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    Where Biodiversity Protection and Decarbonization Meet

    Stockholm (NordSIP) – Most of us are aware that climate change affects the variety of life on Earth at all its levels. The impact that our collective decarbonisation efforts might have on biodiversity, on the other hand, tends to get somewhat overlooked. A webinar organised by the Emerging Markets Investors Alliance on 26 January promises to shed some light on the topic. To help explain the intricate links between decarbonisation and biodiversity, the hosts have invited a veritable expert in the field, Pamela McEwee, Professor of Human Ecology at Rutgers. She has conducted fieldwork in Southeast Asia over the last 25 years on biodiversity, ecosystem services, and climate change. McElwee is a lead author for the Intergovernmental Panel on Climate Change (IPCC), the Intergovernmental Science-Policy Platform for Biodiversity and Ecosystem Services (IPBES), and on the first joint IPCC/IPBES report on Biodiversity and Climate Change.

    To start with, McEwee reminds us that it is essential to acknowledge that some of the actions we take against climate change can indeed have an adverse effect on certain species and even on whole ecosystems. Now that biodiversity is finally taking its well-deserved centre-stage role in the sustainability debate, we need to find ways to incorporate it into the decarbonisation agenda.

    “The conclusions of the IPBES global assessment are unequivocal,” says McEwee. “Biodiversity is declining faster than at any time in human history, and this is happening increasingly at the expense of nature’s ability to provide many other contributions, including climate regulation, water and air quality regulation, and genetic resources,” she adds. McEwee also emphasises the complexity of the challenge ahead. Looking at the many different species of plants and animals threatened with extinction, she reflects that there is no single measure that could save all of these categories. The drivers of biodiversity loss, from direct exploitation of the terrestrial, freshwater, and marine environment to pollution, are multiple and intertwined. Climate change is just one of these drivers.

    “The Earth’s climate and biodiversity are inextricably connected with each other and with human futures,” reminds the professor. “They reinforce each other and therefore cannot be managed in isolation from one another,” she adds. Climate change exacerbates risks to biodiversity and natural and managed habitats. Carbon storage by forests across latitudes is increasingly constrained by warming, drought, and degradation. The progressive productivity loss due to warming is accompanied by the increased release of greenhouse gases from permafrost in polar areas. Conserving biodiversity could help nature adapt to climate change. Actions that halt, slow or reverse biodiversity loss can also help mitigate climate change.

    McEwee explains how coordinating across climate, biodiversity and development may create trade-offs and co-benefits. As an example, she describes how bioenergy crops covering large shares of land threaten biodiversity and food security for people. Restoring natural ecosystems, like the mangroves, on the other hand, enhances carbon storage and benefits biodiversity and people. There are plenty of cautionary case studies, ranging from palm oil in Indonesia to mining for cobalt in wilderness and high seas.

    Fortunately, there is a lot that private-sector actors can do to drive the biodiversity agenda forward, according to McEwee. She offers a glimpse of the upcoming IPBES Business and Biodiversity Assessment (2021-2023), which aims to support efforts by businesses to achieve the 2050 Vision of Biodiversity and the SDGs and inform relevant multilateral agreements and initiatives. The assessment is expected to propose criteria and indicators for measuring the dependencies and impacts of business on biodiversity and nature’s contribution to people. According to McEwee, such clear indicators are essential to assess progress. Existing standards and certifications, such as RSPO, FSC and MSC, show mixed results on biodiversity progress and rely on different tools and indicators, not all of which have an explicit climate focus.

    There are many business challenges at the interception of nature and climate. McEwee takes up offsets as an example. Establishing equivalency for biodiversity has proven methodologically problematic, and the Voluntary Standards for Carbon Markets have no clear biodiversity co-benefit rule. Another example of a challenge is figuring out how financial sector innovations primarily designed for climate, such as green bonds and climate-risk disclosures, can benefit biodiversity.

    McEwee rounds up, offering a few pieces of advice to the investment community. “Be aware that attention to climate impacts and solutions is not enough; you need to understand the implications and trade-offs for biodiversity, too,” she says. She urges investors to look for toolkits that can help address nature risks and impacts and join alliances and networks that focus on both climate and biodiversity outcomes, such as Business for Nature or the Science-Based Targets Initiative.

    “Let’s make sure that Net Zero is also Nature Positive,” concludes McEwee.

    Image by Gerd Altmann from Pixabay

     

    Julia Axelsson, CAIA
    Julia Axelsson, CAIA
    Julia has accumulated experience in asset management for more than 20 years in Stockholm and Beijing, in portfolio management, asset allocation, fund selection and risk management. In December 2020, she completed a program in Sustainability Studies at the University of Linköping. Julia speaks Mandarin, Bulgarian, Hindi, Russian, Swedish, Urdu and English. She holds a Master in Indology from Sofia University and has completed studies in Economics at both Stockholm University and Stockholm School of Economics.

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