From story to system: Rethinking how we finance Non-Economic Loss & Damage in the Pacific

Non-economic loss and damage is not just a policy issue - it’s a lived reality

Across the Pacific, climate change is not a future threat - it is already displacing communities, severing ancestral ties, and endangering ways of life deeply rooted in land, sea, and identity. These are losses that cannot be priced or insured - and that are inevitable. Known as Non-Economic Loss and Damage (NELD), these impacts include the disappearance of cultural heritage, spiritual connection and intergenerational wellbeing (see Figure 1). 

Figure 1 - Typologies of NELD (Source: McNamara et al. 2021)

Yet when it comes to financial responses to NELD, gaps remain in incorporating localised epistemologies. Global mechanisms have begun to recognise NELD in principle - including Loss and Damage financing movements such as the Warsaw International Mechanism, The Bridgetown Initiative and the IMF Resilience and Sustainability Trust - but in practice, financing delivery avenues (modalities) are often overly top-down and technocratic. In turn, this leads to a lack of legitimacy, accountability and cultural grounding needed to support real communities facing irreversible harm.

In the Pacific, the challenge now is not simply recognising these losses. It’s about rethinking how we translate local knowledge into policy, and how financial modalities can better embed local worldviews and values, instead of reliance on technocratic epistemologies. 

Pacific knowledge systems deserve a seat at the table

Pacific Island societies are built on diverse and sophisticated knowledge systems. These are passed down through storytelling, ceremonial practice, and deep relationship with the natural world. They are not “data-poor”; they are rich in meaning, history, and practical insight - but in ways more relevant to their local communities and values. 

This rich history of insights and unique worldviews puts them in a perfect position to blend narrative, visuals and data (ways of knowing) in formulating robust NELD financing modalities (Figure 2).

Figure 2 - Narrative, Visuals and Data Synthesis (Source: Datacamp (2021); Dykes (2019)) 

But these ways of knowing can be at odds with how global institutions design policy. NELD finance still relies on delivery frameworks that are poorly suited for Pacific island nations, and embed performance metrics that fail to capture the values that matter most to Pacific communities. As a result, funding for NELD either gets lost in translation, or arrives in ways that are unhelpful - or even harmful.

If we are serious about equity, justice, and effectiveness in climate finance, we must invest in better financial modalities that are embedded with local knowledge, not just top-down institutional decisions. This means not only listening, but redesigning how local worldviews and values are incorporated into financial modalities for NELD. 

A framework for translation: From stories to systems

One promising approach emerging in the region focuses on building a bridge between community narratives and policy systems. This involves three key steps:

Synthesising visuals, data and narrative into evidence

Pacific communities have long used narrative, song, and visual art to communicate values and memory. When combined with maps, climate data, or visual timelines, these stories become powerful tools for communicating loss in ways that policymakers and funders can act on (see Figure 2). This helps to more specifically frame the exact nature of NELD gaps and requirements in Pacific communities. 

Structuring policy with cultural relevance

Storytelling must be matched with policy tools that reflect community goals. That means breaking down broad ambitions - such as preserving cultural identity or enabling dignified relocation - into practical, fundable actions in a clear policy taxonomy. It also means ensuring instruments like grants, trust funds, or community-led programmes align with social and cultural logics. 

Delivering finance through pathways that work

Too often, well-meaning policy gets stuck at the delivery stage. To create durable change, Pacific governments and partners must ensure that NELD financing flows through appropriate channels - such as national systems, local organisations, or trusted intermediaries - and is embedded in law, norms, and markets that communities can shape (see Figure 3).

Figure 3 - Pathways of influence for durable change (Source: Humphreys et al. 2019). 

Specifically, this framework outlines the four pathways through which community knowledge can shape systems, in a way that does not succumb to short-term governance lapses: 

• Rules – Embed community-defined goals in laws, national plans, and formal processes.

• Norms – Shift expectations about what constitutes just and legitimate climate action.

• Markets – Design economic tools and incentives that respect cultural and ecological realities.

