12.2.2.4 Deconstructing the concept of biodiversity into sub-themes (the 'matrix')

Biodiversity is a complex concept. Asset managers find it difficult to 'translate' BES issues into business risks. For some sectors, the link with biodiversity is obvious, for example mining and forestry. These sectors have extensive impacts on nature. For most sectors, however, the relationship between biodiversity loss and individual companies is less straightforward.1 The type of impacts and relationships are highly variable between sectors. A possible overlap with other environmental themes, such as water and CO2 emissions, are also considered to be confusing by some of the interviewees. In general, asset managers have very limited time for an assessment per company, and are thus in need of 'quick answers'. Not only are these 'quick answers' currently unavailable, most mainstream asset managers do not know which questions to ask. ESG Agencies struggle with similar constraints in trying to develop biodiversity information products for asset managers on a company-specific level. There is a trade-off between the efficiency of the process and the level of detail and specificity of the information. The right balance is still to be discovered. Some work has been done to make corporate risks related to BES loss transparent per sector.2 The existing matrices, however, are still quite abstract in nature with limited use for data collection and decision-making at company level.

Some of the interviewees even argue that the best way forward would be to proceed on some of the most material and most readily applicable sub-themes, like water, instead of pursuing the general concept of BES. The BES concept might currently prove to be too big to handle for the financial community. Others suggest linking up to the climate change debate, because climate change is high on the agenda, and it obviously has an extensive impact on BES. However, one ESG Agency pointed out that the term 'biodiversity' has a valuable symbolic meaning and should thus not be deleted when deconstructing the concept.