THE CONTEXT
Nature-based solutions (NBS) are being widely hailed as a win-win for addressing biodiversity loss and climate change, whilst also supporting sustainable development. The NBS concept is grounded in the knowledge that biodiversity loss and climate change have several shared drivers and hence also shared solutions. The United Nations Environment Assembly (UNEA) Resolution on Nature-Based Solutions (March 2022) for supporting sustainable development defines NBS as actions to protect, conserve, restore, sustainably use and manage natural or modified terrestrial, freshwater, coastal and marine ecosystems, which address social, economic and environmental challenges effectively and adaptively, while simultaneously providing human wellbeing, ecosystem services and resilience and biodiversity benefits. The definition does not include ‘nature-derived’ solutions, such as the use of wind, wave and solar energy, or ‘nature-inspired’ solutions, such as design of materials modelled on biological processes.

NBS range from minimal or no intervention such as establishing conservation areas, to the creation of new ecosystems, such as community gardens, urban parks, or mangroves. They represent an evolution of terms used to express similar ideas, such as urban forestry, green and blue infrastructure, or the delivery of ecosystem services. The umbrella concept of NBS also encompasses ecosystem-based adaptation, ecosystem-based disaster risk reduction, low-impact development, water-sensitive urban design, sustainable urban drainage systems, and ecological engineering. These concepts are applicable across strategic, spatial planning, soft engineering, and performance dimensions. The most frequently used of these concepts at EU level have been regrouped in an online glossary on the Resources Hub OPPLA, the EU repository on NBS.

The Nature-Based Solutions for Climate Manifesto developed for the UN Climate Action Summit 2019 calls NBS a fundamental part of action for climate and biodiversity. It cites authoritative research indicating that NBS can provide over one-third of the cost-effective climate mitigation needed to achieve 2030 climate goals by unlocking nature's mitigation potential. About 62% of this contribution is estimated to come from NBS in forests, 24% from NBS in grasslands and croplands, 10% from peatlands, and 4% from coastal and marine ecosystems. NBS are already being delivered and can be scaled up exponentially if they are fully valued and receive proper investment. The manifesto points to four areas of urgently needed priority action to ensure this:

1. Increasing and mainstreaming NBS within national governance, climate action and climate policy-related instruments;
2. Enhancing regional and international cooperation;
3. Generating the shifts needed in domestic and international governance and finance;
4. Scaling up NBS for mitigation, resilience and adaptation in key areas.

Seventy governments, private sector, civil society and international organisations signed up to the manifesto, and NBS expansion has been identified as en essential step towards achieving the goals of the UN Decade of Ecosystem Restoration. NBS underpin the Sustainable Development Goals by supporting vital ecosystem services, biodiversity, access to fresh water, improved livelihoods, healthy diets and food security from sustainable food systems. Their multiple benefits have been highlighted in UN-Habitat's new Urban Agenda 2030 and the Convention of Biological Diversity’s Biodiversity Framework (2021). They also contribute to the objectives of other international agreements, such as the Sendai Framework for Disaster Risk Reduction. The IUCN Global Standard for NBS and the EC Handbook on evaluating the impact of NBS are expected to greatly contribute to a more consistent understanding, implementation and measurement of the impact of this concept globally.

The IPCC 6th assessment report (2022) cites NBS as exemplary in demonstrating how innovative ideas can expand the climate solution space. While the mitigation role of increasing forest cover has dominated earlier discussions, the role of NBS in promoting adaptation of ecosystems and human societies is being increasingly emphasised. It points to mounting evidence that diverse, native tree species plantations are more resilient to climate change than fast-growing monocultures, often of exotic species. At the same time other natural ecosystems such as savannas, grasslands, peatlands, wetlands and mangroves have considerable value as carbon sinks as well as for other ecosystem services such as hydrological regulation, coastal protection, maintaining biodiversity and contributing to human livelihoods. It cautions against trade-offs between biodiversity, carbon sequestration and water use that can result from aggressive reforestation or afforestation, especially of non-forest land, or for the sole purpose of increasing carbon sinks through bioenergy with carbon capture and storage.

Demand for NBS is increasing globally, due largely to their mainstreaming in international policy as well as initiatives by citizens and actors who recognise their multiple benefits. Investment, however, remains a challenge. The UNEP State of Finance for Nature report (2021) estimates current global annual investment in NBS at USD 133 billion, mostly from public sources. To meet climate change, biodiversity and land degradation targets, it calls for a tripling of investment in NBS by 2030 and a quadrupling by 2050. The World Economic Forum (2020) has quantified that over half the global GDP, USD 44 trillion, is potentially threatened by nature loss while the transition to a nature-positive economy could create 395 million jobs by 2030. The UNEP report The State of Finance for Nature in the G20 (2022) builds on this report, revealing that the current G20 investment in NBS of USD 120 billion per year is insufficient, and private-sector investments are particularly inadequate. It calls on G20 countries to scale up annual NBS spending to USD 285 billion by 2050 to tackle the interrelated nature, climate, and land degradation crises on which much of our economies depend.

