The international illegal trade in wildlife and wildlife products has reached crisis proportions and is now ranked the fourth largest global illegal activity after drugs, human-trafficking, and arms. We are facing a risk of future generations living in a world deprived of some of its most iconic species. Extinction is forever; we need to act now.
Rhinos in particular are under immense pressure. Demand for rhino horn has reached unprecedented levels. The resulting illegal trade is pushing African rhinos towards the tipping point, where deaths start exceeding births and continental population numbers decline at an accelerating rate.
These increased poaching pressures are increasing the costs of rhino conservation, such that many protected areas face funding gaps to effectively secure and grow priority African rhino populations.
Addressing this challenge requires a targeted and scalable approach that utilises innovative financing mechanisms to draw on philanthropic and impact investor capital to drive improvements in protected area management effectiveness.
‘There are some genuine stories of hope for rhinos. The sustained success of certain rhino populations where there has been significant and focused conservation effort indicates that with the right formula, poaching can be reduced and these animals can thrive.
The opportunity is to successfully navigate this current poaching crisis, and then allow these species to recover in some significant, well-protected, monitored and managed areas in Africa’s last remaining wildernesses such as the Tsavo West Intensive Protection Zone (IPZ).’ Mike Knight, Chair of International Union for Conservation of Nature's (IUCN) Species Survival Commission (SSC) African Rhino Specialist Group
“Globally threatened species deserve special attention and priority. At the same time, limits on our funding base demand innovation and ingenuity in the way resources are mobilized to conserve biodiversity at a planetary scale. The RII is one such promising approach to attract impact investors interested in concrete outcomes in rhino conservation. The knowledge being accumulated through the RII can soon be used to address conservation opportunities in Africa and elsewhere.” Gustavo A. B. da Fonseca, Director of Programs, Global Environment Facility
Rhino conservation managers are struggling to raise sufficient funds from traditional sources required for effective day-to-day management and protection of rhinos, let alone the funds needed to improve and sustain these impacts over the long-term.
Creating long-term financing solutions for conserving species and engaging people through developing livelihoods will depend on changing the way conservation is funded.
In response, the Rhino Impact Investment (RII) Project is conducting a three-year testing phase, which began in 2016, to assess the feasibility of using outcomes-based financing to ensure long-term funding for critical conservation areas, using rhinos as an initial focus.
‘Lack of funding is one of the biggest barriers to successful rhino conservation and that is where the RII Project comes in. Attracting novel funding sources to address global rhino issues, while simultaneously professionalising the way that conservation designs, delivers and reports on its impact will encourage a sector-wide evolution from box-ticking to delivering results’. - Chris Gordon, ZSL Kenya Country Manager and RII Project Pilot Site Manager
The objective is to transform conservation by demonstrating an outcomes-based financing mechanism that is scalable - a way to direct additional funds to effectively improve the management of priority rhino populations.
The outcome will be to launch an investment product that will drive impact-focused and cost efficient growth in rhino numbers.
Through the RII Project outcomes-based financing model, an evidence-based approach to management planning and other data-supported interventions inform a theory of change which links rhino conservation outcomes clearly to investor pay-out, and investment success.
The RII Financing Mechanism directs impact investment funds toward selected sites to finance management interventions for rhino conservation. The investor assumes the risk of the investment based on an understanding or measurement of the risk and uncertainty associated with the interventions.
A Key Performance Indicator (KPI), net rhino growth rate, is used to inform the conservation outcome. A secondary set of interim KPIs are utilized for short-term payment triggers, based on the assumption that short-term KPIs influence the ultimate KPI. Based on the conservation outcome (measured by the KPIs), the outcomes-payer pays the impact investor back the original investment plus or minus a percentage relative to conservation outcome.
Unlike traditional fundraising models, the design of the RII model demands an outcomes-based approach to address conservation challenges. Anchored on metrics and evidence, this model drives stakeholders to critically analyse and understand conservation issues, define progress and focus on results, shifting focus from outputs to long-term impacts.
“Creative ideas for generating incremental, more efficient, more impactful, success-driven conservation finance must be designed, tried and tested: the RII Project is doing just that and holds significant potential for creating an exciting new asset class capable of engaging new and more diversified capital markets into the conservation sector.” Giles Davies, Senior Partner and Founder of Conservation Capital, the RII Finance Manager
This ground-breaking conservation finance initiative will offer outcomes-payers and impact investors the world’s first species specific outcomes-based funding mechanism.
