It is now well established that biodiversity & ecosystem conservation is facing a significant global challenge. The loss of native plant, fungal and animal species distributed across the planet, and their habitats, is pronounced and growing.
Addressing this is imperative if the future of one species – humans – is also to be guaranteed. This risk is being compounded by the acceleration of climate change that is augmenting ecosystem loss.
Biodiversity as a concept
Species diversity is fostered within natural biological habitats that possess the structural integrity to be self-sufficient. They also function within a highly specific environment that has underpinned their evolution.
Resilient habitats mitigate the worst impacts on their indigenous species of external shocks such as heat stress, floods, dehydration, or invasion by alien plant or animal species. And facilitate the recovery of the affected species.
Biological diversity has many dimensions. It acknowledges the intricate interactions within ecosystems that occur between species and their communities, or between the gene pools of individual organisms. Which is why it has been described as the ”web of life” .
Threats to sensitive ecosystems have progressively increased over the past 50 years. Causes include stressors such as destructive or poorly managed land clearing for the spread of urbanisation and agriculture; or the removal of native forests where the trees are sold as a commercial commodity.
Each has threatened the survival of unique plants and animals. They have also fragmented or destroyed their highly specific habitats that could eventually have fostered their recovery.
In response, wildlife conservation and enhancement measures were introduced in many countries following ratification of the 1992 UN Convention on Biodiversity (CBD) in 1993, but they were generally regarded as inadequate. The UN global assessment “Report on Biodiversity and Ecosystem Services” (IPBES), published in 2019, outlined how the diminishing global biological diversity presages the loss of a further 1-million species over the coming decades.
The moral hazard this creates threatens the wide range of social and economic services that rely on stable ecosystems for their performance.
In particular, they challenge terrestrial food production, and the future of marine life including commercial seafood. The natural buffering processes provided by wetlands and forests against extreme storms and floods, will also fail if the projected growth in unsustainable development and the adverse impacts of global warming are not contained.
Recognition that the consequential economic cost of not conserving nature will be catastrophic, led to the wide acceptance of the UN Kunming-Montreal Global Biodiversity Framework in December 2022. This outlined goals for protecting biological diversity in the context of the emerging threats, with certain targets to be achieved globally by 2030.
Immediate implications for business
The normal operations of many businesses can create circumstances that potentially degrade, or even destroy, ecosystems in their vicinity. Potentially hostile commercial activities include forestry, agriculture, mining and unsustainable urban property development.
The global finance industry has been developing protocols to help investors optimise their equity and debt portfolios to minimise financial loss from wildlife destruction. This is creating an impetus for organisations seeking investment capital to understand the implications of their interface with sensitive ecosystems, and then disclose them in accordance with internationally agreed reporting frameworks.
In September 2023, the Taskforce on Nature-related Financial Disclosures (TNFD) published comprehensive international guidelines for reporting on biodiversity impacts. These are expected to become the de facto benchmark for disclosures by the finance sector, and for the business entities around the globe with which it interacts.
Australian firms that operate within the value chain of large international investors can therefore increasingly expect to be requested to report on how they manage their interface with the natural world. T he Middle Way can help them:
- understand their exposure to vulnerable ecosystems;
- disclose their potential impacts and dependencies on native fauna and flora in the area of influence of their operations; and
- prepare plans showing how they will implement effective remediation and conservation measures, and communicate these to stakeholders in both their upstream and downstream supply chains.