With the COP26 summit in motion, and the UN reporting a “code red” for global warming, the pressure on businesses to address climate change is intensifying. Against this background, the G7 recently called for the world to become nature positive. But what does it mean? How does it differ from, and interplay with, other objectives like net-zero? Crucially, how can businesses make it mean something tangible — not just words on your ESG mission statement?
What Is Nature Positive?What does nature positive mean? According to the World Economic Forum, it means “enhancing the resilience of our planet and societies to halt and reverse nature loss.”
How Does Nature Positive Differ from Net-Zero and Carbon Neutral?Nature positive isn’t the only term used to describe climate-focused activity. We also hear carbon-neutral, net-zero and carbon or corporate footprint. How is nature positive different? The World Economic Forum believes it “represents a real paradigm shift in how nations, businesses, investors and consumers view nature.” Rather than doing simply “less harm,” individuals and businesses are being exhorted to impact nature positively, enhancing ecosystems rather than settling for damage limitation.
Why Is It Important Now?Nature positive as an aspiration is gaining traction and garnering headlines. In their recent announcement, G7 leaders announced that “our world must not only become net zero, but also nature positive, for the benefit of both people and the planet.” This sits against a backdrop of increased focus on all aspects of environmental, social and governance (ESG) activity. This has some drivers:
- Burgeoning regulation and legislation. More and more jurisdictions are making ESG disclosures mandatory.
- ESG ratings. These scores are being used increasingly as a means of assessing companies’ investment potential.
- There is a growing sense of the need for companies to act with integrity. Shareholder activism and the reputational risk of falling short on ESG are focusing boardroom attention on corporate ethics. At the same time, a general move towards business philosophies like the triple bottom line concept reflects many businesses’ desire to “do the right thing” on environmental and social matters.
- And ESG isn’t purely an altruistic play. Organizations are alive to the real business benefits resulting from a more socially — and environmentally-conscious operation. This may be benefitting from the innovative ethos that results from a diverse workforce or the proven improvements in financial performance linked to ethical corporate behaviors (perhaps driven by the 64% of US consumers who consider a company’s ethical performance in purchasing decisions). Acting ethically makes sound business sense.
How Can Businesses Become Nature Positive?The World Economic Forum (WEF) has published a blueprint for businesses wishing to “transition to a nature-positive future.” This has valuable guidance for organizations wanting to understand and take steps towards being nature positive, including 15 transitions companies can make to halt nature loss by 2030. The WEF estimates that these 15 systemic transitions could generate up to $10.1 trillion in business value and 395 million jobs by 2030 — further evidence of the commercial benefits of a nature positive approach. Although transition risk is always a consideration when implementing any business change, the benefits of moving towards a nature positive approach hopefully outweigh any challenges in getting there.
What Practical Steps Should Businesses Take to Become Nature Positive?
- Assess your current performance. How do your existing processes and operations stack up against a nature-positive agenda? Even this first step can be a challenge for many businesses, as they lack oversight of their ESG performance across all the organization’s entities.
- If this is the case for you, you need to step back and review your overall ESG strategy. Is it comprehensive; does it cover all areas of your operations, all geographies? How do you capture your processes and policies? Without a structured framework in which to manage and measure ESG, you will struggle to gather the data you need, monitor your performance and progress, and take steps to improve.
- Once you have a structure for your ESG-focused strategies, you need to implement the governance processes that oversee them and measure progress. Sustainability and corporate governance are intrinsically linked; your environmental efforts may be for nothing without good governance.