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Sustainability Monitor

Alarming Decline in Biodiversity

by Dr. Christoph Biehl

Insights to the value of ecosystem service for the economy

The loss of biodiversity is progressing worldwide on a historic scale and endangers key ecosystem services – from pollination to coastal protection to water supply. Economic activities are among the main drivers of biodiversity decline. At the same time, this creates considerable risks for companies, investments and global value chains. Biodiversity policy should therefore be understood not only as environmental policy, but also as economic policy with all relevant stakeholders playing their part.

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The global loss of biodiversity is progressing at an unprecedented speed and threatens central ecological, economic and social foundations. Nature is severely degraded in many places, and central ecosystem services such as pollination, soil fertility, water regulation or coastal protection are coming under increasing pressure. The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) identifies five main drivers: changes in land and sea use, direct exploitation of organisms, climate change, environmental pollution and invasive species – all of which are closely linked to economic activity.

The analysis shows that the biodiversity and climate crises are inextricably linked: climate change exacerbates other stress factors, while intact ecosystems also make important contributions to climate adaptation and carbon storage. An effective response therefore requires an integrated approach in politics, business and the financial sector.

From an economic point of view, more than half of the global gross domestic product is directly or indirectly dependent on functioning ecosystems. Agriculture, construction, food production and the pharmaceutical industry are particularly affected. The destruction of nature increases financial risks, jeopardises business models and puts a strain on supply chains. Investors are increasingly responding with initiatives such as Nature Action 100 or SPRING, which urge companies to analyse nature dependencies and take concrete action.

Politically, the Kunming-Montreal Global Biodiversity Framework (GBF) has been setting central guidelines since 2022, including the goal of protecting 30 percent of land and ocean areas by 2030. The EU addresses biodiversity loss with instruments such as the Biodiversity Strategy 2030, the Restoration Regulation, the Deforestation Regulation, the Chemicals Strategy and the Zero Pollution Plan. In Germany, the National Strategy for Biological Diversity 2030 forms the framework for extensive measures.

Companies can effectively address biodiversity risks through so-called double materiality, science-based monitoring, restoration plans and local multi-stakeholder approaches, as case studies on activities of the companies Suntory or Holcim show.

Biodiversity loss is therefore not just an environmental issue, but an economic, social and security policy challenge. The trend reversal can only be achieved through coordinated action by politics, business, science, civil society and local communities – as a shared responsibility towards future generations.

Read the entire Monitor: ‘Alarming Decline in Biodiversity’ from our Sustainability series here as a PDF.

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Contact Gisela Elsner
Gisela Elsner kas
Environmental, Climate and Sustainability Policy Officer and KAS Advice and Complaints Officer
gisela.elsner@kas.de +49 30 26996-3759

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About this series

The publications of the Sustainability Monitor are part of our Monitor publication series. The Monitor series deals with one main topic at a time from the perspective of KAS experts and places it in the political and social context on the basis of a few key points.