Biodiversity: It’s Time to Protect Our Only Home

There is a clear need for swift action to address biodiversity loss. The severity of the risks linked to biodiversity loss has not directly translated into changes into corporate actions. While the complexities of effectively measuring and addressing biodiversity loss are acknowledged, regulations and standards to facilitate the process are being developed rapidly and companies need to be prepared to meet them head on. There are actionable steps companies can take now and investors can play a key role to accelerate the momentum of biodiversity action.

Biodiversity is all around us. It underpins not only our economy but also our very existence: Yet, we (individuals, governments, and the private sector) are only in the early stages of understanding how essential a healthy and biodiverse environment is to a stable and well-functioning society.

There is no debate in the fact that we inherently depend on biodiversity for a stable well-functioning society and that human activities are negatively impacting nature with potentially irreversible consequences. Governments and other stakeholders are working to encourage momentum on this important issue through regulation and uniform reporting standards. However, investors will also have a key role to play to help bending the curve of biodiversity loss.

We classify utilities, mining & metals, and paper & forest products as sectors with primarily direct impacts on biodiversity as the majority of their operations happen on owned or directly managed assets.

The global food sector is often cited as one of the primary sectors driving biodiversity loss globally. While the sector heavily exacerbates biodiversity loss, it is also heavily dependent on biodiversity and faces significant associated risks. The impacts to biodiversity are often indirect, primarily through the sourcing of raw materials, making the topic difficult to manage and measure in part due to the sheer scale of global supply chains.

Based on our engagement sample, the insurance sector demonstrates a mixed bag of awareness on the topic of biodiversity. Some of the insurers are taking the subject of biodiversity very seriously, and have announced a specific biodiversity strategy and/or devoted significant resources to initiatives and research on the topic. 

This paper is the concluding section of a thematic paper series on biodiversity, resulting from the discussions we had during meetings dedicated to biodiversity engagement with various companies in the pharmaceuticals and chemicals sectors.
This dialogue followed a framework based on ten questions structured around:

1. biodiversity strategy and governance,
2. biodiversity related impacts, dependencies, risks and opportunities, and
3. biodiversity metrics, targets and reporting.