European Commission

Business and Biodiversity

Globally, biological diversity is being lost at an alarming rate. The recent findings of the Millennium Ecosystem Assessment show that 60% of all ecosystem services worldwide are in decline and species are becoming extinct at up to 1,000 times the normal rate. According to the TEEB report these un-accounted services represent 6% of global GDP.

  • Business is about sustainability

    In order to be sustainable, businesses need to generate profits. But sustainable development requires good environmental performance as well as good social performance. Dealing with environmental issues goes far beyond managing risks. Companies with strong environmental performance can develop this into a competitive advantage: they perform better on the stock market, manage their resources more efficiently, and provide better products and services. Sharing responsibility and taking action for biodiversity is not only a moral issue, it also makes economic sense. Healthy ecosystems support healthy people, sustainable companies, sound economies and hence sustainable development.

  • Not all businesses are alike

    For the natural resource companies – forestry, fisheries, water, mining and oil and gas – biodiversity is mostly about ecosystem management. They must demonstrate that they know how to extract the resources with the smallest possible impact on biodiversity. For those extracting non-renewable resources, the issue involves using best environmental management practices. Other manufacturers can influence the site and resource-efficiency of their operations – and the environmental impact of the end product. For most of the service industry, addressing biodiversity issues may be all about their reputation, but they also need to take into account the impact of their operations, for example the tourism industry, or get to grips with environmental risks, for example in the case of financial services.

  • International institutions

    have acknowledged the need to engage with business on biodiversity issues. The European Commission’s Biodiversity Communication called for a partnership on business and biodiversity /environment/nature/biodiversity/comm2006/bap_2006.htm, while the Convention on Biological Diversity asks the private sector to engage in the implementation of the Convention. http://www.cbd.int/business/.

Involving business in the preservation and sustainable use of biodiversity and fair sharing of the benefits is an important challenge internationally. This was a major conclusion of the Millennium Ecosystem Assessment and was confirmed during the ‘Business and the 2010 Biodiversity Challenge’ meeting of November 2005 in Brazil, organized by the Convention on Biological Diversity (CBD). The CBD acknowledges that businesses can significantly contribute to achieving its objectives. In March 2006, a decision was therefore adopted focusing exclusively on private-sector engagement. The CBD Conference of the Parties (CoP9) in May 2008 (Decision IX/26 – Promoting business engagement) noted with appreciation and welcomed, among others, the Business and Biodiversity initiatives of Portugal, Germany and the Netherlands for their efforts to mobilize and engage the Business community in biodiversity issues, as a means of working towards the 2010 target.

At the tenth meeting of the Conference of the Parties to the Convention on Biological Diversity in Nagoya, Japan (COP 10) governments adopted Decision X/21 on Business Engagement, aimed at promoting a public policy environment that enables private sector engagement and the mainstreaming of biodiversity into corporate strategies and decision-making. The decision encourages businesses and the private sector to monitor and assess their impacts on biodiversity and ecosystem services, and to develop and apply processes and production methods that minimize or avoid negative impacts. Parties also call on the CBD Secretariat to encourage the establishment of national and regional business and biodiversity initiatives, the development of certification tools, and the valuation of biodiversity and ecosystem services.

To read the full decision on business engagement please visit: http://www.cbd.int/decision/cop/?id=12287.

Since the Millennium Ecosystem Assessment highlighted the connections between business activities and biodiversity conservation, ecosystems are ever more considered as key service providers: provisioning goods, regulating biophysical processes, providing cultural services, etc. Things are beginning to change: companies are starting to recognise the competitive advantages that can be gained from the sustainable use of natural resources. Facing the challenge of biodiversity conservation, this has to be led both by Governments, policy makers and businesses.

Since businesses consume ecosystem goods and services, they contribute to ecosystem change. For many, their profits depend directly on well functioning ecosystem services. Indeed, biodiversity and ecosystem services provide essential raw materials for businesses – in industrial production, commerce and trade. For these sectors, biodiversity conservation makes good business sense.

From a business perspective, the reasons to invest in biodiversity conservation are increasingly forceful. An increasing number of market opportunities related to biodiversity conservation such as markets for ecosystems services are developed.

The reasons to invest in biodiversity are even more obvious for business that depends directly on the health of ecosystems. But even businesses that do not directly depend on natural resources can be motivated by new policy incentives as well as changing consumer behaviors to ‘go green’.

The environmental footprint management is increasingly seen as an efficient tool regarding risk management and new opportunities development. Some leading companies have developed daring strategies regarding:

  • The development of responsible products that meet a growing demand, so that they increase their revenues,
  • The consultation of civil society – at both local and global levels – in order to obtain license to operate and secure their activities,
  • The improvement of the use of natural resources, so that they make cost savings,
  • The pre-emption of regulations and public pressure…

These strategies contribute to improve the companies’ bottom line. Further more, since businesses depend on a good reputation with their stakeholders (investors, employees, civil society, etc.), corporate action on biodiversity is helping businesses in distinguishing themselves from competitors, as well as improving relations with their stakeholders’.

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