The evolution of corporate behaviour to tackle biodiversity challenges

Biodiversity loss translates into a 69% species loss since 1970, inextricably connected to changes in land use, overexploitation, and climatic conditions, as well as increasing levels of pollution. Businesses' role in contributing to biodiversity loss is widely acknowledged, and business leaders are starting to step up to the challenge of mitigating and reversing the trends of biodiversity losses.

Imperial College Business School, in partnership with HSBC, has launched a new report: 'The evolution of corporate behaviour to tackle biodiversity challenges', which examines how companies across all sectors and regions globally, have addressed biodiversity in the last two decades.

The study analysed 40,000 biodiversity initiatives disclosed in the sustainability reports of over 6,000 publicly traded companies, identifying those relating specifically to 'preservation and regeneration of life on land - Sustainable Development Goal (SDG) 15 and 'life below water' (SDG14).

Of the 651,880 sustainability corporate initiatives identified between 2000-2021, only 6% relate to biodiversity. Of those, the vast majority (96%) targeted Life on Land, and only 4% - or 0.2% of overall corporate sustainability initiatives, targeted Life below Water. This is despite the central role that the ocean plays in the preservation of life on Earth.

The challenge is complex. Unlike greenhouse gas emissions and pollution, it is difficult to link biodiversity losses with specific activities – save for direct impacts on habitats, such as agriculture on forests and fishing on marine life. Moreover, we are still missing a broadly accepted measurement framework for biodiversity loss. 

The six key conclusions of the report are:

1. The share of initiatives targeted at biodiversity is small relative to the problem at hand
2. Biodiversity initiatives primarily target Life on Land
3. The nature of corporate initiatives targeting biodiversity is evolving for the better
4. Companies are indirectly addressing biodiversity challenges through efforts to address other nature-related SDGs
5. The concentration and quality of biodiversity initiatives vary across regions
6. Where a biodiversity issue is more material for a sector, we see more initiatives, and they are more complex

This report was written in partnership with the Leonardo Centre on Business for Society at the Imperial College Business School.

Authors

Livio Scalvini, Executive Director of the Leonardo Centre on Business for Society

Maurizio Zollo, Scientific Director of the Leonardo Centre on Business for Society and Professor of Strategy and Sustainability.

Contributors

The authors would like to express their gratitude for the valued contributions from the Leonardo Centre team: Matteo Burato, Marina Gadkary, Charlotte Kincaid, and Yvonne Zhang; and Pedro Anaya, Natalie Blyth, Marine de Bazelaire, and Swaroop Nadhavajhala from the HSBC team.

Today, we finance a number of industries that significantly contribute to greenhouse gas emissions and we have a strategy to help our customers to reduce their emissions and to reduce our own. We're focused on supporting businesses across the ecosystem and helping to deliver a net zero global economy, leveraging our global scale, deep expertise and strong presence in emerging markets.

HSBC's Approach to Nature

Governments, businesses, communities and civil society face a common threat from dangerous levels of nature loss. To address this, all parties must work together and take collective action to drive the transformative changes needed to halt and reverse nature loss. Governments will be crucial in setting long-term, stable policies which support the investment decisions needed in the transition to a more nature-based economy. The finance sector can also play a key role in helping to scale-up nature-related finance and reducing the finance flows that harm biodiversity.

In October 2020, HSBC announced its net zero ambition. Transition to Net Zero is now one of our four strategic priorities. We acknowledge that alongside energy transition, halting nature loss is key to achieving net zero by 2050. We are working to build on our longstanding commitment to address nature-related issues and to play our part in reversing nature loss, including working on a new holistic Deforestation Policy aimed at addressing the key commodity and sectoral drivers of deforestation. Our first Sustainability Risk Policy was published in 2004 and covered Forest Land and Forest Products, followed in 2014 by a dedicated policy on World Heritage Sites and Ramsar Wetlands and in 2017 by a policy on Agricultural Commodities. In 2020, HSBC Asset Management and Pollination Group Holdings created Climate Asset Management, with the ambition to grow the world's largest asset management company dedicated to natural capital. You can learn more via our latest Statement on Nature here.