Companies must gear up to weather the coming natural resource crunch

The Natural Value Initiative (NVI) has found that many companies have not adequately prepared themselves for the increasing pressure on ecosystem services. ‘Ecosystem services’ are the benefits obtained by people from the natural world such as timber supply, flood regulation and pollination.

The NVI team carried out the first comprehensive analysis of not only the impacts but dependencies of agriculture and beverage and tobacco sectors on ecosystem services. The report assesses 31 companies across the beverage, food, tobacco and retail sectors, such as Unilever, The Coca-Cola Company, British American Tobacco and M&S.

This new analysis investigates how companies rely on biodiversity and many different ecosystem services throughout their supply chains. For example, it found that over 95% of the water used to make one can of lager is actually in the agricultural sector i.e. the hops and other ingredients that go into beer.

The NVI has developed a benchmarking tool for investors to investigate the extent to which companies are addressing, or not addressing, the risks from loss of biodiversity and ecosystem services.

It is hoped that investors will use the tool to encourage the businesses they invest in to better incorporate them into their management strategies. The tool was developed with six different investors which collectively represent £398 billion of assets under management.

The NVI is a joint programme of FFI, UNEP Financial Initiative, and Brazilian business school Fundação Getulio Vargas.