The Leonardo Centre on Business for Society, 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.
As a proportion of total sustainability initiatives, those focused on biodiversity also declined from about 8% to 4% between 2009-2021.
Despite low representation of biodiversity as a focus in corporate ESG efforts, the report does show increased momentum in the space. The number of biodiversity initiatives grew significantly from an average of 600 initiatives globally between 2005-2007, to an average of over 4,000 initiatives between 2019- 2021.
A geographic analysis reveals that companies in Latin America tend to dedicate more efforts to biodiversity initiatives, launching on average 2.7 biodiversity initiatives per sustainability report. This compares to 1.7 in North America, 1.7 in Asia-Pacific and 1.2 in Europe.
By sector, utility companies implemented the highest number of biodiversity initiatives as a proportion of their overall sustainability initiatives, at 16%. This is followed by 14% for industrials and materials companies (including mining), and 12% for consumer goods.
Around half of corporate biodiversity initiatives were philanthropic, comprising donations, project funding and campaigns. This proportion declined between 2000-2021, with an increasing number of initiatives targeting new products, standards, business models training and measurement. The evolution of the content of biodiversity action shows that companies are increasingly focusing their business activities towards direct reduction of negative impacts on biodiversity outcomes.
Professor Maurizio Zollo, Scientific Director, Leonardo Centre on Business for Society, Imperial College Business School, said:
“Biodiversity is emerging as an increasingly important topic on CEO agendas. However, this has yet to manifest in the strategy discussions on sustainable growth and stakeholder value creation that mature companies are bringing forward. The fundamental problem, and at the same time the unique strategic opportunity, is the failure to seize the strategic value of engaging customers, partners, employees and local communities in innovations linking environmental regeneration and business model development.”
Natalie Blyth, Global Head of Commercial Banking Sustainability, said:
“Biodiversity loss is an urgent problem and a critical consideration for businesses and policymakers as they work to achieve net zero and develop sustainability strategies. Understanding and mapping corporate efforts to tackle biodiversity challenges, and a clear framework for reporting and measurement are key requirements. The transition from business models harming nature to ones that have no adverse impacts or, better, positive impacts on nature comes with opportunities that banks like HSBC can help unlock."
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.
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.