Business and Biodiversity: A Licence to Operate

December 2012
2 pages

Helena Paul

ECO 45, p. 4-6

Forest Mosaics concept: Encapsulating current business-biodiversity relations

A good example of this is the 'forest mosaics concept', meant to bring sustainable development to plantation forestry. This concept is promoted by large pulp and paper companies such as Suzano, Fibria, Kimberly-Clark and UPM, which are all members of WBCSD, working with large NGOs such as WWF and Conservation International. Under this model plantations are bordered by narrow buffer strips of ‘natural’ forest, and threaded by conservation/biological corridors. The model also includes hotspots of high conservation value forest (HCVs). Forest mosaics are operating in the Atlantic forests of Brazil and also in Uruguay. The idea seems to be that conservation of forest biological diversity and ecosystem resilience can take place in the margins of ever increasing exploitation of natural resources, including logging, mining and agriculture. The underlying idea therefore isn't new: Destructive business practices are continue while small areas are set aside for conservation. It's an old concept laid out differently; does it actually change the way these businesses operate?

Business wants access to resources, capital and markets, and a seat at the global policy development table in order ensure it has a licence to operate. At a time of growing concern about pressure on natural resources and the need for sustainability, business also has to talk about biodiversity and sustainable development as a means to secure its business targets. But its motives, influence and outcomes in terms of biodiversity conservation, sustainable use and equitable benefits need to be assessed. Before COP12, steps should be taken to reduce the direct and indirect influence of business on biodiversity decisions in order to assert the primacy of biodiversity as part of our global commons, to be governed by the CBD, not the corporate sector.
At COP 11, business was omnipresent. There were more than 70 events described as ‘business-related’ around COP11 in Hyderabad. It is worth looking a little more closely at the groupings involved. For example, The Economics of Ecosystems and Biodiversity (TEEB), originally commissioned by the G8 +5 was linked to several of them. The TEEB for Business Coalition has powerful founder members including a UK accountancy institute, large conservation organisations and the World Business Council for Sustainable Development (WBCSD), which was involved in 3 side events. This is a very large group whose emergence dates back to the Earth Summit of 1992. Top business clusters within WBCSD include 23 utilities and power companies, 17 oil and gas, 17 engineering, 17 chemical companies, 13 consumer goods, 13 cement, 12 mining and 11 tyre companies.
Regionally, membership of WBCSD is dominated by Europe (68), NAFTA (38), Japan (25). Africa has 2 members, Latin America 13, and Asia other than Japan, 19. Yet, according to TEEB for Business, a greater percentage of business respondents in Latin America, Africa and the rest of Asia expressed concern regarding biodiversity loss than in North America and Western Europe, which suggests the current pattern of WBCSD membership does not reflect the urgency of the need to tackle the issue. The WBCSD has offshoots such as the Brazilian Business Council for Sustainable Development (BBCSD), with 72 members from all areas of industry.

Is the real concern about biodiversity loss or is it about the loss of business opportunities?

Example 1: A side event on 12th October, Mainstreaming Biodiversity in Business in Brazil: The TEEB for Business Brazil Project”, organised by Conservation International, addressed the international launch of the TEEB for Business Brazil interim report., It was sponsored by Monsanto, Syngenta, Vale, Natura and Santander, all but the last of which are members of WBCSD, and the first two spoke at the event. The event description noted: ‘Concerned about biodiversity loss as a threat to their business growth prospects the Brazilian private sector has called for the development of a TEEB-like assessment focusing specifically on their Brazilian business context’. In this way business presents itself as concerned about biodiversity, but only as part of the business bottom line. Is there any possibility of changing this without changing the model altogether?

Providing incentives for business to engage

The mission of TEEB is to ‘make nature economically visible’, although Pavan Sukhdev, former Special Adviser and Head of UNEP’s Green Economy Initiative and Study Leader of TEEB always insists that identifying the value of biodiversity is not the same as putting a price on it. However, with the world economy as currently organised, it is difficult to value anything without effectively putting a price on it - the essential first step to develop market mechanisms in order to attract private sector interest.

Payment for ecosystem services and ‘Innovative Financial Mechanisms’ such as offsets

Goal 4 of Decision X/3, the Convention’s Strategy for Resource Mobilization includes the consideration of payment for ‘ecosystem services’ and innovative financial mechanisms such as offsets. The European Union’s Biodiversity Strategy to 2020 explicitly mentions innovative financing mechanisms, including market-based instruments, Payments for Ecosystem Services and incentives to attract private sector investment. It Source: Centre for Science and Environment states that ‘biodiversity offsets will be looked into as a way of achieving a “no net loss” approach’. We already know from the Climate Convention that the process of measuring, reporting and verifying (MRV) of carbon emissions is complex and costly. Biodiversity is more difficult to measure because no two areas of biodiverse habitat are equivalent and one cannot ustifiably be used to compensate for the loss of another. Yet this is how biodiversity offsets would operate. The UK Department of Environment, Food and Rural Affairs, which is experimenting with offsets, defines them as follows:
‘Biodiversity offsets are conservation activities designed to deliver biodiversity benefits, in compensation for losses, in a measurable way.’ The logical outcome of such a policy is ever-increasing fragmentation of biodiversity, until there is nothing left against which to offset.
Example 2: At COP11, there was a side event on 8th October: Conserving Biodiversity Through Market Mechanisms: Biodiversity Offsets And Their Potential For Company Participation, organised by Global Nature Fund in collaboration with UNEP-FI UNEP-WCMC. This looked at offsets, giving examples of experience in Germany, where offsetting is now law, and which applies the ‘No net loss’ approach through the use of compensation or offsets.

Work to do before COP12

Biodiversity together with ecosystem resilience are crucial to the continuance of the human species. We are already putting intolerable pressure on forests, soils, water, and species diversity. We could be on the edge of the greatest extinction for millions of years, induced by human activity. And we could halt this process with collective political will and action for the common good. A first step is to reduce the influence of business on biodiversity discussions, to assert the primacy of biodiversity and then to make real changes to our development model so that it is no longer dependent on economic growth. But will we do that? Global Biodiversity Outlook 3 of 2010 is clear: “The action taken over the next two decades will determine whether the relatively stable environmental conditions on which human civilisation has depended for the last 10,000 years will continue beyond this century.
The approaches that business and some Parties promoted at COP11 are not the way to defend biodiversity and ecosystem resilience. The logic of the current trajectory of resource exploitation is that we will increasingly render the planet inhospitable, perhaps even uninhabitable for humanity. Somehow we have to break through the deadlock, rebuild trust, and the recognition that we have a common problem and a common interest to protect biodiversity for present and future generations. We have a lot of work to do and we have to get it underway before COP12.