Biodiversity loss is a critical global issue that threatens our well-being and livelihoods. While infrastructure investors have made strides in integrating environmental, social, and governance (ESG) considerations, there is a pressing need to better measure and mitigate investments’ impacts on biodiversity. Biodiversity loss, driven by climate change, habitat change, pollution, resource use, and invasive species spread, creates significant risks for infrastructure and economic resilience.
In a joint effort with management consulting firm Oliver Wyman, WWF developed the white paper Biodiversity and Infrastructure Investing: How Infrastructure Investors Are Factoring Biodiversity Impacts Into Decision-Making. The paper is also supported by the United States Agency for International Development (USAID)-funded Asia’s Linear Infrastructure safeGuarding Nature (ALIGN) Project, which aims to enhance the development and implementation of effective, high-quality linear infrastructure safeguards that protect people and nature from harm. The report builds on the 2020 white paper published by WWF and Oliver Wyman, Incorporating Sustainability Into Infrastructure, which examined how climate and nature-related factors are applied in the infrastructure investment process.
Biodiversity and Infrastructure Investing shows how infrastructure investors and their advisors can incorporate biodiversity into investing. It explores approaches used to assess biodiversity impacts and investor rationale for considering these risks in decision-making, presenting perspectives on the outlook for further progress and where improvement is of the most value.
To inform the white paper, researchers created a global infrastructure investor survey, conducted direct interviews, and performed an in-depth literature review. This comprehensive approach identified five key areas of focus:
- Infrastructure impacts on biodiversity loss and physical and transition risk exposure
- The increase in awareness of and action to address biodiversity loss
- Investors’ current practices, including approaches, frameworks, and metrics used in the decision-making process
- Factors driving further progress, such as barriers and key actions
- Best practice case studies throughout the investment lifecycle
The white paper’s findings reveal that infrastructure investors increasingly incorporated biodiversity and other ESG metrics into their decision-making processes. There are three clear reasons to act more urgently: biodiversity loss is a crisis comparable to climate change, progress is achievable now with low barriers to inclusion, and a nature-positive transition will create new opportunities, such as biodiversity credit markets.
The white paper concluded that increasing awareness and action on biodiversity has not yet led to widespread assessment of biodiversity risk exposures and impacts in infrastructure. We anticipate that investors will increase their considerations over the next one to two years, supported by this research and a growing awareness of available biodiversity frameworks and metrics. This shift is expected to follow a pattern similar to the rapid uptake of climate change considerations in investment decision-making.
