Taking action for nature – investing in economic resilience and prosperity

The European Central Bank opened Finance and Biodiversity Day at COP17, stressing that while the Kunming-Montreal Global Biodiversity Framework set a clear path to 2050, progress has been insufficient. The institution called for accelerating implementation, noting that nature’s continued deterioration demands immediate action rather than further discussion. Finance was identified as central to this transition, with the ECB arguing that protecting ecosystems is not merely spending but a strategic investment in economic resilience and future prosperity.

The ECB underscored the critical role of natural capital in modern economies, comparing it to traditional infrastructure like roads and bridges. It cited estimates that up to half of global GDP depends on biodiversity and ecosystem services, while its own analysis found that 72% of euro area companies rely on at least one such service. The central bank warned that deteriorating ecosystems are already disrupting supply chains, increasing costs, and undermining productivity for firms dependent on natural resources.

The institution criticized the long-standing economic practice of treating nature as a free and inexhaustible resource, noting that this has led to the depletion of natural capital being misclassified as economic growth. The ECB argued that this approach has masked the true costs of environmental degradation, which are now surfacing as supply chain disruptions, higher production costs, and financial risks. It described this as an unfolding economic reality rather than a distant threat.

The ECB concluded that addressing biodiversity loss is not solely an environmental obligation but an economic necessity. It framed the transition as a shift from viewing nature as peripheral to recognizing it as fundamental to economic stability. The central bank called for aligning financial flows with the protection and restoration of natural capital to ensure long-term resilience and prosperity.