Biodiversity risk increases in Nordic companies

71 per cent of the companies are exposed to a material risk because of their reliance or impact on biodiversity, according to the assessment. fewer than 15 per cent of them have adopted a target to reduce their biodiversity impact or restore nature.

Nordic companies do acknowledge that they have an impact or dependency on biodiversity, as a third of the companies report or describe activities within biodiversity, but they are often very vague, despite the fact that they have a high exposure to biodiversity risk. Mads Steinm ller, the head of active ownership at Danske Bank and Danica Pension, viewed that the report made it abundantly clear that many companies overlook not only the risks but also the opportunities of biodiversity.

Companies that use nature's resources in one way or another must set objectives for how they can integrate biodiversity into their approach. He stated in a press release that this will not only contribute to future-proofing of the company, but it will also help to reduce biodiversity risk.

Less biodiversity is lost in forests and oceans, according to the Danske Bank.

It found that 36 per cent of the companies that are potentially linked to deforestation, but only a few have set targets or report on deforestation. 65 per cent of the companies that have an impact on oceans, such as food, mining and oil and gas, only seven per cent of them have set a target for minimising their impact on or restoring oceans.

Nordic companies can affect oceans in a variety of ways, including underwater noise that disturbs species that rely on acoustics, physical pollutants like oil spills, agricultural run-off and human waste.

The issue was examined by Danske Bank because of the biodiversity-related risks that affect the risk profile of companies and therefore investors.

Steinm ller said that biodiversity in crisis and the transition to an economy that preserves and restores biodiversity can affect a company's value, business model and growth potential. We have only one Mother Nature, and for many companies she is their most important supplier, so we all have a role to play in terms of preserving biodiversity and ensuring that both companies and investors contribute to increasing biodiversity.