One of the greatest challenges in biodiversity conservation today is how to facilitate protection of species that are highly valued at a global scale but have little or even negative value at a local scale. Imperiled species such as large predators can impose significant economic costs at a local level, often in poverty-stricken rural areas where households are least able to tolerate such costs, and impede efforts of local people, especially traditional pastoralists, to escape from poverty. Furthermore, the costs and benefits involved in predator conservation often include diverse dimensions, which are hard to quantify and nearly impossible to reconcile with one another. The best chance of effective conservation relies upon translating the global value of carnivores into tangible local benefits large enough to drive conservation “on the ground.” Although human–carnivore coexistence involves significant noneconomic values, providing financial incentives to those affected negatively by carnivore presence is a common strategy for encouraging such coexistence, and this can also have important benefits in terms of reducing poverty. Here, we provide a critical overview of such financial instruments, which we term “payments to encourage coexistence”; assess the pitfalls and potentials of these methods, particularly compensation and insurance, revenue-sharing, and conservation payments; and discuss how existing strategies of payment to encourage coexistence could be combined to facilitate carnivore conservation and alleviate local poverty.

Human activity affecting the welfare of wild vertebrates, widely accepted to be sentient, and therefore deserving of moral concern, is widespread. A variety of motives lead to the killing of individual wild animals. These include to provide food, to protect stock and other human interests, and also for sport. The acceptability of such killing is widely believed to vary with the motive and method. Individual vertebrates are also killed by conservationists. Whether securing conservation goals is an adequate reason for such killing has recently been challenged. Conventional conservation practice has tended to prioritise ecological collectives, such as populations and species, when their interests conflict with those of individuals. Supporters of the ‘Compassionate Conservation’ movement argue both that conservationists have neglected animal welfare when such conflicts arise and that no killing for conservation is justified. We counter that conservationists increasingly seek to adhere to high standards of welfare, and that the extreme position advocated by some supporters of ‘Compassionate Conservation’, rooted in virtue ethics, would, if widely accepted, lead to considerable negative effects for conservation. Conservation practice cannot afford to neglect consequences. Moreover, the do-no-harm maxim does not always lead to better outcomes for animal welfare.