A climate for nature: how biodiversity matters for business?

Q&A with Samuel:

Tell us a bit about your background and what got you interested in biodiversity?

So, my background is in conservation - I spent a decade working across Africa on everything from anti-poaching to wildlife corridors, to finding lost species, communal fishing practices and all kinds of things. This culminated in me then doing a PhD, in which I looked at how large organisations make decisions about biodiversity and practice - and, in particular, from a social perspective - because often we have these processes to follow and, actually, what happens in practice is it comes down to who knows who in negotiation and so forth.

My PhD explored all of these different elements, alongside social science approaches, and through mapping out my findings it became clear there is an opportunity to help people make better decisions in this area. The research showed that while decisions might be approached with the best possible intentions, the outcomes were often negative because those involved in the process had not anticipated quite how difficult it is to make decisions surrounding biodiversity.

What it largely boils down to is the fact that there is never going to be a single, overarching metric for nature or for biodiversity in the same way that there is for almost everything else we manage. As a result, it's much harder for decision-makers to make clearly defined choices, because they cannot simply go "…well, I want the number to be increased or decreased by 10%". Rather, they have to figure out what they specifically want, where they want it and how, which makes approaching the decision process fundamentally more challenging - especially for a large business.

Could you please tell us about your organisation Biodiversify. What do you do? What is your philosophy? And why is what you do important?

We founded Biodiversify in 2018; 'we' being myself and my co-founder Dr Michael Burgass, who did a similar PhD to mine, but from a data and metrics perspective. We quite quickly wanted to work with people who were doing new things, so we didn't want to do anything off-the-shelf. We sought out people who were trying to do something a bit adventurous or a bit unusual in this area, and our pitch to them at this point was basically, "we do not know how to do what you are trying to do - because no one has ever done it before - but we will work with you to figure it out". Together, we combine the strengths of Michael's data skills with my social science and decision science skills.

We got approached by a major, high-end fashion company that has long established itself as a leader in this space and they essentially said, "we know we need a biodiversity strategy, but we do not really know what that looks like… could you help us figure out how to create one?". So we agreed, of course, and shared that, while we had never done this before, we'd be happy to work together with them to figure it out. In doing so, we produced a guide that essentially addressed the whole process of how to produce a corporate biodiversity strategy. It provided something very new in talking about private sector biodiversity strategies.

While there was quite a high likelihood, from our perspective that this might not go anywhere, we found strong interest and companies started reaching out to us. Through working collaboratively with more organisations on their strategies, spanning a range of sectors, we built up a really well-established process that also took into account how every single company is different and requires something bespoke.

Could you expand further on what this kind of 'bespoke' approach means in practical terms?

The variations between companies are enormous when we look closely at a number of variables: their impacts on nature; their business model; the extent to which they are exposed to risk for nature; the extent to which they can actually do something about it; the way they make decisions etc. Companies are dramatically different in terms of their decision-making cultures, which means there simply isn't a one-size-fits-all approach to creating a biodiversity strategy. It has got to be about working with people at the company to bring their expertise to the fore - whether that is about paperboard or packaging, or clothing, wherever it might be - and making sure that people who know how to procure, design and construct these things are in the room at each key stage in the process, so that then you can produce a strategy that is deeply practical.

In the absence of a single overarching metric, the reality is that organisations need to look at a wide range of impacts, from all around the world, and ensure that are addressed in a locally-specific and appropriate way. This means that actually there are lots and lots of different people across the organisation and different departments that have to make all kinds of decisions in order to reduce and address an organisation's impacts and create improvements. So in our role, we work closely with clients to really drill into the detail with them and understand how they operate in order to create strategies that coordinate a huge number of different actions across a company that deliver an overarching ambition.

Why is it that biodiversity is considered a more complex issue than carbon and does this pose a challenge for businesses?

Well to start with, calculating your carbon footprint is more predictable. You know for example, that if you produce something in a factory, then whether that item is a plastic toy or cotton clothing is probably not going to change the carbon impact significantly. In contrast, for biodiversity, plastic toys and cotton clothing would have dramatically different biodiversity impacts and dramatically different biodiversity dependencies, which means you cannot really estimate where your position is on biodiversity. These are massive unknowns which once you start to scratch the surface of, then you begin to see there are huge systemic risks exposed. One example of this is cotton: 24% of the world's cotton comes from India, and it comes from specific regions in India that are extremely degraded and vulnerable to climate change. These are areas where it is going to get incredibly hard for businesses operating in this sector.

