The next phase of ecosystem services will affect companies’ decision making and public policy — but how that plays out remains to be seen, according to a BSR blog.
Last January, companies seeking financing from the World Bank and other Equator Principles signatories became subject to due diligence processes that examine corporate impacts and dependencies on ecosystem services — the benefits provided by functioning ecosystems.
In the blog post, Sissel Waage, BSR director of biodiversity and ecosystem services, looks at what’s next in terms of corporate performance requirements related to ecosystem services, and the implications for companies.
She writes about three scenarios. In scenario 1, “Eagle Hunt,” extreme weather events between 2012 and 2017 shut down major metropolitan areas. Meanwhile, crop yield plummets, skyrocketing commodity prices. As a result, the US and other countries strictly regulate ecosystem services.
Companies face scrutiny by investors and shareholders for not having been more proactive and changing their practices to decrease ecosystem impacts. Pension funds and insurance companies demand corporate disclosures of carbon accounting, water use and sources, biodiversity presence and impacts over time, and the effect of development on water filtration, flood control, erosion and pollination, while divestment and boycott campaigns pick up speed.
Scenario 2, “Raccoon Crawl,” is more of a business-as-usual projection with continued activity on ecosystem services but no public regulation or major corporate change.
In the blog’s final scenario, “Egret Flight,” the private sector partners with the public sector, NGOs and academia to push a system-wide approach to ecosystem services. They form a “learning lab” in 2013 that explores applications of ecosystem services, and by 2025 have developed a range of methods and databases to measure and monitor ecosystem services. Government policies and regulations support ecosystem services and include them in their GDP calculations.
These scenarios and others will be presented in a longer BSR report in 2013.
A November report by the Association of Chartered Certified Accountants found that only a handful of companies in sectors with high environmental impact are reporting substantial detail on biodiversity and ecosystem services. The majority report little or no information because they believe the issue is immaterial.
However, a poll conducted a month earlier by BSR and GlobeScan found human rights, workers’ rights and climate change are the top three sustainability priorities for companies in the coming year, according to 500 business leaders.