A financial framework for nature must that recognise that ecosystems have local temporal and spatial dynamics

William D Pearse, Franklin Allen, Simone Cenci, Hao Liang, Olivia F. Morris, N J Pates, Eleanor M Slade, Lucy Somekh, Enrico Biffis

Decades of research and politics have led to a coherent set of biodiversity metrics and strong evidence that biodiversity supports human well-being. So why do we not have a financial system that encourages conservation and restoration of nature? We argue that a central reason is that the financing used has not been aligned with the spatial and temporal structure of biodiversity. Ecosystems are 'local': strongly shaped by the propagating consequences of interactions through time and across space, such that measuring or predicting biodiversity in any one region requires context from nearby regions and prior ecological processes. Not all financing methods are local, and joint biodiversity-finance approaches that do not account for ecosystems' locality cannot succeed. This mismatch helps explain why biodiversity crediting markets face persistent design problems, and why advances in monitoring or AI, while valuable, cannot by themselves resolve the challenge. We therefore argue for coupled ecological-financing methods that respect ecological locality, non-fungibility, and time-horizons. Drawing on case studies of finance-based interventions, we outline modifications to existing frameworks and argue that biodiversity finance is likely to require new intermediary institutions, potentially including nested global and regional systems of financial institutions.