Building Back Biodiversity: Here’s How Companies are Taking Action
Last year, COP 15 delivered the Global Biodiversity Framework (GBF). This sent a strong message to the business community: sticking to the status quo is short-sighted and detrimental to long-term value.
The urgent call for action on our biodiversity crisis compelled all sectors, including businesses and financial institutions, to unite and reverse nature loss by 2030.
The Private Sector and Biodiversity
The private sector will need to step up and expand their focus on nature-related objectives. Whilst it’s common for Fortune Global 500 companies to set targets for addressing climate change, the same can’t be said for other aspects of nature conservation.
While more companies are making pledges related to biodiversity, it’s important to recognize that it has taken years, if not decades, for companies to act on climate change. The corporate grasp of nature is still in its infancy.
Also, it can be simpler for a company to calculate carbon emissions than to measure biodiversity. Since every habitat and species is unique, there is no standardized method for quantifying ecosystem services.
Despite the challenges, there are companies and financial institutions that are championing nature through biodiversity initiatives.
Ahead of the Game with Disclosure
Target 15 of the GBF requires governments to ensure that large companies and financial institutions assess and disclose their risks, impacts, and dependencies on nature throughout their operations, value chains and portfolios, by 2030.
But that’s where we’re headed. For now, there’s a lot to be desired.
In 2022, CDP, a non-profit specialising in environmental disclosure systems, scored nearly 15,000 companies on their climate change, forests and water security disclosures. They found that more than half (55%) had taken no action to progress biodiversity commitments in the last year. And 70% don’t assess the impact of their value chain on biodiversity.
Of the thousands of companies assessed, only 13 were awarded ‘Triple A’ by CPD for environmental actions (for climate change, forest preservation and water security). They are: Beiersdorf AG, Danone, FIRMENICH SA, HP Inc, KAO Corporation, Klabin S/A, Lenzing AG, L'Oréal, LVMH, Metsä Board Corporation, Philip Morris International, Symrise AG, and UPM-Kymmene Corporation.
Changing the Game with Impact Investment Funds
With current climate and nature emergencies, it’s no longer sufficient for large companies to solely address the environmental impact of their direct operations. Instead, they should actively seek to contribute to the restoration of our planet.
That’s why forward-thinking organisations are harnessing nature-based investments to secure return on investment, whilst also generating social and environmental value (beyond their own footprint).
What’s more, investment in nature can also drive competitive advantage and attract talent and customers.
Some examples of private sector funds:
L’Oréal Fund for Nature Regeneration
The €50 million Fund’s includes active commitments for mangrove restoration in Kenya, rebuilding wildlife diversity in the UK, and facilitating the low-carbon agricultural transition for farmers in France.
Unilever Climate and Nature Fund
The fund will invest €1 billion by 2030 in projects that positively address climate change and protect nature, for example, through forest protection and regeneration.
Apple Restore Fund
Launched with Conservation International and Goldman Sachs, the $200 million fund will accelerate natural solutions to climate change through investments in forestry projects.
Investing in Nature-based solutions
Nature-based solutions offer huge opportunities to find a double win on climate and nature. They have the potential restore nature, mitigate and adapt to climate change, while also supporting the livelihoods and interests of local people.
As a forward-thinking commitment to the Planet’s future, Mondaine has partnered with the non-profit Fairventures to offset carbon emissions through a reforestation programme that works with local communities.
Driving Change, Inspiring Action
Biodiversity initiatives will continue to become a priority for businesses worldwide. In terms of greenwashing, a key aspect to consider is the extent to which initiatives are transformational to a business model. Long term and effective changes must be core to business operations.
Whilst SMEs are excluded from mandatory disclosures for Target 15, they should still strive to assess and disclose, reduce negative and increase positive impacts, and consider all players within an ecosystem.
Because, as with large companies, opportunities abound for those willing to drive real transformation.
1. Claes, J. et al.2022. Where the World’s Largest Companies Stand on Nature. McKinsey. https://www.mckinsey.com/capabilities/sustainability/our-insights/where-the-worlds-largest-companies-stand-on-nature
2. Hoffman, A and Le Goulven K. 2021. Investing in nature gives industry and business a competitive advantage. Here’s why. World Economic Forum. https://www.weforum.org/agenda/2021/09/investing-nature-industry-business-competitive-advantage/
