Every business depends on nature and most are helping destroy it, landmark report warns

The accelerating loss of nature has become a critical systemic risk that threatens global economic stability, financial markets and human well-being. That’s the stark conclusion of a landmark new report published this week by the Intergovernmental Platform on Biodiversity and Ecosystem Services (Ipbes). Theassessment, known as the Business and Biodiversity report — approved by representatives of more than 150 governments — reframesbiodiversity lossnot as a distant environmental concern, but an immediate economic threat that reaches into boardrooms, supply chains and households alike.

From food production and water security to insurance, tourism and global trade, it finds that every sector of the economy depends, directly or indirectly, on nature’s continued stability. Yet economic growth has come at a staggering ecological cost and the systems that reward profit continue to penalise protection. Between 1820 and 2022, the global economy grew from $1.18 trillion to more than $130 trillion.

Businesses played a central role in that expansion. But the failure to account for nature — and to integrate its value into economic and financial systems — has driven unprecedented biodiversity loss, with 14 out of 18 categories ofnature’s contributions to peoplenow in decline. The consequences are not evenly shared.

[paywall]

While wealth and material capital have grown, natural capital has shrunk. The benefits of growth have accrued to some, while the ecological costs — degraded land, polluted water and collapsing ecosystems — have fallen disproportionately on others, particularly in poorer regions and among Indigenous and local communities. This imbalance has now reached a tipping point, Ipbes warns.

The decline of biodiversity and ecosystem services is no longer a background trend but a critical systemic risk, with implications for human rights, economic resilience and long-term prosperity. The report describes how business governance and strategy have developed in systems that largely ignore or undervalue biodiversity, creating a gap between how companies operate and what nature needs to survive. Business decision-making is driven by short-term timelines driven by quarterly profits, annual reports and fast investment returns while ecosystems recover over much longer periods.

Because of this mismatch, biodiversity loss is rarely factored into corporate decisions and companies struggle to justify action under traditional ideas of fiduciary duty that prioritise short-term shareholder returns. At the same time, markets do not properly price biodiversity or the services nature provides, such as clean water, climate regulation and pollination. Companies therefore face little financial penalty for harming nature and gain few rewards for protecting it, leaving weak incentives to conserve, restore or sustainably use biodiversity. Despite mounting evidence, the report finds that the conditions in which businesses operate continue to reward behaviour that drives nature’s decline.

[/paywall]