In a landmark move, the International Finance Corporation (IFC), a member of the World Bank Group, has announced a significant investment in a biodiversity green bond issued by Banco Davivienda, Colombia's second-largest bank. This innovative financing instrument aims to channel funds towards projects that conserve, protect, and restore the country's rich biodiversity and natural resources.

Empowering Sustainable Development through Biodiversity Preservation

Investing in Nature-Based Solutions

The biodiversity bond proceeds will finance a range of projects focused on climate-smart and regenerative agriculture, reforestation, and sustainable freshwater and marine production. By directing resources towards these initiatives, Davivienda is poised to play a pivotal role in preserving Colombia's diverse ecosystems and promoting sustainable practices. This investment aligns with IFC's commitment to advancing sustainable finance and biodiversity protection, underscoring the growing recognition of the critical importance of safeguarding our natural heritage.

Strengthening Davivienda's Sustainability Commitment

Davivienda, a leading financial institution in Colombia and Central America, has demonstrated a strong dedication to sustainability. The bank aims to have at least 30% of its portfolio comprised of sustainable loans by 2030, showcasing its commitment to integrating environmental and social considerations into its business operations. IFC's involvement in the bond issuance will provide Davivienda with valuable knowledge, innovation, and capacity-building support through advisory services, further enhancing the bank's ability to identify, finance, and monitor biodiversity-focused projects.

Fostering Sustainable Finance Ecosystems

IFC's participation in Davivienda's biodiversity bond represents an innovative financing instrument, as it supports the second biodiversity bond to be issued globally. This landmark transaction is expected to attract interest from international investors who value IFC's performance standards and expertise in sustainable finance, thereby mobilizing resources for biodiversity protection. Furthermore, IFC's engagement with Davivienda is part of the broader World Bank Group's efforts, in collaboration with the Financial Superintendency of Colombia, to promote sustainable finance and incorporate biodiversity considerations into the country's green taxonomy.

Driving Environmental Impact and Market Transformation

The investment in Davivienda's biodiversity bond is anticipated to have significant environmental effects, contributing to the conservation and restoration of Colombia's biodiversity. At the market level, IFC envisions that this project, along with its policy dialogues and advisory services, will encourage other market participants to offer biodiversity debt instruments in Latin America and the Caribbean. This will foster the growth of sustainable finance markets and promote a nature-based economy in the region, ultimately driving a transformative shift towards a more sustainable future.

Embracing Agrosustainable Practices

Davivienda's commitment to sustainability extends beyond the biodiversity bond, as the bank actively accompanies and encourages its clients to adopt agricultural practices that promote reforestation, the use of biological alternatives for crop nutrition, the protection of native species, and the implementation of climate-resilient, nature-based solutions. The biodiversity bond will enable Davivienda to finance projects with agrosustainable certifications, further contributing to the mitigation of land-use change, the conservation of sensitive ecosystems, and the protection of wildlife.The announcement of Davivienda's biodiversity bond issuance was made within the framework of the COP16 activities held in Cali, Colombia, underscoring the global significance of this initiative and its alignment with international efforts to address biodiversity loss and climate change.