S&P Global’s ESG and sustainability-focused business Sustainable1 announced today the launch of a new Nature & Biodiversity Risk dataset, which lets companies and investors to assess, manage and address nature-related risks and impacts.

The new dataset comes as businesses and financial institutions increasingly focus on nature and biodiversity risk, and as global efforts to address nature-related issues begin to pick up pace. In December 2022, for example, global governments adopted the Kunming-Montreal Global Biodiversity Framework at the COP15 UN Biodiversity Conference, agreeing to a set of goals aimed at ending biodiversity loss, protecting natural ecosystems and ramping biodiversity-related financing.

Companies are also facing increasing pressure to assess and report on nature and biodiversity-related issues, with new disclosure systems emerging such as the Taskforce on Nature-related Financial Disclosures (TNFD), currently under development. In December, the International Sustainability Standards Board (ISSB) of the IFRS Foundation announced plans to add requirements for companies to provide transparency on impacts and risks related to natural ecosystems to its Climate-related Disclosure Standard, with a particular focus on the TNFD’s work.

Nature & Biodiversity Risk applies the Nature Risk Profile methodology that was launched in January by S&P Global Sustainable1 and the UN Environment Programme (UNEP). It covers over 17,000 companies and over 1.6 million assets, using nature-related risk metrics such as The Ecosystem Footprint (measuring the land area, ecosystem degradation, and ecosystem significance) to deliver a deeper understanding of a company’s impact and dependency on nature.

Thomas Yagel, Chief Operating and Product Officer, S&P Global Sustainable1, said:

“From the launch of the Taskforce on Nature Related Financial Disclosures (TNFD) in 2021 to the significant commitments made at COP15, there is an increasing demand from companies and investors to be able to quantify both their dependency on nature and the impact of their operations on location-specific ecosystems.”

Along with the launch of the new solution, Sustainable1 analyzed the S&P 1200 using the new dataset, indicating that 85% of the companies show significant dependency on nature, using around 22 million hectares of land for direct operations in 2021. Additionally, 46% of those companies have at least one asset located in a Key Biodiversity Area (KBA), leaving them open to future regulatory risk and reputational damage.

Steve Bullock, Managing Director, Global Head of ESG Innovation and Solutions, S&P Global Sustainable1 said:

“Our research shows that 85% of the world’s largest companies have a significant dependency on nature, indicating the critical importance of greater transparency for market participants on nature-related risks and opportunities. This new dataset signals a maturation of the conversation on nature and provides clear metrics quantifying the nature related dependency and impact of over 1.6 million global real assets.”

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