In fact, this is precisely where many companies are seriously lagging, according to a new report from Danske Bank and Danica Pension, which has mapped the work – or lack of same – of 99 Nordic companies on biodiversity.
Among other findings, the report shows that 71% of surveyed companies are exposed to biodiversity risk, while less than 15% of companies have set a target for reducing their negative impact on nature or defined how they will contribute to restoring biodiversity.
“The report makes abundantly clear that many companies overlook biodiversity and its associated risks and opportunities. Companies that use nature’s resources in one way or another must set objectives for how they can integrate biodiversity into their approach. Not only will this contribute to futureproofing the company, it will, not least, help to reduce biodiversity loss,” says Mads Steinmüller, Head of Active Ownership at Danske Bank and Danica Pension, who adds:
“Biodiversity in crisis and the transition to an economy that preserves and restores biodiversity can affect a company’s value, business model and growth potential. We have only one Mother Nature, and for many companies she is their most important supplier, so we all have a vital role to play in terms of preserving biodiversity and ensuring that both companies and investors contribute to increasing biodiversity,” he says.
Facts about the report and the companies
Based on 99 Nordic companies
71% are exposed to biodiversity risk
15% have set a target for reducing their negative impact on nature
Walk the talk
However, what other companies do is one thing, what exactly does Danske Bank do?
As a first step, Danske Bank has signed up to the Finance for Biodiversity pledge, committing the bank to measure and report on how we impact nature through the bank’s financing and investing activities by the end of 2024.
In addition, both Danske Bank and Danica Pension are keen to increase the focus on biodiversity through active ownership. More specifically, Danske Bank and Danica Pension have pledged to engage 30 large, global companies that all have a significant impact on our oceans and forests in a focused dialogue going forward to 2025.
“Our goal is to influence companies through active ownership and help ensure they set specific targets, and measure and report their impact on nature. Ultimately, this will preferably result in companies reducing their negative impact on biodiversity. Biodiversity is extremely complex and a new area for many. As more knowledge is acquired about the area, we will regularly raise our ambitions together with these companies,” says Mads Steinmüller.
Head of Active Ownership, Danske Bank and Danica Pension
However, the bank is not increasing biodiversity requirements just for the sake of it. Like climate change, loss of biodiversity is a credit risk, while economic growth and prosperity are also associated with a high degree of biodiversity.
The World Economic Forum (WEF), for example, estimates that half of global economic production (approx. USD 44 trillion) is either moderately or very dependent on biodiversity and ecosystem services.
“We expect a similar policy response to combat biodiversity loss as the one that has been put in motion to mitigate climate change. This will mean that several companies will be faced with biodiversity related risks and opportunities affecting their current and future business. As a bank we need to understand these impacts and support our clients in transitioning to sustainable business models,“ says Samu Slotte, Global Head of Sustainable Finance at Danske Bank.