Biodiversity considerations should be integrated into chemical industry’s business strategies
This was one of the key conclusions of the EU policymakers, NGOs, scientists, and chemical industry present at the Cefic event held on the topic on 19 May.
Biodiversity loss is a risk that goes beyond environmental factors
The evidence about the biodiversity crisis is growing. According to the World Economic Forum Global Risks Perception Survey of 2021-2022 ,13.5% of the respondents – including industry, NGOs, academia, and policymakers – expects biodiversity loss to become a threat within 2-5 years, and 27.0% within 5-10 years. It can have irreversible consequences for the environment and lead to a reduction in numbers of species. But it goes beyond that. It will also have an impact on the economic activity, societal well-being, and geopolitical and technological factors. “We need to transform the way we produce and consume products and the way society is organised”, said Carina Larsfalten, Director Corporate Engagement of The Nature Conservancy. “Customer demand for sustainable products is rising rapidly and investors are increasingly demanding nature-related disclosures and the setting of science-based targets (SBTs) for nature”, she added.
We need to address the drivers of biodiversity loss
The main drivers of biodiversity loss are pollution, climate change, habitat destruction, over-exploitation, and invasive species. “The impact of the release of synthetic chemicals is often underestimated” said Ksenia Groh, Group Leader Bio-analytics of the Swiss Federal Institute of Aquatic Science and Technology (EAWAG), “When chemicals do get considered, the focus is on pesticides, given that some of them are acutely toxic, but there are more chemical groups that also deserve attention in this regard. Besides direct toxicity, chemicals could exert a multitude of other effects potentially affecting biodiversity, including diminishment of genetic diversity as an adaptation trade-off, which could in turn have an effect on the resilience to future threats.”
Regulatory measures are increasing
“Biodiversity and climate change are interlinked and interdependent and need to be addressed jointly” according to Anna Karamat, Policy Officer Biodiversity and Business, European Commission.
“The World Business Council for Sustainable Development embraces a goal for nature, an equivalent of net zero for climate”, Nadine McCormick, Manager Nature Action of the WBCSD explained. Nature-positive combines three measurable objectives: zero net loss of nature from 2020, net positive by 2030, and full recovery by 2050.
The EU Green Deal is the basis for many strategies the Commission has proposed, including the EU 2030 Biodiversity Strategy adopted two years ago. The overall objective of the Strategy is to protect nature, restore degraded areas, set ambitious objectives at global level, and enable the transformative change we need – which includes the role business has to play.
The EU 2030 Biodiversity Strategy has a strong focus on business and finance. The Corporate Sustainability Reporting Directive will require new reporting obligations from businesses – improving the quality and scope of disclosures on environmental aspects such as biodiversity and ecosystems.
Where do we stand today?
Results of the self-assessment tool from the industry’s voluntary programme Responsible Care show that land use and biodiversity are not yet well-enough integrated in company strategies. The impact drivers vary from habitat transformation, pollution, climate change, and overexploitation to invasive species, which makes it difficult to measure them. And the dependencies are even more diverse, from the provision of raw materials, pollination, carbon sequestration, water provision to transport routes. The Cefic guidance published in 2013 is recognised to be a valid tool to be used by the sector on how to deal with biodiversity. A comprehensive set of key principles will be developed by Cefic to further enhance the incorporation of biodiversity and ecosystems in the strategy of chemical companies
Chemical companies have also been working on approaches to measuring corporate biodiversity performance. For instance, a 5-step biodiversity risk scan by CSR Europe, provides guidance into: scoping, internal assessment, stakeholder engagement, materiality matrix and decision-making guidelines.
The panel concluded: We should all rally for nature positivity
There may be no standardised approach yet, but companies should not “wait for the perfect” to start measuring their performance. Companies will be expected to report on biodiversity and ecosystems according to the European Sustainability Reporting Standards drafted by the European Financial Reporting Advisory Group (EFRAG). In addition to contributing to the consultation on the EFRAG disclosure requirements, Cefic, together with its members, is working on the creation of a set of indicators to measure the sustainability performance of the chemical sector, including biodiversity.