Show Notes: Shifting political priorities and economic pressures over the past couple of years have seen several countries scale back climate commitments contributing to the growing gap between climate pledges and real-world emissions (still rising).

What does this mean for a ‘Just Transition’ and Net Zero? While there is no silver bullet, IUCN and UNEP emphasise Nature based Solutions (NbS) can be pivotal for climate mitigation and adaptation, when pursued alongside rapid decarbonisation globally.

To discuss NbS, and climate change I recently caught up with Swapan Mehra a global leader in climate action and ecosystem conservation. In this deeply insightful conversation Swapan spoke about how NbS is a holistic approach to addressing the climate crisis, through a spectrum of actions designed to protect and restore ecosystems while simultaneously delivering co-benefits for biodiversity, communities and individuals. We also spoke about…

👉🏾 How NbS are fundamental in agrarian contexts like India, where communities are inextricably linked to their natural environments.

👉🏾 The practical implementations of NbS in India's Nationally Determined Contributions (NDCs), that highlight the ambitious targets set for increasing forest carbon stocks by 2.5 to 3 billion tons by 2030

👉🏾 The challenges to adoption by the private sector

· Lack of standardised financial mechanisms, regulatory hurdles, and insufficient data and knowledge about NbS performance and returns

👉🏾 NbS frameworks including IUCN; Voluntary carbon markets integrity initiative

👉🏾 Investor expectation vs reality

👉🏾 Voluntary carbon markets, carbon credits and greenwashing

We also spoke about India’s carbon trading and green credit scheme, leadership commitment, the impact on SMEs, projects he is particularly proud and being a climate optimist……

“To me, just transition means ensuring that climate action doesn't come at a cost of life, livelihoods, equity, inclusion, but rather climate action promotes life, livelihood, equity, inclusion. In the context of the global south, especially India, where our communities have such a direct relationship with nature, with our landscapes, this means putting farmers first, indigenous communities first, it means ensuring investments which are locally contextualized to the needs of the communities and ensuring that a large part of the benefit flows to them. These are communities who have not played a major role in actually causing climate change, and now yet we are dependent on them to solve the problem for us.”

Episode Transcript:

Sudha: Good afternoon, Swapan. Wonderful to catch up again after a long time

Swapan: Good afternoon, Sudha. Very good to catch up.

Sudha: Let's get started with a quick introduction. Tell us a bit about yourself and IORA Ecological Solutions.

Swapan: Sure. So, firstly, thank you for having me on your podcast Sudha. I'm Swapan Mehra, I'm the founder and CEO of IORA Ecological Solutions. IORA Ecological Solutions is a leading developer of nature-based solutions, policies, implementation plans and action on ground in India. Over the last 15 years, we worked across 200 projects in the areas of forest conservation, forest restoration, and sustainable agriculture, while also helping India and many other countries develop leading policies to not only plan action on climate change, but also execute this action through financing and technology. Our mission is to make nature count, our mission is to ensure that there is holistic conservation of nature, of biodiversity and the communities who depend on nature.

Sudha: That's very, very interesting.

So, from our previous conversations and what I've read about IORA, I understand that, like you said, nature-based solutions for climate mitigation adaptation are pivotal to the work that you do. So what counts as nature-based solutions and why are nature-based solutions crucial to tackling climate change?

Swapan: Well, that's a great question. So nature-based solutions is a broad category of actions which in summary are actions that can protect, sustainably manage, and restore modified ecosystems while providing the core benefits of biodiversity, climate mitigation, climate adaptation, human wellbeing. Some examples of nature-based solution include afforestation, reforestation forest conservation, mangrove restoration soil and sand, enhancement, et cetera.

Now, why are nature-based solutions gaining a lot of traction? I think there are multiple reasons. One is that it's mildly accepted that nature-based solutions have the capability to deliver close to 30% of all mitigation actions, which are needed to stay below the two degree levels, which are enshrined in all of the global NDCs by 2030, a third of the actions.

The second reason is that nature-based solutions, like I mentioned earlier, deliver a lot of core benefits, versus any other solution, I'm not saying that our nature-based solutions are more important or less important than technology-based solutions. But as compared to other solutions, these core benefits of nature-based solutions are immense, especially in an agrarian vulnerable country like India.

If you're able to restore lands, restore water bodies, aforest, it can help tremendously in reducing climate risk for communities, helping creating jobs, help in ensuring livelihoods are sustained. Lastly there are two kinds of climate actions that we broadly have been all working on in the last few years.

