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UN summit moves to protect biodiversity

United Kingdom
Financial Times
Mike Scott

Just a month before global leaders are set to gather in Cancun in order to fail to agree on how to tackle climate change, almost 200 countries came together to negotiate a landmark deal on biodiversity and ecosystems.

Environment ministers agreed measures to halt the loss of species and habitats that could have significant consequences for businesses and investors. The summit of the United Nation’s Convention on Biological Diversity held in Nagoya, Japan, adopted targets to halve the loss of natural habitats, including forests, and to increase the amount of land designated as nature reserves from 13 per cent today to 17 per cent by 2020. A tenth of the world’s marine and coastal areas will also become reserves, up from 1 per cent today.

While the world has been focusing on climate change, there has been a largely unseen depletion of habitats and species in recent years. The UN’s Economics of Ecosystems and Biodiversity initiative has calculated that the natural world provides services ranging from water purification to pollination of crops, flood prevention and climate regulation, with an economic value of between $2,000bn and $5,000bn a year.

However, analysis by Trucost, a consultant, suggests the world’s top 3,000 companies cause environmental damage costing $2,200bn a year. “We continue to lose biodiversity at a rate never before seen in history – extinction rates may be up to 1,000 times higher than the historical background rate,” says Ahmed Djoghlaf, executive secretary of the CBD.

“Business as usual is no longer an option if we are to avoid irreversible damage to the life-support systems of our planet,” adds Achim Steiner, executive director of the United Nations Environmental Programme.

A 20-point strategic plan will provide the framework for the protection of fish stocks, and combat ongoing loss and degradation of natural habitats.

Unlike many international agreements, “it is quite immediate”, says Jon Williams, partner, sustainability and climate change at PwC. “Countries have to come up with binding targets that are operable by 2012.”

It will be crucial for business to be involved in the development of these national biodiversity plans, says Abyd Karmali, global head of carbon markets at Bank of America Merrill Lynch, “to ensure they can leverage market forces to meet the targets in the plan, which should be realistic and have the right incentives in place”.

Perhaps the most important aspect of the deal is the agreement on access and benefit sharing of genetic resources, which has been an aim of the CBD since its creation in 1992. The details of exactly how this will work remain unclear, but companies that use genetic resources are likely to have to pay into an international fund that will finance research and projects to protect biodiversity and habitats in developing countries.

While the extent of the impact this will have on businesses is unclear, “any company reliant on genetic resources from biodiversity and ecosystems will have to negotiate agreements to maintain access to those assets”, says Mr Williams.

The pharmaceutical sector is the most obviously affected, but cosmetics groups, agri-businesses, tourism companies and extractive industries could also be hit. Companies that already have to engage with local communities, such as mining and forestry groups, will be much better placed to deal with the new rules, he says.

It will be important for companies to make an effort to understand how much value is at stake in their operations and supply chains once the national biodiversity plans are published, says Mr Karmali. “Businesses will need to accelerate plans to understand what impacts they have on biodiversity and ecosystem services and to quantify some of these impacts in financial terms.”

The deal is likely to boost ecosystems markets, which have been dominated by voluntary offset providers, driven by demand from the corporate sector or non-governmental organisations. Initiatives such as payments for watershed services in Costa Rica and wetland banking in the US are likely to expand, and product certification schemes such as the Marine Stewardship Council and the Forest Stewardship Council are likely to become increasingly important.

Latin America and the Caribbean have the potential to become a region of “green superpowers” because a number of countries “are sitting on a vast level of biodiversity resources and have the economic mechanisms to capture the value of these resources”, Mr Williams says. “They are probably a decade ahead of any other region in this area.”

A recent study* by PwC for the UN Development Programme says the region is ideally placed to develop habitat banking mechanisms that could protect against biodiversity loss and deliver economic growth at the same time.

Habitat banking allows businesses to buy credits from land owners who preserve or enhance the conservation value of their land to compensate for the environmental impacts of their development projects there or elsewhere.

El contenido de las noticias que se presentan en esta sección es responsabilidad directa de las agencias emisoras de noticias y no necesariamente reflejan la posición del Gobierno de México en este u otros temas relacionados.


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