A new report funded by the European Commission makes a strong case for integrating biodiversity into private sector business plans and core activities around the globe. The report reveals considerable recent growth in eco-certified products and services, growing consumer concerns for sustainable production, and shows how biodiversity can provide a substantial business opportunity in a market that could be worth $2-6 trillion by 2050.
The ‘TEEB for Business’ report makes seven key recommendations for businesses, and calls on accounting professions and financial reporting bodies to develop common standards to assess biodiversity impacts, and develop new tools for this purpose.
“Despite some local successes, and in spite of a growing awareness of the problem, the global rate of biodiversity loss does not appear to be slowing. But this report shows that businesses can help, and I am heartened to see these tangible examples of companies that are flourishing without damaging the only planet we have,” says European Commissioner for the Environment Janez Potocnik.
Key Proposals for Businesses
TEEB for business recommends a series of actions to help companies minimise their biodiversity risks and seize the business opportunities ecosystems services create:
* Identify the impacts and dependencies of your business on biodiversity and ecosystem services (BES)
* Assess the business risks and opportunities associated with these impacts and dependencies
* Develop BES information systems, set SMART targets, measure and value performance, and report your results
* Take action to avoid, minimize and mitigate BES risks, including in-kind compensation (‘offsets’) where appropriate
* Grasp emerging BES business opportunities, such as cost-efficiencies, new products and new markets
* Integrate business strategy and actions on BES with wider corporate social responsibility initiatives
* Engage with business peers and stakeholders in government, NGOs and civil society to improve BES guidance and policy.
Biodiversity is Good For Business
The report finds that while a majority of companies still treat biodiversity superficially in their reports, growing numbers are aware of the potential benefits. Biodiversity and ecosystem services offer opportunities for all business sectors, and their integration can bring significant added value by ensuring the sustainability of supply chains, generating new products, creating and penetrating new markets and attracting new customers.
Policies to manage biodiversity and ecosystem risks can also help to identify new business opportunities, such as reducing input costs through improved resource efficiency, developing and marketing low impact technologies, managing and designing projects to reduce ecological footprints, and providing professional services in risk assessment and management/adaptation.
Estimates developed by PricewaterhouseCoopers for “sustainability-related global business opportunities in natural resources (including energy, forestry, food and agriculture, water and metals)” suggest a potential market in the range of $2-6 trillion by 2050 (at constant 2008 prices). About half of this is “additional investments in the energy sector related to reducing carbon emissions”. Markets for biodiversity and ecosystem services are growing, as shown by data compiled by Forest Trends and the Ecosystem.
The certified agricultural products market was valued at over $40 billion in 2008 and is expected to reach up to $210 billion by 2020, and may reach $900 billion by 2050.
Payments for Ecosystem Services for water-related ecosystem services and watershed management account for only $5 billion in 2008, but are expected to total more than $30billion by 2050.