Why does nature matter for business?

This article looks to simply and clearly explain why nature matters to business. There’s a lot of complexity around this topic and we’re always to hand if you want to dig in more.

What is nature?
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Nature means the natural world and has an emphasis on its living components. [Think: the diversity of living organisms, including people, and their interactions with each other/ their environments]. It is made up of four realms: Freshwater, Ocean, Land and Atmosphere #Fola.  

Nature provides the foundations of our economies and societies – from the air we breathe and the water we drink to the soil we grow our food in. Everyone, everywhere depends on nature.

What is happening to nature?
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Did you know that 1/3rd of our topsoil has been degraded and that 93% of fish stocks are already fished at or beyond maximum sustainable levels? Or that globally the amount of natural capital assets per person (e.g. water, wood, minerals etc) declined by nearly 40% in 1992 to 2014?

It’s scary. We are depleting nature faster that in can restore itself, and this is amplified by human-driven climate change. It's even said that we are entering the Earth’s 6th Mass Extinction.

‍Why should my business care?
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Your business impacts nature. All of us impact nature in some way but above all, food, energy, infrastructure, and fashion can drive 90% of human-caused pressure on biodiversity. We’re all responsible for nature loss.
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Your business faces risks from nature. After interviewing 1,500 experts and business leaders, the World Economic Forum found that environmental risks are now the most significant risks for the next decade. And yet, these same risks are the ones that executives feel least ready to address – with the one study finding that the majority of global companies assessed did not really understand how they affect and rely on nature.

Your business likely relies on nature to operate. A staggering 55% of global GDP depends on nature. Today’s data centres have huge freshwater requirements, farmers need productive soil, and pharma companies need novel sources of drugs. We may not see it, but our high tech, sanitised global economy, is built on nature.

Your business can seize opportunities by acting on nature. Acting on nature not only reduces the major risks set out above, but also opens up opportunities for job creation and growth (one estimate suggests 395 million jobs and $10 trillion of GDP growth). A strong approach to nature can build reputation and tap into new markets (e.g. biotechnology, renewable technology, sustainable agriculture etc). As an example, see our post on the UK Nature Markets Framework.

Why act now?

Risks and opportunities exist now. Ignoring these risks won’t stop them. In fact, the shockwaves from nature-loss are already affecting companies and governments; and even a simple understanding of these can vastly improve your ability to respond. On the flipside, early mover opportunities don’t last forever.

Governments are acting now; regulation is already coming down the line. Countries are feeling the impact from a changing environment (e.g. Slovenia was hit by flooding that created economic losses equivalent to 16% of its GDP) and projections are that nature loss can cause serious damage to the global economy (see below). In response, they are acting on nature-loss, most notably through the Global Biodiversity Framework through to reporting frameworks such as CSRD, which is mandatory for many companies.

The crisis is now. Bluntly, today’s economy is exhausting nature. Through collective action, we need to turn off the tap and move quickly, rather than face the daunting and accumulating impacts of delayed action.‍

What can I do about it?

This may feel daunting but we’re here to help. We’d like to leave you with 3 key messages:

There are lots of levers to pull. Typically, the first step is building understanding and engagement on the issue. Companies then analyse and report their relationship with nature and, in parallel, begin to integrate nature into their corporate strategy and governance.

This is iterative. No-one will get it right first time but even just starting the process will radically improve your understanding of your business’ relationship with nature and help you to position accordingly.

We can help. This is our day job: to take the complexity of this area and make it digestible. Whether through our nature diagnostic (for reporting and strategy), bespoke videos or nature action plans, our mission is to advance understanding, reporting and action on nature.

If you want an informal chat on nature, please do reach out on LinkedIn or at information@fola.earth
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