Payments for Ecosystem Services: The case of Europe and Germany

Europe’s Payments for Ecosystem Services (PES) are largely delivered through Agri-Environmental Schemes (AES) under the EU’s Common Agricultural Policy (CAP), one of the world’s largest public PES systems. Funded jointly by the European Commission and member states, these schemes compensate farmers and forest owners for adopting practices that protect biodiversity, soils, water, and climate. Implementation is decentralized: EU institutions set broad priorities, while member states and, in federal systems like Germany, regional authorities design and manage programs.

Payments for Ecosystem Services: The case of Costa Rica

Costa Rica is a global pioneer in Payments for Environmental Services (PES), managed by the National Forestry Financing Fund (Fonafifo). Since 1997, the program has paid landowners to conserve and restore forests, covering four key services: carbon sequestration, water protection, biodiversity, and scenic beauty. Its strength lies in a stable legal framework (Forestry Law 7575), a dedicated financing mechanism from fuel and water taxes, and strong partnerships with communities, Indigenous Peoples, and the private sector.

Payments for Ecosystem Services: The case of Indonesia

Indonesia uses Payments for Ecosystem Services (PES) to support conservation, sustainable resource management, and climate resilience. Programs operate at both national and community levels, linking ecosystem service providers—such as forest communities and land managers—with beneficiaries including government agencies, private companies, and NGOs. Projects focus on water regulation, biodiversity protection, reforestation, and habitat restoration, with performance-based payments tied to measurable outcomes.

Payments for Ecosystem Services: The case of South Africa

South Africa’s Payments for Ecosystem Services (PES) programs focus on watershed protection, carbon offsets, and biodiversity, with funds often channeled through NGOs and community organizations rather than directly to landowners. Funders include water users, corporate investors, and industries like mining, while beneficiaries such as Water User Associations, biosphere reserves, and conservancies implement projects that enhance water security, restore ecosystems, reduce fire risks, and promote regenerative agriculture.

Financing Nature's Adaptive Capacity

This report examines five case studies of innovative mechanisms designed to mobilize private capital into adaptive Nature-based solutions (NbS) across the world through desk research and close interviews with the managers or investment directors of the funds. The cases, which include Forest Carbon, Acumen Resilient Agriculture Fund, Landbanking Group, Impact Earth, and Wildfire Resilience Insurance, provide insights into how NbS projects and investments are increasingly recognized as adaptation investments as these two spaces converge.

Shared Principles for Growing High-Integrity Use of Carbon Credits by Companies and Other Buyers

In response to calls from businesses for greater clarity from governments on the use of carbon credits as part of corporate decarbonisation plans, the Coalition to Grow Carbon Markets has issued a clear set of Shared Principles on the voluntary use of high-integrity carbon credits to provide consistency in approach across jurisdictions. The Shared Principles establish six pillars for corporate carbon credit use, including credits derived from forest-related carbon reductions and removals.

State of Finance for Forests

The first "State of Finance for Forests (SFF) report: Unlock. Unleash. Realizing forest potential requires tripling investments in forests by 2030" provides a global overview of public and private forest finance in 2023, comparing current flows with the investments needed to realize forests’ potential to address climate change, biodiversity loss, and land degradation.

Amazonia Bond Issuance Guidelines

The Inter-American Development Bank and the World Bank jointly developed the Amazonia Bond Issuance Guidelines to provide guidance and suggestions for the issuance of capital market instruments to finance investments in projects that support the transition to net-zero deforestation in the Amazonia region and help the local population pursue better livelihoods while preserving the ecosystem.
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