Why is biodiversity important?
When we damage or destroy the variety and balance of the web of life on Earth – animals, plants, fungi and micro-organisms like bacteria – we humans will not have enough fresh water, food, medicines and clean air for survival.
The biodiversity loss leads to nature crisis and global co-dependent financial and non-financial risks. This could be due to habitat loss, land use degradation, over-exploitation of natural resources or water, land and air pollution, which then in turn impact other businesses, society and the entire value chain.
Who and how should measure and manage these risks?
Each of us have a role to play in protecting the nature, but to move the masses, and change our economic and social behaviour at larger scale, we need to move companies and governments.
We start with how companies’ leaders, their directors discharge their legal duties by applying existing company and securities laws to biodiversity risk and the directors’ fiduciary duties to act with care and loyalty. A failure to consider biodiversity risks may trigger a breach of these duties.
Such duties evolve and their main social and regulatory context and expectations reflected in, for example:
- COP15, the UN Convention on Biological Diversity (December 2022)
- the Task Force on Nature-related Financial Disclosure (TNFD) framework
- the International Sustainability Standards Board (SASB) and The International Accounting Standards Board (IASB)
- the UK 10 Point Plan for financing biodiversity
- growing number of climate change and biodiversity-related litigations, and new legislation on environmental due diligence in global value chains
- investors, NGO, multilateral agencies calls and requirements to manage biodiversity risk.
Some industries, such as agriculture construction or mining, have a higher demand on natural resources, however all companies have a role to play through value chain.
Our work is to assist with biodiversity focused governance, disclosure or specific projects. We all start with helping you to understand the companies’ directors’ duties.
In addition, companies and governments are now being challenged in court. There are more than 3,000 climate change and biodiversity related cases around the world US, and this bring in litigation and reputational risks.
Comprehensive resource on most of the Climate Change Litigation cases around the world can be found here: Climate Change Litigation Databases and one in particular we are interested in is ClientEarth v Shell Plc
So, do you know how biodiversity risk and opportunities might affect your company’s corporate governance practices? How do you measure, disclose and act on evolving nature-related risks? Do you have the appropriate skills and information to identify and measure your company’s dependencies and impacts?
Do you need training or further information or a dedicated expert support to keep you abreast on development of TNFD and ISSB guidance and building the company’s expertise and readiness to implement it?