Byline: Pippa Howard, Chief Nature Strategist, NatureMetrics
At the COP15 summit in December 2022, 188 nations agreed to the Global Biodiversity Framework (GBF). This landmark agreement comprises four goals and 23 targets aimed at halting and reversing biodiversity loss, with the headline aim to restore 30% of degraded natural habitats by 2030.
Digging deeper into the targets, it becomes clear that, as they are transformed into national and international regulations, every organisation will be affected. They are both broad and specific. Target 7 calls for reduced plastic pollution, pesticides and improvements to water health. Target 8 requires a substantial increase in biodiversity-friendly practices in agriculture, aquaculture, fishing and forestry. Target 14 says biodiversity needs to be fully integrated into policy, regulation and planning across all levels of government and all sectors.
For large companies, requirements to regularly measure and disclose their environmental impacts across their operations and supply chain are covered in Target 15. Target 19 focuses on finance, with the aim of funding biodiversity and making it easier for private sector companies to invest in nature-positive funds and schemes. As the targets turn into policy, banks, for example, will come to require business loan applications to cover lenders’ positive or negative impacts on nature. At the summit, 150 financial organisations, managing more than $24 trillion between them, many as first-time visitors to the biodiversity COP, signed a statement asking world leaders to be ambitious in defining the GBF and to halt and reverse biodiversity loss.
So what happens next? There might be a temptation to wait and see what the specific regulations, policies and requirements arising from the GBF look like. But this would be a mistake. It’s already arriving.
New biodiversity regulation implementing targets discussed in the GBF is falling into place and has been for some time. In January, the EU’s Corporate Sustainability Reporting Directive came into force, requiring large companies to record and report on their environmental impacts. The proposed EU Nature Restoration Law will further enshrine many of the GBF targets into legislation. Its Habitats Directive already protects around 1000 species and 200 habitat types, while new and stringent deforestation regulations will come into force this year. The UK government agreed to Biodiversity Net Gain regulation in February, whereby all development needs to avoid or offset any loss of habitat, with an online recording tool to be released later this year. Already, the UK’s Environment Act 2021, requires planning permissions from local authorities to deliver a biodiversity net gain of at least 10%.
And independently, around the world, many leading businesses have implemented their own nature-positive requirements from suppliers over the last decade, since the Kyoto Protocol and the publication of the UN’s Sustainable Development Goals, either because of their own ESG commitments or because they know that these practices will become regulatory requirements before long.
In other words, if your business isn’t already affected by biodiversity regulation, it will be very soon. Becoming nature positive will no longer be a nice-to-have reputational asset, but simply a licence to do business. And new regulations can be enormously disruptive to businesses, so smart organisations will prepare now, if they have not already started.
The first step is to understand your business’s relationship with nature, its impacts, dependencies and risk-factors. Perhaps it impacts nature directly, or its footprint has an impact. This can be very clear in some sectors, like construction, extractives or agriculture. But regulations will go beyond direct impacts, and into the business’s supply chain. It might use raw materials, finished goods or suppliers that have their own impact and footprint, each of which needs to be properly understood.
Companies need to measure these factors in a way that goes beyond simple awareness: they need to start biodiversity accounting — accurate figures, monitored over time, that will be publicly disclosed. Leading companies are already doing this — the top tier of mining and energy companies, giant agricultural companies, consumer goods companies like Unilever and Nestlé, the fashion house Kering — all are practising biodiversity accounting to fully understand their impacts on nature. And nature is then mainstreamed in the way they make decisions, applying the mitigation hierarchy to achieve the optimum outcomes for nature.
In terms of footprint, many businesses will need a spatial representation of land and species lost or gained. They’ll need to measure in real terms what is happening to biodiversity on the ground. This is NatureMetrics’ specialism, bringing eDNA testing together with digital technology to provide robust, comprehensive biodiversity measurements over time, providing the information that will be required by regulators and the insights that can inform nature positive decision making.
With the accounting mechanisms in place, companies can then see what biodiversity deficit they may have and make a plan to move towards net positive impact through precise, measurable and transparently demonstrable steps. Where nature is impacted, there may well be decisions available to reduce or mitigate that impact: a different choice of site, different operational procedures or more environmentally responsible suppliers. Where there is an unavoidable negative impact, that can’t be squared by more positive impacts in other areas of the business, the balance needs to be restored through compensation mechanisms, offsets or nature-based solutions.
We are all dependent on nature and this new wave of legislation and regulation is a long overdue and necessary antidote to the many decades of complacency and pillage that preceded it. We need to change the world, urgently, to avoid further environmental catastrophe, and change is only possible based on measurement. Every organisation needs to know where it stands, what impacts it currently has and how each of its future decisions can alter that impact in its journey to becoming nature positive.