This year, 2020, has been dubbed the “super year” for the environment. We’re used to hearing about climate change and the urgent need to slow global warming. This year, environmental experts are adding another focus to the mix: biodiversity.
A new business buzzword? Or an oldie but a goodie? It depends who you ask. Historically, biodiversity tends to be a sustainable business trend that comes and goes but now, it may (fortunately) be here to stay.
In January, the environment was top of mind among the world’s most notable business leaders at the World Economic Forum (WEF) in Davos. According to the WEF’s 2020 Global Risk Report, destruction of nature negatively will affect bottom lines and generally, these risks are undervalued by business decision-makers.
While business and biodiversity might seem strange bedfellows, companies are dependent on biodiversity. And while the level of dependency can vary across sectors, the loss of biodiversity is a critical risk for all. For example, a failure to take biodiversity into account could lead to reduced food supplies, disrupted supply chains, economic loss from floods or fires — and that’s just scratching the surface.
The good news: Businesses are poised to lead global efforts in the movement to better protect the planet. They have the resources, autonomy, technology and ability to innovate that other stakeholders do not.
The time is now to invest in smart eco-forward business strategies, so corporations aren’t forced to play catch-up after it’s too late. Conservation International’s Helen Crowley and Leonardo Viana, will discuss biodiversity, conservation and business at GreenBiz 20 in Scottsdale, Arizona, this week.
Here are the need-to-know basics:
What is biodiversity, and why does protecting it matter?
Simply speaking, biodiversity is “all life on Earth.” It’s every plant, animal, insect and microbe that make up the ecosystems on our planet. It ultimately supports our well-being by providing food, water, a stable climate, equitable supply chains, medicine and more.
Unfortunately, biodiversity is being lost at an alarming rate. The latest information from the United Nations states that nearly 1 million species are on the verge of extinction. This level of decline is unprecedented in human history; thus, we have no barometer to gauge what this loss could mean. What we do know is that all life is connected, a disruption in one part of the world will have ripple effects in another.
Many scientists note that we’re facing the sixth extinction event in the history of our planet, and it’s being driven by human activity. Therefore, we need immediate, transformational action to stem biodiversity loss.
Why should businesses invest in biodiversity, and where can they start?
Biodiversity loss poses reputational, regulatory and financial risks to businesses. Companies are dependent on biodiversity for long-term sustainability.
Biodiversity loss poses reputational, regulatory and financial risks to business. Companies are dependent on biodiversity for long-term sustainability.
To better understand both the impacts businesses have on biodiversity and the ways in which the business world relies on it, the first step is to conduct a baseline assessment of your interaction with the environment. This often involves mapping a business’ or suppliers’ operating and sourcing practices. Then an analysis of the value they bring to your business is necessary. The need to secure and ensure the quantity and quality of materials coming from supply chains makes the case for a strong investment in policies and practices that are good for the environment, local communities and your revenue — nature-smart investment is a win-win-win.
To help companies with site-based biodiversity indicators, Conservation International and partners are developing a multi-step framework that will allow companies to better measure and address their direct impact on biodiversity. Unlike other indicators, this framework measures on-the-ground changes in the condition of, pressures on and support for biodiversity at the site-level — which aims to be aggregated into an indicator of biodiversity performance at the corporate-level.
What more can businesses do?
Those of us in the conservation world have been saying for decades that nature has value and now the world is waking up to that reality. Businesses have the flexibility and resources to be the needed change agents for this decade of environmental action. Conservation presents a real opportunity for leadership.
Some companies are leaning in and protecting nature and supporting the local indigenous communities that have centuries of traditional conservation-based knowledge. The next step is to identify how other businesses can learn from this success.
One company leading the way at understanding impact and dependencies on nature across their whole supply chain is Kering, a French international luxury group with brands including Gucci, Balenciaga and Saint Laurent. Through the pioneering Environmental Profit & Loss (EP&L) methodology, Kering has been tracking different types of environmental impact through six indicators (and many sub-indicators) including: GHG emissions; water use; water and air pollution; land-use change; and solid waste. Kering uses this corporate natural capital accounting methodology to guide its prioritization of actions around mitigating impact and identifying supply chain and sourcing approaches that can deliver positive outcomes for biodiversity.
Companies also can play a critical role in protecting biodiversity by supporting external conservation efforts. According to a report by Credit Suisse and McKinsey & Company, between $300 billion to $400 billion is needed each year, but conservation projects only receive about $52 billion. Private sector investments could scale conservation efforts.
Do thriving ecosystems support other urgent environmental issues?
An investment in biodiversity is an investment in environmental issues at large. More companies are joining the fight to slow climate change through investments in renewable energy and carbon capture and storage technology. A supplemental commitment to biodiversity conservation will support not only climate change goals but also will ensure ecosystems thrive.
Investors and employees are increasingly expecting companies to help in solving for climate change. Nature-based climate solutions, or the protection, restoration and improved management of land can contribute 37 percent of the required emissions reductions needed to reach Paris Agreement targets. Standing forests keep carbon from entering the atmosphere, slowing temperature increases and providing homes for wildlife ensuring biodiversity survives.
It’s an exciting time to affect change as the urgency around biodiversity is not expected to slow. In October, the United Nations Convention on Biological Diversity, which includes representatives from 196 countries, meets to finalize a new agreement for the global protection of nature which will keep biodiversity and climate change top of mind.
Collaboration across sectors will be key, but businesses have an opportunity to lead and may stand to lose the most if we don’t protect the planet. After all, conserving biodiversity is just good business sense.