Working with Kenya Wildlife Service (KWS) and Tsavo Trust, the RII Project is testing rhino conservation interventions in Tsavo West National Park in Kenya to monitor and understand metrics that will critically underpin the development of a rhino outcomes-based financing mechanism.
Tsavo West National Park, under the management of KWS, is in the southeast of Kenya, and is part of the Tsavo Conservation Area, a massive 48,000-km2 wildlife area. Tsavo is arguably the most important protected area network in the country, supporting a diverse range of species and a Key 1 priority rhino population of Continental Significance as categorised by the IUCN SSC’s African Rhino Specialist Group.
The pilot results, thus far, not only support the feasibility of an outcomes-based financing mechanism but have also delivered critical rhino conservation outcomes in Tsavo West.
‘Tsavo is a vast wilderness, one of the few remaining in Africa. We’ve seen some incredible progress since the start of the RII Project, and the momentum that is gathering will help restore this landscape to the major wildlife area that it was in the 1950s’. Dr Richard Leakey, Chairman of the KWS Board
Realising this potential requires securing of the IPZ through better law enforcement, monitoring, intelligence gathering and community engagement.
RII Project interventions have also targeted training and improved infrastructure, including water and fire management, to create an enabling environment for effective rhino management.
This in turn has improved the lives of the people on the front line of rhino conservation in Tsavo West and fostered an increase in staff motivation and morale.
These interventions will enable KWS to use other Kenyan rhino sanctuaries as founder populations for stocking rhinos into this important rhino habitat as part of a national meta-population management approach.
Maximising black rhino population growth rates through good habitat and population management will provide sufficient rhinos for stocking the surrounding IPZ. Ensuring optimal rhino reproduction rates is critical.
By supplementing the current small IPZ population, with significant numbers of rhinos from other sanctuaries, achieving a 6% growth rate target (compared with 2% growth at present) will have a massive impact on growing both Kenyan and global black rhino numbers.
And by boosting overall growth rates and numbers, the buffer against poaching will be increased.
RII Project interventions to deliver improved security, monitoring, and park operations have important impacts more broadly for habitats, tackling threats, and protecting other species.
Over 60 mammal species, including the ‘Big Five’ (lion, leopard, rhino, elephant, and Cape buffalo), and over 400 avian species have been recorded in Tsavo, including many threatened species. It also contains the largest population of elephants in Kenya, ≈35% of the National population. Tsavo constitutes 50% of Kenya’s National Parks land area and generates revenue that not only supports Tsavo but also helps to fund smaller and less visited protected areas across Kenya.
Excitingly, if there is demonstrable success for a rhino outcomes-based financing mechanism, then there is scope for this approach to be scaled to finance other species, such as elephants, and even protected area outcomes.
The co-ordinated, collaborative, and cross sector approach of the RII Project and the challenges addressed and successes achieved will create a valuable knowledge base for the field of conservation finance going forward.
The Rhino Impact Investment RII Project is an initiative of United for Wildlife, an unprecedented partnership between seven of the world’s leading wildlife charities and The Royal Foundation of The Duke and Duchess of Cambridge and Prince Harry.
Implementation of the Rhino Impact Investment Project is led by the Zoological Society of London (ZSL) and the Project is funded by the Global Environment Facility, the UK Government through the IWT Challenge Fund, United for Wildlife (UfW) and ZSL. The United Nations Development Programme is the GEF Agency acting as the operational arm of the GEF to implement and execute Project activities consistent with both the GEF mandate and national sustainable development plans.
The Rhino Impact Investment Project receives implementation support on technical conservation, conservation finance and legal from Implementation Partners including Credit Suisse, DLA Piper, Fauna & Flora International (FFI), the IUCN SSC African and Asian Rhino Specialist Groups (AfRSG and AsRSG), Kenya Wildlife Service (KWS), The Nature Conservancy (TNC), UBS and WWF-UK.
Conservation Capital, a leading specialist practitioner in the field of conservation enterprise and related conservation investment financing, is the Finance Manager of the RII Financing Mechanism. With operating hubs in the UK, South Africa and Kenya, Conservation Capital has helped mobilise and structure more than US$220 million of finance into enterprise driven conservation projects across more than 25 countries – primarily in Africa and Europe.
This story was originally published by UNDP.
Story: Oliver Withers, Chris Gordon, Andrea Egan, Penny Stock, and Midori Paxton. Photos: ZSL Kenya and Burrard-Lucas Photography.