Did the biodiversity summit deliver? Assessing COP15 part 1

The rate of biodiversity and ecosystem loss means we’re in a race against time to protect the earth’s life support systems.
November 2021
Marcus Wilert

Marcus Wilert

Vice President, Responsible Investment team

Biodiversity loss and degradation of ecosystems is rapidly progressing. The World Wildlife Fund estimates that the Earth is losing species at a rate of 1000 to 10,000 times higher than the average for the past one million years, and deforestation and conversion of native vegetation continues unabated. This undermines the basic life support system that provides the habitable conditions we all depend on. The United Nations warns that biodiversity loss severely undermines progress to reach at least 8 of the 17 Sustainable Development Goals.

COP15 – protecting biodiversity and natural resources

COP15 is shorthand for the 15th Conference of the Parties to the Convention on Biological Diversity, established in 1992 with the goal of protecting biodiversity and natural resources. The Conference was originally planned to be held in 2020 but was delayed by Covid-19 and subsequently split into two parts. The first part kicked off on October 13th in Kunming in China’s Yunnan province. Part two is scheduled for spring 2022 and will result in the adoption of a post-2020 global biodiversity framework (GBF) laying out the pathway for 2030. The strength of the outcome is crucial. In the more than ten years since the previous framework – the Aichi targets – came into being, biodiversity loss has increased, and while some progress was made, none of the targets were fully met.

Economic and financial systems need to transform

The task to halt and reverse biodiversity loss falls on all of society’s actors and the Conference specifically noted that actions are needed to transform economic and financial systems. The COP15 declaration highlights the key role of the private sector in this effort through Targets 14 and 15. Target 15 asks businesses to assess and report on dependencies and impacts on biodiversity, to reduce their negative impacts and enhance nature-positive activities. While frameworks are still in development, the Science-Based Targets Network and the Taskforce for Nature-related Financial Disclosures have already provided some guidance for target-setting and reporting, respectively, which will support implementation. Target 14 states that all activities across all sectors of shall be aligned with biodiversity goals. This includes financial flows, making the financial sector a key player to support the reallocation of capital to close the estimated gap of US$700bn per year up to 2030.

Funding commitments

Governments including the UK, Japan, China, and France committed funding explicitly for biodiversity, in some cases as a portion of climate funding. This highlights the effect of biodiversity loss exacerbating climate change by turning biomes from being net-absorbers of greenhouse gases to emitting them. Ensuring the economic transition to a nature-positive approach is necessary for achieving net zero. Strengthening ecosystems and biodiversity helps nature be our ally in combating climate change. While there is a clear recognition of these links, exemplified also by deforestation commitments during COP26, work remains to be done on harmonising the respective policy strands.

The role of developing countries is crucial, as that is where much of biodiversity loss resulting from conversion and deforestation of native vegetation happens. The Global Environment Facility in partnership with the United Nations Development Programme will be fast-tracking financial and technical support to enable developing nations to implement the framework.

What’s needed at COP15 part 2

Hopefully part two of the conference in the spring of next year will produce an ambitious biodiversity framework that can provide both increased momentum and clarity for investors and businesses to align their efforts in the same way as the Paris agreement did for climate change. However, the failure to fully reach any of the Aichi targets showed how challenging and wide-ranging the task is. During a press conference, the Executive Secretary Elizabeth Maruma Mrema stated that lessons had been learnt from the previous goal-setting process and that there was increased confidence in a more effective approach this time around. Considering the pace and scale of biodiversity loss, there is no time to waste. In anticipation of the global framework providing clear targets and pathways, business and investors should assess, engage, and organise to get a head start on developing strategies to reduce biodiversity impacts and ensure dependencies are well understood and managed.

Use our handy glossary to look up any technical terms you are unfamiliar with.

Risk warnings
The value of investments and any income derived from them can go down as well as up and investors may not get back the original amount invested.
The information, opinions, estimates or forecasts contained in this document were obtained from sources reasonably believed to be reliable and are subject to change at any time.
Views and opinions have been arrived at by BMO Global Asset Management and should not be considered to be a recommendation or solicitation to buy or sell any companies that may be mentioned.

Use our handy glossary to look up any technical terms you are unfamiliar with.

Marcus Wilert

Get to know the author

Marcus Wilert, Vice President, Responsible Investment team

Marcus joined the Responsible Investment team at BMO GAM in 2020 and is focusing on labour standards and biodiversity. Before joining BMO, Marcus spent a decade and a half in supply chain sustainability across the world. When not working, he enjoys sailing and Filipino martial arts.

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