Why biodiversity and nature matter to finance

Michelle Horsfield, a former environmental scientist and executive director of ESG advisory for the SMBC Group, and Keith Bottomley, deputy policy chair for the City of London Corporation, talk through the issue of biodiversity as it relates to finance.

7 key takeaways from this video

Biodiversity can be defined as the variety of life on earth. Just as diversity in the workplace leads to a stronger organisation, in nature, greater diversity leads to better resilience to shocks, particularly from climate change.
We are losing biodiversity. For example:
- Wildlife populations have dropped by more than two-thirds since 1970.
- 33 animal species have no wild population remaining .
By 2030, nature loss could cause global GDP reductions of £2.1tn yearly.
Biodiversity and nature are often used interchangeably. However, nature is the term for the systems, features, forces, and processes – such as the weather, water or carbon cycles – of our world. Biodiversity is just one part of nature.
It’s important to identify whether the loss of biodiversity or of nature is a risk for your firm.
‘Ecosystem services’ is a term that captures everything that our natural ecosystems do for us – such as flood protection or air filtration – that we don’t pay for with money.
This is why biodiversity and nature are highly relevant to finance: our economy has been built without paying for the cost of ecosystem services – 55% of global GDP is reliant on them – so it is in our interest that they work.