Why the UN’s latest report on the state of our planet’s biodiversity and ecosystems matters to financial institutions

7 May 2019

Image: Matt Zimmerman

Few weeks pass without scientists reporting new knowledge of how badly humans are treating our planet, and the consequences for our common future. With the launch of the IPBES report summary for policymakers and a whole host of new and old facts and statistics, one may ask what is different this time?

The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystems (IPBES) was set up in 2012 as an independent intergovernmental body to provide objective scientific assessments about the planet’s biodiversity and ecosystems. This IPBES report will do for biodiversity and ecosystems what the IPCC reports have done for climate – bring it to the forefront of people’s attention, influencing policymakers, business and financial institutions to action. Because if it does not, we may as well look for another planet to inhabit.

Some highlights:

  • 47% reduction in ecosystem extent and condition
  • 75% of terrestrial and 66% of marine environment severely altered by human actions
  • >85% of wetlands lost in just 300 years
  • 33% of marine fish stocks harvested at unsustainable levels
  • Up to 1 million species threatened with extinction, many within decades
  • >33% marine mammals threatened with extinction
  • 50% of live coral cover of reefs lost in 130 years
  • 50% of agricultural expansion occurred at the expense of forests
  • >2,500 conflicts over fossil fuels, water, food and land currently occurring worldwide
  • +/-4 billion people rely primarily on natural medicines
  • >80% of global wastewater discharged untreated into the environment
  • 10 times increase in plastic pollution since 1980
  • 30% reduction in global terrestrial habitat integrity caused by habitat loss and deterioration
  • US$235 to US$577 billion annual value of global crop output at risk due to pollinator loss

The facts should shock people, politicians, businesses and financial institutions into action.

As the planet’s population gets larger and richer, more food, energy and materials than ever before are being used, increasingly at the expense of nature’s ability to provide such contributions in the future.

The report notes that economic incentives generally favour expanding economic activity, and often environmental harm, over conservation or restoration. Yet incorporating the value of nature into decision making improves ecological, economic and social outcomes.  We also know that except in scenarios that include transformative change, these negative trends will continue – things will get worse without significant change of momentum from people and policymakers.

The good news is that while some degradation is irreversible, much can be done to improve outcomes in the future. We can safeguard the environment by using the best available scientific knowledge to develop widespread support for conservation, ecological restoration and sustainable use actions. This implies mainstreaming biodiversity and sustainability across all extractive and productive sectors, including mining, fisheries, forestry and agriculture, so that individual and collective actions together result in the reversal of deterioration of ecosystem services at the global level.

For financial institutions this means going beyond climate, to set targets and goals for biodiversity and ecosystems indicators. This is not an easy task, especially since many of these indicators are not fully developed for finance sector use. However, the days when financial institutions could use lack of scientific knowledge and data as an excuse for inaction are over. The Natural Capital Finance Alliance’s ENCORE tool already connects nature to economic sectors across the entire economy, and future iterations of the tool will add natural capital impacts and better environmental data coverage.

As more granular and robust science becomes available to decision makers, and as the momentum grows to protect and restore the environment in order to safeguard our common future, health and prosperity, there will be increasing pressure on financial institutions to show that they are also part of the solution. This is why financial institutions should take special notice of the report and the building momentum towards a new deal for nature in 2020.

Find out more about UNEP FI’s Ecosystems work here or contact Anders Nordheim for more information.

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