FINANCING ECOLOGICAL RESTORATION:
A New Renaissance
“It was painful to watch nature be destroyed and indigenous tribes exiled from their land. It angered me”
The Renaissance marked a departure from the feudalist tenets of the Middle Ages and galvanized Europe with breakthrough ideas in science, politics and art. A new humanist view of man and revolutionary technologies such as the printing press transformed society and improved the lives of millions. According to Willem Ferwerda, founder and CEO of Commonland, modern society is at a similar crossroads, in which man is moving from the wanton destruction of our planet to a more enlightened, long-term care for our ecosystems. With its proven approach to landscape restoration, Commonland hopes invite communities, farmers and financiers into the age of ecology.
A tropical biologist by training, Ferwerda has witnessed how man’s insatiable desire for economic profit wreaked havoc on the ecosystems of his beloved Colombia. Later, he became the director of the Dutch office of the International Union for the Conservation of Nature, which publishes the infamous red list of species threatened with extinction. “It was painful to watch nature be destroyed and indigenous tribes exiled from their land. It angered me, but I was also frustrated by how nature conservation is funded by donors pursuing short-term political goals. I realized we needed to alter the economic model.”
In dialogue sessions with CEOs from large corporations, however, Ferwerda found that shareholder value and short-term thinking remained the norm. Undeterred, he left the IUCN and took a sabbatical to find a way to incorporate biodiversity into a business model. First, Ferwerda asked farmers and investors in 15 countries about their dreams and frustrations. “Farmers were frustrated the pressure to make a profit made it impossible for them to transfer their land to the next generation in a better shape. What they wanted instead, was to both produce and improve the landscape at the same time. In turn, investors found their children blamed them for investing in the destruction of the planet, while there were not enough bankable restoration projects around. Investors wanted to be able to look their children in the eye and have more and larger projects.”
The result of Ferwerda’s exploration is a holistic framework in which various stakeholders work together to pursue four returns. Rather than starting with technology or finance, the model puts people first by seeking the return of hope, inspiration and purpose, because “landscapes are the mirror of the soul.” In addition, the model pursues returns on social capital, for example in the form of jobs, education and natural capital, or the restoration of biodiversity and the quality of water and soil. Finally, the model strives for long-term sustainable profit.
These four pursuits lie at the heart of Commonland, which Ferwerda set up in 2013. Commonland does not finance restoration projects itself, but catalyzes them by bringing together local governments, communities, businesses, farmers and NGOs. Using the Theory U change management methodology, the usually-polarized perspectives of these stakeholders are bridged, and a shared vision and zoned landscape restoration plan are co-created. Once the plans are signed off, a separate organization with its own team of local experts is set up for the restoration project, in which Commonland and the stakeholders participate. Once the direction and plan for an area are clear, the partners begin to seek funding from investors, philanthropists and DFIs. What is key here is the timeframe, which is at the heart of the Commonland approach. “Our projects have a minimum investment timeframe of 20 years, which sounds long but is realistic from an ecological point of view. For example, it takes at least 10-15 years to restore monoculture agriculture landscape to an ecologically diverse form.” For investors who consider an 8-12 year timeframe ‘long-term’, it will take some getting used to, but Ferwerda believes the longer timeframe actually creates trust among stakeholders.
“We have spent 250 years creating financial capital at the expense of people and nature, but I believe we are experiencing a renaissance and have entered the age of ecology”
Commonland’s approach has been tested in several countries, including an agroforestry program in central India, a dryland restoration initiative in Spain and the 125,000 hectare restoration of a peat meadow landscape in the Netherlands. A project set up in Australia has even become so successful it was listed on the stock exchange, where its value has quadrupled. These initial successes are now inspiring other organizations to follow suit, with Wetlands International adopting Commonland’s model in 2021. Commonland’s ambition is to transform 100 million hectares of degraded landscape by 2040 and, through that, to contribute to the Sustainable Development Goals, which are all linked to how people live and work on the land. The two main obstacles to realizing this are that fact that institutions, the regulatory environment and corporate culture are not designed for landscape restoration, but also due to the lack of process financing. “It costs around €10 million to cover the development costs of one landscape project. DFIs and other large investors have the means to cover the costs for 20 years, which would lower risks and make it easier for other investors to come on board.” In spite of the doom and gloom around climate change and the loss of biodiversity, Ferwerda remains optimistic about the future of our ecosystems. “We have spent 250 years creating financial capital at the expense of people and nature, but I believe we are experiencing a renaissance and have entered the age of ecology. It will take some time, but gradually our economies and regulatory systems will adapt, especially when DFIs and other large investors incorporate our model into their own. I have hope.”