Why nature matters

Integrating climate and nature: the rationale for financial institutions

Cambridge institute of Sustainability Leadership (September 2022)

A report arguing for the integration of climate and nature considerations by financial institutions considering the issues such as materiality, unintended consequences, compounding effects, potential synergies and macroprudential risks.

Engaging Mozambique’s business and financial sectors on biodiversity

IUCN (September 2022)

An insight looking into the IUCN’s BioDev2030 programme in Mozambique and how it is engaging with business and finance in the country specifically focusing on two workshops held.

Valuing natural capital: Asia has the most to lose, and gain

The Business Times (September 2022)

An op-ed outlining the significant leadership the Asia-Pacific region could take on investing in nature and shifting the global economy to nature positive.

Where the world’s largest companies stand on nature

McKinsey (September 2022)

According to recent research, over half of insurers and re-insurers believe that nature-related risk is material to their underwriting business, however nature risk is not being assessed by underwriters. This report provides a framework for insurers and reinsurers to assess nature risk in their underwriting activities.

Biodiversity quickly rises up the ESG investing agenda

The Financial Times (September 2022)

An insight exploring the rise of biodiversity as one of the most important themes in sustainable finance and investing, including examples of asset managers beginning to invest in natural capital.

Unpriced nature and climate risk could wipe $ billions off world’s food and agriculture companies, as investors urged to eliminate deforestation from investments

UNFCCC Race to Zero (September 2022)

This insight covers a key point made at New York Climate Week that investors need to remove deforestation in their supply chains. It is supported by new research from the UN-backed Race to Zero campaign that highlights how ignored the land transition still is for many investors.

ESG Explainer: Call of the Wild

ESG Investor (July 2022)

An insight explaining the new IPBES report on humanity’s reliance on the natural environment, and explaining the significance of IPBES and its work.

Trustees should treat biodiversity as important as carbon emissions

IPE (July 2022)

An op-ed explaining why trustees and investors need to focus on biodiversity as well as climate-related issues.

It’s time for business to step up to protect biodiversity

World Economic Forum (July 2022)

An insight exploring the current biodiversity crises and the challenges fancing the protection of biodiversity – plus what needs to happen next.

Financing Nature and Biodiversity in ASEAN

Global Ethical Finance Initiative (June 2022)

A video discussion on financing nature and biodiversity in the ASEAN region featuring speakers from the ASEAN Centre for Biodiversity, UNEP FI, WWF and ADM Capital.

Perspectives on Biodiversity and Natural Capital

BNP Paribas (June 2022)

An in-depth newsletter which covers all aspects of biodiversity and natural capital as it relates to the global financial system, including but not limited to a section on TNFD, biodiversity hotspots, systemic risk, the EU Taxonomy, sector-specific issues, and how to harness nature-positive activities.

The Nexus of Biodiversity Conservation and Sustainable Socioeconomic Development in Southeast Asia

Academy of Sciences Malaysia (June 2022)

This report from the Academy of Sciences Malaysia outlines on the economic value of South East Asia’s biodiversity – which is at least US$2.19 trillion per year – and highlights that the figure can rise if nations work put effective conservation measures in place.

We are seeing the beginning of a shift in policy to provide explicit financial incentives for nature inclusion and restoration

Environmental Finance (June 2022)

An op-ed that gives a good high-level overview of the nature crisis and all the private-sector initiatives and government / intergovernmental legislation aiming to halt it.

Harmful Marine Extractives: Deep-sea mining

UNEP-FI (June 2022)

A briefing paper on the devastating effects of deep-sea mining for the finance community. UNEP-FI states that “in their current form, there is no foreseeable way in which the financing of deep-sea mining activities can be viewed as consistent with the Sustainable Blue Economy Finance Principles”. The paper addresses the reputational, regulatory, and operational risks associated with deep-sea mining and how the financial sector should respond.

The Case for Biodiversity

Bloomberg (May 2022)

A panel featuring Dr Danielle Wood of the MIT Media Lab and Dr Josh Tewkesbury of the Smithsonian Institute on the basics of biodiversity, biodiversity loss, the value of measuring biodiversity, and how the private sector can tackle it.

Why we need a joined-up approach to tackling biodiversity loss, desertification and climate change

Reuters (May 2022)

This piece highlights the importance of including a focus on land degradation within the discussions on climate change and biodiversity loss, as restoring this is a vital step towards a more nature and climate positive future. It also shows that the movement of money from harmful subsidies to restoring degraded land could be a big driver of change.

The Global Assessment of Private Sector Impacts on Water

Ceres (April 2022)

A report which digs into how industry practises are threatening global freshwater systems in five main ways – groundwater depletion, metal contamination, plastic pollution, water diversion and transfer, and eutrophication. As well as the impacts industry is having on nature, the report lays out what the long-term exposure is for different industry sectors in the face of increasing water risks. It focuses on both the local and specific, as well as the global and systemic – as well as what institutional investors can do in engaging with companies in these sectors to deal with this problem.

How can organizations grow with nature?

KPMG International (April 2022)

10 things boards and executives should know about nature-related risks and opportunities.

