SINGAPORE: The Asian Markets Biodiversity Report Card, the first evaluation of the progress of Asia’s largest companies in tackling biodiversity-related issues by the RSK Group, suggests that fewer than 50% of organizations are taking sufficient steps to protect biodiversity and address their impact on the natural world.
The report determines the number of organizations referencing biodiversity, where biodiversity features in materiality assessments, and the efforts taken to identify and address biodiversity impacts.
In the lead-up to the 15th meeting of the UN Convention on Biological Diversity (COP15) in Montreal, Canada, the RSK Group – with a family of more than 150 environmental, engineering and technical services businesses – hopes to raise awareness of the urgent need for biodiversity protection to be embedded in business decision-making.
Undertaken by Nature Positive, a specialist consultancy under the RSK Group that enables businesses to understand their specific link to nature, the report consists of an analysis supported by six interviews with sustainability experts in the region.
The interviews included several conducted by the Thailand Development Research Institute (TDRI), with whom Nature Positive partnered to gain further insight into Asia.
The report methodology involved a review of publicly available sources such as website content and annual reports relating to 192 companies listed on the Japanese, Thai, Hong Kong and Singapore stock exchanges.
Key findings of the report include:
- While 70% (135) of the 192 companies reviewed across all four stock exchanges referenced biodiversity on their websites and published reports, only 42% (80) were given a ‘1 rating’ by the report for highlighting biodiversity as a material issue. Of the 80, only 4% recognized biodiversity as a priority.
- 52% of companies either did not mention biodiversity in their public materials or were just using it as a passing mention.
- 77% of companies reviewed on the Japanese stock exchange highlighted biodiversity as a material issue and were given the top rating, compared to 33% in Singapore, 30% in Hong Kong and 28% in Thailand.
- Of the 80 companies found to highlight biodiversity as a material issue, only 36 (45%) displayed active conservation or restoration activities.
- Sectors with more obvious direct interactions or dependencies with the natural world such as consumer staples, energy and materials were more likely to discuss biodiversity, with 50% or more of companies in these sectors recognizing biodiversity as a material issue. Sectors with fewer direct impacts such as healthcare and IT/communication services were less likely to do so.
Protecting Asia’s diversity
Asia is home to a broad array of biodiversity and is a habitat for some of the most iconic species in the world. But it is also the largest and fastest-growing economic bloc globally, which is a driving factor in devastating biodiversity loss.
The main causes of biodiversity loss include direct habitat degradation or loss through land use, over-exploitation of species through direct harvesting from nature or its indirect effects, and climate change and pollution of land, water or air, including through the release of excess nutrients.
Protecting biodiversity is crucial because it supports the interactions between species known as ecosystems.
Healthy ecosystems clean our water, purify our air, maintain our soil, regulate the climate and recycle nutrients, providing raw materials for everything from goods to medicines and so much more, making them critical for business success.
Asia’s nature is central to delivering solutions to net zero climate goals, unachievable without ending deforestation within the decade and protecting marine life, which scientists estimate absorbs up to 30% of global carbon.
The region is vulnerable because of the critical role that healthy natural habitats play in providing resilience for communities as they adapt to the impacts of climate change.
The report points out that addressing biodiversity makes business sense, given the increasing pressure on businesses to alleviate and reverse biodiversity loss.
If companies fail to respond, they risk losing consumers and investors through reputation damage which could affect profits and viability.
Adopting a nature-positive framework enhances the attractiveness of a business, particularly to ecologically aware consumers, job seekers and investors.