One is actions that lead to avoidance of emissions. Second, which lead to, removal of emissions, which are already out there. While renewable energy and such categories, which have gained a lot of investment in the last few years, which is critical to the global pathway of decarbonisation, we all agree that there is already a lot of emissions out there, which are already starting to warm the globe, the process has already started. This is now a well-established fact, which means that we also need to balance this out with a lot of removals.

In the removal space, nature-based solutions have a distinct advantage also of being cost effective. Industrial removals, carbon capture are still very expensive, given that nature-based solutions have the ability to remove at a fair price locked carbon for periods of 30, 40, 50 years, which is what the world needs to move towards, net zero technologies and their core benefits. This is the reason why nature solutions are gaining a lot of traction and attention now.

Sudha: Yeah, my, first interaction was at the Planet Cognisphere event and so it's interesting to see, that it prioritizes not just, removals, but it prioritizes communities, and it looks at community impact and the cost of doing this entire process, because who's going to finance, where's the money going to come from?

So I think we definitely need low-cost innovations, and this sounds like a great way, to approach and, address the challenges. So, the NBS have been, incorporated into the NDCs as a part of the country's strategies, and you have helped develop India's National REDD+ strategy.

Tell us a bit more about it.

Swapan: So, yeah, Sudha most countries now have a major component of nature-based solution in their NDCs, this includes major budgets for afforestation, for reducing deforestation, and even in some cases for reducing emissions from agriculture.

So those components are there in various NDCs. India where we've had the pleasure and the privilege to be helping the Ministry of Environment Forest, making a roadmap for the NBS part of its NDC, has a major target to increase carbon stocks in India's forest and tree cover by two and a half to 3 billion tons by 2030, which is a major target.

Now, NDC targets are also slightly related to this instrument called REDD plus. REDD plus is an instrument which is being developed by the UN, in an effort to reduce emissions from deforestation, forest degradation and also to enhance the quality of the forest, the plus stands for Sustainable Forest Management and Enhancement.

REDD Plus has been under development for many years, the World Tree Carbon markets have adopted REDD plus in various forms, and there have been many projects, many initiatives. We had a chance to develop India's National REDD Plus policy and guidance document back in the day. Now there are also some challenges when it comes to REDD plus.

REDD plus is a very critical instrument. I especially feel that it needs to be promoted more and more because there is a distinct advantage of conserving existing good forest over creating new forest. I'm not saying creating new forest is not a good strategy, it is, but the true system service is the biodiversity, and very importantly, the culture and heritage enshrined in existing forests.

In order to regain that, the process for a new forest can span century.

I'm not remembering the number exactly, but from what I recall, I think less than 10%, 15% of the worlds intact forest is left now. Most of it is gone. These forests also play a very major role in regulating very major climatic and and weather cycles around the world. Water cycles, et cetera. And which is why REDD Plus as an instrument continues to be in dialogue, in discussion, and various people try to figure out how we can, promote this further.

In the context of India one of the reasons why India takes a very strong view of NBS and its NDC and has this major goal on increasing forest tree carbon stock - is also a recognition of the fact that firstly India's land, has high productivity can grow forest, traditionally has had a lot of forest, still maintains a large amount of forest, close to 25%. It's critical for India's biodiversity, it’s critical for India's water, but very importantly, India has close to anywhere between three to four hundred million people who are still directly dependent on a forest for their livelihoods. For us, maintaining this forest, enhancing this forest is critical for our social development, for our social growth and inclusion of our communities as well.

Sudha: Absolutely. I think I was staggered when I realised the scale of the population that is dependent on forest and forest-based livelihoods.

So it's good that there is a strategy that exists at the national level. Swapan what has been your experience of adoption by the private sector and what are some of the challenges of adoption of NBS by the sector?

Swapan: We interestingly with the World Economic Forum and CII did a survey of the Indian private sector a few months ago on their appetite and challenges in adopting NBS as a strategy central to their sustainability, climate change, et cetera. So I'll summarize some of the results from that survey, but also some of my observations over the years.

One thing that I can clearly mention is that there is growing interest in the private sector to look at NBS, either as a strategy to help them offset their climate and biodiversity footprint, or to offset some value chain risk. But a wide majority of corporates, especially in India, still view NBS as something that they need to address or they can address as part of their corporate social responsibility and not core strategy. Which is a challenge and I think that this is also where our community, the community of nature profession, needs to do a lot more to get these companies to mainstream nature on their balance sheet. To value the liability of negative nature impacts, but also value positively the gains from positive nature stewardship, which in our experience, far outweigh investments because the gains from nature are so multifold.

