Businesses 'profit from investing in nature'
- 13 July 2010
- From the section Science & Environment
Businesses can and should take a key role in stemming biodiversity loss around the world, a report concludes.
The latest report from The Economics of Ecosystems and Biodiversity (Teeb) project argues that many sectors have a stake in protecting nature.
A survey by PricewaterhouseCoopers (PwC) finds that in some nations, more than half of CEOs see nature loss as a challenge to business growth.
The UN-backed Teeb project presents its latest results in London on Tuesday.
The first Global Business of Biodiversity symposium, held at the Excel Centre in London's Docklands, will hear that about half of European and US consumers say they would stop buying products from companies that disregard biodiversity concerns.
"Better accounting of business impacts on biodiversity, both positive and negative, is essential to spur change in business investment and operations," said Joshua Bishop, chief economist of the International Union for the Conservation of Nature (IUCN) and co-ordinator of the Teeb for Business report.
"Smart business leaders realise that integrating biodiversity and ecosystem services in their value chains can generate substantial cost savings and new revenues, as well as improved business reputation and license to operate."
Mining for positives
Among the "smart companies" to be discussed at the symposium is Rio Tinto, a mining conglomerate whose reputation (like others in the field) has been criticised on environmental and human rights grounds.
In 2004, the company adopted a "Net Positive Impact" (NPI) commitment on biodiversity.
This sees it working with environment organisations to protect important areas from direct mining impacts and putting funds into conservation to "offset" damage caused.
Another is the agribusiness giant Syngenta, which recently launched Operation Pollinator, a scheme to restore important bee habitat.
The scheme is seen as a potential contribution to curbing the ongoing bee decline in Europe and North America.
One recent study put the global value of insect pollinators at $189bn per year - a classical example of the kind of "ecosystem service" that nature provides for free, and that humans would have to pay to replace if the natural system broke down.
Items in the credit column including protection from storms, habitat for young fish, and carbon storage.
Teeb has calculated the annual value of forest loss around the world at $2-5 trillion.
Plants and machinery
Teeb, and the UN Environment Programme to which it is affiliated, argue that this kind of analysis makes nature protection a good investment for businesses.
Consumer opinion could be another factor.
A recent Ipsos survey found that in countries possessing high levels of biodiversity, awareness of biodiversity decline was correspondingly high, rising to 90% in Brazil.
Among business leaders, the PwC survey found that more than half of CEOs in Latin America see declines in biodiversity as a challenge to growth.
But the figure drops to 20% in Western Europe, and just 15% in the UK.
And only two of the world's largest 100 companies see biodiversity and ecosystem loss as a strategic issue.
"Businesses need to start thinking about ecosystems as an extension of their asset base, part of their plant and machinery, and appreciating the value they deliver," said Jon Williams, PwC's partner for sustainability and climate change.
Teeb's leader, Deutsche Bank economist Pavan Sukhdev, believes companies will find it easier to invest in biodiversity protection once a mechanism for Reducing Emissions from Deforestation and forest Degradation (Redd) becomes established through the UN climate convention.
Many countries favour a variant called Redd-Plus where issues such as biodiversity and forest peoples' rights would be protected.
"We can move to a stage where big companies and countries are able to say 'we're meeting 20% of our emissions targets' or whatever it might be through investing in green carbon," he told BBC News.
"Then we can look at other issues, such as the forest's water storage function for local people, for example.
"So it won't be a market in the classical sense but it will be a mechanism, and companies investing would be able to see whether their investments bring about things such as an improvement in water availability or an increase in the tiger population or whatever it might be."
Teeb will produce its final report for October's meeting of the UN Convention on Biological Diversity (CBD) in Japan, which will see governments examining the reasons why they have failed to live up to their 2002 pledge to curb nature loss by 2010.