This week, 320 global companies, prepare to embark on accounting for nature in their annual reports. Accounting for nature, wildlife and climate, is soon to become a mainstay of corporate practice. It’s about time too. But it remains to be seen how they will actually measure ‘nature’ … even more so, how they can practically demonstrate being ‘nature positive’. What does nature positive mean? Nature is the latest buzzword to capture the attention of bureaucrats worldwide but isn’t really very well understood. To put it simply, nature = ecosystemsHow ecosystems function An ecosystem is a community of lifeforms that interact in such an optimal way that how ecosystems function best, is when all components (including humans and other animals) can persist and live alongside each other for the longest time possible. Ecosystems are fuelled by the energy created by plants (primary producers) that convert the Sun's heat energy More = wildlife. But the fact we can’t restore functioning ecosystems without rebuilding wildlife populations still isn’t front-and-centre (where it should be) It will take many more years before this gets the attention it deserves. Oxford University, meanwhile, have published a report on the importance of nature and it makes for interesting reading.
The erosion of natural capital linked with biodiversityWhat is the definition of biodiversity? When we ask, what is the definition of biodiversity? It depends on what we want to do with it. The term is widely and commonly misused, leading to significant misinterpretation of the importance of how animals function on Earth and why they matter a great deal, to human survival. Here I will try to More loss and environmental degradation generates significant and long-term risks to society, the economy and therefore financial institutions, from increasing the risk and impacts of pandemics, floods and droughts, to undermining water quality and supplies, soil erosion, damaging agricultural production and risks to human health. More than half of global gross domestic product (GDP) is dependent on nature and its services, yet it could also be argued that there is no economy (or indeed, life) without these critical services, such as water, clean air and food.
Oxford University Environmental Change Institute, December 2003
What is nature-positive?
I’ve been giving this a lot of thought recently and I’ve come up with this simplified proposition:
We live in the biosphere, a container for life, made up of ecosystems. Ecosystems are the fabric that holds together the patterns of biodiversity together. Biodiversity delivers three key elements for our survival: air, food, water. When these patterns are stable enough, we are healthy and our climate becomes predictable. This can be said to have a ‘nature positive’ value. That is more to say, that our ecosystems are delivering a net surplus of energy, that enables humanity to survive, without eroding the underlying fabric that holds it all together. For a longer explanation, read my book, Wildlife in the Balance.
Our actions, whether well-intentioned or not, have two key consequences:
- To pollute the biosphere, resulting in a threat to our air, food, water; and
- To further erode the fabric of ecosystems, either directly or unintentionally, leading to poor health and an unstable climate (many of our efforts to engineer better human services, are nature-negative).
Every action needs to be measured against these two outcomes. Because they feed back into one another. They first cause harm that is socially unacceptable and eventually the life-supporting container begins to collapse.
The Oxford University Report
Thank you Vian Sharif for this useful summary:
New study finds that $5 trillion of nature-related economic risks will amplifyAmplification (of nutrients and energy). Animals consume plants and other animals and in doing so, reintroduce important energy-containing nutrients back into the environment, at even higher concentrations and in patches. Amplification of energy is driven by migration and happens at every scale, from insects moving daily in and out of your vegetable patch, to African wildebeest herds and the seasonal More climate change
🌱 Nature is the foundation upon which our global economy is built.
❗️ For this reason, nature loss is a major systemic risk for financial markets and investors.
🏦 This includes the impact of nature loss on the value of investments/assets and other forms like regulatory risk.
🏫 The new research from the University of Oxford found that shocks to the global economy related to nature loss could cost even $5 trillion.
📈 The authors found that deforestation, land-use change, over-extraction and pollution erode the natural capital and, at the same time, act as ‘risk amplifiers’ on the impacts of climate change.
🌿 The study also highlighted the challenges for financial institutions in managing nature risks that are still not accounted for in the financial sector.
📜 The researchers recommend that governments and regulators implement a precautionary approach. This includes a pressing need to assess nature risks, in line with recommendations from the Taskforce on Nature-Related Financial Disclosures and identify possible gaps in regulation
What’s your role in being nature positive?
Your insurance premiums for health, property and business, are already increasing as a result of this loss and the largest reinsurance companies in the world are lobbying governments to put nature-based solutions first, as this is the only way to restore balance. This is why corporations are worried.
The challenge that corporations will have though, which is summed up nicely in the Oxford Report is:
“Links between biodiversity, ecosystem functioning and ecosystem services … need to be better linked in order to improve understanding and explanation of important relationships and feedbacks between components of coupled social-ecological systems … Risks are … unique to the local ecological, social, economic context, so these issues pose challenges for financial risk assessment” (my emphasis added).
In short, this means recognising you as part of nature. When were you last asked how your life is affected by the corporate development happening around you? That is going to start happening more and more.
Where does wildlife come into this?
Simple. We know, for instance, that even ‘intermediate levels’ of fish species loss reduces algal production more than climate warming. Higher levels of extinction has effects rivalling ozone layer loss, ocean acidification and even nutrientEnergy and nutrients are the same thing. Plants capture energy from the Sun and store it in chemicals, via the process of photosynthesis. The excess greenery and waste that plants create, contain chemicals that animals can eat, in order to build their own bodies and reproduce. When a chemical is used this way, we call it a nutrient. As we More pollution. This means, we’ve eroded the container more significantly, than we are polluting it. But we’re not being told that.
Restoring natural processes is more critical than anything. And there is only ONE WAY TO DO THIS. That’s to re-establish wildlife populations and give nature space take its course. Because every effort we’ve ever made to interfere with these undefinably complex problems, has resulted in making things worse.
I’m personally excited about this future. A brighter, more vibrant world, full of wondrous wildlife where we can have cleaner air, water and food.
