Can private finance help support ambitious European freshwater restoration?
New sources of funding are needed to meet the needs a growing ecosystem restoration movement in Europe, according to a newly published report.
In particular, ambitious restoration initiatives which help bring Europe’s freshwaters back to life require financial support from both private and public sources in order to fulfil their potential.
Researchers from the EU MERLIN project explored the potential for restoration managers to diversify how they raise funds to support their work. They highlight the need for creative thinking to address the ‘funding gap’ in a realm traditionally supported by public grant funding.
The report outlines that whilst private finance has the potential to support ambitious freshwater restoration in Europe, there are a number of barriers to its uptake. These include specialised language, perceptions of reputational risk, and the difficulties of writing business plans based on the financial benefits produced by restoration.
Committed programmes of communication and collaboration are needed between restoration managers and private sector financiers in order to unlock shared potential, the report states. This process should be underpinned by support programmes, pilot initiatives and expert guidance, the authors advocate.
“We have collected documentary evidence and empirical lessons from twenty cases over three years to shed light on the factors that drive and hinder collaboration between restoration teams and private capital,” says co-lead author Gerardo Anzaldua from ECOLOGIC.
“By looking at how the restoration community communicated, perceived the issues, and got involved—as well as the structures they work within—we took a different approach that adds to ongoing work on funding freshwater restoration and nature-based solutions,” Anzaldua says.
“Restoration teams show a great variety of views on the best strategies to scale up and diversify funding for restoration initiatives,” continues co-lead author Josselin Rouillard from ECOLOGIC. “Some are more equipped than others in reaching out to the private sector. Many are concerned by the resources that would be needed to effectively reach out and create lasting partnerships. Working with the private sector really requires a lot more thinking on the benefits and opportunities that restoration offers for economic activities. It really is a shift in paradigm.”
“Scaling up to a European level in a harmonised, homogeneous way, is unrealistic,” says Gerardo Anzaldua. “Restoration teams need support along their diversification journey, but the type of assistance needed is quite distinct at each stage. It starts with learning on how to communicate with the private sector, understanding their language and needs, all the way to setting up new governance arrangements to have the right accountability and reporting systems. There is no standardised ‘cook-book’, as every context is different.”
“A lot is at stake, as the risks and damages of the ongoing environmental crises are mounting fast while public budgets become increasingly strained,” adds Josselin Rouillard. “Yet there are rightful concerns about the principles and metrics that drive private funding and finance into restoration. It is thus important to reflect on what the pre-conditions are for a successful partnership between the restoration community and the private sector. Safeguards are needed, with serious consideration to possible effects in terms on ownership and access, wealth distribution, equity, and wellbeing.”
“While we focused our work on the restoration community, there is as much work on the side of private donors, lenders, and investors,” Gerardo Anzaldua concludes. “There is scope for simplifying the language but also for increasing their restoration literacy. Improving communication between the two communities is really the first step before interests and priorities can even start to be aligned.”
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This article is supported by the MERLIN project.
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