By Simon Jessop
LONDON, Aug 4 (Reuters) – Companies and financial institutions are not moving fast enough to address nature loss despite the growing threat it poses to profits, economic growth and global supply chains, the U.N.’s biodiversity chief told Reuters.
Ahead of the next round of talks under the Convention on Biological Diversity (CBD) in Armenia in October, Executive Secretary Astrid Schomaker said that while some companies were highly engaged, many remained “on the sidelines”.
“Companies are not investing enough time and energy and resources into analysing their biodiversity impacts and dependencies and risk along the supply chain,” she said ahead of preparatory talks for COP17 in Nairobi this week.
That is despite biodiversity loss featuring among the World Economic Forum’s top global risks since 2020.
“The paradox is that … biodiversity and nature risk has been amongst the top risks for the past five or six years,” Schomaker said. “So in a way they are aware that there’s a risk, but companies are not yet acting on it.”
The slow pace of action reflects practical and financial hurdles, Schomaker said. Companies have been slow to assess biodiversity risks, while governments have yet to require greater disclosure.
Unlike carbon emissions, biodiversity risks are often location-specific and harder to measure, making them tougher for companies and investors to incorporate into decision-making.
MORE SPENT ON HARMING NATURE THAN PROTECTING IT
Corporate progress will form part of a broader COP17 review of the landmark Kunming-Montreal Global Biodiversity Framework agreed in 2022.
Under the deal, countries committed to protect 30% of land and sea by 2030, restore degraded ecosystems and reduce subsidies for activities that harm nature.
A key goal was mobilising at least $200 billion a year from public and private sources, but progress has been slow, hampered in part by a slide in development funding by richer countries led by the climate-sceptic Trump administration.
Schomaker said spending that harms nature still far exceeds funding aimed at protecting it. A 2023 U.N. study found more than $7 trillion was invested in environmentally harmful activities, most of it by the private sector.
Redirecting private capital towards nature-positive investments remained the “biggest challenge”, while development lenders needed to reflect biodiversity risks more directly in lending decisions, she said.
A key issue at COP17 will be scaling up the Cali Fund, launched last year to channel money from sectors such as pharmaceuticals and biotechnology that profit from genetic resources into nature conservation.
Research released last week from Zero Carbon Analytics said tropical forests hold up to $1.2 trillion in undiscovered drug value from flowering plants alone.
The scheme envisages contributions of 0.1% of annual revenue or 1% of annual profit, but several issues remain unresolved, Schomaker said.
Among the outstanding questions are how funds should be shared between countries and Indigenous communities, and whether companies should contribute based on total revenue when only part of their business relies on genetic resources.
Countries have also been slow to encourage participation through measures such as tax incentives, Schomaker added.
(Reporting by Simon Jessop. Editing by Dhara Ranasinghe and Mark Potter)
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