for investors [1], nature targets and metrics for their investees [2], nature-related engagement policies for asset managers [3], and co-investment strategies from public and philanthropic actors to stimulate the buy-in of all these market players [4]. Together, this reflects a conversation about nature that keeps getting handed over to spreadsheets and investment fixes, until the ecological question gets hidden under the technical one.

Business models for biodiversity: what they can and cannot do

The global economy depends deeply on nature, and yet continues to erode it: trillions of dollars still flow into activities that damage biodiversity, while conservation and restoration receive a fraction of that investment. Closing that mismatch requires not only mobilizing capital, but primarily understanding which business models can plausibly deliver biodiversity outcomes, what governance surrounds them, and what values are defined when nature is integrated into economic decision-making.

Although integrating nature at the firm or investment level has become a dominant framing in biodiversity finance, it is not the only route to biodiversity-positive outcomes [5]. In this narrative, access to decision-making tends to stay with investors and firms, while nature has been reframed from a shared, public good into a private asset, aiming for clearly defined risk-return profiles.

Five ways businesses generate revenue from biodiversity

In recent research, my colleagues and I identified five distinct biodiversity business models (BBMs), each following a different pathway to biodiversity impact [6]:

1. Bundling biodiversity improvements into an existing product, such as certified timber or wildlife tourism.

2. Selling biodiversity improvements directly, such as habitat or nature credits.

3. Providing technology that measures and monitors biodiversity, largely nature tech.

4. Developing substitutes for environmentally destructive commodities, such as alternative proteins or synthetic flavourings, reducing pressure on land and species indirectly.

5. Treating biodiversity as a form of risk protection, embedding it into assets such as buildings or farmland to preserve their value.

Earlier work on urban nature-based solutions identified a related but distinct set of value-creation archetypes, finding that only a small subset are primarily driven by clear economic returns, while the majority depend on other, non-market forms of value creation [7].

A single business rarely relies on just one model. Some initiatives push this stacking logic beyond a single business altogether. For example, the Landscape Enterprise Networks (LENS) follows a related approach from the demand side. LENS starts by identifying groups of businesses, such as food and drink companies, water utilities, and local authorities, that share a commercial dependence on the same landscape. It then pools their funding into collaborative value chains that pay farmers and land managers to support implementation of nature-positive agriculture and nature-based solutions across that shared area.

Beyond the firm: why landscapes matter

Most organizational and financial thinking about biodiversity, including the five business models above, treat the firm as a central actor [8]. Biodiversity loss and recovery, however, unfold in landscapes: a river catchment, a farming region, a wetland complex, shared by farmers, banks, asset managers, municipalities, and communities who rarely coordinate their capital together.

This tendency to analyze organizing and financing for biodiversity primarily through firm or investors-centered decision-making could be described as a corporate/ investment myopia, a framing that highlights the mismatch between where biodiversity value is generated and lost, and where financial and governance attention is currently directed. Regenerative agriculture models involving multiple actors across a shared landscape, and water funds that pool downstream contributions to protect upstream catchments, illustrate this gap: neither fits neatly within a single firm’s balance sheet, yet both depend on coordinated, landscape-level financing.

For example, the Marke model, currently being rolled out among Dutch dairy farmers, replaces fixed rules with shared, area-level targets that farmers, water boards, and public and private partners agree on together to move the agricultural sector towards a regenerative practice with biodiversity integration at the core. Individual farmers are then rewarded through pooled, stacked payments from multiple partners for outperforming those shared baselines.

What would it take to change the frame?

Treating biodiversity business models as an endpoint risks mistaking commercial viability for biodiversity success. Treating them as a starting point opens a harder question: what would organizing and financing for biodiversity look like if the landscape, rather than the firm, were the primary unit of analysis?

Answering this question requires examining not only which business models attract capital, but who retains access and decision-making power once nature is reframed as an investible class — and what is lost or gained in that reframing.

Open questions remain:

• What governance can sustain landscape-level co-financing for the long-term?

• How can corporates and financial institutions act together as leverage points rather than independent actors?

• How should biodiversity business models be assessed beyond commercial viability, based on their actual biodiversity outcomes?

As private investment in biodiversity continues to grow, these questions should not stay optional extras. They determine whether biodiversity business models deliver genuine transformative change, or simply repackage familiar financial logics under a new label.

[1] Coqueret, G., Giroux, T., & Zerbib, O. D. (2025). The biodiversity premium. Ecological Economics, 228, 108435. https://doi.org/10.1016/j.ecolecon.2024.108435

[2] Gjerde, S., Sautner, Z., Wegerich, A., & Wegerich, A. (2026). Corporate nature risk perceptions. Review of Finance, Volume 30(Issue 1,), 11–42. https://doi.org/https://doi.org/10.1093/rof/rfaf050

zu Ermgassen, S. O. S. E., Howard, M., Bennun, L., Addison, P. F. E., Bull, J. W., Loveridge, R., Pollard, E., & Starkey, M. (2022). Are corporate biodiversity commitments consistent with delivering ‘nature-positive’ outcomes? A review of ‘nature-positive’ definitions, company progress and challenges. Journal of Cleaner Production, 379, 134798. https://doi.org/10.1016/j.jclepro.2022.134798

[3] Olofsson, E. (2026). Drivers of Nature-Related Investment Strategies Among Institutional Investors. Business Strategy and the Environment, n/a(n/a). https://doi.org/10.1002/bse.70598

[4] Flammer, C., Giroux, T., & Heal, G. M. (2025). Biodiversity finance. Journal of Financial Economics, 164, 103987. https://doi.org/10.1016/j.jfineco.2024.103987

[5] Heal, G. (2004). Economics of biodiversity: An introduction. Resource and Energy Economics, 26(2), 105–114.

[6] zu Ermgassen, S., Papari, C.-A., Batho, J., de Witt, S., Egli, F., Maddinson, C., Toxopeus, H., Troiano, M., Shrikanth, S., Stuart, A., Wildgruber, K., & Thompson, B. S. (2026). Business models for biodiversity (G4n8v_v1). SocArXiv. https://osf.io/preprints/socarxiv/g4n8v_v1/

[7] Toxopeus, H., & Merfeld, K. (2023). Exploring Business Models for Sustainability With Nature as a Key Resource: A Case Study of Urban Nature-Based Solutions (SSRN Scholarly Paper №4425414). Social Science Research Network. https://doi.org/10.2139/ssrn.4425414

[8] Panwar, R., Dahlmann, F., Louche, C., & Pek, S. (2026). Thinking With, Not Just About, Nature: Reimagining the Business–Nature Relationship. Business & Society, 00076503261425556. https://doi.org/10.1177/00076503261425556