World Environment Day: why it matters for business
5 June 2021 is World Environment Day; when the UN urges us all to reimagine, recreate and restore our relationship with the planet.
The facts speak for themselves. Ecosystem degradation is already affecting the well-being of at least 3.2 billion people – 40% of the world’s population. Approximately 30% of natural freshwater ecosystems have disappeared since 1970 and one third of global fish stocks are now overexploited.
For purpose-led businesses, these statistics may be emotive enough to prompt action. But there are also very compelling financial reasons to incorporate environmental targets into corporate strategies.
The case for business action
It’s estimated than half of the world’s total Gross Domestic Product is moderately or highly dependent on ecosystem services, as highlighted in a recent report from the Natural Capital Finance Alliance.
Another report estimates that $10 trillion in global GDP could be lost by 2050 if ecosystem services continue to decline. Another found that land degradation could reduce global food productivity by 12%, causing food prices to soar by up to 30% by 2040. Put simply, a healthy ecosystem is fundamental to the global economy.
The effects will not be confined to specific sectors. As the Natural Capital Finance Alliance report says, “This dependency might be more obvious for primary industries like agriculture or forestry… However, secondary and even tertiary industries like tourism and consumer goods rely heavily on nature through their global supply chains.”
Adapt or fail
The UN is giving us 10 years to prevent, halt and reverse the degradation of ecosystems, and in doing so help to combat climate change and its effects.
Businesses that acknowledge their impact and take action now protect themselves from tightening scrutiny from investors, customers and government. They gain competitive advantage, financial buy-in and futureproof their operations for a changing world. As Mark Carney, former governor of the Bank of England puts it, “Businesses that don’t adapt [to the climate crisis] will go bankrupt, without question”.
This World Environment Day should serve as a catalyst for all businesses to take genuine, authentic action on their climate impact.