Interview, Fireside Chat
Investing in Nature-Based Solutions
- Global participation in the Paris Agreement and shifting investor and consumer priorities are compelling companies to publicly commit to emissions reductions, with nearly two-thirds of MSCI AQUI global equity benchmark members already declaring such targets.
- Corporate implementation strategies typically prioritize reducing emissions from operations before offsetting remaining emissions, utilizing three primary approaches: shifting to lower-carbon business models, reducing supply chain emissions, and acquiring emissions offsets.
- Specific initiatives include dedicated funding mechanisms, such as Apple's Restore Fund for carbon sequestration, alongside forestry investments designed to address supply-demand imbalances in developing economies while generating financial returns.
- Investment partnerships will prioritize operators with local market expertise and standard setters to ensure high integrity, with a focus on accountability through direct dialogue, reflecting a 20-year evolution that now rejects low-impact projects.
- The outlook anticipates continued uncertainty in reaching net zero, driving the evolution of tools, increased financial innovation for emerging business models, and a need for collaboration across public, private, and nonprofit sectors to align incentives.
- Global timber consumption is projected to rise annually due to urbanization and home building, creating a significant supply-demand imbalance in developing economies that serves as a strategic focus area for current investment strategies.