Reporting the corporate risks of climate change is increasingly becoming a required part of doing business. This month, the Securities and Exchange Commission made such disclosures mandatory for public companies in the United States, following the lead from the European Union and California.
But climate is not the only aspect of the natural world that is being transformed by human activity.
Oceans, forests and fresh water supplies have also suffered. Though corporate leaders often don’t talk about these other parts of nature, they could deeply impact the corporate world in ways that we are only beginning to measure.
Will the demise of insects that pollinate crops slash productivity? Could groundwater depletion threaten the boom in data centers? (More on that below.) Will policies to stop ocean pollution impact how companies produce plastic?
Hundreds of companies have already committed to start reporting their nature-related risks in their financial disclosures, and they will start rolling them out in the next few months.
“We’ve got to change the mindset around nature being something we can take for granted,” Tony Goldner, the executive director of the Taskforce on Nature-Related Financial Disclosures, which produced the framework the companies are using. “It’s a risk we have to actively manage. And the resilience of nature underpins the resilience of business.”