Economics Department Professors Edward Barbier and Joanne Burgess co-authored an article with Professor Thomas Dean of the College of Business titled “How to pay for saving biodiversity” which was published in the prestigious journal Science on May 4, 2018.
They argue that to preserve the rich array of species around the world, corporations will need to engage and contribute financially as part of a global agreement. In the piece, they propose modeling the new global pact after the 2015 Paris Climate Change Agreement. But instead of focusing primarily on governmental entities as partners, they say corporations in industries that rely on biodiversity should invest in the effort as well.
The reason for that, they claim, is that governments don’t have the financial wherewithal to contribute the $100 billion a year that would be needed to protect the earth’s broad range of animal and plant species. Secondly, and perhaps more importantly, corporations in industries like seafood, insurance and forest products stand to significantly increase their profits by investing in the effort — and avoid financial losses that would necessarily come with irreversible declines in biodiversity.
“Let’s get the companies and non-state entities involved from the beginning, so that we can deal with the funding issue,” says Barbier, a world-renowned environmental economist who joined CSU last year. “It’s the good thing for their bottom line, and corporations are beginning to realize that. I think we’re at a turning point, but if we don’t act quickly, we’re going to lose much of the world’s remaining biodiversity.”
The authors say the 1992 Convention on Biological Diversity, one of the first international environmental agreements negotiated, has not done enough to reverse the decline of biological populations and diversity on land and in oceans. They add that neither has the Global Environmental Facility, which was created the same year for biodiversity conservation in developing countries. Those countries host the most biodiversity in part because so many of them have tropical climates.
Similarly, the CSU faculty write that the Aichi Biodiversity Targets that governments around the world have agreed to are seen as too modest because they call for conservation of only a small percentage of the habitats needed to save global biodiversity. Based on scientific recommendations, their proposed international agreement would preserve at least half of the world’s terrestrial, inland water, coastal and marine habitats by 2050.
“It is critical that the upcoming Convention on Biological Diversity in Egypt this November finds creative solutions to the current biodiversity conservation crisis,” Burgess says. “As our article discusses, establishing a Global Agreement for Biodiversity with expanded conservation and finance targets is required. Creating mechanisms for corporations to be part of the solution rather than part of the problem could help mobilize financial resources and create incentives to avert a catastrophic loss of biodiversity.”
Barbier and Dean met last year and began discussing the idea while serving together on a panel hosted by CSU’s Global Biodiversity Center, which is housed at the School of Global Environmental Sustainability. Barbier and Burgess, who are married, have been writing about corporate incentives for environmental stewardship for years.
According to projections in their article, the seafood industry stands to gain $53 billion annually from a $5 billion to $10 billion investment each year in a global agreement on biodiversity, while the insurance industry could see an additional $52 billion with a similar investment. By spending $15 to $30 billion annually, the forest products industry would attain its sustainable forest management goal. Companies that participate would also create new marketing opportunities such as certified labeling campaigns.
“This is where the right thing to do and the bottom line come together,” Barbier says. “And it’s fairly urgent. I don’t see the funding gap closing any other way.”
He notes that some industries have already seen corporations band together in sustainability agreements like the Seafood Business for Ocean Stewardship initiative.
“At its foundation, this article is arguing that corporations have a vested interest in the preservation of biodiversity, and that interest should lead them to support efforts to preserve our biosphere,” Dean said. “For too long we have viewed corporate and environmental interests as adversarial, when they need to become aligned if we are to be successful both economically and environmentally. What seems obvious to me is that corporations that depend on the health of our ecosystems are at risk of losing the foundations of their businesses in the long run. Growing awareness of this challenge will increasingly motivate corporations to engage.”
Their article continues to attract media attention internationally as can be seen in the June 28, 2018 publication “Scientists call for a Paris-style agreement to save life on Earth” on The Guardian’s website.