SINGAPORE – Media OutReach – 15 September 2022 – The Asian Markets Biodiversity Report – the first assessment of the progress of Asia’s largest companies in addressing biodiversity issues by the RSK Group – suggests that less than 50% of organizations take sufficient action 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 made to identify and address biodiversity impacts.
Ahead of the 15th meeting of the United Nations Convention on Biological Diversity (COP15) in Montreal, Canada, the RSK Group – with a family of over 150 environmental, engineering and technical services companies – hopes to raise awareness the public to the urgent need to integrate the protection of biodiversity into corporate decision-making.
Produced by Nature Positive, an RSK Group specialist consultancy that helps businesses understand their specific connection to nature, the report consists of analysis supported by six interviews with sustainability experts from the region. Among the interviews, several were conducted by the Thailand Development Research Institute (TDRI), with which Nature Positive has partnered to better understand Asia. The report’s methodology involved a review of publicly available sources such as website content and annual reports for 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 in the four exchanges referenced biodiversity on their websites and published reports, only 42% (80) of the 192 companies received a “1” rating in the report for highlighting biodiversity as a material issue. Of the 80, only 4% recognize biodiversity as a priority.
● 52% of companies have not mentioned biodiversity in their public documents or only use it in passing.
● 77% of companies reviewed on the Japanese Stock Exchange identified biodiversity as a material issue and obtained the highest score, compared to 33% in Singapore, 30% in Hong Kong and 28% in Thailand.
● Of the 80 companies surveyed that highlighted biodiversity as a material issue, only 36 companies (45%) show active conservation or restoration activities. While this figure is encouraging, companies cannot be sure that these activities are sufficiently offsetting their impacts due to the lack of benchmark assessments.
● Sectors with more obvious direct interactions or dependencies with the natural world – such as consumer staples, energy and materials – were more likely
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.
“The report seeks to answer a pressing question – whether Asia’s biggest companies are taking sufficient action on their impacts on biodiversity. While it’s encouraging to see companies talking about biodiversity, the extent to which this drives meaningful change is debatable. There is still a lack of understanding of the link between commercial activities and impacts on biodiversity,” said Dr Stephanie Wray, CEO of Nature Positive.
Dr Wray added: “As a first step, organizations should undertake a biodiversity audit to understand how they depend on and impact nature. Setting targets for biodiversity restoration would be a clear sign of Asian companies’ intention to start tackling their impacts. It is encouraging that ten organizations mentioned in our report have done so and hopefully more will follow.
Protecting Asia’s Diversity
Asia is home to a wide range of biodiversity and is a habitat for some of the world’s most iconic species. But it is also the largest and fastest growing economic bloc in the world, which is a driving force behind the devastating loss of biodiversity.
The main causes of biodiversity loss include direct degradation or loss of habitat through land use; overexploitation of species by direct removal from the wild or its indirect effects; and climate change and pollution of land, water or air, including through the release of excess nutrients.
The protection of biodiversity is crucial because it supports the interactions between species called ecosystems. Healthy ecosystems clean our water, purify our air, maintain our soil, regulate the climate and recycle nutrients – providing the raw materials for everything from goods to medicines and more, making them essential to business success. . Asia’s nature is key to providing solutions to net-zero climate goals – these are seen as unachievable without ending deforestation within a decade and protecting marine life, which scientists say absorbs up to 30% of global carbon. The region is vulnerable due to the critical role that healthy natural habitats play in ensuring the resilience of communities as they adapt to the impacts of climate change.
The report highlights that addressing biodiversity makes business sense, given the growing pressure on businesses to mitigate and reverse biodiversity loss. If companies do not respond, they risk losing consumers and investors through reputational damage, which could affect profits and viability. Embracing a nature-friendly setting enhances the attractiveness of a business, especially to eco-conscious consumers, job seekers and investors.
“Understanding the impacts and dependencies on nature, and reversing the loss of nature, is particularly important for businesses in Asia. We need to let go of the idea that there is a difference between financial value and non-financial value. Capital allocation models must enable sustainable development, with capital markets properly valuing inclusive, impactful and sustainable business practices and rewarding the most sustainable companies,” said Joe Phelan, Executive Director, Asia-Pacific, Global Council businesses for sustainable development.
While this report focuses on Asian companies, it’s not just companies in this region that are struggling with their stocks. A report published by Nature Positive last year on FTSE100 companies in the UK found that only 64% of listed companies dealt with biodiversity issues, while more than a third did not even mention biodiversity.
About Nature Positive and the RSK Group
RSK (www.rskgroup.com) is a global leader in providing sustainable solutions. Its family of more than 150 environmental, engineering and technical services companies and 10,000 employees work together to provide practical solutions to some of the greatest challenges societies have ever faced.
The company operates in most sectors of the economy, including many of the most critical to future global sustainability, such as water, energy, food and beverage, infrastructure, urban development, mining and waste. With its integrated offering of research and development, consulting and field application, RSK can provide a complete solution unrivaled in the market.
The company is certified according to the international standards ISO 9001, ISO 14001 and ISO 45001 for quality, environment and health and safety management.
One of its businesses is Nature Positive, a sustainability consultancy that helps businesses understand their specific connection to nature. Nature Positive provides services including baseline biodiversity assessments; supply chain risk assessments; the biodiversity footprint; and practical mitigation, compensation and compensation measures.
About the report
A total of 192 companies were screened on the Japanese (48), Thai (50), Singapore (30) and Hong Kong (64) exchanges using information from publicly available sources to determine how many companies refer to the biodiversity, where biodiversity features in materiality assessments and efforts to identify and address biodiversity impacts.
The analysis is complemented by six interviews with sustainability experts from the region, including several conducted by the Thailand Development Research Institute (TDRI), with whom Nature Positive has partnered to better understand the region. Interviewees represented a wide range of organizations, including a global conservation partnership, a built and natural asset consultancy, a water utility company, a stock exchange, a conglomerate, and an oil and gas company. The interviews provided context to the findings of the desk research and gave greater insight into the progress made and the challenges faced by organizations when seeking to manage their impacts on biodiversity.