At the United Nations climate conference in Cali, Colombia, the Sustainable Markets Initiative Africa Council announced a new programme called “Natural Capital on African Governments’ Balance Sheets.”
The effort aims to bring the value of forests, wetlands and biodiversity into national accounting systems, a step that aligns with the African Union’s Nairobi Declaration on Climate Change signed in September 2023.
Putting Nature Into Economic Frameworks
The initiative was first introduced at the Commonwealth Heads of Government Meeting in Samoa before being detailed at COP16.
It proposes a partnership between institutional investors and public bodies to treat ecosystems as an investable asset class.
“Africa’s natural capital forms the backbone not only of our economies, but also of global business models and societies,” said Dr Hubert Danso, co‑chair of the council.
He added that large‑scale investments are needed to protect and expand that value, and that “mandate‑aligned institutional investor‑public partnerships with governments” could generate returns that benefit people, planet and investors.
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According to the council’s documentation, the world faces an $800 billion annual investment gap for nature‑based solutions.
Current financing mechanisms are insufficient because they lack standardized methods for valuing ecosystems and do not align investor incentives with conservation goals.
Stakeholder Reactions and Planned Actions
H.E. Josefa Leonel Correia Sacko, the African Union Commission’s commissioner for agriculture, rural development, blue economy and sustainable environment, welcomed the programme.
She said embedding nature on balance sheets sends a clear signal that the continent’s natural wealth is a strategic asset for both Africa and the world, and that the approach can drive sustainable growth and resilience.
In the broader context, treating ecosystems as capital could reshape how development is financed across the continent.
If policymakers adopt these metrics, they may be able to justify larger climate‑related expenditures and reduce reliance on short‑term loans that often ignore environmental impacts.
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The council expects to reveal concrete investment commitments at the 2025 Africa Climate Summit, where international and domestic investors, businesses and philanthropies will be invited to support the initiative.
Global Implications
King Charles III, founder of the Sustainable Markets Initiative, wrote in the initiative’s foreword that accelerating sustainability across all economic sectors is essential for building a productive future.
He emphasized the need for a center to mobilize resources and incentives.
The programme’s success could influence global markets by providing a template for integrating natural assets into financial reporting.
Such a model may encourage other regions to adopt similar accounting practices, potentially unlocking further investment in ecosystem preservation worldwide.
