According to the World Economic Forum’s latest Global Risks Report, the loss of biodiversity and the collapse of ecosystems represent one of the leading environmental risks we will face in the coming years. These risks could lead to a contraction of global Gross Domestic Product (GDP) by up to USD 2.7 trillion by 2030 (World Bank Report). This ecological crisis has profound economic implications and requires an urgent commitment from all sectors of society.
Etifor, with the contribution of the Forum for Sustainable Finance and the Region of Lombardy in the framework of the Italian Business@ Biodiversity Group, has produced a Position Paper that explores the economic opportunities arising from biodiversity, entitled “Protecting biodiversity in Italy:
a cost-effective opportunity for businesses”.
The health of biodiversity in Italy
According to the European Environment Agency’s State of Nature in Europe Report, based on monitoring carried out between 2013 and 2018, 16.3% of species are considered to be in a poor state of conservation, compared to the European average of 20.6%. Concerning habitats, only 9.8% of types are considered to be in good conservation status. The European average is much higher: 14.7%.
These data present a still incomplete picture of the state of biodiversity conservation in Italy, but sufficient to highlight the need and urgency to take action to protect biodiversity in our country.
Investing in biodiversity is worth it
According to the European Commission’s Impact Assessment Study, investments in biodiversity conservation and restoration projects could bring significant economic benefits, estimated at EUR 69,596 million by 2050. Benefits arise from ecosystem services such as carbon storage and sequestration, water quality regulation, pollination and production of renewable raw materials.
According to the European Commission’s Impact Assessment Study, the benefit-cost ratio related to such interventions would be 14.7, equivalent to saying that every euro invested in biodiversity can generate a return of €14.7 in the form of community benefits.
The role of private companies
The private sector can play a significant role in promoting biodiversity in Italy. According to the World Economic Forum, over 50% of global GDP is generated by economic activities that depend on nature and its services.
However, funding for biodiversity conservation falls significantly short of the estimated need. There is, therefore, a substantial financing gap for biodiversity conservation, estimated at between EUR 561 billion and EUR 773 billion per year.
In Italy, too, private companies have a crucial role to play in meeting this financial challenge: it can be calculated that, when divided by the turnover of Italian companies in 2020 (ISTAT), for every million euros of turnover, companies would have to invest at least 93 euro in biodiversity restoration.
Italian Business @ Biodiversity Working Group
The Paper clearly and concisely outlines our views on the role and opportunities for biodiversity-related businesses. It also introduces the main objectives of the Italian Business @ Biodiversity Working Group, an initiative born this year during the organization of the European Business & Nature Summit, which aims to maximize the results of biodiversity conservation and restoration in Italy by involving private and financial organizations.
The aim is to raise awareness of the economic importance of biodiversity, promote public-private partnerships and align business strategies with international best practices to reduce environmental impacts and support conservation efforts.