Financing a Nature-Positive and Socially Inclusive Climate Transition for Thailand

Thailand has one of Southeast Asia's most developed markets for sustainable finance. But almost all of that capital is aimed at climate alone. Nature and social inclusion are not yet built into the tools that guide it - neither the country's taxonomy (the official system that defines which activities count as green or sustainable) nor its bond frameworks and reporting. This project gave Thai regulators, banks and coastal communities the practical tools to change that.

This is a Thailand-UK PACT-supported project led by ZSL Thailand in collaboration with Sal Forest.

This project produced three knowledge products - Taxonomy Phase II Report, Transition Bond Toolkit, Transition Bond Design. Find out more below.

The challenge: Thailand's fast-growing sustainable finance market was built for climate, not for nature or people, and the sectors and communities most dependent on nature were being left out. 

At the project's start, three barriers stood out:

• limited technical understanding of what 'nature-positive' and 'socially inclusive' actually mean in a financial product;
• weak links between the regulators, financial institutions, conservation groups and communities needed to build investable projects;
• and no practical Thai example to follow.

A fourth ran through all of them: persistent inequalities in access to finance and decision-making for women, persons with disabilities, migrant workers and ethnic-minority communities.

The sectors and communities at stake

Our approach

Working alongside the Bank of Thailand, the Securities and Exchange Commission (SEC), the Department of Climate Change and Environment, and the Department of Marine and Coastal Resources, ZSL and Sal Forest took a four-part approach:

• Build capacity and a shared evidence base through two national workshops.
• Strengthen the rules with benchmark criteria, a gap analysis and recommendations to improve Thailand's Taxonomy (Phase II), plus a practical "do less harm / do more good" checklist.
• Prove the product by designing a Mangrove Restoration Outcomes Bond, an instrument, new to Thailand, that pays investors only when results are independently verified on the ground. It builds on ZSL's wider mangrove restoration work and on the Rhino Bond model, and we tested it with stakeholders.
• Share the knowledge through a set of open, reusable products and a national dissemination webinar.

Throughout, GEDSI (Gender Equality, Disability and Social Inclusion) was treated as a design parameter on every product, from taxonomy screening criteria to bond KPIs, and was held to the same standard.

Knowledge products

Three reports form the project's core knowledge products, each available to download.

Taxonomy Phase II Report and Checklist

Recommendations for strengthening the classification framework for credible transition activities. The report benchmarks Thailand's taxonomy against the EU and ASEAN systems, identifies where Phase II falls short on measurable nature and social outcomes, and includes a "Do Less Harm / Do More Good" checklist that financial institutions can use now to tell a genuinely nature-positive bond.

 Download the report 

Transition Bond Toolkit

Practical guidance for translating transition objectives into investable financial instruments. The toolkit includes an instrument decision tree, a step-by-step method for setting credible biodiversity and social KPIs that can be reused whichever instrument is chosen, and Thai and international case studies.

 Download the toolkit 

Transition Bond Design

The full design of the Mangrove Restoration Outcomes Bond - Thailand's first instrument of its kind. Sets out the KPI framework spanning ecological and social outcomes, with a subset of indicators directly linked to investor payments, and the validation findings from testing the structure with stakeholders.

 Download the report