Finance & Investment Organizational Governance

WWF Tool Helps Companies, Investors Mitigate Biodiversity Risks Across Their Operations

The tool includes over 50 biodiversity-relevant data layers that collectively provide a global, holistic picture of nature-related risk — the first-ever platform that brings together such a diverse range of data specifically for the purpose of analyzing biodiversity-related risks to corporates and investors.

Published 1 year ago | About a 4 minute read

Image: Zaid Ahmed

This week, at the World Economic Forum in Davos, WWF launched its Biodiversity Risk Filter (BRF) to help companies and financial institutions start to understand and make good on their commitments to support biodiversity.

Last month at COP15, the world's governments adopted a Global Biodiversity Framework — something of a ‘Paris Agreement for nature’ in which they’ve committed to act collectively to immediately halt and reverse biodiversity loss by 2030. Business and financial institutions have a critical role to play in this, delivering the investment and business models needed to achieve the goals of the agreement. But many companies and investors are still struggling to understand the impacts and dependencies of their activities on nature and this tool aims to bridge that gap.

The BRF is a first-of-its-kind, free, online tool — available on the WWF Risk Filter Suite platform along with the Water Risk Filter tool — to help companies and financial institutions identify and mitigate biodiversity-related risks across their operations, value chains — and investments. Produced in collaboration with Climate & Company, important methodological guidance demonstrates to users of the tool, particularly financial institutions, how the Biodiversity Risk Filter can be applied to a portfolio of companies. This is also illustrated by a case study on a representative investor portfolio.

Our global economy and financial system are deeply embedded in nature. With nature in crisis, companies and investors from all sectors are exposed to biodiversity-related risks. According to the World Economic Forum, more than 50 percent of global GDP — or US$44 trillion — is highly or moderately dependent on nature and its services.

In December 2022, more than 330 business and financial institutions from 52 countries with combined revenues of more than $1.5 trillion urged world leaders to adopt mandatory requirements for all large businesses and financial institutions to assess and disclose their impacts and dependencies on biodiversity by 2030 — and some have already begun to put their money where their mouths are. However, understanding biodiversity-related risks and opportunities along the value chain and across different locations — using a defensible, science-based approach — remains one of the most challenging tasks for companies and financial institutions striving to develop nature-positive business models.

New tools have emerged to address this need — such as NatureMetrics’ new nature-performance monitoring service — but WWF’s Biodiversity Risk Filter is the first free offering.

“Increasingly, companies and financial institutions recognize the business case for tackling biodiversity loss; but many simply do not know where to start. Understanding biodiversity-related business risks is the first step towards being able to tackle them and a prerequisite to setting relevant biodiversity targets — something many companies are likely to look at during this year, following the adoption of the Global Biodiversity Framework. This tool helps them to map and assess biodiversity-related risks, enabling them to prioritize investments in areas that will make the most impact in mitigating their risks,” says Rebekah Church, WWF’s Global Biodiversity Stewardship Lead.

A spatially explicit tool prioritizing issues and locations from a nature and business perspective, the Biodiversity Risk Filter can assess biodiversity-related risk for all industries and in all countries. It breaks down complex biodiversity information and gives businesses practical, decision-useful information in a visually comprehensible way. At the basis of the BRF are over 50 biodiversity-relevant data layers that collectively provide a global, holistic picture of nature-related risk. As such, it includes information on species and ecosystems and protected areas; as well as the biggest pressures on biodiversity such as deforestation, habitat destruction, pollution, land use change for agriculture etc. The data has been provided by WWF, IBAT, IUCN, UNEP-WCMC, ENCORE, RepRisk, FAO, the World Bank and NASA, among many others. It is the first-ever platform that brings together such a diverse range of data specifically for the purpose of analyzing biodiversity-related risks to corporates and financial institutions.

The tool builds on the success of the long-standing WWF Water Risk Filter, both of which can be accessed on the WWF Risk Filter Suite. Both Risk Filter tools help the private sector to develop sustainable business operations and investments and support alignment of companies’ and financial institutions’ sustainability commitments and engagements to global frameworks including the Taskforce on Nature-related Financial Disclosures (TNFD), Science-Based Targets Network (SBTN) and the UN Sustainable Development Goals (SDGs).