Why ignoring biodiversity loss is an increasingly risky business

Why ignoring biodiversity loss is an increasingly risky business

Last September, fires had already begun burning in Queensland and New South Wales.

The human, ecological, and economic impacts of Australia's Black Summer were unprecedented, and will continue to unfold in years to come.

Scientists have long warned that climate change compounds the frequency and severity of hazards like fire, flood and drought, as well as the spread of infectious diseases.

The erosion of natural supporting systems, like healthy forests and soils, exacerbates these risks.

Last week, the UN reported that for the second consecutive decade, parties to the international Convention on Biological Diversity - including Australia - had failed to meet any targets set to prevent further species extinctions, protect and restore ecosystems, promote sustainable agriculture and forestry, or reduce air and water pollution.

Although inextricably linked with climate change, biodiversity loss has received comparatively less attention from the business and finance sectors.

Yet a growing recognition of the financial risks stemming from the erosion of biodiversity is driving an explosion of interest in products and investments that directly benefit nature.

In July, an international partnership of financial institutions and environmental NGOs established the Task Force on Nature-related Financial Disclosure to develop a new corporate reporting framework for biodiversity loss.

Australian banks published the first national guidelines for climate risk disclosures last week. Its therefore reasonable to anticipate that mandatory natural capital risk reporting is on the horizon.

The federal government's plan to direct $18 billion over 10 years to "priority low emission technologies" has already been criticised by climate experts.

But it also misses a huge opportunity to facilitate investment in natural technologies with biodiversity co-benefits, like plankton-based feed to reduce methane emissions from cattle, or reintroduction of tidal flows in marginal cane lands to enable restoration of carbon-rich mangrove forests.

Government leadership, including supportive policies and investment, is crucial to unlock the opportunities associated with halting biodiversity loss.

Modelling by Ernst & Young suggests a conservation and land management stimulus could create jobs and facilitate economic recovery, particularly in regional areas hardest hit by the effects of COVID-19, bushfires and drought.

We truly live in unprecedented times when finance, agricultural and environmental groups join forces to help solve these crises.

Governments must start actively working with, not against, this remarkable transformation.

Megan Evans is a lecturer and research fellow at the University of NSW, Canberra.