Can we investors save life on earth? EIRIS’s Mark Robertson believes so.
It’s almost two months since delegates from around the world met in Nagoya, Japan, to sign a UN agreement aimed at reducing biodiversity loss and habitat change. But even the UN’s own environment officials have found little evidence of any “meaningful and decisive action”.
All companies affect ecosystems and are also dependent on functioning ecosystems to remain in business. Biodiversity loss creates significant risks for businesses in the shape of increased costs, of raw materials such as fresh water and insurance against disasters, new governmental taxes and policies on biodiversity, and reputational damage from NGO and consumer campaigns.
However, a 2010 EIRIS report* finds that only 6 percent of the top 1,800 international companies listed on the London Stock Exchange have an adequate policy on biodiversity.
Over the next few decades ecosystems will be altered faster and more extensively than ever before. Investors must understand the systematic risks biodiversity loss represents and use their influence to increase company participation in voluntary stewardship schemes to protect biodiversity. A number of “green and ethical” financial products are available, the lending and investing activities of which help to safeguard biodiversity. You can find a list of these products at yourethicalmoney.org.
* EIRIS – Experts in Responsible Investment Solutions