This month the International Corporate Governance Network (ICGN) has become the latest group to launch a toolkit of investors to assess biodiversity risk.
Target 15 of the Global Biodiversity Framework announced at COP15 last year requires large and transnational companies and financial institutions to monitor, assess, and disclose biodiversity risks, dependencies, and impacts from operations, supply and value chains, and investment portfolios.
So, where do investors start? ICGN’s Natural Capital Committee, which I co-chair, asked this very question and ICGN responded. In January 2023, the network issued a viewpoint outlining 10 game-changers—concepts, processes, strategies, frameworks, and legal regimes—that will fundamentally alter how the economy and capital markets interact with the environment.
It followed that with its biodiversity toolkit, which provides guidance enabling investors to assess biodiversity risks and impacts, and identify opportunities to participate in relevant global stewardship initiatives in this rapidly changing landscape.
The toolkit comprises a glossary of technical terms, information about the Taskforce on Nature-related Financial Disclosure’s (TFND) framework, and open-source and paid for biodiversity tools.
See also: – TNFD mandating discussions are underway
It also outlines stewardship opportunities, such as the Finance for Biodiversity Pledge, Nature Action 100 and the Finance Sector Deforestation Action Initiative.
As investors, we must evolve our standardization and integration approach to assessing biodiversity risks and impacts. We must explore more nature-positive investments and use all the stewardship tools available, from direct corporate engagement to galvanizing global support for robust regulation. We must ask both companies and research providers to improve data quality. We must assess and address the environmental and human impacts of biodiversity loss. And we must ensure local communities, including Indigenous peoples, have a seat at the table.
We encourage investors to engage boards on their understanding of biodiversity risks and impacts, a process that ICGN viewpoint and toolkit can help with.