Protected areas are one of the cornerstones of natural resource conservation. Their objective is to protect habitats considered critical because of the diversity or uniqueness of the species they contain, or due to the biological phenomena they harbor. In Mexico , SEMARNAT’s National Commission for Protected Areas (CONANP) is responsible for 154 federal protected areas, which cover approximately 9.4% of the country’s territory. Conservation of these habitats must necessarily take place within a framework of social co-responsibility that entails a mutual search for sustainable alternatives in the use of natural resources.
In 1992, the government of Mexico applied for a US$25 million donation from the Global Environment Facility (GEF) via the World Bank, in order to finance ten protected areas. In 1996, the result of a study accompanied by recommendations from over 80 organizations and individuals involved in protected area management, proposed using the remaining funds to establish a private endowment, whose interest would ensure the basic operation of these ten protected areas in the long term. At the same time, the National Council for Protected Areas was created as an advisory council to CONANP, formed by members of different sectors of society with expertise in protected areas, which operates independently from the government. The Council followed the study’s recommendation to establish a private endowment and chose the FMCN to manage this new Fund for Protected Areas.
The FMCN’s Protected Areas Program started with the establishment of FANP in 1997 receiving a US$16.5 million donation as a result from the GEF donation restructure. While FANP manages, ensures the proper use of the interest income, and raises additional funds, CONANP is responsible for the technical management of protected areas and for carrying out the project and the World Bank acts as the implementing agency of GEF.

The Monarch Butterfly Biosphere Reserve harbors one of the most fascinating phenomena in biology. Each year millions of monarch butterflies from Canada and the United States hibernate in its fir forests. This protected area is also an essential hydrological watershed that supplies Mexico City with water. According to studies conducted by the National Autonomous University of Mexico with support from World Wildlife Fund (WWF) 50% of the Reserve’s forests were either lost or heavily damaged in the last 25 years. In order to halt this accelerated deterioration, WWF and government environmental agencies proposed to expand the protected area and change its category to a biosphere reserve.
Biosphere reserves have buffer zones, where sustainable activities can take place, and core areas, where extraction of natural resources is prohibited. The enlargement of the Reserve proposed in 1999, meant that the new core area would affect logging permits granted to local landowners before the decree. In 2000 WWF and FMCN obtained a US$5 million donation from the Packard Foundation and US$1 million from SEMARNAP to establish the Monarch Butterfly Conservation Fund, whose goal is to provide an incentive to conserve forests for core area landowners and to ensure local participation in the conservation of the Biosphere Reserve.