Now is the time to be wild

No, I am not talking about the war which right now is so close to our borders, but the need to look to the nature which surrounds us, and in the last hour before being too late to take action to protect it.

Last week, when things where still not so disastrous, I attended a conference organized by the Group I worked with, on the risks and opportunities related to biodiversity and natural capital. And the main take away was that we would collectively need to act for our nature, putting the same degree of emergency as in the case of climate change. Even the approach is similar to the one for the climate change. I speak about biodiversity loss, one of the risks in the top ten on 2–5 years time horizon, as per the latest Global Risk Report (WEF, 2022).

Somehow, this conference changed my agenda for personal leadership opportunity. Instead of exploring the possibility of having a more sustainable approach in my private life, I decided to devote this post to a topic related to my field of activity, ESG risk assessment and sustainable finance.

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair”1

To have a bit of a context, the studies shows that since the era of Great Acceleration, the human being by now achieved the best times in terms of well-being in its history. However, this has been done on the expense of the mother nature, which faces the worst time since the human being made its first step on the planet. With all these achievements we succeeded to put in extinction more than 50% of the other beings that share the planet with us, compared to the year 1970 (Myers, 2017)

Coming back to the biodiversity topic and climate change, one could conclude that there are the two sides of the same coin (Societe Generale, 2022), as the COP15 on biodiversity is to set a similar type of agreement for nature as in the case of Paris Agreement. Furthermore, “our world must not only become net zero, but also nature positive, for the benefit of both people and the planet” (G7, 2021). Such a nature positive approach will enrich biodiversity, reduce environmental impact and pandemic risk. Building on the example of the Taskforce on climate-related financial disclosures, a Taskforce on Nature-related financial disclosure is supposed to be implemented by 2023. Europe is to extend by 2023 its Taxonomy for biodiversity. Similarly to Science based targets initiative (SBTi) for climate change, Science based targets framework for nature (SBTN) are contemplated.

And above all, in terms of opportunities, the aim is to channel financing not only to less harmful environmental activities, but to the ones less harmful for biodiversity. Another color has been penciled to financing instruments, the blue one, dedicate to marine resources or its restauration, inspired by the green finance. It also means designing new nature-based financing solution, such as conservation finance, financing for land regeneration and sustainable agriculture or nature positive infrastructures. There might be carbon and biodiversity off-sets, as tools to pay for ecosystem services.

I discovered during the conference some of these instruments in more details and I plan to scan all our portfolio of clients with the aim to identify those opportunities that might serve such purpose of addressing the risks related to the biodiversity loss and eventually contributing to the conservation or restauration of natural capital.

I would hope to be able to structure such type of financing on our local market, for the benefit of the whole ecosystem.

And I do hope that wildness will not prevail.

Sources:

1Charles Dickens, A tale of 2 cities

G7, 2021, 2030 Nature Compact, accessed at https://www.g7uk.org/wp-content/uploads/2021/06/G7-2030-Nature-Compact-PDF-120KB-4-pages.pdf

Myers SS, 2017, Planetary health: protecting human health on a rapidly changing planet, Lancet.

World Economic Forum, Global risks report, 2022, accessed at https://www.weforum.org/reports/global-risks-report-2022