Triodos Investment Management is betting that nature-based solutions, still a niche segment, will mature into a full-fledged asset class within the next decade. To support that vision, the Dutch sustainable investor is launching two private funds that combined aim to mobilize more than 250 million euro for biodiversity and ecosystem restoration.
“The world is deteriorating dramatically when it comes to biodiversity,” said Karel Nierop, head of products and solutions at Triodos IM. “You can wait until everything is perfectly measurable and tradable, or start building the infrastructure today.”
Private markets as a growth path
According to Triodos IM, nature-based solutions are currently where wind and solar energy were in 2005: young, fragmented, and difficult to scale, but with clear societal drivers. Private markets offer the greatest opportunity for innovation, customization, and real impact at this early stage.
“If you look at which companies are making a positive impact on nature and biodiversity, there are very few listed companies that do so in a targeted way,” said Nierop in an interview. “So if you want to generate real positive impact, the solutions currently lie mainly in private markets.”
The first Triodos IM fund will focus on agricultural and forestry land in Europe and North America and is being set up in collaboration with Fondaction, a Canadian labor-controlled pension fund. The second fund, also scheduled for launch in 2026, will target ecosystems in emerging markets. Both contribute to the broader goal of Triodos Bank to mobilize at least 500 million euros in financing for nature-based solutions by 2030.
Triodos Investment Management currently manages approximately 20 funds with various risk-return profiles, including impact private debt and equity funds investing in listed equities and bonds. Including private banking, Triodos managed about 7.2 billion euros in assets at the end of 2024. Of that, 5.6 billion is managed directly by Triodos IM.
Tangible impact
The fund strategy is explicitly focused on tangible environmental outcomes: regenerative agriculture, reforestation, and restoration of degraded land. This requires a new vocabulary of return. “We are also setting more generic impact targets,” said Nierop. “You should think of the goal to convert one hundred percent of acquired land into what we define as regenerative agriculture or closer-to-nature forestry. You should also think in terms of specific CO2 reduction or sequestration targets.”
These sequestration targets refer to capturing CO2 in ecosystems, such as soils and forests. Triodos IM collaborates with specialized partners like Treevive in Latin America and Goodcarbon in Germany, who support the funds with impact data, monitoring, and verification. As of December 2024, Triodos reported 16 kilotons of CO2-equivalent ‘sequestered’ — roughly the same as 656,000 mature trees, according to its annual report.
Toward a mature market
Triodos’ approach aligns with broader international momentum. According to the UN Environment Programme (UNEP), the volume of private investment in nature-based projects has more than sextupled since 2020, reaching over 100 billion dollars. Meanwhile, research firm Meticulous Research projects that the biodiversity credit market could grow to 37.5 billion dollars by 2032, up from 6 billion in 2024.
Morningstar research further indicates that 61 percent of institutional investors now see ESG as part of their fiduciary duty, compared to 53 percent a year earlier.
“You can see biodiversity developing into something just as important as climate change,” said Nierop. “It is already embedded in many policy and investment strategies.”
Triodos believes professionalization is the next step: measurable impact, reliable data, and a strong project pipeline are prerequisites for attracting institutional capital. “In practice, the market decides where capital flows,” said Nierop. “And that flow increasingly moves toward companies offering solutions to the great challenges of our time.”
According to a September 2024 Morningstar report, global assets in biodiversity-themed funds have more than doubled over the past three years, reaching 3.7 billion dollars as of September 2024, with all 34 funds domiciled in Europe. While that remains small compared with the 530 billion-dollar climate fund market, the sector’s rapid expansion signals growing investor awareness of biodiversity loss as a systemic risk.