A majority of companies that have outlined commitments on biodiversity have not taken any action on pledges, according to data released Wednesday by non-profit CDP, as countries prepare to negotiate on potential mandatory environmental disclosure next week at the COP15 summit in Montreal.

CDP, an NGO that runs a global corporate environmental disclosure system, found that 31% of companies have made a public commitment to, or endorsed, biodiversity-related initiatives, with another 25% planning to do so within the next two years.

This would mean more than 56% would have made voluntary commitments by the end of 2024 if companies follow through with the plans.

Despite what CDP described as a “promising” number of pledges that demonstrate corporate readiness, at 55% more than half of companies have not taken action to make progress on these biodiversity-related commitments in the last year.

Around 70% of companies do not assess the impact of their value chain on biodiversity at present, with the sectors with the most damaging impacts among the worst for disclosure, namely 74% of those in the apparel sector and 73% of those in manufacturing.

Many of these firms have the potential to have the greatest impact, but a strong majority are not taking action to stop biodiversity loss and environmental degradation, CDP found.

In 2022, a total of 7,790 companies responded to questions on biodiversity through CDP’s climate change questionnaire, meaning almost 90% of companies contacted responded.

The survey conducted in 2022 was the first of its kind for CDP relating specifically to biodiversity impact.

COP15 CONTEXT

The report comes on the eve of the UN Convention on Biological Diversity’s COP15 summit in Montreal that begins on Dec. 7 and runs to Dec. 19 at which negotiators will discuss a proposal for mandatory requirements for all large businesses and financial institutions to assess and disclose their impacts and dependencies on nature.

This outcome would be highly significant and likely to drive faster corporate action from companies to reduce biodiversity loss and ecosystem degradation, as well as help help investors to understand the biodiversity-related risks in their portfolios, and redirect capital toward sustainable activities.

“COP15 is often referred to as a ‘once in a decade’ opportunity, but it’s actually once in a generation. In ten years’ time, with little intervention, it is likely our biodiversity and ecosystems will be damaged beyond repair,” said Sue Armstrong Brown, global director for environmental standards at CDP.

“CDP’s new data shows that the voluntary progress already made should be all policymakers need to finally make biodiversity disclosure mandatory.”

“Governments must seize this chance and create the enabling environment companies need to drive forward their commitments by agreeing a clear and ambitious Global Biodiversity Framework. This must include mandatory environmental disclosure through Target 15,” she added referring to the agenda item that will be discussed in Canada.

There seems to be a rising appetite for mandatory disclosure from companies around the world as last month more than 330 businesses with more than $1.5 trillion in combined revenues called on heads of state to make nature-related disclosure mandatory at COP15.

“We need better and more consistent disclosure from the private sector, which is why we provided funding to CDP to introduce new questions linked to nature-loss and biodiversity. Enhanced disclosures enable us to allocate capital in a way that can help protect our clients from risk, while contributing towards a better future for society and the planet,” said Jane Ambachtsheer, global head of sustainability at BNP Paribas Asset Management.

Another of the main items on the agenda in Montreal is the setting of a global target to be nature positive by 2030, with an eventual goal of full natural restoration by 2050.

This could be seen as a similar target as the temperature warming limits in the Paris Agreement of 1.5-2C.

It is uncertain as yet whether the mandatory disclosure, or this wider biodiversity goal, will be achieved at COP15.

By Roy Manuell – roy@carbon-pulse.com