BIODIVERSITY FOOTPRINTING & ACTION PERSPECTIVES. UKSIF Edinburgh Conference March 2018

Transcription

1 BIODIVERSITY FOOTPRINTING & ACTION PERSPECTIVES UKSIF Edinburgh Conference March 2018

2 WHY BIODIVERSITY FOOTPRINTING? We use it because it is valuable, we lose it because it is free. (Pavan Sukhdev, 2012)

3 WHAT IS BIODIVERSITY? Diversity between species, within species & of ecosystems

4 WHY IS IT IMPORTANT? Resiliance Functioning Life & Business support system

5 WHY IS IT IMPORTANT? Natural Capital Protocol, 2016 Biodiversity underpins the stock of natural capital and the ability of ecosystems to provide the flows of ecosystem services

6 WHY BIODIVERSITY FOOTPRINTING BY FINANCIAL INSTITUTIONS?

7 WHY BIODIVERSITY FOOTPRINTING? Risk management Natural capital Biodiversity as a means. o to reach objectives on carbon, water, land o To balance policies on carbon, water and land o To contribute to the SDGs Biodiversity s intrinsic value

8 RISK MANAGEMENT - NATURAL CAPITAL

9 RISK MANAGEMENT NATURAL CAPITAL X X X Loss of biodiversity loss of flows of ecosystem services Loss of Value / Return on investment Sectors/companies that highly depend on natural capital

10 RISK MANAGEMENT NATURAL CAPITAL Adapted from: Is biodiversity a material risk to companies?, ISIS, 2004.

11 RISK MANAGEMENT - NATURAL CAPITAL Carbon footprint Many FIs focus on carbon / water / deforestation Water footprint Deforestation / land use footprint

12 RISK MANAGEMENT NATURAL CAPITAL Climate footprint These are key drivers of biodiversity loss, but not all. Water footprint Other drivers of biodiversity loss: invasive species, pollution, disturbance, overexploitation, etc. Deforestation / land use footprint

13 RISK MANAGEMENT NATURAL CAPITAL Climate footprint Biodiversity footprinting provides insights in the drivers of biodiversity loss enabling tailor made action Other drivers of biodiversity loss Water footprint Deforestation / land use footprint

14 BIODIVERSITY AS A MEANS Carbon sequestration Climate adaptation Biodiversity provides solutions to climate / water / land related risks a tool to reach objectives Water retention Water purification Forest cover / Resilient, multifunctional ecosystems

15 BIODIVERSITY AS A MEANS Climate footprint Biodiversity footprinting shows how carbon, water and land use influence biodiversity balancing policies Other drivers of biodiversity loss Water footprint Deforestation / land use footprint

16 BIODIVERSITY AS A MEANS To contribute to the SGDs Biodiversity as the life support system

17 BIODIVERSITY S INTRINSIC VALUE Edinburgh European Best Destinations Copyright, SergeBertasiusPhotography

18 WHY BIODIVERSITY FOOTPRINTING? Climate footprint Other drivers of biodiversity loss Impact on biodiversity as a proxy for impact on natural capital Water footprint Deforestation / land use footprint

19 WHY BIODIVERSITY FOOTPRINTING? Climate footprint Other drivers of biodiversity loss Impact on biodiversity as a proxy for impact on natural capital Water footprint Deforestation / land use footprint

20 WHY BIODIVERSITY FOOTPRINTING? Climate footprint Other drivers of biodiversity loss Impact on biodiversity as a proxy for impact on natural capital Water footprint Deforestation / land use footprint

21 WHY BIODIVERSITY FOOTPRINTING? Climate footprint Other drivers of biodiversity loss Impact on biodiversity as a proxy for impact on natural capital Water footprint Deforestation / land use footprint

22 WHY BIODIVERSITY FOOTPRINTING? Climate footprint Other drivers of biodiversity loss Impact on biodiversity as a proxy for impact on natural capital Water footprint Deforestation / land use footprint

23 WHY BIODIVERSITY FOOTPRINTING? Climate footprint Other drivers of biodiversity loss Impact on biodiversity as a proxy for impact on natural capital Water footprint Deforestation / land use footprint

24 ASN BANK TOWARDS A NO NET LOSS OF BIODIVERSITY

25 ASN BANK TOWARDS A NO NET LOSS

26 ASN BANK Part of the Volksbank N.V. Number of customers ASN Bank (2016): 645,336. Total assets under management at ASN Bank and ASN Investment Funds: over 13 billlion Positioning as a sustainable bank

27 ASN BANK & BIODIVERSITY No net loss of biodiversity as a result of all of our loans and investments by 2030 Three pillars sustainability policy: Human rights, Climate, Biodiversity In place: Biodiversity policy Investment criteria Start 2015: ASN Bank s long term biodiversity objective? Investments as an entry point or need society / planetary boundaries? Footprint analysis to get a feeling of ASN Bank s impact & responsibility 2016: No net loss by 2030 objective

28 BIODIVERSITY FOOTPRINT ASN BANK

29 STARTING POINTS Must be scalable to other banks Can be explained to our clients Must be transparent (no black box calculations) Must be supported by our stakeholders Cannot be too complex / costly Needs to have a scientific base

30 STARTING POINTS Must be scalable to other banks Can be explained to our clients Must be transparent (no black box calculations) Must be supported by our stakeholders Cannot be too complex / costly Needs to have a scientific base

