Appendix B: Full list of finance solutions for nature TABLE A2 Finance solutions for nature This Appendix contains further details on all finance solutions for nature covered in Chapter 1, excluding the priority solutions covered in the deep-dives in Chapter 2. # Solution Definition Scalability Nature impact Financial instruments 1 Sustainability-linked bonds (SLBs)Outcome-based, tradeable fixed- income instruments with coupon rates tied to meeting entity-wide environmental or social KPIs; failure to hit KPIs raises coupon rates; over-performance can trigger a decrease. High; due to ease of issuance and broad market access; achieved significant commercial scale for decarbonization purposes. Medium; outcome-based structure links financial incentives to impact, but relatively poor history of triggers and nascent track record from existing transactions. 2 Thematic bonds Tradeable fixed-income instruments whose use-of- proceeds is earmarked for specific environmental and social projects; also called green, social and sustainability (GSS) bonds. High; due to ease of issuance and broad market access; nearly $100 billion annual market in 2023 for nature- related issuances. Medium; funds are ringfenced, but major concerns over lack of returns and governance standards. 3 Commercial bonds Traditional bonds where issuers raise capital and investors earn interest; capital may, by discretion, be used for nature projects.High; due to ease of issuance and broad market access.Low; as the priority is financial returns. 4 Impact bonds Bonds that may finance nature-related projects; include concessionary/blended finance to de-risk private investment.Medium; due to transaction complexity; suited to boosting business case for nature projects given their flexible transaction size; aggregation extremely impactful; potential to scale up is strong but more limited than commercial markets. Medium to high; payout terms contingent on outcomes, but outcomes not linked to natural capital approaches; though track record is improving. Recent examples: World Bank outcome bonds,120 Rhino Conservation Impact Bond,121 Indonesia Coral Bond.122 5 Conservation notes Fixed-income product channelled to conservation projects with concessional interest, ensuring long-term conservation. Low; product is relatively niche. Medium; depends on issuer credibility. 6 Sustainability-linked loans (SLLs)Outcome-based loans with interest rates tied to borrower’s environmental or social KPIs; missed targets trigger a rate increase; over-performance can reduce rates further; may include supply chain finance. High; wide applicability and flexible transaction size; significant market size overall (>$700 billion/year), though nature labelled loans are a smaller share. Medium; outcome-based structure links financial incentives to impact and a growing track record, but concerns remain over effectiveness of triggers. Finance Solutions for Nature: Pathways to Returns and Outcomes 39

Finance Solutions for Nature 2025