In the context of the International Day for Biodiversity (22 May) and the six years since the publication of the encyclical Laudato Si
"Biodiversity loss is a global problem that no country, no matter how rich or powerful, can tackle alone."
— António Guterres, Secretary-General of the United Nations
Biodiversity is no longer a peripheral theme reserved for the environmentalist discourse but has become a central factor of systemic risk and, at the same time, one of the most relevant strategic opportunities for companies in the 21st century. The acceleration of ecosystem loss, growing investor pressure, emerging regulation, and social expectations around the role of the private sector in planetary regeneration converge on a new imperative: to integrate biodiversity as an intrinsic part of business decisions, not only as a matter of environmental responsibility but as a structuring element of business resilience and competitive positioning.
On the political and multilateral level, the Kunming-Montreal Global Biodiversity Framework, adopted at COP15 in December 2022, set a new course for humanity. This historic agreement outlines a set of ambitious targets to be achieved by 2030, including the restoration of at least 30% of degraded ecosystems, the effective protection of 30% of terrestrial, freshwater, and marine areas, and the mobilization of at least USD 200 billion per year to finance these actions. This financing should be ensured by a combined effort between the public and private sectors, with the use of market-based instruments such as biodiversity credits – mechanisms that attribute economic value to nature conservation and regeneration actions based on traceable, measurable, and verifiable metrics (Source: CBD, 2022).
These credits are voluntary and tradable units associated with positive outcomes for nature, such as the recovery of species, the protection of habitats, or the regeneration of ecosystems. Unlike traditional offsets, which compensate for damages, "biocredits" are associated with additional and positive contributions – and will therefore be increasingly highly valued by investors and institutional buyers. When integrated into hybrid projects – such as Carbon Credits+, recently recognized in Portuguese legislation – these instruments generate dual value: climate and ecological (Source: IFLR ESG Report 2024)(Source: Diário da República, DL 4/2024).
The international framework is strengthened by new legislative instruments at the European level, which aim to put multilateral commitments into practice. One of the most relevant is the European Nature Restoration Act, approved within the framework of the EU Biodiversity Strategy for 2030, which aims to reverse biodiversity loss and restore degraded ecosystems across the European Union by 2050, with binding targets for Member States:
- Restore at least 20% of the EU's land and marine areas by 2030;
- Restore all degraded ecosystems by 2050 (forests, wetlands, rivers, grasslands, marine ecosystems, etc.);
- Prioritise Natura 2000 areas (EU protected areas network); improve specific indicators such as soil biodiversity, pollinators, river connectivity, and tree cover.
Under this European law, the Member State must present National Restoration Plans with concrete measures and deadlines for their fulfillment and monitor their progress towards the goals based on scientific and verifiable indicators, integrating its "nature policy" with other policies, such as agriculture, fisheries, and urban planning. This law aims, at the same time, to strengthen food security, water quality, landscape resilience, and human well-being.
Another central piece of legislation is the Corporate Sustainability Due Diligence Directive (CSDDD), which, although currently in the process of being amended in the context of the regulatory simplification proposed by the European Commission (Omnibus package), sets the foundations for a new corporate liability regime. This Directive will oblige large companies to identify, prevent, and mitigate adverse impacts on human rights and the environment, including biodiversity, in all their operations, subsidiaries, and value chains, regardless of their geographical location. This is a structural change that broadens the scope of corporate responsibility and enshrines the natural environment as a relevant legal element in business decisions.
At the same time, the entry into force of the Corporate Sustainability Reporting Directive (CSRD) marks a new era in the way companies should analyze and communicate their impacts. By requiring a double materiality analysis – i.e., in the case of biodiversity, the simultaneous consideration of the company's impact on the environment and the company's exposure to ecological risks – this Directive makes biodiversity an unavoidable topic for any organization wishing to maintain access to capital, markets, and reputation. Companies will have to include clear indicators in their reporting on land use, pressure on habitats, consumption of natural resources, and ongoing mitigation or regeneration measures.
Regardless of this new regulatory context – and what results from the ongoing process for its simplification – companies are faced with a strategic choice: resist change and accumulate increasing risks or adopt a proactive approach and transform biodiversity into a vector for innovation, reputation, and fundraising. Increasingly, the second way is proving to be not only more sustainable but also more profitable.
Biodiversity is not only an environmental asset; it is also a source of cross-cutting innovation. Pioneering companies in sectors such as cosmetics, pharmaceuticals, agri-food, and biotechnology are developing new products and processes based on genetic resources and traditional knowledge associated with intact ecosystems. Financial institutions are structuring conservation-related investment products, and regenerative value chains are increasingly gaining the trust of stakeholders and preference among conscious consumers. In this new scenario, investing in biodiversity becomes a strategy for anticipation, differentiation, and value creation. Business leadership is already called upon today for the theme of biodiversity and will be measured, increasingly, by the ability to generate regenerative value, not just mitigation.
Six years after the publication of the encyclical Laudato Si, which called the world to an integral ecology — where social justice, environmental responsibility, and intergenerational vision intertwine — it is becoming increasingly clear that protecting and regenerating biodiversity is not just an environmental issue: it is an affirmation of ethical and strategic leadership in a time of global ecological disruption.
Thus, more than a legal or reputational obligation, biodiversity is today a real key to resilience, innovation, and the purpose of companies that want to thrive in an increasingly interdependent world.
Have a great and impactful week!
Mafalda Sarmento
Sustainability Officer at CATÓLICA-LISBON
Researcher and Consultant at Center for Responsible Business and Leadership
Angela Lucas
Consultant and Advisor at Center for Responsible Business and Leadership
Co-Founder, Partner & Board Member Land Fund