31 STARTING POINTS Must be scalable to other banks Can be explained to our clients Must be transparent (no black box calculations) Must be supported by our stakeholders Cannot be too complex / costly Needs to have a scientific base

32 THE FOOTPRINT CALCULATION 1. Investment in a sector/company economic activities 2. Environmental effects of these activities (LCA) 3. Using Exiobase data including trade flows between countries 4. Use of dose-response relations to link effects to impacts on biodiversity (ReCiPe) 5. Calculation of impacts on biodiversity per Euro investment 6. Identification of impact hotspots in the investment portfolio 7. A qualitative analysis to understand the limitations, to enable adjustment of scores where needed & to allow for interpretation with care 8. Focus on hotspots for next steps: e.g. more specific assessments 9. Biodiversity objective, policy & investment criteria, monitoring on KPIs

33 RECIPE 2016 IN A NUTSHELL Exiobase results Raw mat. Land use CO2 VOS P SO2 NOx CFC Cd PAH DDT Water Climate Change Terrestrial Ecotoxicity Terrestrial Acidification. Land Occupation Land Transformation (regional) Water Scarcity Marine Ecotoxicity Tropospheric ozone cr. Fresh water Eutrophication Fresh Water Ecotoxicity Environmental Mechanism. Part 1 Terrestrial Biodiversity loss Marine water Damage Fresh water Damage Environmental Mechanism. Part 2 Result: Potentially Disappeared Fraction of species (PDF) on a m2 or m3 during a year. This can be unified as species.yr PDF.m2.yr PDF.m3.yr Endpoint Species.yr

34 EXIOBASE ENVIRONMENTAL DATA Worldwide model of 90% of all economic activities and their impact: 170 sectors in 43 countries and 5 rest of the world regions All trade flows between these sectors and countries (a few million) Most important emissions, land use and social data per sector, per Euro Developed in 10 years time in three EU research projects

35 SCOPING - WHAT DOES AN INVESTMENT MEAN? SCOPE 1 NIKE direct emissions SCOPE 2 Purchased energy SCOPE 3 First tier Direct supplier SCOPE 3 Rest of the supply chain Raw materials cotton wool leather

36 FOOTPRINT RESULTS

37 FOOTPRINT RESULTS Biodiversity impacts in hectares (ha) Government Bonds Mortgages local governments Residential construction Wind energy Solar energy Equities 2014 Impact in ha 2015 Impact in ha 2016 Impact in ha

38 FOOTPRINT RESULTS Indexes in m 2 / Government Bonds Mortgages local governments Residential construction Wind energy Solar energy Equities Index m2/ 2015 Index m2/ 2016 Index m2/

39 CONCLUSIONS The footprint methodology serves as a compass pointing in the right direction Changes in data and methodology affected the absolute result, but not the direction Decisions on scope highly influence the result Land use, Climate change and Water use are the main drivers Equities have the worst index - small shifts can have big impacts Use of a complementary qualitative analysis essential to enable correct interpretation & identify follow-up steps

40 ACTION PERSPECTIVES TOWARDS A NO NET LOSS

41 ACTION PERSPECTIVES Interpret with care! Combine with a qualitative analysis Understand the footprint limitations Some impact drivers not covered by ReCiPe How may these drivers affect the scores in different sectors? Footprint based on Exiobase data: sector averages How will investment criteria affect scores? What difference is your policy making (towards a NNL)?

42 TOWARDS A NO NET LOSS PORTFOLIO Biodiversity impacts in hectares (ha) Towards a no net loss: Just even-out impacts? Government Bonds Mortgages local governments Residential construction Wind energy Solar energy Equities 2014 Impact in ha 2015 Impact in ha 2016 Impact in ha

43 TOWARDS A NO NET LOSS PORTFOLIO No follow the mitigation hierarchy

44 Biodiversity positive investments Green Funds Water boards Green energy Green Funds Water boards Green energy Biodiversity positive investments Green Funds Water boards Green energy Green Funds Water boards Green energy Restoration criteria No criteria yet Restoration criteria? Best in class Certification BMP Criteria state bonds FSC, RTRS, RSPO Extra criteria based on impact drivers hot spots Exclusion & Avoidance Fossil fuels, Mining, Agriculture Exclusion in Equity? Policy options From exclusion to BD positive investments Policy ASN Bank Already strict investment criteria Towards a NNL What options are available?

45 TOWARDS A NO NET LOSS Avoid: Maintain/expand avoidance through exclusion criteria Mitigate. Screen existing investment criteria for improvements. Focus on equities first: reduce impact through shifting investments Restore: Assess opportunities of restoration criteria in the biodiversity policy Positive impacts: Use investments with a positive impact (green energy, green roofs, green bonds, circular economy) to create a no net loss Next steps for ASN Bank

46 INTERESTED TO KNOW MORE? Masterclass on biodiversity footprinting, co-organised by UKSIF Footprinting of (part of) your investment portfolio Identification of impact hot-spots Assessment of policy & investment criteria Join further development of the footprinting methodology with ASN Bank and other FIs

47 FURTHER READING biodiversiteit/no-net-loss-of-biodiversity-in-2030.html

48 QUESTIONS.? Wijnand Broer Mark Goedkoop