Not enough companies linked to the agricultural supply chain have board-level expertise in biodiversity, despite the surge in nature commitments, according to an executive at Morningstar Sustainalytics.

“Very few” companies have specialist knowledge or training on biodiversity among board members, said Gayaneh Shahbazian, biodiversity engagement manager at Morningstar Sustainalytics.

Just three out of 50 global companies from across the agricultural value chain had board-level expertise to address biodiversity-related risks and opportunities, Shahbazian found in research published this month.

Although 43 out of the 50 companies recognised biodiversity as a material issue, only 26 had board-level oversight of the topic, she said.

Source: Morningstar Sustainalytics

“It’s a similar story if you look to strategy, quite a few companies have a high-level commitment in place on nature or biodiversity, but then very few actually have a strategic approach to address it,” Shahbazian told Carbon Pulse.

“Part of it is there isn’t enough incentive at the moment, and that’s to do with the enabling environment. What will come out of COP16 to push the incentives?”

Corporations are likely to deliver a steady flow of nature-related commitments in the run-up to biodiversity conference COP16, which begins in October in Colombia, Shahbazian predicted.

“We can leverage companies that are [committing] as a blueprint for companies that are struggling, or don’t have the resources, or are not prioritising this topic,” she said.

The unnamed 50 firms included agricultural financiers, packagers, palm oil producers, and agrochemical companies.

Sustainalytics engages with the companies as part of an ongoing programme that could involve escalation up to investor letters and shareholder proposals, according to its website.

Progress has been made since COP15 in Montreal, Canada in 2022, but many companies are still at the beginning of their journey, according to Shahbazian.

“There’s enough information for companies to act on their impacts and dependencies on nature, but it’s quite a hard task, and most companies don’t have that level of oversight of what and where their impacts and dependencies are, and the scale and scope of them,” she said.

“That’s a huge barrier. If that information is not visible, and you don’t know the materiality of that information, then you won’t act on it.”

Methodologies for assessing nature impacts have been published over the last couple of years by organisations such as the Taskforce on Nature-related Financial Disclosures and Science Based Targets Network.

Last week, the World Economic Forum revealed examples of nature positive action from seven international companies including IKEA, Walmart, and Orsted.

Interest in large-scale large-scale investments in ecosystem services that support biodiversity​ via regenerative agriculture has ramped up this year, with commitments from Pollination and Climate Asset Management.

By Thomas Cox – t.cox@carbon-pulse.com