Incentivising private sector contributions to multilateral funds for the protection of biodiversity

Biodiversity underpins a large share of global economic activity, yet the finance available to protect it falls well short of what is needed. An estimated US$300 billion to US$1 trillion per year is required by 2030, compared with current nature conservation spending of around US$220 billion annually, more than 80% of which comes from governments.

Closing this gap will require greater public spending alongside new approaches to mobilising private finance. This report examines how private sector contributions to global biodiversity funds can be incentivised and integrated into core business activity rather than treated as philanthropy. Taking the Cali Fund as its primary case study, it draws lessons for other biodiversity finance mechanisms.

The Cali Fund was established under the Convention on Biological Diversity in response to the growing commercial use of digital sequence information (DSI), genetic data that is commonly accessed through open-access databases. Companies that use DSI and meet specified sectoral and financial criteria are encouraged to contribute 1% of profits or 0.1% of revenue. However, contributions are voluntary and, as of October 2026, the Fund had received five contributions totalling US$10,577.

Drawing on a literature review, interviews with DSI experts and participation in DSI Informal Dialogues, the report finds that the general business case for biodiversity does not in itself create a strong incentive for companies to contribute to multilateral biodiversity funds. Experience from other international mechanisms also suggests that voluntary contributions are more likely where the contributor base is clearly defined and companies have a strong incentive to participate.

The report identifies four complementary ways to strengthen incentives:

• Make contributions commercially visible. Better disclosure of companies’ dependence on DSI, independently verified contributor certificates and an official mark could make participation more visible to investors, customers and other stakeholders.
• Increase the cost of non-contribution. Investor initiatives could incorporate questions about DSI dependence and contributions into their engagement with companies, while clearer signals about future benefit-sharing expectations could encourage companies to prepare for stronger requirements.
• Increase the value of contributing. Contributors could receive better information about Fund allocations and results, while greater clarity over how contributions relate to national and international benefit-sharing regimes could provide greater legal certainty.
• Reduce the cost of contributing. Governments could clarify the tax treatment of verified contributions and consider targeted fiscal incentives, while carefully designed bond-linked approaches could provide another route for supporting contributions.

These measures are likely to be most effective in combination. The Cali Fund remains at an early stage, and its future trajectory will depend partly on how outstanding questions about its scope, its relationship with other benefit-sharing regimes and the incentives available to companies are resolved. Addressing these issues will help determine whether it can convert its substantial theoretical revenue potential into sustained private sector participation.

DOI: 10.21953/researchonline.lse.ac.uk.00141453