The Edge of Risk
FUTURE OF FOOD
Biodiversity Deforestation Pollution
Why Business Should Care About
Biodiversity Loss
December 15, 2016
Identifying risks in a coal mine is relatively easy; just bring a canary.
It works on a planetary level, too. Just look at the health of global animal
populations, which have declined at an alarming rate: 58 percent between 1970
and 2012. Under a business-as-usual scenario, this figure could climb to 67
percent by 2020, according to World Wildlife Fund’s latest Living Planet Report.
For companies and brands that rely on renewable resources in their supply
chains, this loss of biodiversity is a clear reminder of how rapidly and
extensively critical ecosystems are being degraded. It’s also a stark reminder
that companies should be looking at the big picture when considering business
risks.
The Living Planet Report describes nine planetary boundaries that, once
exceeded, “will cause unacceptable and irreversible changes to resources that we
depend upon.” Of those nine, we have already exceeded two: the level of
biodiversity necessary to maintain resilient ecosystems and the balance of
nitrogen and phosphorous. We may also have surpassed the planet’s tolerance
for the loss of forests, grasslands, wetlands, coastal habitats and coral reefs.
In each of these areas, food production both threatens and is threatened by the
degradation of critical ecosystems and the renewable resources they provide.
This means that slowing and reversing the loss of biodiversity is critically
important not only for the environment, but also for the global food system’s
resilience and economic sustainability. Without functioning landscapes to filter
fresh water, build fertile soil or renew fish stocks, food production, bottom lines
and people suffer. The canaries are telling us that we are mining our renewable
resources at unsustainable rates.
Losses on Land and at Sea
Across each of the planet’s three major systems—terrestrial, marine and
freshwater—food production drives biodiversity loss.
The Center for Biological Diversity estimates that global food production is
responsible for 70 percent of human-induced biodiversity loss globally. In
addition to losing species, we are losing the populations that are necessary to
keep their diversity. The Living Planet Report found that between 1970 and
2012, wildlife populations in forests, grasslands, woodlands and other terrestrial
ecosystems declined 38 percent. Agriculture is the leading cause of
deforestation, particularly the expanded production of beef and soy in Latin
America, palm oil in Indonesia and Malaysia and cocoa in West Africa.
Biodiversity loss is a stark reminder that
companies need to look at the big
picture when considering risks.
Marine biodiversity declined 36 percent between 1970 and 2012, driven mostly
by overfishing. More than 30 percent of the world’s fisheries are harvested
beyond their biological capacity. We must reduce excess fishing capacity and
output to allow the stocks to rebound. Nearly 60 percent are being fished right up
to their limits, leaving no room for increased sustainable production or responses
to anticipated weather variability and production variations from climate change.
Unfortunately, biodiversity suffered its most dramatic decline in freshwater
systems: 81 percent between 1970 and 2012. Here, again, agriculture is a
significant contributor, in particular through its use of nitrogen and phosphorous.
These elements are plentiful in our environment, but they are overused or
misused as fertilizer on croplands. Along with pesticides and eroding soil, they
run off into lakes, rivers, streams and coasts that people rely on for drinking
water, recreation, food and jobs.
These and other agricultural practices—such as tillage, annual cropping without
rotations and the excessive use of pesticides—accelerate soil erosion and diminish
the land’s productivity. Using tools and techniques such as cover crops,
conservation tillage, terracing and buffer strips—which depend on local
conditions—can help rebuild organic matter in soil so the land retains water,
builds fertility and ultimately increases productivity and profit while requiring
fewer inputs. Such practices build soil that is more resilient to erosion, drought,
flood and other effects of climate change.
More Wealth, More Demand, Less Capacity
The global population will approach 10 billion within the next few decades, and
per capita incomes will nearly triple. Overall demand for food will double just at
the moment that we have already begun to exceed the planet’s carrying capacity.
Increasing income and the well-being of all are moral imperatives. So, reducing
income is not the solution to mitigating environmental, social and economic risks
of natural resource degradation. Changing production and consumption are.
Increasing transparency and eliminating illegality is a critical solution that would
help reduce the impact of food production on terrestrial, marine and freshwater
biodiversity. Because our food systems have become so global, it is difficult to
track commodities from farm to table. Opaque supply chains and resource
degradation increase risks for companies whose valuations are driven by brand
and reputation, license to operate and access to markets and raw materials.
By using technology to shine light on their supply chains, companies can
uncover and eliminate hidden risks and illegality—from slave labor in shrimpprocessing plants to illegal cocoa production in national parks—and ensure that
customers are getting the food they think they’re buying. Transparency also
allows companies to begin to identify, measure and manage resource use and
impacts and engage producers to help reduce the impacts of production not just
today, but over the long term.
The converging trends of population increases and income growth and the
decline in biodiversity and ecosystem services are evident. They represent a
significant risk to the food system, another increasingly planetary system on
which everyone depends. If businesses want to maintain their license to operate
today and ensure a stable supply of renewable resources tomorrow, they have to
think, engage and act on a planetary level. They will need to work with supply
chains as the integral partners they already are.
Looking ahead, we are going to have to produce more food over the next 40
years than we have in the last 8,000. The question is: Can we do so without
degrading ecosystems and natural resources past their limits? If the
canaries—indeed, all animals, plants and microbes—are any indication, we must.
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