We tend to hear companies saying, "oh, yes, this is much harder than carbon". However, to answer the second part, I think it is useful to give you some figures to show the increase in engagement on nature and biodiversity issues. Biodiversify hired its first employee in April 2020 and now, four years later, we are a body of 20 people, and our clients include companies from every sector that you can possibly imagine.

So what we are seeing is that people are taking this extremely seriously and, while they recognise the difficulties, they are not being put off by the challenge, because no one looks at the world around them and says "ahh, it will be fine, I am sure the natural world will be alright...". Everybody looks at it and goes "no, no, we do need to do something about this". There is this huge educational component here - it's really important to help organisations as a whole learn about nature.

Why is it that biodiversity has suddenly gained attention and traction?

I would say that part of the reason why we are seeing this field move so incredibly quickly is because once organisations start looking into it, they very quickly realise that they are exposed to massive risks. So carbon took around 15 years to get to where it is now in the business and reporting world. In comparison, biodiversity has gone from nought to the stage where everyone is talking about it within three or four years; and a large part of this is explained by the observation that when a company starts to delve into this area, they quickly realise the impact they are having on biodiversity. If you produce anything that is living, or that comes off a living thing, or anything that is farmed or harvested, then you also depend upon biodiversity. Even if you don't, there are often penalties but, again, companies often don't know why that is; and then there is the question of what can you actually do to mitigate these kind of risks and impacts?

Often companies will be uncertain over what they can actually do - all they know is that this is getting attention in the news, their sector industry organisations are talking about it and it's of growing importance. As a result, organisations are recognising they need to fully understand what risks they are exposed to and what they can do in response. Otherwise, there are quite serious potential business implications if things go the wrong way. And part of what is so different between carbon and biodiversity is that with carbon the impacts and the risks are much more homogenous. So, obviously, if we see massive climate change impacts, then it will affect countries in different ways, but it will affect everybody more broadly.

I was having a long conversation with a team yesterday, for example, who are particularly interested in reducing the temperature in key streets of major cities, as they recognise the importance of having more urban biodiversity in these areas in the form of tree cover and bushes. Without it, people simply would not want to go there - whether for business, pleasure, tourism or whatever reason - and that would have a huge economic impact on many cities. So I would say the single biggest difference between carbon and biodiversity is that biodiversity is quite easy to delve into in order to do good, but also it is quite easy to get into it, because there are very clear commercial reasons for doing so.

What are the greatest challenges and opportunities for businesses in relation to biodiversity? We are seeing organisations realise the benefits under Biodiversity Net Gain (BNG), for example, but outside of BNG, is this an opportunity or are we simply at a tipping point where we have got to do something?

I mean, yes, there are definitely opportunities in this that you do not get in carbon. So with carbon if you meet your carbon targets, then there are limited additional benefits to the business, but it is largely about public perception. Certainly, you might get some efficiencies and cost savings and all that kind of stuff, but you are not likely to see dramatic benefits. Whereas biodiversity is quite the opposite for anything that is farmed or anything that depends upon water. If you have more biodiversity, then there are a whole host of benefits and, as I mentioned before, there is a lot of evidence to show that where you have more nature across a landscape, you get more consistent rainfall. This, in turn, means less droughts, less floods and you get better control of major crop pests.

In the East of England, for example, where a lot of the sugar is grown in the UK, permission had to be sought to use otherwise banned neonicotinoids pesticides on sugar beet. This is because they've seen such massive booms of aphid populations, which totally destroy the crops. Well, part of the reason the aphids are booming is due to there being very few natural predators to them in the environment, because that is the most degraded part of England.

So, there is quite clearly a huge incentive there for farmers in that region to have more nature; partly for the water and moderation benefits, but also because it reduces the likelihood, and extent, of major pest outbreaks. And those are just a few examples, as there are actually a whole host of wide-ranging issues. A lot of companies speak to us because they care about the health and wellbeing of their employees, and they are aware that if you have more nature around the sites in which they operate offices or campuses or whatever it might be, then that has a significant component.

Now, probably the single biggest thing you can do to make a region more resilient to the impact of climate change - which is largely heat extremes, droughts and floods - is to have more biodiversity. If you have a more resilient system, you have more rainfall and less extremes and so on, which means that people look at that and go, "okay, well, if you sell clothes and even if those are not made from cotton, if the productivity of 24% of our cotton dramatically goes down that is going to have huge ripple effects for all kinds of different sectors". So, quite quickly people begin to see that they need to understand what is going on here and what they can do about it. A large part of the process is about getting to grips with what is going on, what risks an organisation is being exposed to, and then that gradually leads towards identifying what can actually be done.

