Biodiversity and Economy – An Underestimated Relationship

  • 2022/03/04     Dresden, Germany

    Image: Oliver Fox

    Led by the question “Why Does Biodiversity Loss Threaten Economies and Businesses?” the Saxon Dialogue on Biodiversity discussed the interdependence of biodiversity and economy.

    By Laura Hoffmann

    The Gross Domestic Product (GDP) – a common measurement for success and economic growth – highly depends on biodiversity. More than half of the world’s GDP can be linked to nature and yet the latter’s worth to society is not reflected in market prices. Our consumption and production patterns have to change and we need to implement sustainable behaviour.

    Opportunities for Biodiversity in Our Economy

    The final seminar of the five-part series was opened by Dr Frauke Fischer – biologist, entrepreneur, and consultant – showing the global effects of biodiversity loss on our economy.

    Dr Jasper Meya, postdoc at iDiv (German Centre for Integrative Biodiversity Research) in the research group of Biodiversity Economics, focused on the impacts of biodiversity loss on the German economy. Natural capital stocks have degraded severely, which applies not only to the ecosystems in Germany. All over the world, biodiversity is declining, leading to extreme risk and uncertainty for our economies (Dasgupta 2021). The value of biodiversity need to become visible by reflecting them in market prices. To achieve this, public funds should be more linked to the protection of ecosystem services, and the system of incentives in biodiversity conservation reformed.

    Oliver Fox, biologist and Advisor in the Entrepreneurial Association for Mineral Building Materials (Unternehmerverband Mineralische Baustoffe e.V.), shares a unique perspective from the mining sector. Often known as a major cause of land-use change (one of the direct drivers of biodiversity loss), mining can be an opportunity for biodiversity and species which prefer open land. He shows companies, which species can be found in mining landscapes so that they better understand their role in nature protection. With his expert advice, companies can create temporary habitats during the dismantling process like small water bodies that benefits local biodiversity.

    Image: Oliver Fox

    Image: Laura Hoffmann/UNU-FLORES







    Biodiversity Needs to be Assigned Economic Value

    The biggest challenge for companies regarding biodiversity management is that many of them have not yet discovered how they impact and depend on biodiversity. Without knowing their relation to biodiversity, businesses tend to regard it as unimportant. Not considering biodiversity in their management approach could create substantial business risks. Even though under the prevalent economic paradigm, biodiversity and related ecosystem services provisioning are coupled to economic success, the significance of healthy biodiversity remains overseen. Our society has built an economic system based on production and consumption in which companies have lost their connections to nature and biodiversity.

    Due to the missing awareness of the importance of biodiversity, business decisions are often made at the expense of biodiversity and not in favour of nature protection. This is reflected in the existing laws, subsidies, and certificates for organic cultivation. Biodiversity does not have a major role in many certificates, for example, the one given by the EU; and subsidies are spent on productions that damage biodiversity (TEEB 2009). It needs to be clarified, what organic certificates and labels on products mean and a biodiversity-friendly labelling needs to be established, with which consumers receive transparent information about the product. A lot of public relations work is needed to make it clear to citizens that they do have the power of choice in their consumption to shift the market into a sustainable economy.

    Dr Fischer emphasised that biodiversity offsets can be used as a bridging measure but not as a long-term solution to protect biodiversity and restore nature. Biodiversity, when lost once, is probably lost forever, and cannot be replaced by simply planting trees in the short term. Ecosystems and especially forests need a long time to grow and reestablish themselves. Nevertheless, degraded land can be enhanced with a change of land-use type and by creating new habitats alongside. Additionally, rewilding big mammals can support open land structures and keep different habitats long-term.

    The experts agree that the importance of biodiversity needs an economic value in our markets. However, our present economic paradigm, which externalises social and environmental aspects, still has too many supporters to realise a successful change. We need to take action and shift biodiversity to the focal point of companies, the economy, governments, scientists, and every individual, so as to shift consumption patterns. Combined actions and increased conservation efforts can bend the curve of biodiversity loss (Leclère et al. 2020).