EU RESEARCH INFORMING POLICY ON NATURE-BASED SOLUTIONS
A nature-based economic approach is complementary to EU goals such as a Circular Economy and Bioeconomy that propose viable pathways towards sustainable development. However, while the economic relevance of the circular economy and food and bio-based industries has been extensively debated and researched, much less work has gone into examining potential economic benefits of NBS or the challenges facing nature-based enterprises (NBE) in delivering NBS. The Commission report (2022) highlighting the vital role of NBS in shifting towards a nature-positive economy is a first step in addressing knowledge gaps in this area. Based on extensive consultations, it profiles various activities where NBE are engaged in delivering NBS. It calls for increased corporate investment in NBS, further supporting as well as going beyond current Natural Capital and Circular Economy approaches. By raising awareness on crucial issues such as ‘greenwashing’ by the corporate sector, it informs recommendations for realising a robust transition to a nature-positive economy. The report is aimed specifically at economic policy-makers but is of high relevance for policymakers across multiple domains, public sector institutions and agencies, researchers, civil society and NGO representatives, investors and financial institutions, industry and NBE.

Robust evaluation of the impacts of NBS is essential for supporting practitioners in improving quality, efficiency and effectiveness at various stages of NBS implementation. The recent Commission report (2022) on Evaluating the Impact of Nature-based Solutions provides a summary of key principles in developing an impact evaluation framework, including a theory of change, and selecting appropriate impact indicators and high-quality data collection methods. The recommended indicators include climate resilience, biodiversity, water management, natural and climate hazards, green space management and air quality. The report presents four European NBS case studies with diverse geographies and challenges, thus illustrating how impact evaluation can be tailored to local contexts.

Building on the G20 report, the Commission's Nature-Based Economy working group published the draft White Paper From Nature-Based Solutions to the Nature-Based Economy (2021) calling for an increase in private-sector investment in NBS from 14% of total investment in 2021 to 40% by 2030. It proposes policy measures at global, EU, national and local government levels: systemic measures needed for long-term transformative change, as well as immediate short-term actions to boost the market for NBS. The results of the White paper consultation process will provide input for the forthcoming EC Expert Publication on the Nature-Based Economy. Systemic measures proposed at the EU level include improving policy alignment with NBS in all relevant policies and strategies; investing in research to optimise synergies between the nature-based economy and other Green Deal principles; stimulating NBS market development and accelerating take-up of corporate and SME valuation of nature. Immediate actions proposed include tripling EU NBS investment by 2030 and quadrupling it by 2050 as per the recommendations of the UN report; stimulating knowledge exchange within Europe as well as internationally, in particular for the Global South; stimulating private-sector supply of NBS; developing more comprehensive standards for NBS, and supporting platforms, networks and NBS market events.

NATURE-BASED SOLUTIONS IN EU POLICY
NBS are key to the European Green Deal, in particular the policies relating to biodiversity and climate change. The EU-BDS 2030, the new EU climate adaptation strategy and the European Climate Law prioritise NBS for addressing climate mitigation and adaptation and conserving biodiversity. Key NBS named include protecting and restoring wetlands, peatlands, coastal and marine ecosystems; deploying green infrastructure and planting trees; and promoting and sustainably managing forests, grasslands and farmland. In 2020 the EU-BDS 2030 proposed legally binding targets to restore degraded ecosystems with the most potential for carbon sequestration and disaster risk reduction. These targets are now enshrined in the nature restoration law (2022). To reverse the loss of green urban systems and improve connectivity between green spaces, the Commission has called on cities to develop ambitious urban greening plans including urban forests, parks, farms meadows and hedges, green roofs and walls, and tree-lined streets To this end it has set up an EU Urban Greening Platform under a new Green City Accord with cities and mayors, in close coordination with the European Covenant of Mayors.

The new adaptation strategy aims at more systemic adaptation centred around larger-scale NBS implementation. Given their multiple benefits and low costs, a bigger role is envisaged for NBS in land-use management and infrastructure planning. Apart from biodiversity protection, carbon sequestration and climate resilience, NBS sustain healthy soils and water quality, and reduce flooding risks. In coastal and marine areas they enhance coastal defence and reduce the risk of algal blooms. The adaptation strategy calls for improved quantification and communication of the environmental, social and economic benefits of NBS in order to enhance take-up of these multipurpose "no regrets" solutions. The Commission will develop a certification mechanism for carbon removals, enabling robust monitoring and quantification of the climate benefits of many NBS. It will continue to incentivise and assist MS in rolling out NBS through assessments, guidance and funding. Its European Business and Biodiversity initiative will pay special attention to incentivising NBS and eliminating barriers to their take-up, as part of the European climate pact,

The urgent need for improved finance and long-term investment in NBS has been emphasised in all relevant EU strategies and studies. Investments in NBS must be viable over the long-term, because climate change is amplifying pressure on ecosystems. Under InvestEU, a dedicated natural-capital and circular-economy initiative will be established to mobilise at least €10 billion over the next 10 years, based on public/private blended finance (see our thematic pages on biodiversity and finance). Targeted support can be unlocked under Cohesion Policy programmes, the European Green Deal Investment Plan and via investments, eco-schemes and advisory services in the Common Agricultural Policy. The EU sustainable finance taxonomy will help guide investment towards NBS deployment.