Whether it’s the fractal patterns that make up a fern frond or the billions of genes that comprise a polar bear’s genome, we are accustomed to thinking about nature in terms of marvellous complexity.
That idea can be a powerful argument for why the natural world must be protected but there’s also a danger it can be a handbrake on the actions needed to do so.
Now that the Taskforce on Nature Related Financial Disclosures has released its final framework, the idea of shifting towards a nature positive future has become suddenly material for companies looking to strategise, manage risks and identify opportunities.
Nations have made and embraced new global nature targets at December’s COP 16, while news headlines deliver daily warnings of ecosystem collapse. Organisations like the World Economic Forum have attempted to quantify how dependent global economies are on nature and what is at stake for individual companies as a result.
Amongst all this noise there’s a serious risk that business leaders might feel activated by a sense of urgency but paralysed into delay or inaction by what they regard as the inherent complexity of the nature challenge. There’s a sense that some believe the cost of responding is too great, the benefits are too uncertain or the ‘right’ response is yet to emerge.
And that couldn’t be further from the truth.
In reality, everything you need to respond to the nature challenge boils down to four simple questions that every company should be asking itself right now: What was nature like before? What is it like currently? What do we want it to be like in the future? And who is best placed to help us answer this?
These questions delineate the task that lies ahead for most companies: understanding the direct impact of their processes and presence on natural environments as well as the indirect impact and dependency of their supply chains and their products once released into the market. Ignorance and inaction will not be an option as shareholders, customers and regulators become increasingly sensitive to nature damage.
The good news is that getting started on this path is not as complex as commonly feared.
In fact, most companies have probably already started. If you have a net zero strategy and are monitoring and reporting your emissions and your impact on climate then you have already made a start on your nature positive strategy. If you have investigated your supply chains to ensure they don’t entangle with human rights abuses or modern-day slavery then you’ve already made a start on your nature response. If you have invested in or commissioned a new development that needed to meet local environmental regulations then you are already sitting on some of the data you need to help inform your nature plan.
Every company’s response should start with a thorough accounting: What are the places where your business processes – direct or indirect – are impacting on and dependent upon nature? What were those locations like before? What needs to be done to restore them? I am regularly surprised by how little understanding large and small companies have when it comes to their dependencies on nature. I will often start by asking them: ‘Show me on the map where your dependencies and impacts are’. Not many can.
Companies should also, in this initial phase, begin investigating how their response to the nature challenge throw up opportunities via emerging environmental markets. As such markets take shape there will be significant scope for nature-based solutions to not only contribute towards the protection and restoration of natural capital but to insulate against corporate nature risk and offer additional revenue streams and opportunities in themselves.
Companies have had 15 years to integrate in their business processes reporting, disclosure and mitigation measures relating to greenhouse gas emissions in the fight against climate change. It is not possible, nor expected, that doing the same for nature can happen in 15 weeks — once the TNFD framework lands. There is urgency to act but it will be necessary to take stock and chart a careful and considered pathway.
There will, however, be no perfect response and unduly delaying until one emerges will not lead to a good outcome. There will be first-mover advantages for those who can grasp where the opportunities lie in the emerging nature positive and net zero economy.
It is necessary to make a start on meeting the nature challenge using the tools and knowledge systems we already have access to, rather than waiting for some future breakthrough or innovation. A critical lever for those wanting to lead on nature positive transition will be to engage more directly with Indigenous peoples and systems of knowledge. Around the world such communities are the best and often last remaining holders of knowledge who can answer the questions about how natural systems once functioned, what has been lost and what is needed to restore them.
Disconnection from such sources – often wilfully – is a large part of what has gotten us to the point where ecosystems are at risk of collapsing all over the world.
These are system level problems and cannot, by definition, be solved by one actor, one person or one company. Working with First Nations people, with scientists and research institutions and other parts of civil society will be critical for businesses wanting to mitigate nature risk and grasp opportunities. The need to broaden the circle occurs within companies also. At present, we see many large businesses that have a champion for action on such issues but have not been able to embed this as a priority organisation wide.
Dealing with the challenge of the nature positive transition isn’t always easy but it shouldn’t be paralyzingly complicated. The tools we need, the knowledge that’s key and the relationships that can deliver it already exist within touching distance of most corporate leaders. As the TNFD arrives it is the mindset that needs to shift and alongside it our sense of what’s possible. The sooner that shift begins the better.
Guy Williams is a foundation member of the Taskforce on Nature Related Financial Disclosures and is Executive Director at global climate change investment and advisory firm Pollination. He was formerly Global Nature Lead at Deloitte and has always been and continues to be a primate ecologist passionate about the protection of nature.