I also feel that even to head in that direction, while there is interest from companies, there are also certain systemic barriers, some institutional barriers that we need to take care of, amongst them, one is just the availability of tools data metrices.

There is a wide range of different standards available, but there is no standardisation. That's something that we need to work on. India actually is taking a leadership role in that space, with the government firmly taking control of sustainability, reporting standards, et cetera, but we need to do more.

There needs to be data and metrices available today if there is a company which wants to put biodiversity impact on its balance sheet, where do they get the data for? We don't have site specific information easily available. Then there is also a challenge of, I would say talent in this sector, more and more people need to be trained on how to account for all of this. In terms of investing in nature, in the survey that I mentioned earlier, there were some very interesting responses that finally, when you deal with investments in nature, you're dealing with land, with communities, with governments, and there needs to be more regulatory clarity changes in policies that allow the private sector to invest in nature, which at the moment is not very straightforward. Then of course, even if those things are clear, the one thing that the private sector needs to reorient their investment systems around is just the way you invest in nature, the system of investment in nature, because these investments are very long term. If you want to invest in a forest, you need to wait for 15 years for it to grow.

There is some uncertainty. Uncertainty about and risks of nature, which at the moment our corporate systems are not tuned to value, you know?

There is mortality, there is pest, there is a climate event. So I think that's where we are right now. There is to summarize increasing interest, but still on the margins, looked at as some companies have taken a leadership role and are investing heavily, but many look at this as sort of an additional corporate social responsibility, investment versus core strategy.

And that's what we need to now push nature towards.

Sudha: I think, you've made some really good points there, especially about understanding and getting it to be as a part of the strategic business decision rather than a CSR initiative and an add-on that you do to just talk about philanthropy or your piecemeal efforts.

And it has to be probably at the design stage and the C-suite have to be involved in discussions around how they adopt it and how they showcase the liability on their balance sheet or show stewardship of what they're doing. And how it, aligns with their business purpose because at the end of the day, you're not asking them to do something that doesn't align with how they're doing their business. It has to be aligned and integrated with how they're doing their business for this to be sustainable, and to be successful in the long-term.

Right?

Swapan: Absolutely. Absolute.

Sudha: So is there a framework or best practice? You mentioned, you know, India's taken a lead on setting standards and sustainability reporting. But is there a framework or best practice for organisations that want to adopt NBS as a part of this strategy, to offset GHG emissions?

And how do you ensure then that the communities benefit from projects and programs? Like you said, when companies look at community programs, it is through the CSR lens and it is not strategic at all.

Swapan: So firstly, at a meta level, there are some, global frameworks for NBS, amongst them the one that is most widely referred to is the IUCN framework, which actually lays out quite well what are the components of NBS, how to approach NBS and how to develop NBS solutions. Then in the carbon market, there are good practices which are laid out by the carbon standards, but also bodies like the, Voluntary Carbon Market Integrity initiative in which we are involved, and the ICVCM, et cetera, which are trying to focus on good practices to ensure that there are high standards of carbon removals from nature projects in general. A good NBS strategy must integrate firstly, robust baselining assessment of local contextual needs of a specific side that you want to invest or work in. This is very critical.

This requires comprehensive thinking and planning, small things such as which species you're planting, where in combination with which is something that has to be thought through, has to be suitable and beneficial to the community there.

The projects have to ensure that there is fair benefit sharing with communities, with long-term interest, and their priorities are taken into account when taking decisions on designs of these programs. For us at Iora benefit training is not merely a checkbox that you just do an activity, get consent and move on, it's actually the foundational centrepiece of these projects. As an example, in our project in Meghalaya, where we just done the first carbon payments to communities and mind you the highest prices in India, 40 Euros. We've spent two years in engaging the communities, getting the priorities and planning the agroforestry model, and we ensure that, a very large portion, a wide majority of the carbon benefits goes to farmers. In fact, it's IORA's policy that piece is centred to design of the project.

Sudha: As a climate finance expert, what has been your experience of what attracts investors to these projects? Because investors are critical, right?

Swapan: So investors are looking for scalable, verifiable high-quality nature-based projects, which can have both sound, environmental and financial returns. That's what investors are looking for and in defence of the investors, the project pipeline also is thin. Like projects which combine all the elements of proper planning, proper baselining, the right science parameters, the right financial parameters are also difficult to come by, but that's what investors are looking for. One of the mismatches I think that's happening a lot is the investors expectation of the time horizon of return versus where actual projects can return. The really good quality nature projects require a much longer time...