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Business Must Adapt to Realities of Global Ecosystem Change

The Millennium Ecosystem Assessment determined that the capacity of ecosystems to provide people with valued goods and services, such as food, water, fiber, carbon storage, and control of floods, disease and climate, was degraded for nearly two thirds of the ecosystem services examined.

The Ecosystem Challenges and Business Implications report, launched today, warns that companies must transform their business models to avoid major economic losses caused by ecosystem degradation. Findings in this publication include:

  • Many companies recognize the risks associated with degrading ecosystems, but most don't make the link between healthy ecosystems and their business interests.

  • Many companies already work with nongovernmental organizations to adapt to ecosystem change. But the magnitude of environmental change requires a collective business response.

  • Business risks include scarcity of raw materials, higher operating costs, government restrictions and reduced flexibility.

  • Companies can best respond to the growing loss of ecosystem services by measuring their impact and dependence on ecosystem services, taking advantage of emerging opportunities, and reducing their operational footprints.

New Business Opportunities

The report also suggests many business opportunities arising from the growing scarcity of ecosystem services, all of which can contribute to ecosystem conservation:

  • New low-impact technologies and products

  • Demand for ecosystem restoration

  • New markets, such as nutrient trading and carbon sequestration

The publication includes descriptions of changes that companies have made in response to their recognition of the business value of ecosystem goods and services:

  • Skanska has begun to develop its approach to climate change by using scenario modeling. These models will be applied to new development projects to assess the potential impacts of climate change on indoor climate and help the company consider architectural designs accordingly.

  • Cadbury Schweppes is engaged in an Earthwatch Institute research project to investigate the feasibility and potential of cocoa production in a biologically diverse environment. Cadbury Schweppes employees join the project as volunteer research assistants and gain a better awareness and understanding of the links between biodiversity, sustainability and the Cadbury Schweppes supply chain.

  • Wal-Mart has set a goal to purchase all of its wild-caught fresh and frozen fish for the North American market from MSC-certified fisheries. In 2006, Wal-Mart gave their non-certified suppliers three to five years to develop plans and programs to become certified.

  • Rio Tinto (pdf) has developed a water diagnostic tool to help understand the cultural, social, economic and environmental risks and opportunities for water. It focuses on water supply, discharge quality, cost and community engagement. Applying the tool on 15 of their operational sites has revealed that risks are site specific and that water is a key interest for local communities.

  • Terra Eco Systems specializes in recycling organic waste materials to agriculture, land restoration, forestry and horticulture. Each year the company recycles more than 1.7 million metric tons of organic material including water and wastewater sludge, as well as green and kitchen waste. Through these services Terra Eco Systems provides cost-effective fertilizer solutions.

The Ecosystem Challenges and Business Implications report also includes commentary by Edmund Blarney, Interface Europe


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