Support for a requirement that businesses indicate nature-related risks associated with their activities – known as mandatory disclosure of biodiversity impacts – has gained considerable momentum at Cop15.
The call is even being supported by many businesses and financial institutions represented at the biodiversity summit in Montreal, Canada.
Known as “Target 15″ in a draft global biodiversity framework, it advocates “mandatory requirements for all large business and financial institutions to assess and disclose their impacts and dependencies on nature”. This is being proposed together with an objective to halve negative impacts and increase positive impacts.
Industry executives have joined activists and negotiators from nearly 200 countries in considering how mandatory disclosure should apply, but the commercial world and financial sector are also seeking clarity and guidance from governments on how they should contribute to halting and reversing biodiversity loss.
“There is huge amount of momentum behind mandatory reporting,” said Lucy Gaffney of Business for Biodiversity Ireland (BBI) who is attending Cop15. Compared to previous biodiversity Cops, she said the level of business engagement on the issue was unprecedented.
There was always the risk of greenwashing by some companies, but BBI supported moves to mitigate that risk by having adequate verification processes in place, she said.
WWF director Marco Lambertini confirmed the business presence was unprecedented but there are “no lobbyists” he said – unlike the more than 600 oil and gas lobbyists at the recent climate Cop in Egypt. Businesses at Cop15 wanted to help fix the biodiversity issue and to contribute to a nature-positive future, he believed.
Sectors such as mining, agriculture, oil and fashion, nonetheless, are under scrutiny at the Cop15 talks, due to their heavy impact on nature with activities that can contaminate soil, pollute waterways or pollute the air.
The reporting measure, as currently drafted, would also ask companies to halve those negative impacts by 2030, which could mean additional costs for businesses, said Franck Gbaguidi, senior analyst for energy, climate and resources at the Eurasia Group risk advisory.
But a weak deal without global agreement on how businesses should behave could also raise company costs – by opening the door to a global patchwork of different biodiversity regulations and requirements that makes compliance more difficult, Eurasia Group said in a policy statement.
Business impacts on biodiversity are being highlighted across a wide range of sectors.
Fashion and retail
Fashion and retail are facing pressure from consumers and governments to reduce waste and carbon emissions throughout their operations. For them, a strong deal that forces all companies to report any harm would work toward assuaging some consumer concerns.
In a letter to world governments in October, more than 330 companies including Swedish fashion giant H&M Group, furniture maker IKEA, British pharmaceutical and biotech company GSK and Switzerland’s Nestle came out in support of a Cop15 deal that includes mandatory disclosure of companies’ environmental impacts by 2030. This has been strongly endorsed by the EU.
Smaller companies with limited resources for monitoring and accounting could find a disclosure requirement more challenging.
For companies mining metals and coal, an environmental disclosure requirement could force companies to reveal the impacts not just from the blasting and drilling they do on site, but also from the logging and deforestation carried out in creating access roads.
Mining companies are also concerned about the central goal of the Cop15 talks – to set aside 30 per cent of Earth’s land and ocean areas for conservation by 2030. That could cut into areas rich with resources for extraction.
“There are going to be some places which are just going to be ‘no go areas’, and that can be hard for the mining sector,” said Aimee Boulanger, executive director of the Initiative for Responsible Mining Assurance.
The International Council on Mining and Metals, which represents 26 of the world’s largest mining companies, would back a deal that sets “a level playing field” with uniform rules in all regions, said the group’s chief executive, Rohitesh Dhawan.
With new disclosure rules, the farming sector would face an increased burden of reporting on activities such as land clearing and pesticide use.
Demanding reporting obligations could burden smaller farms and ranches, some industry groups warned.
“A lot of our producers are family businesses,” said Larry Thomas, manager environment and sustainability with the Canadian Cattle Association.
The agriculture sector will likely escape a separate proposed goal to slash pesticide use in half, Mr Gbaguidi noted. There is opposition from developing countries such as Brazil, Argentina, and Paraguay due to food shortages and higher prices.
“Because of the food crisis, a lot of emerging markets are just not as open as they would have been on setting bold targets related to the agricultural sector,” he added.
Oil and Gas
Following Cop15, oil and gas companies are expected to increase their internal resources for reporting on and disclosing how oil drilling and exploration activities impact nature as well, Mr Gbaguidi said.
The Canadian Association of Petroleum Producers said the country’s oil and natural gas industry wants to minimise marine and land disturbances, while also quickly restoring lands degraded by their operations to natural landscapes, CAPP spokesperson Jay Averill said. – Additional reporting: Reuters