Climate Transition in the Context of Biodiversity Conservation

The United Nations (UN) held two flagship conferences of the parties (COP) at the end of 2022 to discuss a wide range of environment-related issues. The UN Biodiversity Conference (COP15) engaged stakeholders from different areas in government, academia, NGOs, the private sector, and Indigenous communities to combat biodiversity degradation. The conference ended with a landmark agreement including a bold global biodiversity framework. Nevertheless, there is still a long way to go for the global biodiversity conservation. Although policymakers typically approach climate change and biodiversity as different issues, it is important to increase synergy between the two ideas to improve policy.

Biodiversity—changes in ecosystem structure and services—can affect climate while climate change can affect diversity in species, food security, and other natural features. Despite this relationship, however, one study found that media coverage on climate change was up to eight times greater than discussions on biodiversity. This stems from some of the technical challenges when turning biodiversity loss from an environmental issue into a concise policy concern. To start, it is both controversial and difficult to place a value on nature, and experts may still end up failing to alert policymakers on the direct impacts of biodiversity loss, either on people or the economy with their current valuations. Further, while regulators can set carbon emission targets for climate change mitigation, they have not found a common indicator for biodiversity conservation, which can further discourage substantive policy conversation. This lack of interconnection between the two topics will result in inefficient policies and even negative impacts on environment protection. For example, overplanting trees for carbon sequestration through so-called “compensation actions” will change the ecological balance, which can negatively affect local biodiversity. In this way, increasing the synergy between climate and biodiversity policy conservations not only raises awareness of the importance of biodiversity, but also the role it plays in protecting the environment through an effective and comprehensive approach.

Deforestation-free action can be a good start to realize this synergy since forests are important habitats for wildlife and critical sinks for carbon emissions. According to the Food and Agriculture Organization of the United Nations (FAO) and United Nations Environment Programme (UNEP), forests are home to 80% of amphibian species, 75% of bird species and 68% of mammal species. Research shows that since 1990, the conversion of forest to other land uses has caused the loss of 420 million hectares. Additionally, human activities such as agricultural expansion have damaged over 100 million additional hectares of forests through droughts, forest fires, and the proliferation of invasive species. Countries with the highest deforestation rate, such as Russia, Canada, and the U.S., should be the first to focus on transitioning their economies.

This transformation will effectively engage different sectors along the supply chain in deforestation-free action, including the private sector. Businesses have a vital responsibility to manage their supply chains in a sustainable manner and their actions have a huge impact on addressing deforestation. Food producers, for example, can change their business practices to include farm assessments, certification, and satellite monitoring to ensure their suppliers do not engage in deforestation upstream of the value chain. Creating frequent technology exchanges among countries in this way will help realize a global cost-effective transition. For example, Canada and some high-forest cover countries, such as Indonesia and the Democratic Republic of Congo, have set up Forest Stewardship Council partnership. Through this partnership, Canada shares its expertise and technology for sustainable forest management, including the use of GIS mapping, remote sensing, and forest inventory techniques.

The biggest obstacle, however, when engaging the private sector in both climate-related transition and biodiversity conservation is maintaining funding for environmental concerns by integrating them with traditional production instead of treating them as subset philanthropic campaigns. Developing climate and nature related risk assessments provides an effective avenue. Risk assessments show businesses how environmental issues like biodiversity loss and climate change can cause material financial losses to their production process. Currently, NGOs and consulting firms have developed several useful assessment tools, such as the Biodiversity Impact Assessment Tool by Institutional Shareholder Services (ISS) and ISO 14091 to assess the risks and vulnerabilities of an organization under the context of climate change and biodiversity loss.

Since transitioning to deforestation-free supply chains requires significant coordination among many parties, governments also have an important part to play in realizing this coordination through enforceable regulations and effective monitoring. Regulations to enhance corporate transparency are one of the first steps governments can take to create assessments on how biodiversity loss translates into financial risks. Both the Task Force for Nature-related Financial Disclosure (TNFD) and the Task Force on Climate-related Financial Disclosures (TCFD) recently released frameworks that address how to widen the adoption of information disclosure in corporate reports. These disclosures include evaluating how a business is impacting biodiversity loss and accelerating climate change.

In short, biodiversity loss deserves just as much attention as climate change since the two disciplines are highly interrelated. To effectively cope with these challenges, countries must coordinate along the supply chain through joint efforts between the public and private sector to transition industries into a deforestation-free global economy. Nature and climate related risk assessment tools and information disclosures can show private companies how biodiversity loss and climate change are financially detrimental to their business models. These disclosures assist companies in allocating capital in ways that protect companies from risk, contributing to a better future for society and the planet. Biodiversity assessment tools have a long way to go before they can have the same impact as carbon emission measurement in climate policies. This progress, however, is the first step showing how decisionmakers in governments and private firms to come together to tackle biodiversity loss. In this way, deforestation-free action among companies can be a good start to make full use of these tools and realize the synergy between climate change and biodiversity.