Digital Biodiversity and Finance: South Africa is a party to the United Nations’ Convention on Biological Diversity (CBD) and has been since 1996. South Africa is, in line with its international obligations, required to implement the various obligations agreed to under the CBD, as amended from time to time. As a result, the obligations arising from the CBD will inform South Africa’s future laws and policy changes regarding Biological Diversity; and
The 16th meeting of the Conference of Parties regarding the CBD was concluded in November 2024, wherein key issues surrounding biological diversity were discussed and agreed upon. These changes include:
- Adoption of new biodiversity conservation targets, focusing on restoration and sustainable use of ecosystems;
- Agreement on digital sequence information (DSI) frameworks to ensure equitable access and benefit-sharing;
- Enhanced commitments towards financing biodiversity conservation and integrating nature-based solutions into climate action.
The connection between biodiversity conservation and climate action can be better understood as the climate crisis worsens. Among the key emerging concepts in this area come digital biodiversity and biodiversity finance. Countries strive to reach their biodiversity and climate goals, opening up opportunities and challenges presented by these novel approaches, which ultimately shift the pace of conservation initiatives. This article will elaborate on how digital biodiversity and finance are important in any conservation effort and in fighting against climate change with effectiveness.
What is Digital Biodiversity?
Digital biodiversity involves the collection and application of genetic and biological information through digital modalities, more often than not involving the use of Digital Sequence Information (“DSI”). Applications have ranged from basic research to commercial utilisation in the development of new pharmaceuticals, among other applications, to crops resilient against the vagaries of climate change. Core solutions on digital biodiversity for climate change include:
Genetic Resources for Climate-Resilient Agriculture
Such climatically resilient crops are impossible to achieve without DSI. For instance, genetic information from wild relatives of plants can be used in breeding crops tolerant of extreme temperatures and drought – growing consequence of climate change.
Restoration of Biodiversity
By using digital biodiversity information, researchers and policymakers would be aware of the genetics involved in the endangered species to thus institute restorative programs in that regard. This aids in the development of climate-resilient ecosystems that sequester carbon in an efficient manner for the climate mitigation process.
Ensuring Equity in Access and Use of Digital Biodiversity
Multilateral Benefit-Sharing Mechanisms
As such, an agreement was reached at COP16 to establish a multilateral mechanism that provided countries with benefits sharing arising from the utilisation of digital biodiversity. For example, this allows countries that have rich biodiversity to receive fair and decent compensation when part of their genetic resources is put to commercial use in other countries. This would thus provide an incentive for conservation and fair representation in response to climate change.
How Benefit Sharing Supports Climate Adaptation
These mechanism revenues can, in turn, be used to support communities living in areas of high biodiversity to adapt to the effects of climate change. The fact that they can deal with climate-related issues often makes them more vulnerable, and their compensation must be carried out in a just manner as a means of supporting their response strategies.
The Role of Finance in Biodiversity and Climate Conservation
Bridging the Funding Gap
Target 19 of the Kunming-Montreal Global Biodiversity Framework calls for the mobilisation of $200 billion annually for biodiversity conservation. Unfortunately, funding stands below this target currently. Biodiversity financing is urgently needed to underpin conservation that contributes simultaneously to addressing climate change, such as reforestation and protection of marine habitats.
Integration of Biodiversity and Climate Finance
Together, biodiversity finance and climate finance could lead to a more complementary and better use of resources. For instance, restoration projects related to the mangrove forests might receive funding from both biodiversity and climate finance, since these would offer dual benefits: protecting the coastal ecosystems and acting as carbon sinks.
Emerging Solutions: Biodiversity Credit Markets
Voluntary Biodiversity Credits and Climate Action
But with increasing agreement that voluntary biodiversity credit markets are one important means of unlocking private sector investment in biodiversity, this works very much like carbon credits. Companies can offset their environmental impacts by investing in biodiversity projects. There’s a very clear positive impact on climate action; in helping to restore and protect biodiversity, companies also contribute to better carbon sequestration, which is crucial in addressing climate change.
Challenges in Scaling Biodiversity Credit Markets
In its place, notwithstanding enormous potential, the market is riddled with challenges: standardisation and accountability lie at the heart of most contentions. Regarding biodiversity and climate goals, for markets to be linked with a regulatory and monitoring system, credibility of issued credits must be guaranteed.
Nature is Linked with Climate and So Are the Solutions
Nature-Based Solutions as a Common Ground
Nature-based solutions involve afforestation, restoration of wetlands, and land-use practices that are an integral part of dealing with interlinked crises related to climate and biodiversity. For instance, the restoration of degraded forests will help protect many species and capture vital carbon that will be essential in the fight against climate change.
Nature-Based Solutions See Increased Investments
These were calls that were only consolidated by the just-ended COP16 Conference as the only means through which one can confront the challenges brought about by the climate crisis. In addition to being cost-effective, these approaches come with numerous other benefits that include improved biodiversity, improved regulation of the water cycle, and improvement in resilience against extreme weather events.
Fostering Collaboration Between Sectors
Private Sector’s Role in Biodiversity and Climate Conservation
The private sector will, consequently, be taking the lead in these two agendas: biodiversity and climate change. It is through investment in digital biodiversity and biodiversity credits that businesses can meet their set sustainability goals while being able to contribute to bigger climate initiatives.
Policy Support for Integrated Conservation Efforts
This is where policymakers come in, and they need to create frameworks that will encourage integrated approaches towards biodiversity conservation and include biodiversity and climate finance. Such policies will enable a holistic approach to address linked challenges: biodiversity decline and climate change.
South Africa’s Role in Advancing Conservation Strategies
Digital biodiversity and biodiversity finance are increasingly critical tools in addressing the twin crises of biodiversity loss and climate change. Equitable access to genetic resources, new streams of funding and support for nature-based solutions all offer pathways to a more resilient future for people and the planet. The outcomes of COP16 point to the need to convert these innovative strategies into concrete actions that involve all sectors -government, business, and local communities, in fulfilling South Africa’s obligations under the Convention on Biological Diversity and advancing effective conservation strategies.
For expert legal advice and guidance on navigating biodiversity regulations and benefit-sharing mechanisms, reach out to Bishop Fraser Attorneys today.
