Although the rush of climate announcements and pledges at COP26 have grabbed most of the headlines, the COP in Glasgow was not the only COP that took place this year.
COP15 (Part I) in Kunming in early October was focused on halting biodiversity loss, which according to the UN is in “accelerating” and threatens around 1 million animal and plant species with extinction. Moreover, biodiversity is a crucial defence in tackling the wider environmental crisis. Forests and oceans currently absorb more than half of the carbon dioxide the world emits (source: IPBES-IPCC, 2021).
Natural capital flows
Yet how these facts are translated into investment decision-making processes – from developing taxonomies to financial modelling – leaves much to be desired. For example, while we can neatly understand whether a company’s emissions reduction plan is aligned with a pathway to 1.5°C, it is more complex to understand and weigh up a company’s impact on biodiversity.