Why biodiversity and business should go hand-in-hand

Many businesses will welcome the UK’s new emphasis on integrating biodiversity into investment decisions, but action needs to be accelerated and investment expanded if we are to attain the sustainable societies that we envy in some of our northern European neighbour countries, argues Malcolm Robertson, principal ecologist and James MacGregor, environmental economist, at Ramboll.

We remain a long way from seamless trade-offs among economic and environmental benefits, but the proposed pathway for the UK is a positive step.

The recent Spring Statement by Chancellor Philip Hammond highlighted a fresh commitment to placing business and economics at the heart of environmental stewardship.

Specifically, he promised to mandate ‘biodiversity net gain’ assessments as milestones in development projects in England and announced the commissioning of a review into the link between biodiversity and economic growth. Both of these will expand awareness and expertise in the protection of our natural capital and ensure that more sustainable decisions are made by public and private sectors.

Biodiversity has been a gnawing concern for many years, with policy-makers desire for a focused strategy on biodiversity at odds with the struggles to identify mechanisms that meaningfully integrate the values of biodiversity into economic decisions.

For instance, the UK is committed to the ‘Aichi targets’ under the Convention for Biodiversity since 2010 and the Lawton Report highlighted declining biodiversity in England (noting that with climate change, the situation is likely to get worse) and called for better protection of England’s biodiversity. Furthermore, biodiversity in the UK is a devolved responsibility, with separate strategies developed in England, Northern Ireland, Scotland and Wales.

The Spring Statement complements ongoing initiatives, including the government’s 25 Year Environment Plan published in 2018, which formalises the need to protect the environment for both its intrinsic value and critically for the value it provides to society through the range of provisioning, regulating, supporting and cultural services (such as fresh water, local climate and air quality, habitat for species, recreation, physical and mental health, raw materials, medicinal resources and food). With the UK food industry worth £100 billion, the value of environmental services is considerable.

We therefore see this as a positive commitment to capitalise on this growing understanding of the value of natural capital in shaping key decisions, and to enshrine the protection of the environment as the basis of a more sustainable society. The Statement underscored the importance of biodiversity using the emblematic example of the UK’s 1,500 species of pollinators that are estimated to deliver £680m annual value to our economy – more than the Royal Family.

However, the declining bee population in the UK shows that high values are not resulting in protection from the harsh realities of persistently growing human impact on our environment. If all new infrastructure and housing has to deliver net gain, conceptually the large-scale investment in infrastructure and housing should actually lead to potentially significant increases in biodiversity. If this policy does deliver on its promise, developments would be decoupled from the degradation of biodiversity.

There is cautious optimism around the mandating of biodiversity net gain on developments. This proposed policy will impact business and the governance capabilities of the public sector alike. Local authorities will need to build capacity and disseminate clear guidelines to ensure consistency, and post-development monitoring and enforcement will be required to ensure net gains are realised.

Reaction to the announcement across the industry is positive, but we hope that the research builds on existing national and international work, such us the UK National Ecosystem Assessment, which offers a well-established framework and range of values for policy formulation.

As well as proving the positive link between biodiversity and economic growth, the review must start to chart a path for industry and commerce to work toward broader environmental net gains to protect and restore our natural capital. Biodiversity net gain should be closely aligned to wider environmental net gain and climate adaptation and mitigation policies, so that trade-offs and unintended consequences are identified, and synergies are maximized as part of the planning process.

Overall the review should provide a level playing field for sustainable development and it is hoped that this will bring confidence and certainty to the building and investment sectors. With political and economic uncertainties around Brexit, it would have been easy to delay any government interventions that could be deemed a further burden on UK business.

But our experience shows that the Chancellor has pitched this right. There are opportunities to make more sustainable decisions that increase efficiency, profitability and economic growth. We look forward to working with UK businesses and the government to realise this vision.