With a billion-dollar shortfall in biodiversity finance looming and increasing regulatory pressure, organizations are seeking structured approaches to nature-related compliance. The Science Based Targets Network’s five-step methodology offers compliance officers and risk managers a systematic framework for assessing, measuring and reporting on biodiversity impacts. William Theisen, CEO of EcoAct North America, an environmental consultancy, explores how emerging standards could reshape corporate environmental obligations.
With a projected $4.6 billion shortfall in development finance to meet 2025 international biodiversity finance target, biodiversity — and nature more broadly — is one of the most overlooked segments in the climate change landscape today. However, with a constant stream of natural disaster headlines and growing attendance at 2024’sUN Convention on Biological Diversity Conference of Parties (COP), nature conservation and regeneration are moving up the priority lists of internal and external stakeholders.
To meet nature goals like biodiversity and ecosystem restoration in a standardized and accountable way, many organizations have begun adopting a more science-based approach, particularly the framework established by the Science Based Targets Network (SBTN).
As more internal and external pressure has been heaped on organizations to “do the right thing” by the environment, voluntary sustainability initiatives and compliance requirements have become increasingly diverse and far-reaching. Businesses have been turning their attention toward additional areas like biodiversity and nature and begun incorporating these areas into their overall sustainability strategies and roadmaps. However, while many businesses today recognize the role of biodiversity and nature in their broader sustainability footprints, many are not only finding it difficult to glean the data that they need but to put the processes in place to enable them to capture these insights in a comprehensive and effective way.
Science-based targets for nature can help them do this.
Understanding science-based targets for nature
Science-based targets (SBTs) take into account how much a company needs to decrease its emissions in order to limit global temperature rise to 1.5° Celsius. Working under the understanding that globally we need to reach net-zero emissions by 2050, the Science Based Target initiative (SBTi) has set out specific guidelines on how much direct, indirect and value chain emissions need to decrease for both high-emitting sectors and companies ready to take climate action.
Given how sprawling and multi-faceted sustainability planning can be, businesses often find it challenging to build actionable sustainability targets and goals. SBTs provide a cornerstone framework by which they can develop long-term sustainability success in an ambitious, tangible and accountable way, particularly when it comes to emissions.
Emissions are only one factor in sustainability, though, and the SBTN has extended targets beyond emissions to include aspects of nature like water, biodiversity and other nature-related areas. By embracing SBTs for nature, businesses are expected to meet the 2022 Kunming-Montreal Biodiversity Framework goals, which include reversing biodiversity loss.
SBTs for nature are designed to outline actionable steps to achieve these goals over the long term and help businesses align with the Taskforce on Nature-related Climate Disclosures (TNFD), Carbon Disclosure Project (CDP) and other high-priority regulatory frameworks.
Getting started
SBTs for nature are packaged into a comprehensive five-step methodology that allows businesses to gauge their current impacts on nature, set hard and fast targets and establish reporting.
1. Assess
The first step is designed to help businesses take a step back and get a baseline understanding of their true impact on nature. This entails going through a rigorous review of exactly where nature-related impacts are the most prevalent and pressing and then combining these insights together to form a more business-wide view.
2. Analyze and prioritize
With these insights in hand, business can then formulate tangible goals and develop plans of attack based on their priorities. Priorities will vary from business to business; however, they should take into account immediate needs as well as the feasibility of meeting targets based on factors that include human rights and financial demands.
3. Measurement and target setting
Once priority areas have been defined, business can then begin to set targets. To do this, businesses need to establish their baselines and confer with existing SBT guidelines for freshwater, land and other nature areas. Guidance for oceans and biodiversity are still under development; however, in lieu of specific benchmarks for these areas, there is biodiversity-related guidance outlined in the SBTs for freshwater and land guidance sections, for example.
4. Execute
After the initial groundwork steps are established, it is now time for businesses to commit to a process for executing on these targets and establish a setting of guiding principles to help them do so. To help with this, the SBTN debuted its Action Framework (AR3T) in 2020, providing an actionable overview of values that business can use to begin their journey and hit their newly set targets:
Avoid future impacts
Reduce negative impacts that cannot be entirely avoided
Restore and regenerate by initiating efforts for nature to recover from negative impacts, such as through revegetation initiatives
Transform by leading to system-wide changes to prevent biodiversity loss
Formal guidance for how to implement these steps is set to be debuted by SBTN in 2025. In the interim, existing technical guidance from STBN — for freshwater, for example — illuminates potential avenues for businesses to pursue these targets.
5. Track
Lastly, with targets and an action plan defined, businesses need to settle on their disclosure and track protocols to ensure accountability. Exact procedures for measurement, reporting and verification are set to be debuted in 2025. However, the SBTN has consistently advocated for broad public disclosure of progress, so businesses adopting SBTs for nature should anticipate that comprehensive transparency will be expected.
