By Beth Keddie, Managing Director at Pollination
Nature loss is continuing at an alarming rate and business leaders are paying attention. The hard reality is that our current economic system is driving the very loss of nature on which it, and our broader collective wellbeing, also depends.
For most of us, nature feels intuitive; it’s visible and all around us. However, when we start to place it in a business context, nature can begin to feel more complicated and it’s often difficult to know where to start. Across sectors such as mining, property and industrials, business leaders are increasingly aware of the urgency of the situation. While these sectors are highly exposed to nature-related risks, they are also best-placed to act.
In our experience, the perceived complexity of the nature agenda is too often becoming a roadblock to progress. The challenge is not just understanding the issues, but also knowing how to take meaningful action. Amidst is all one thing is clear – data is crucial in understanding the extent and shape of dependency and impact nature has on their organisation.
Naturally, this appears to be a daunting task, but there is a path leaders can begin to follow to better understand, organise and leverage their data to act in a timely manner on nature-related risks.
From nature data to nature intelligence
Rather than rushing to fill perceived gaps in nature data, the first step is working out which data matters most. This requires a shift in mindset, from simply collecting nature data to developing actionable nature intelligence. Businesses should start by performing a high-level nature scan, mapping the intersection of nature with each step of their value chain, from material extraction and production through to design, construction, operations and end-of-life to work out what might be material.
Applying business knowledge to these findings then helps to pinpoint where the biggest risks and opportunities lie, providing a clearer picture of how operations interact with nature. The key is to avoid getting overwhelmed and instead focus on understanding what data is most relevant to corporate strategic objectives.
Setting hypotheses
Once a nature scan is completed, the next step is setting hypotheses. This approach helps to pinpoint areas of material impact and dependencies, business units and key activities that require deeper focus. Hypotheses should be developed across the following dimensions:
- Value chain stage
- Impacts and pressures
- Dependencies and ecosystem services
- Geography
Breaking down these elements allows businesses to focus on priority areas and identify near-term, low-risk “quick wins”. A good example of this involves our work with a property company. We helped to develop a hypothesis that amidst a wide portfolio of activities and assets around the world, greenfield developments, and assets located in emerging economies identified as having high-physical and transition risk profiles, were likely areas of potential material risk for the company. This helped inform the selection of a pilot site, allowing us to practically test and understand more tangibly, where and how risks could manifest.
Once hypotheses are established, testing them through focused pilot projects is essential. While perfect data may not be available, businesses will gain enough insight to take meaningful action.
Take action and maintain momentum
Following the establishment of hypotheses and pilot projects, businesses must turn insights into action. The results of a nature scan, combined with pilot findings, provide a wealth of new information that can inform decision-making. They can also inform which data really matters and to prioritise how any data gaps in those areas should be closed.
This should consider how data is collected, organised and structured for analysis, interpretation, communication and reporting. These processes should align with existing strategies, systems and processes to ensure efficiency. Importantly, a universal approach does not exist; strategies, needs, and ambitions should drive data procurement and system selection rather than the other way around. Using credible, consistent data is key, but with so many databases to choose from, businesses must focus on selecting the ones that align with their goals.
By taking a structured approach to understanding and addressing nature-related risks, businesses can move from complexity to action, ensuring they are well-positioned to navigate the challenges of climate change.