The pressure on our natural environment has increased substantially overtime. Halting and preserving nature and its capacity to contribute to sustainable economic growth is a significant challenge, bringing with it significant risks to corporate and financial stability, but also opportunities. All businesses depend on nature and its services either directly or through their supply chains, and those businesses that are highly reliant on nature are considered ‘most at risk’ from the consequences of nature degradation and biodiversity loss. 

Integrating Nature: The case for action on nature-related financial risks

University of Cambridge Institute for Sustainability Leadership (April 2022)

Since 2019, CISL has been collaborating with financial institutions on a programme to support the integration of nature into financial systems, creating resources for practitioners and senior management.

CISL’s latest publication, Integrating Nature: The case for action on nature-related financial risks, CISL, 2022, brings together the outcomes of that programme, providing senior management with the business case for integrating nature-related risks into financial decisions by detailing:

  • Why action is need
  • How action can be taken
  • Use cases assessing nature-related financial risks
  • What is now needed to accelerate the integration of nature into finance

Nature’s Assets: Why Biodiversity is Good for Business

Sustainalytics (March 2022)

With biodiversity loss identified as one of the top three risks to business, it is quickly becoming a key topic in boardrooms around the globe. Human pressure on natural environments and ecosystems has accelerated species loss to a rate at least 100 times higher than the natural extinction rate. This unprecedented decrease in biodiversity due to human activity has both direct and indirect social and economic impacts, as over half of the world’s GDP – approximately $44 trillion – is at moderate or severe risk. Unless further biodiversity loss is prevented and biodiversity-related impacts are better managed, many business activities will soon be unsustainable.

This ebook outlines the steps companies can take to measure and manage biodiversity-related issues. Readers will discover:

  • How current business activity is accelerating biodiversity loss
  • The material impacts biodiversity loss has on businesses across sectors
  • How companies can protect against natural capital losses and address potential biodiversity-related risks.

A quarter of Africa’s GDP is dependent on nature; it must be managed responsibly

Mail & Guardian (March 2022)

‘We depend on nature for food and water, for our health, and also for our economic wellbeing. Every business at some level depends on resources drawn from nature, such as crops, fish, timber, fibre, or rare earth elements, or on the stability of ecosystems.

Often we only see this when those ecosystems are upset such as when over-extraction from natural water sources causes drought or unsustainable agricultural practices lead to soil degradation and ultimately to food shortages.’

Biodiversity concerns set to be the next frontier after climate change

IFLR (February 2022)

ESG: With the rise of natural capital initiatives such as the TNFD, systemic risk issues related to ecosystem collapse will soon receive the same amount of attention as climate change.

Climate Change 2022: Impacts, Adaptation and Vulnerability

IPCC (February 2022)

The Working Group II contribution to the IPCC Sixth Assessment Report assesses the impacts of climate change, looking at ecosystems, biodiversity, and human communities at global and regional levels. It also reviews vulnerabilities and the capacities and limits of the natural world and human societies to adapt to climate change.

Valuing nature: An interview with Elizabeth Maruma Mrema

Aviva Investors (February 2022)

In this interview, AIQ catches up with Tanzanian biodiversity leader and lawyer Elizabeth Maruma Mrema about the threat of biodiversity loss, the recent Kunming Declaration and missed Aichi Biodiversity Targets, as well as the role of finance in protecting nature.

Why Biodiversity Is Moving to Top of Mind for Investors

Lazard Asset Management (February 2022)

‘Biodiversity, or the variety of life on earth, is declining and is projected to deteriorate faster and further if humans fail to change the status quo. Forestry, agriculture, energy extraction, fisheries, and fashion are just a few of the industries causing damage to ecosystems that we rely on and, in some cases, the damage may be irreparable. A continued loss of biodiversity could lead to environmental destabilization and, ultimately, ecological collapse. Such damage to the ecosystems we depend on to provide pollination, clean water, carbon sequestration, and even protection against infectious disease would almost certainly cause wide-reaching economic consequences for most investors.’

Biodiversity loss – the next big challenge for investors

Asian Investor (January 2022)

Nature loss across Asia will profoundly damage economic activities that rely on natural capital, according to several recent studies. Investors need to act.

Several recent reports from global agencies have confirmed that investors’ focus on minimising the effects of climate change has come at the expense of ignoring perhaps an even greater risk – the loss of biological diversity.

China: $1.9 Trillion Boost and 88 million Jobs by 2030 Possible with Nature-Positive Solutions

World Economic Forum (January 2022)

  • Two-thirds of China’s total Gross Domestic Product (GDP) is at risk of disruption from nature loss.
  • New report focuses on the economic case for safeguarding nature in China.
  • Nature-positive practices, those that add value to nature, could contribute $1.9 trillion to the economy a year and 88 million jobs by 2030.
  • China is well-placed to lead the transition to a new global green economy with lasting impact.

Corporates – Latin America & Caribbean: Deforestation Intensifies Reputational Risk For Companies Operating In Brazil

Moody’s (December 2021)

Environmental damage to Brazil’s biomes will have a substantial impact on Brazilian companies in coming years, rippling across different sectors and the wider economy.

