The Tamesis
A global body focused on biodiversity and ecosystems says the world’s economic growth has caused huge losses in biodiversity and “poses serious and pervasive systemic risks” to financial stability and human well-being.
A new report released on Monday (February 9) Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES) said “Businesses can either lead change or risk extinction.”
All businesses rely on and impact nature, and all businesses can be active agents of change, IPBES said its new report highlights dozens of ways businesses can do this.
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Officials from more than 150 governments attended the intergovernmental body’s 12th plenary session in Manchester last week to learn about the report, which found business is crucial to halting and reversing biodiversity loss.
But organizers say “many people often lack the information to address their impacts and dependencies, as well as the risks and opportunities associated with biodiversity and nature’s contributions to people.”
The IPBES report was compiled over three years by 79 leading experts from the scientific community and the private sector from 35 countries and regions around the world.
These leading scientists say every business depends on biodiversity and every business affects biodiversity.
“Even companies that appear distant from nature or do not consider themselves nature-based are directly or indirectly dependent on material inputs, regulation of environmental conditions (such as flood protection and water supply), and non-material contributions such as tourism, recreation, education, and spiritual, aesthetic and cultural values.
“But businesses often bear little or no financial cost for their negative impacts, and many businesses currently do not generate revenue from positive impacts on biodiversity.”
Systemic risks persist in enterprises
The assessment found that current operating conditions for businesses are not always consistent with achieving a just and sustainable future, and that these conditions can also perpetuate systemic risks.
“Businesses often face insufficient or perverse incentives, barriers that impede efforts to reverse natural decline, an institutional environment with insufficient support, enforcement and compliance, and large gaps in data and knowledge.
“These, combined with business models that result in ever-increasing material consumption and an emphasis on reporting quarterly profits, are exacerbating the degradation of nature around the world.”
Fundamental changes are possible and necessary to create an enabling environment where corporate profits are aligned with benefits for biodiversity and people, the report says.
It shows both the risk that nature loss poses to businesses and the opportunities for businesses to help reverse the situation.
Matt Jones, UK Environment Agency’s “impact officer” and one of the three co-chairs of the review, said the report would provide guidance for businesses and financial institutions, as well as governments and civil society, on how to take meaningful steps to achieve change.
He said: “Businesses and other key players can either lead the global economy in a more sustainable direction or end up at risk of extinction… Both species are species in nature but may also be species of their own.”
“Business incentives lead to natural decline”
Jones and his colleagues say current business practices need to be addressed so that changes can be made to halt and reverse biodiversity loss. For example, the massive subsidies that contribute to biodiversity loss are targeted at business activities with the support of corporate and trade association lobbying.
Global public and private financial flows that have direct negative impacts on nature are estimated at $7.3 trillion in 2023, including $4.9 trillion in private finance, including approximately $2.4 trillion in public spending on environmentally harmful subsidies.
By comparison, only $220 billion in public and private financial flows will be spent on activities that help protect and restore biodiversity in 2023, accounting for just 3% of public funding and incentives that encourage harmful business practices or discourage behavior that benefits biodiversity, IPBES said.
“Biodiversity loss is one of the most serious threats to business,” said American professor Stephen Polasky, another co-chair of the assessment.
“The twisted reality, however, is that it appears more profitable for corporations to destroy biodiversity than to protect it. Business as usual may be profitable in the short term, but the impacts of multiple corporations may have a cumulative effect that aggregates into global impacts that cross ecological tipping points.”
Pro-nature policies and financial and cultural shifts are also among the most profitable initiatives, the report said. “This report provides tools for choosing more effective measurements and analyses,” Polaski said.
Perhaps the most positive news from the latest IPBES report is that China, India and the European Union All, along with representatives from more than 100 other countries, endorsed the agency’s findings.
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