A new type of investment bond, the ‘Rhinoceros Bond,’ has emerged. This was created to preserve the black rhinoceros, an endangered species.
The black rhino lives in South Africa, Kenya, and Tanzania and is the most endangered species announced by the International Union for Conservation of Nature (IUCN). According to the International Rhino Foundation, black rhinos decreased from about 65,000 in 1970 to 2,400 in 1995. The decrease in population is because the horns of the black rhinoceros are used to treat cancer and perform sacred rituals for African tribes.
The International Bank for Reconstruction and Development (IBRD) raised funds to prevent this decrease. This bond system raises funds to preserve the black rhino. If the number of black rhinos in the region increases five years later, interest will be paid between 3.7% and 9.2%, depending on the increase. Interest will not be paid if the number of rhinos does not change. Central governments, state-run companies, financial institutions, and companies can borrow money to carry out policies or businesses to support efforts to increase the number of black rhinos in South Africa’s Elephant National Park (AENP) and the Great Fish River Nature Reserve (GFRNR).
Pursuing profits through investing money in businesses or companies that positively impact society or the environment is called impact investing. Previously, investment in youth employment, retirement, and education received attention. However, the scope has expanded to include direct investment in public interest projects such as wildlife protection. Also, a significant change in how the environmental protection fund is being raised is drawing attention. If rhino bonds are successful, they can be expanded to financial products to protect other wild animals such as tigers and gorillas. This method could also be used to protect other species and save endangered animals.
As the world’s first rhino bond draws attention, institutional investors and individual high-value investors are interested in endangered animals. Private investing is expected to revitalize and show a positive driving force in the financial market.
