McKinsey is working with Enduring Earth, a collaboration between The Nature Conservancy, The Pew Charitable Trusts, World Wildlife Fund, and ZOMALAB to accelerate ocean, land, and freshwater conservation and support community development worldwide. This effort brings together governments, local communities, Indigenous Peoples, and funders to develop accountable, actionable, and science-based conservation plans that create opportunities for sustainable economic growth.
Central to this approach is Project Finance for Permanence, an innovative and proven model that fully funds conservation efforts to ensure durable and scalable impact. McKinsey is contributing to this model through the analysis and optimization of socioeconomic impact, identifying sustainable financing mechanisms, and enabling access to carbon markets. To date, nearly 90 million hectares across five nations have been conserved with the goal of protecting another 600 million hectares across 20 nations by 2030.
We spoke with McKinsey partner Duko Hopman, who works closely with Enduring Earth, about how and why sustainable conservation efforts impact our planet and communities.
How did you first get interested in conservation?
As is the case for many clients I work with, it’s been a lifelong passion of mine. I was passionate about nature and conservation from the age of 4 or 5 years old. I was a member of the World Wildlife Fund’s “rangers,” where every weekend we would go into the woods and do what, in our minds then, was very important conservation work in the forest. I studied biology in my undergraduate studies. And I’ve tried to make conservation part of the work I do since my early days at the firm. Early on, I worked on anti-poaching efforts with governments in Africa and nature conservation strategies for Central Asian countries. And now I’m thrilled to be able to focus on important conservation projects like Enduring Earth and the Blue Nature Alliance.
The global nature crisis, though just as important, gets less awareness and action than the climate crisis. Tell us more about this.
First of all, the climate crisis and global nature crisis are incredibly interdependent. Nature degradation accelerates climate change, and climate change accelerates the loss of ecosystems. But the nature crisis is also devastating in its own right. There are estimates we are using up what amounts to 1.8 planet earths through habitat destruction, pollution, and the impacts of over-fishing and industrial activity. Obviously, we only have one planet. We have lost 68 percent of wildlife populations in the last 50 years. There are many people just like me who feel very passionate about preserving these incredibly beautiful ecosystems, but there are also economic reasons to care about this. Close to half of the world’s GDP is reliant on nature and intact ecosystems. You can see that in action with some of the clients I work with. Collapsing fish stocks are affecting people in coastal areas. Deforestation, which affects rainfall, threatens crops and our food systems. Remote local communities who rely heavily on nature suffer the consequences most directly.
What can we do about it?
In the past, a “fortress conservation” approach was common -- put a fence around an area and kick everyone out of it. That’s a very non-inclusive and violent way to conserve an area, and it’s also ineffective because you’re pushing out people who have deep ties to, and are stewards of, the land. That is the absolute opposite of what Enduring Earth is doing. Instead, it’s asking the question: How can we partner with local people and strengthen their stewardship of their land and waters? It’s about working with communities on how we can build a sustainable and highly inclusive economy that creates better conservation outcomes.
Tell us more about Project Finance for Permanence.
Traditionally, many conservation projects and programs around the world struggle annually to figure out the best way to protect an area and fund that preservation. But a short-term approach to conservation -- especially when it comes to funding -- can be risky. In difficult economic times or when there are funding disruptions, support for conservation can struggle. As a result, ecosystems get degraded and it’s very hard to build that back. That’s why keeping ecosystems intact requires a long-term, perhaps even a permanent approach.
The approach closely follows the project financing methodology commonly used in large infrastructure projects. It ensures all funding and pre-conditions for success are committed in a single deal moment, before funding is released. That means the commitments of one stakeholder, say a government, can then leverage the commitments of others, like philanthropists or the private sector, and vice versa. Early community buy-in and involvement is a very important part of the process. Communities are in the driver’s seat every step of the way. The result is funding in perpetuity and the right technical assistance for ecosystems to thrive at scale. Some of the PFPs we work on with Enduring Earth are tens of millions of hectares—the size of some countries.
What’s McKinsey’s role in all of this?
We partner closely with the Blue Nature Alliance and Enduring Earth to provide analytics and other support to inform decision making. For example, we analyze proposed conservation efforts to see which type of funding mechanisms can be designed or accessed for long-term funding. We look at a range of potential options and models, from accessing global carbon markets to innovative bond issuances. We also analyze the potential socioeconomic benefits of conservation efforts, and what needs to be in place to maximize those benefits. Take for example, the number of community jobs created through sustainable fisheries.
All of this fits in the context of McKinsey’s ambition to be catalytic in the world’s transition to become both carbon net zero and nature positive.
We help provide the data and insights that illustrate for stakeholders how these ambitious programs fit into a broader context of sustainability targets. How, for example, does a Project Finance for Permanence that includes the conservation of large coastal mangrove systems contribute to a country’s climate change mitigation strategy? All of this fits in the context of McKinsey’s ambition to be catalytic in the world’s transition to become both carbon net zero and nature positive. Conservation has an incredibly important role to play in this as does our work with corporations and countries on their journeys to become nature positive.
What excites you most about the future of conservation work?
More than 100 countries have committed to the target of 30x30 proposed by the UN Convention on Biological Diversity to conserve 30 percent of the earth’s land and marine area by 2030. This commitment is an incredible step, but it’s not just political will that makes this happen. It needs to be matched by technical expertise and funding coming together. I’m very happy McKinsey can help with that. There’s potential for huge impact and I’m excited for us to be involved.