So, what would you would say to those companies who are already actively involved in biodiversity projects?

For the companies that are already ahead on this, you can use your existing projects to contribute to biodiversity efforts but, more importantly, you can also use the infrastructure designed to deal with carbon to help support the way you approach biodiversity.

A key fundamental component of this is figuring out how to bring biodiversity into many different decision-making arenas across your company. If I use clothing as an example, the biodiversity impact of an item of clothing partly comes from a range of sources: the marketing function, which has figured out what customers are interested in; and also from the designers, who figured out "how do we actually design these things and which kinds of materials do we use"; and then also from procurement managers, supply chain managers, contract negotiators and all of these kinds of people. And to actually address biodiversity effectively you have to start to figure out how you might bring biodiversity considerations into all those different arenas, which in many cases people are already doing for carbon or other sustainability metrics.

I would love to say that you should do carbon and biodiversity at the same time, or you should do biodiversity first but, honestly, I wouldn't! I think for those companies that have not yet got started on carbon, then that is an easier place to begin and is more established. If a company is small enough that it has not started on its carbon journey yet, then it is probably a bit ambitious to try and progress multiple things.

Every business will find itself at a different stage in their thinking around biodiversity and nature - whatever its size or scale - but would you still encourage a smaller business to be thinking about biodiversity when it might still be trying to get its head around carbon?

I would say one thing worth noting here is that we are still very much in the early stages of the biodiversity sustainability journey. So coming back to my initial point, we only started really thinking about this area some four years ago; and here I'm referring to the frontrunners, which means there are very few companies that have gone through a full impact analysis, biodiversity strategy, implementation strategy, and all this kind of stuff. There is not really a sort of 'set piece' or a very clear, single guide of how to do it. And because most people do not know how to do it, we are still all figuring it out collectively as a sector. Once we have done that, it will start to become much clearer what a smaller organisation can do, because there will more standardised processes in two to five years' time. And what is really important is that there will be more sector-wide initiatives.

One of the big challenges with all of this is that it is quite hard for an individual company to deal with certain impacts and aspects of biodiversity. This is where we find that the umbrella organisations - those that bring companies together across a sector and often initiate pretty competitive kinds of projects - are actually a really good place for SMEs and other smaller organisations to get involved.

The other thing, I would say is that, in many cases, smaller organisations have simpler business models and supply chains. Not always, but it can sometimes be the case and it is these organisations where there could be a real opportunity for innovation. There is huge potential for those that have a strong grasp on where their stuff comes from, because almost all the biodiversity impacts of any company will be where something is grown, harvested, farmed, and pulled out of the earth - that is where your impacts are. Therefore, sometimes SMEs will have a clearer link to that because they are selling a simple product, or they have a narrative around their business model. Something I would really encourage people to do is use the fact that there is no single, set approach. There is not a standard model to actually go, "well, we think we have an idea of how we could do it". You know, people come up with something that is a bit more interesting and a bit more unusual; and actually there is massive space for that at the moment.

Is there anything about biodiversity that you think would surprise people or that they might not be aware of? Is there anything sector-specific that we should consider?

The thing that often surprises people is quite how much their biodiversity impacts come from the earliest parts of their supply chain. Often, we will work with companies on both their supply chains and their sites, which is interesting because their sites are probably going to be responsible for less than one percent of their biodiversity impact. However, that will often matter more to them because it's something they have greater control over, it affects employees and is, ultimately, a very good place to start. I think it is not unreasonable, but actually the vast majority of their impact is in their supply chain. So a lot of companies don't realise quite how much they are going to have to work with their suppliers and procurement teams around this in order to understand how they can actually do something about it.

The other thing I would note is that, again, the place where things are sourced from has a huge impact on the system an organisation uses and their impact on the drivers of biodiversity loss. So with beef-based products, for example, you might buy leather or beef from Italy and your impacts will probably be fairly low. If you chose to buy the same product from Brazil, however, then your biodiversity impact would potentially be extremely high. So it's important to note that if you are buying a commodity that has high variation in terms of its potential risk, there might be a pitfall or a horrible discovery waiting to happen. Issues might arise where, for example, you buy a product through an auction house or complex supply chain thinking it's coming from Europe but it then turns out it's coming from somewhere with a much more precipitous trend of biodiversity loss.

