Journey towards nature-positive business

Nature supplies us with essentials like air, water and food, among other necessary resources in our daily lives in order to help us survive. It is thus evident that if nature is under threat, it would cause a significant impact on humankind.

Business refers to a set of activities carried out by an entity or an individual to produce goods and services of commercial value. However, any business requires the use of at least some natural resources. Therefore, the diminishing natural reserves would have a direct impact on businesses as well.

Businesses often contribute to the damage caused to natural resources through the excessive use of water, polluting water bodies by releasing liquid waste, polluting the air by emitting greenhouse gases, and expelling harmful solid waste materials on fertile land and in water bodies. Often, the production of harmful materials, such as non-biodegradable plastics, is also the reason for damage to the earth's natural resources.

Due to such collective activities worldwide, the natural world is declining at an unprecedented rate today. The foundations on which our modern economy and society are running, are eroding faster than ever. According to an analysis by PwC, more than half of the world's gross domestic product is significantly or moderately dependent on nature.

The global economy has grown 25 times in the last 50 years. At the same time, the global wildlife population has declined by 69 per cent, according to Living Planet Index 2022.

The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services has assessed that land degradation, another phenomenon on natural decline, negatively impacts 3.2 billion people globally, and accounts for an economic loss of nearly 10 per cent of the global GDP.

Considering these data points, it is evident that some immediate actions need to be taken in order to slow down this decline of nature. However, a significant impact can only be made if actions pertaining to the same are taken collectively by all stakeholders.

This fast decline of nature also calls for urgent action on the part of businesses. Businesses face new risks from nature loss in the form of reduced productivity, higher input costs and a greater degree of climate threats. Additionally, businesses need to address the emerging actions and reactions of various stakeholders – namely regulators, consumers and investors. Therefore, businesses must start developing nature-positive strategies and integrating them into their operations.

The starting point for business leaders should be to develop a thorough understanding of what nature means for their respective businesses, and identify the direct and indirect touchpoints with nature – considering both inputs and outputs of their business activities.

For example, an agribusiness may identify land, water, fertilisers, pesticides, electricity and seeds as their input touchpoints with nature and build strategies to become nature positive in terms of the utilisation of each of these. Similarly, for an apparel manufacturing business, the strategy should be around carefully choosing input materials – like cotton produced through another nature-positive business entity.

Depending upon the identified touchpoints with nature, the business then needs to formulate its strategy to make each of them nature positive by undertaking various measures. Furthermore, business leaders need to upskill their workforce to execute nature-positive initiatives and deliver sustainable outcomes.

With the pace with which nature is diminishing today, it is crucial that the actions to repair the damage start immediately. Therefore, business leaders need to redefine business leadership and demonstrate the same through their journey towards building nature-positive businesses.

The writer is a partner with PwC. The views expressed here are his own.