Following COP27 and as COP15 is underway, one phrase which has continued to dominate is Nature-based Solutions (NbS).
Governments are increasingly focusing on them in the context of mitigation, adaptation and efforts to ensure our societies and economies build-up resilience to deal with the degree of climate change which is now inevitable. NbS are increasingly part of corporations’ net-zero commitments. But they must tread carefully.
The last month once again raised alarm. Abnormally mild autumns across Europe coincided with the publication of a series of damning UN reports that make it clear we are running out of time. To have a chance of stopping catastrophic climate change and halting devastating environmental degradation, we must halve global greenhouse gas emissions and reverse nature loss by 2030.
Although historically siloed, it is now widely accepted that the climate and nature crises are interconnected and must be tackled together. As the issue of nature has risen up the agenda, attention has turned to NbS: actions to protect, sustainably manage, or restore natural ecosystems, that address societal challenges such as climate change, human health, food and water security.
Whilst such a spotlight is welcome, it has brought to the fore an incorrect narrative: that NbS are a suitable replacement for decarbonisation. Many corporates would love this to be true, or for the belief it is true to further spread. I must stress, there is no substitute for immediate emissions reductions. Instead, NbS should be seen as complementary to reducing emissions.
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NbS may not be a silver bullet, but when applied well they can help meet environmental and social targets, including in forested landscapes. When designed and implemented in accordance with the best safeguards and standards, NbS can generate multiple benefits for the environment, economies and societies. They can also support corporations to reduce their environmental impacts and mitigate the impacts of a changing environment on operations.
But, despite NbS’ potential, they are not without risk. CDP’s new policy brief Disclosing Nature’s Potential: Corporate readiness for Nature-based Solutions, outlines some challenges surrounding the implementation of NbS which must be acknowledged and addressed.
Alongside the need to ensure that NbS complement, not replace, direct emission reductions, companies must remember that if not carefully conceptualised, planned and monitored, interventions intended to be labelled as solutions will generate unintended negative consequences. For example, reforestation efforts that result in non-native monoculture tree plantations can undermine not only biodiversity but also social objectives through the depletion and pollution of water sources.
In addition, NbS can offer flexible long-term solutions, but there can be significant timescale uncertainty. Their planning and implementation may lead to complex governance challenges, especially those which are large scale and involve multiple stakeholders.
So, in the context of these challenges and given their eagerness for them, how prepared are companies for NbS? CDP data released last month would suggest not well enough. CDP’s corporate forests disclosure data from Brazil and the UK found that disclosing companies are falling short of requirements to implement the necessary actions that form the basis for a successful NbS.
For example, forest-related risk assessments are critical to understanding how an NbS can address identified social and environmental challenges and risks posed to business operations. Yet only a third (31%) of companies are fully assessing the impact of activities on ecosystems and habitats, social impacts and local communities. Ecosystem restoration and protection is a critical component of NbS – a positive biodiversity outcome is a core tenant of any NbS project. Less than half (41%) of disclosing companies analysed were fully meeting CDP’s KPI on this topic.
It’s clear that there is some way to go for corporate enthusiasm for NbS to translate into reality. Companies must act now to ensure their business model is prepared and that they truly advance the environmental agenda, not set it back.
Governments have a crucial role to play in supporting them to do so. The US NbS Roadmap published at COP27 should offer an example in doing so. Governments can and must help to prepare and guide companies through the NbS process, while providing clear direction on forests and climate. Ambitious policies that provide direction and momentum will give businesses a clear objective towards an equitable, net-zero, nature-positive economy.
Support from policymakers is also required to ensure NbS are applied in the right way with appropriate financial resources and incentives, and at sufficient scale to make a positive difference. This includes setting overarching standards to avoid misuse, reduce transaction cost and maximise the regional benefits.
Mandating nature-related corporate disclosure and supporting this in the new global biodiversity framework at COP15 will ensure companies are transparent about their practices and improving the institutional preconditions for effective NbS.
As we strive to rapidly reduce emissions and boost our resilience and ability to adapt, we cannot waste the tools we have. That must include Nature-based Solutions.