• Direct access – Ensure communities and local institutions have the capacity and authority to receive and manage funding themselves

By synthesising the above 3 elements, translating local worldviews and epistemologies into NELD financing modalities can become a much more coherent practice. 

Case study: Vanuatu and the pathways to action

Vanuatu provides a powerful example of leadership in this space. It successfully led the International Court of Justice to form an advisory opinion that nations not curbing greenhouse gas emissions may be in breach of international law. Likewise, it very recently released its world-leading loss & damage policy. 

This has translated into tangible efforts to build community-driven pathways for addressing loss. For example, stories from frontline villages are being collected and translated into policy briefs and budget proposals. Community organisations are mapping spiritual and cultural assets at risk from climate change, helping governments prioritise where and how to act.

These initiatives are not about fitting Pacific knowledge into external systems. They are about redesigning systems to work for the Pacific - and showing that it’s possible to combine culture, justice, and policy rigour.

Rethinking delivery: Four pathways for durable change

How can we make sure that finance for NELD not only arrives, but delivers? When well-designed storytelling feeds into each of these pathways, it strengthens the case for NELD finance and builds the systems needed to deliver it.

For non-economic loss and damage (NELD) financing to serve Vanuatu effectively, it must be grounded in Ni-Vanuatu culture. Funding frameworks should reflect the way identity, kastom, and community life are bound to land, ocean, and spirituality - not just to physical assets. By integrating narrative, data, and visual tools, financiers can ensure that support resonates with the social fabric of Vanuatu rather than imposing external definitions of loss.

The Norms Pathway highlights how kastom stories and oral traditions can reshape what is recognised as “loss.” Community narratives capture the grief of losing sacred stones, the interruption of genealogies, or the breaking of rituals that connect people to land and ancestors. These are not secondary impacts but central to resilience. When such narratives are included in proposals, they reframe climate loss from an economic problem into one of cultural survival, dignity, and sovereignty.

Culturally rooted data strengthens this reframing. Indicators such as the restoration of ceremonies, the continuity of chiefly authority, or the stewardship of customary land express resilience in terms that matter to Ni-Vanuatu communities. They also provide common ground for dialogue between village councils, provincial governments, and international donors, helping to bridge customary and state systems of governance.

The Direct Access Pathway becomes vital when participatory tools are embedded into institutions. Practices like cultural mapping of tabu sites, village-level climate stories, or community-designed infographics allow Ni-Vanuatu voices to set the terms of engagement. When these tools feed into national monitoring systems, they change the logic of finance from externally imposed benchmarks to co-created measures that communities own and trust.

In this way, NELD financing can uphold kastom, protect identity, and sustain the spiritual and cultural bonds that define Vanuatu society. It ensures that recovery and adaptation are not only about rebuilding roads and schools, but about preserving the cultural foundations that give meaning to life across the islands.

From recognition to responsibility

At its core, NELD financing is not just a technical problem. It is a question of whose knowledge counts, whose systems are resourced, and whose futures are protected. The Pacific has answers - but only if we build the right bridges between story and system.

At its core, NELD financing is not just a technical problem. It is a question of whose knowledge counts, whose systems are resourced, and whose futures are protected. Across the Pacific, communities are grappling with how to preserve culture, spirituality, and identity in the face of climate disruption. From the loss of burial grounds to the breaking of ocean-based traditions, these impacts strike at the heart of what it means to belong. Addressing NELD in the region therefore requires approaches that honour local governance systems and cultural resilience, not just material recovery.

In Vanuatu, these principles are especially clear. Ni-Vanuatu communities already embody bridges between story and system through the interweaving of kastom and everyday life. The nakamal, for example, is not only a meeting house but a living archive where elders pass on stories, rituals, and genealogies that bind people to place. Ceremonies such as land-cleansing or reconciliation are more than symbolic; they restore balance after disruption and reaffirm stewardship of land and sea. If financing mechanisms can respect and resource these cultural practices, they will not only compensate for what is lost but also strengthen the systems that make recovery possible. In this sense, NELD finance becomes a tool to uphold sovereignty, protect kastom, and ensure that the futures safeguarded are the ones Ni-Vanuatu people choose for themselves.

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