I think it is difficult to pick out an individual sector where these issues are prevalent, because it is more of a consistent theme across many sectors when people start to look into where stuff actually comes from. And I think the broader trend of what we are seeing is more and more companies suddenly putting a lot of effort into their supply chain visibility, because they are realising this is fundamental to quite a large number of different sustainability efforts - not just this, but also forced labour and water and all of these other major social issues.

So do you think that the European Regulation on Deforestation-free Products, which is all about your forest risk commodities, is also helping put a spotlight on biodiversity?

It is the biggie, although it is the CSRD (the Corporate Sustainability Reporting Directive) that has much much more impact on what is driving companies to actually do something about biodiversity. So, this is the directive that basically says that any company over around 500 people has to report on a range of various different sustainability issues, which impacts roughly 50,000 companies across the EU. Now, what this means is that at some point in the not-too-distant future all of these companies are going to have a very public disclosure of their impact on biodiversity; which is quite scary, because most of them have no idea what their impacts on biodiversity are and this has had a huge effect on this sector.

Even if companies are not that worried about the impact, the reality is that they'll need to carry out a study on their sustainability issues; commission someone to look into their impacts and report to their board sooner or later, and then share that report publicly and have to think about what it means for their public image. That has a huge effect on a company because suddenly it means that there is an enormous pan-organisational effort to collect the data, consider it and work through what the implications of the findings might be. And just that simple act of individuals having to engage with all this has a huge effect on what a company is thinking and doing in this space.

Focusing in more on the existing legal framework, we of course know that the TNFD (Taskforce for Nature-related Financial Disclosures) is a good thing, but do you think it's enough? Is it being adopted sufficiently?

So I think there are two quite different lenses you can use to look at this. The first is in terms of what these global frameworks really mean and what they are actually designed to do. So CSRD (Corporate Sustainability Reporting Directive) and TNFD (Taskforce on Nature-related Financial Disclosures) essentially say the same thing - in simple terms, they say, "look at your supply chain impacts and tell us what you are going to do about them". There is a bit more to it than that, but that is basically it and they are very broad and general - which is completely appropriate for something that is designed to be that universally applicable. They both point towards SBTNs (science-based targets for nature), which is the opposite and is extremely specific, but the important thing is to figure out what your responsibilities are and how you should be setting targets; and that requires an incredible amount of data. Doing the analysis to understand where your impacts might be, and then doing some disclosure is not too challenging. The tricky bit is figuring out, how do you coordinate potentially hundreds of different actions across an organisation to figure out what you are going to do to improve your relationship with nature.

I said there were two lenses. The other lens to this is that actually it is really important to remember that organisations and companies are not large machines, they are actually people; they comprise lots of different people coming together to make decisions collectively. And what we have seen is that in all cases, there is, generally, a passionate collection of individuals at a company who have seen this stuff coming and worked together to change things for the better and change the way in which the organisation operates. And so, in many cases, these frameworks (CSRD, TNFD, SBTN) have really become a lever that these impassioned individuals can pull to go "right, we need to put some attention on this, we need to put some budgets on it, and we need to spend some time on it".

Thinking about our own organisation, we have to be quite careful in the way we structure our work to reflect these trends, and it's often the social process that surrounds this that is the most important part. It is often the fact that if you bring together people from design, procurement, marketing, sales, finance, and the corporate aspects of a business to talk about nature - because you are going through some, you know, consultant-led process - maybe three or four times in the space of three or four months, then providing that space to talk about what this means at the company has a huge effect on the thinking around what it should be doing. And suddenly, ideas and innovations and opportunities all start to emerge, because people get together and go, "well actually, yes, we could do something about this, and it would also have business benefits". It is just, however, very rare that you get such important people coming together to talk about nature for two or three hours at a time.

So, I would say that the frameworks themselves are helpful, but what's really powerful is giving individuals with the capacity to really drive and enact change in an organisation, the space to come together, learn about it, and figure out what they think should be done.

What is the one thing you want people to walk away from this knowing?

I think for me, the key message is that there is an enormous change coming; and it is coming very, very quickly. There are both challenges and opportunities in this and an organisation that stands still is going to have no idea what is actually going on, until suddenly it is dealing with the impacts in catastrophe mode. There is an enormous opportunity here to both avoid catastrophes and fires by getting on top of your understanding of where the risks are, but then there is also the opportunity to get all of these benefits; both in terms of commercial benefits and all of the good things that come from motivating employees that feel that actually the company is doing the right thing and it is the right place to be working, because they are taking this fundamental issue seriously.