Imagine this: a large pharmaceutical company is on a quest to develop treatment for an emerging disease. The company has access to large databases like GenBank, containing information on the DNA of hundreds of thousands of plants, animals, microorganisms, even viruses. The company combs through that data, conducts laboratory and clinical research, and finds the vital genetic components that help them produce a new drug and make a multi-billion-dollar profit.
This is already the reality.
However, the countries and communities that safeguard the unique web of life that the databases draw from have rarely benefited. With the new Cali Fund – established under the Convention on Biological Diversity – this is about to change.
The fund just celebrated its one-year anniversary and is now fully operational. Here are six things to know about this ground-breaking instrument.
What is digital sequence information?
In the past, when people wanted to make use of the natural properties of living things they would need to find a sample. For example, a researcher might trek through the semi-arid expanse of Africa’s Sahel region to locate a drought-tolerant plant they could crossbreed with local flora.
With the march of technology, this has changed. Now, there are massive online databases filled with the genetic sequence data that makes every living organism unique. This is known as digital sequence information. Researchers can study the traits of plants, bacteria, fungi and other species from the comfort of their laboratory (or couch).
Artificial intelligence (AI) helps analyze patterns across large volumes of sequence data in record time, increasing the likelihood of hitting upon a potentially profitable discovery.
Who governs digital sequence information?
Although it is often used by pharmaceutical companies, cosmetic makers, agri-food conglomerates and other private businesses, digital sequence information is a public good. Countries have been clear: the benefits from these genetic resources should be shared fairly. At the 15th Conference of Parties to the Convention on Biological Diversity in Montreal, Canada, 196 governments established the Multilateral Mechanism for the Fair and Equitable Sharing of Benefits from the use of Digital Sequence Information.
This agreement is a follow-up to the Nagoya protocol, which governs benefit sharing of physical organisms. In a world of ever more powerful computers and AI, countries felt the need to extend the same principles to digital twins.
What is the Cali Fund?
The Cali Fund is the financial arm of the Multilateral Mechanism. It was established in 2024 at the 16th Meeting of the Convention on Biological Diversity in Cali, Colombia. It is intended to ensure that at least some of the profits made through digital sequence information support those that protect biodiversity. This includes Indigenous Peoples, recognized as important custodians of the planet’s natural heritage.
Who contributes to the Cali Fund?
Users – such as companies – who benefit from digital sequence information can now contribute a portion of their profits to the fund. Under the currently agreed framework, these rates are 1 per cent of a firm’s annual profits or 0.1 per cent of annual revenue made from the product in question. Companies can contribute by becoming members of the fund, which is set up as a United Nations multi-partner trust fund.
A group of governments, businesses and non-governmental organizations have come together as “Friends of the Cali Fund” to encourage companies to join. If large pharmaceutical companies and other major players sign up, the fund could generate billions, its backers say.
Who benefits from the Cali Fund?
It is designed to compensate countries rich in biodiversity. This is because these nations often forgo profits to protect the species that populate digital sequencing databases. For example, a nation might turn a rainforest into a national park, giving up revenues that would come from logging.
At least 50 per cent of the Cali Fund’s resources will go to Indigenous Peoples and local communities, recognizing their role in protecting and restoring ecosystems. Some details, including whether funds will go directly to communities or flow through governments, are still under discussion.
What role can individuals play?
With its one-year anniversary, the Cali Fund has now publicly opened its call for members.
“This is about critical mass,” says Julian Blanc, Head of the Biodiversity and Land Branch at the United Nations Environment Programme. “If only one company joins, it is less than a drop in the bucket. But if citizens and consumers are aware, advocating for companies to contribute their share – that’s when communities can see real benefits.”
Written by Ann-Kathrin Neureuther
Technically reviewed by Alex Owusu-Biney, Soo-Young Hwang, Adriana Rivera Brusatin and Julian Blanc.
