Eight reasons why business should care about biodiversity
By Rebekah Church, Global Lead Biodiversity Stewardship, WWF
We know that the health of the global economy depends on nature. The World Economic Forum estimates that 44 trillion USD of value generation, representing more than 50% of global GDP, is dependent on nature, biodiversity and the services it supports. This means that the relationship that companies have with nature can create business risks — but also huge opportunities for improving both sustainability and profitability. Here are some of the core reasons why businesses should care about biodiversity and shift their practices towards nature-positive business models:
1. All businesses directly or indirectly depend on biodiversity and ecosystems for their profitability. Companies rely on nature for direct inputs like water or fibres, or on business-enabling ecosystem services like pollination, water regulation and soil fertility. On the other hand, biodiversity loss can expose companies to resource scarcity, value chain disruptions, or increased operational costs.
2. Positive and negative impacts on nature can have serious reputational consequences for companies and can ultimately affect brand value and market share. One recent study revealed that global executives attribute 63% of their company’s market value to their overall reputation.
3. Adopting nature-positive practices can be a great opportunity for companies to increase their market share and expand into new markets that are demanding biodiversity-friendly products and services. On the other hand, companies with negative impacts on nature can lose market share as consumers develop more environmentally-conscious purchasing behaviour.
4. Companies that don’t manage biodiversity risks well can sometimes face legal and regulatory consequences, like prosecutions or lawsuits. This can mean serious financial consequences for companies, and in some cases they can lose permission to operate in critical areas.
5. Shifting operational practices to become more nature-positive can offer co-benefits to both businesses and biodiversity. For example, agricultural companies that adopt integrated pest management practices can lower the cost of agrochemical inputs while benefiting the species and ecosystems around them.
6. Nature is a key component of sustainable finance. With growing global momentum towards a more sustainable economic system, financial sector actors are increasingly scrutinizing companies’ environmental practices. Companies that manage their environmental impacts well may have better access to capital, and those that don’t may face increasingly higher barriers to financing.
7. Stakeholders are increasingly concerned about how companies manage their impact on nature. Employees, customers, shareholders, business partners, regulators, local communities, and others are telling companies more and more that impacts on nature matter to them. Maintaining positive relationships with these important stakeholders requires businesses to address these concerns proactively.
8. Finally, everyone has a role to play in contributing to achieving global goals around climate change and biodiversity. Businesses are in a unique position to achieve global impact and help transform our economic systems to a more sustainable, nature-positive model that can benefit business, society and the planet.
Luckily, there are many things businesses can do to better understand and act on their biodiversity risks and opportunities, and WWF has developed programs and tools (like the Water Risk Filter and forthcoming Biodiversity Risk Filter)to support companies in their biodiversity stewardship journeys. For more information, see our latest report, A Biodiversity Guide for Business.
