Addressing the financial gap requires securing investments from public and private sources.
Sept 1. Come up with a revenue generating idea, which can involve sale of a tangible product (e.g. coffee); a deal involving an intangible product (e.g. sale of carbon credits); or provision of a service (e.g. accommodation facilities). In all cases, opportunities can exist within the boundaries of the protected area or in the surrounding area.
Step 2. Elaborate the idea into a business model by identifying assets in the protected area that can be used to provide revenue for conservation, e.g. exceptional beauty, biodiversity, offsetting potential, etc.
Step 3. Conduct a feasibility study to prioritize ideas and determine whether to develop a project or not. A feasibility study explores multiple aspects of a business idea to determine if it is practical, viable and suitable for a specific context.
Step 4. Make the business case for the prioritized idea(s). A business case is intended to provide justification for pursuing a given business model. Ultimately, the business case will be used to inform investors and convince them to invest in a given proposal. It is also useful to inform partners and other actors and stakeholders involved in the development of a conservation finance project.
- Enabling legal frameworks for the business idea. Some options for sustainable financing depend on legal or regulatory measures (e.g. taxes or compensation requirements). Where these measures are not in place, it may be possible for PA managers to work with policymakers to revise relevant frameworks. However, it may take longer for this idea to actually take place.
- Strong partnerships with different stakeholders (e.g. government actors, civil society organizations, local business and communities) for developing and implementing the project.
The legal and institutional frameworks can enable or obstruct a business idea. A site may attract tourists, but if the legal framework does not allow the PA to financially benefiting from tourism (e.g. by sending entry fees to a central government budget rather than staying in the site) the idea will not address the financial gap. Therefore, it is important to ensure that the feasibility study includes a legal analysis of the business ideas.
It is essential that business models consider the needs, capacities and interests of different stakeholders (e.g. government actors at all levels, civil society organizations, local businesses and industries, and communities living in and around the area), otherwise these groups can create obstacles.
Finally, it is important to consider the cost of the process of developing and realizing the business. This includes not only the necessary initial investment, but also the time and resources needed to elaborate a business plan and undertake necessary studies and consultations. In some cases, undertaking the steps detailed here can take several years.