In February 2021, Preventable Surprises held a week-long online dialogue to set an investor agenda for biodiversity loss. In this Chatham House-rule, text-only online format, participants were invited to discuss and respond to a series of “provocations” – short texts written by leading experts, designed to yield creative thinking, test the wisdom of the crowd and challenge the status quo. We are publishing these provocations on our blog this month in an effort to broaden this conversation.
By David Obura, Director CORDIO East Africa and member of the Earth Commission.
State of nature. A high level set of biodiversity goals have been compiled recently, summarized in the box below. The question is, how can investors act on such goals to meet standards for minimizing impact to nature?
There are two ‘knowns’, with certainty: a) people, our societies, our cultures, are dependent on nature (i.e. biodiversity) in myriad ways – try and enumerate the essential things we use or enjoy that do NOT come from nature originally; and b) the state or condition of almost all aspects of nature is declining.
From a global or birds-eye view, we can synthesize two principles, across the four parts of nature:
We can measure many aspects of nature – such as in relation to species numbers, ecosystem extent and integrity and benefits derived from nature (e.g. quantity of fish). Models of species and ecosystem growth and change, and provisioning of resources, are well developed. The Earth Commission is working to identify global ‘guardrails’ for biodiversity metrics for a ‘safe and just’ future, working in tandem with the Science Based Targets Network, which is translating these to local scales for application by companies and cities. We hope that these become used as primary measures alongside economic indicators, as measures of societal success and wellbeing.
Tipping points. What happens when nature declines? For species we know they can become extinct (locally, and globally). For ecosystems, they may collapse. These are critical ‘tipping points’, or forks in the road from which it may be very hard, or impossible, to return. The guardrails mentioned above are intended to protect us from stepping too close to these tipping points. Systems and resilience science explore how to recognize tipping points, predict where they may be (at what levels of key variables), and the consequences of traversing them. There are many unknowns about these questions, particularly as a system becomes increasingly complex, as natural and nature-human systems are. These sciences explore risk – much as investment analytics do.
One characteristic of nature is the scaling or aggregation from individual locations and contexts, to the global – such as the full distribution of a species, or extent of an ecosystem. There are also many local/geographic ‘replicates’ of human-nature systems (such as fishing communities in a coral reef seascape, or businesses in a city), but aggregated all together, we only have one planet or biosphere. So just as with the decline of nature, reversing decline and avoid tipping points builds up from each individual entity that takes positive action.
I present four provocations, in relation to investor actions in relation to biodiversity tipping points:
1) Integrated accounting and similar processes that incorporate complex and diverse data have matured considerably. For example, countries are building national accounts incorporating natural assets, and ocean accounts incorporating ocean assets. These processes need to be mainstreamed to better account for nature’s health, and given our emerging awareness of extreme risks posed by climate change and by human action on some systems, they should be mainstreamed VERY quickly, perhaps within a timescale of 2-5 years.
Question: But, do/can they incorporate the issue of tipping points/thresholds, and the need to remain a safe distance away from those thresholds?
2) Mainstream production sectors – fisheries, forestry and agriculture – already conduct in-depth analyses, though to date to maximize output rather than secure long term balance.For example, the FAO puts out annual reports on the State of World Fisheries (and Aquaculture), and the most recent one for 2020 shows that only 5% of global fisheries are not fully utilized or over-utilized, and this proportion has been steadily declining since the beginning of these computations. The capacity exists to measure and take decisions, but the incentives do not favour sustainability and securing biodiversity, even in 2020. Re-analysis of historical trends using an integrated accounting perspective following will likely show the perverse actions and incentives that have been operating till now.
Question: Could this help change incentives to favour sustainable behaviour across sectors, and of actors within sectors?
3) Another approach may be to develop an SDG narrative for each product/actor/ sector, to explore interactions and their effect on tipping points. In this approach economic activity is be accounted for under SDG8 but alongside this, other indicators such as ecosystem health under SDG14/15 will be included, and the AGGREGATE picture beyond profit and GDP will show net positive or negative trends.
Question: Can this focus attention to where interventions can produce net positive outcomes, and in particular to avoid tipping points related to interactions across the goals and single-factor thresholds (e.g. economic growth (goal 8) vs. environmental sustainability (goals 14/15))?
4) The Impact Inequality relation of the Dasgupta Review looks at population, economic activity or wealth per capita and a technology or efficiency term. By applying this relation we might identify what a sustainable wealth or income level is, given today’s/future population and current/future technology. A back-of-the-envelope calculation indicates that in the long term (in 50 years), countries with Very High and High scores of the Human Development Index would have to reduce their total impact 30% by 2030 and 70% by 2100 for global sustainability.
Question: Can actors/investors use the impact inequality relation to identify the scope of work they need to do to reduce their contribution to a tipping point, to avoid transgressing it? And perhaps more importantly, identify what changes in income/affluence or technology can protect from approaching a tipping point?
Dasgupta P (2021) The Economics of Biodiversity: The Dasgupta Review. https://www.gov.uk/government/publications/final-report-the-economics-of-biodiversity-the-dasgupta-review
Díaz S, Zafra-Calvo N, Purvis A, et al (2020) Set ambitious goals for biodiversity and sustainability. Science 370:411–413. https://doi.org/10.1126/science.abe1530
Obura DO (2018) The Three Horses of Sustainability—Population, Affluence and Technology. https://doi.org/10.20944/preprints201812.0176.v1
Obura DO (2020) Getting to 2030 – Scaling effort to ambition through a narrative model of the SDGs. Marine Policy 117:103973. https://doi.org/10.1016/j.marpol.2020.103973