Biodiversity: Unlocking natural capital value for Australian Investors

Australian Council of Superannuation Investors (ACSI) (November 2021)

A report covering the basics of what Australian investors need to know about the nature crisis and the different financial risks affecting companies across different sectors of the economy.

‘Nature loss is as big a business risk as climate change. We must tackle both with equal urgency’

Reuters Sustainable Business (November 2021)

David Craig of the Taskforce on Nature-related Financial Disclosures explains how the TNFD will provide a framework for companies to measure and account for their impacts on biodiversity for the first time.

Why is it more crucial than ever for business to identify, assess and disclose nature-related risks?

PwC (November 2021)

TNFD Taskforce member Daniel O’Brien, Head of Sustainable Business Solutions at PwC, highlights three crucial ways in which nature-related risks can become material for businesses.

Financial sector has ‘great power’ to stop biodiversity loss and reap the rewards of being ‘nature positive’, report reveals

EY, Microsoft and Earth Knowledge (October 2021)

The financial sector risks inflicting significant damage on itself and companies across the world if it fails to use its “great power” to stop actions that harm the planet, a new report by EY, Microsoft and Earth Knowledge has said.

As a core part of global economies, banks, investment firms and insurers have a “great responsibility” to ensure they support activities that are “nature positive” and protect the air, land, water and animals in the Earth’s unique and delicate ecosystems.

Entitled “Waking up to Nature – the biodiversity imperative in financial services”, the report estimates that the world’s largest investment banks provided $2.6 trillion of loans and underwriting services linked to the destruction of nature in 2019 alone, and a failure to act at pace and scale to rectify this will create a “material financial risk for the financial services industry”. This will manifest in “market, credit, reputational, regulatory, supply chain, operational, employee engagement and underwriting risk”, the report states.

Public concern grows over nature loss

The Economist Intelligence Unit (EIU) and WWF EU (May 2021)

Research considering public attitudes to nature loss and how they have changed over the past five years.

‘The UK’s Dasgupta Review shows how we can avoid financing our way to extinction’

Reuters Events Sustainable Business (February 2021)

An insight explaining “why solving the data gap is critical to unlocking a flood of money towards a nature-positive economy.”

The Dasgupta Review strengthens the case for finance sector action on nature

Global Canopy (February 2021)

An insight explaining how the Dasgupta Review is an important call for financial institutions to use their leverage to tackle the escalating nature crisis.

‘The One Planet Summit for Biodiversity was just a start. We need to plug the finance gap for nature’

Reuters Events Sustainable Business (January 2021)

An op-ed outlining how the increased attention to biodiversity needs to be followed up by finance action on nature.

One Planet Summit: Biodiversity rises up the global agenda

Natural Capital Finance Alliance with UN WCMC (January 2021)

An insight outlining the increasing attention being paid to biodiversity by governments and businesses.

The Global Risks Report 2021

World Economic Forum (January 2021)

The annual Global Risks Report analysing the biggest risks to business and the global economy in 2021. It states that some of the probable risks in the next ten years are extreme weather, climate action failure, and social insecurity, all of which are expected to get worse.

The world’s banks must start to value nature and stop paying for its destruction

The Guardian (October 2020)

A news article on the Bankrolling Extinction report which shows the flows of finance to sectors with high impacts on nature, and how the banks have little understanding to or indifference of the implications.

Conserving our common heritage

WWF and Swiss Re (June 2020)

In this joint report, World Wildlife Fund (WWF) and Swiss Re Institute are collaborating to focus on the concept of spatial finance in understanding threats to World Heritage Sites (WHS). Spatial finance uses geospatial observational data – geographical information systems (GIS) – combined with machine learning to assess the risks and impact of financing and re/insurance decisions. Conclusions can be incorporated into sustainable financing and re/insurance frameworks.

The spatial finance approach can be used to assess both the long-term impacts of economic activity and short-term disaster risk management, such as oil spills.

Investors must act to address biodiversity loss

UN PRI (October 2020)

A blog highlighting the early action investors are taking on biodiversity, and how this action can be scaled up.

Biodiversity and Ecosystem Services: a business case for re/insurance

Swiss Re (September 2020)

“The Swiss Re Institute Biodiversity and Ecosystem Services (BES) Index assesses which economic sectors are most reliant on nature and evaluates the exposure each country has to BES decline.”

Our Planet: Too Big To Fail

WWF (September 2020)

A film that explores the risks of inaction, the impact of investing-as-usual, and the role the finance sector can play in powering a sustainable future.

Global Futures: A study into the global economic impacts of nature loss

Global Trade Analysis Project, Natural Capital Project, WWF (February 2020)

A study using cutting-edge models to investigate the global economic impacts of natural capital depletion. It looks at this over 140 countries, all industry sectors, and six critical ecosystem services such as water supply, and timber supply.

Nature is too big to fail – Biodiversity: the next frontier in financial risk management

PwC and WWF (January 2020)

This new reports finds “that the financial risks associated with the loss of biodiversity will become increasingly important in 2020 – especially in the lead up to the United Nations Biodiversity Conference in October in Kunming (China).” It highlights the mutual reinforcement of the climate and nature crises and the challenge this poses to decision makers.