Rampant biodiversity loss poses a growing global economic risk, according to a report released Wednesday by the Paulson Institute, the Nature Conservancy, and the World Wildlife Fund. But policy shifts, including financial mechanisms that support the environment, could reverse the trend, the groups claim.

“We’re never going to be able to calculate the full value of nature,” says Henry Paulson, former U.S. treasury secretary and founder of the Paulson Institute. “But one thing we know is that if you don’t put a value on it, its value is zero. We need to help people understand what the real cost is.”

Although more than half of global gross domestic product (or $58 trillion) is dependent on nature, according to the accounting firm PwC, the world is on track to lose up to half of all species by 2050. And there is a large gap – as much as $1.13 trillion a year – between what is currently being spent to protect biodiversity and what is needed, according to the “Financing Nature 2026” report.

Much of the world’s biodiversity is at risk, yet natural ecosystems are foundational to every national economy. A new report by environmental groups highlights how policies can make a difference.

More than 85% of the world’s wetlands are gone, according to researchers, and North America has already lost more than half its grasslands. If critical ecosystems collapse – think fisheries, timber, and others – it could cost the world more than $2.7 trillion per year by 2030.

Some environmentalists have long bucked at the idea of putting a price tag on nature, and they worry that trying to save nature by thinking about profits furthers the same mode of thinking that contributed to its degradation in the first place. But Mr. Paulson points to a number of case studies, included in today’s report, where the right economic incentives have prompted real changes on the ground.

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In England, for instance, an agriculture subsidy reform has furthered environmental stewardship by giving financial incentives for protecting soil health and other important biodiversity efforts. Croatia has created biodiversity sensitivity maps to coordinate the locations of their renewable energy development. And in 2024, Ecuador and Bank of America executed a $1 billion debt-for-nature swap, refinancing some of the country’s debt while generating more conservation funding that will help manage 4.6 million hectares of protected areas.

“People will look at protecting nature as a luxury,” says Mr. Paulson. “That it’s a niche, and it comes at the cost of our economic security, our national security, and jobs, rather than the fact that it underpins all this. It’s the foundation for our economy.”

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