Motivated by the results of the Millennium Ecosystem Assessment, the 190 large companies that make up the World Business Council for Sustainable Development (WBCSD) decided late last year to make ecosystems their fourth focus area.
This has already led to work with organizations such as IUCN, the World Resources Institute and Earthwatch Institute on ways in which business activities and market instruments can be used to support the sustainable management and use of ecosystem services.
Focusing on ecosystems The Council’s other focus areas are ‘Energy & Climate’, ‘Development’ and the ‘Business Role’ (defining the role of business in society). All of these also have to do with ecosystems — especially the effects on ecosystems of the ways in which we use energy and of unsustainable forms of development.
Some ecosystems are the primary source of energy that powers livelihoods — for example wood for cooking and heating in many developing countries. At the same time, current energy demands are negatively impacting ecosystems and threatening their ability as providers. The challenge, therefore, is to harness energy systems and ecosystems in a manner that makes them mutually supportive.
It is now widely accepted that human activity is largely responsible for changes to the world’s climate patterns. Changing rainfall patterns, for instance, appear to be causing increasing desertification and crop failures, while rising sea temperatures seem to have led to a bleaching of coral reefs.
At the same time, ecosystems influence climate. Land-use changes like deforestation lead to increasing CO2 emissions. Part of the solution lies in de-carbonizing the global economy through the development of clean renewable technology. Another part of the solution rests in valuing and protecting ecosystems so that they can continue to provide their services sustainably. For instance, the sustainable management of forests so that they can continue to sequester carbon and deliver other critical services like water quality, habitat, erosion control as well as fiber for both forest products and ‘carbon neutral’ energy.
The development of crops for biofuels, if unrestrained, will have devastating effects on ecosystems. Competition between food and fuel crops will likely lead to greater pressure on ecosystems, including water services. Comprehensive energy policy frameworks are needed to regulate this and encourage greater use of sustainably produced biomass energy.
Managing the world’s forests Greater effort is needed to increase the sustainable management of the world’s forests, especially in developing countries where large-scale deforestation needs to be curbed to protect ecosystems, mitigate the impacts of climate change and reduce forest carbon emissions. International funding mechanisms, additional to the Clean Development Mechanism, which might allow developing countries to receive payments for carbon sequestration services if they avoid significant deforestation, are under discussion and development.
At the national level, this can be supported through forest policies that recognize and value forests as a critical resource — policies that must be more effectively enforced. Avoiding unsustainable competition for forest fiber and removing subsidies that encourage forest conversions for crop cultivation, including biofuels, should be early policy priorities.
Development agencies and business can also play a role via investments in new sustainable forestry projects and in building the capacity of local forest governance systems. The deployment of Intensively Managed Planted Forests to maximize environment benefits — such as taking pressure off natural forests — and local livelihood opportunities, while also providing fiber for products and energy on an eco-efficient basis, can play a role here. Encouraging the uptake and wider use of sustainable forest management standards is important. The industry should be encouraged to further develop and implement forest management and process technological improvements to increase the volume of sustainable produced fiber for raw material and biomass energy. Public policies could promote an increase in the recovery of wood and paper products for energy and production needs and the substitution of sustainable forest products over non-renewable, energy intensive alternatives.
Where there is challenge, there is opportunity. Corporations that factor these risks into their operations will be able to take advantage of these opportunities and gain competitive advantage, while contributing to efforts to reverse ecosystem degradation.
New businesses The global energy challenge offers the possibility for the introduction of new technologies and products that can serve as substitutes for ecosystem products, help restore ecosystems or increase the efficiency of their use. It also offers a chance to open up new markets such as water quality trading, certified sustainable products, or wetland and threatened species banking. Market mechanisms like certification and trading could be applied to ecosystems and their services to support sustainable consumption levels. New businesses — such as ecosystem restoration, or environmental asset finance or brokerage — could also emerge. All these would create new revenue streams for currently unrealized assets, such as wetlands or forests.
The impact of human and industrial activity on ecosystems, particularly to meet energy requirements, is not in doubt. At the same time, the role of ecosystems in meeting these demands is crucial. The challenge lies in ensuring the sustainable management of ecosystems to fulfill energy demands while ensuring that energy use and consumption do not lead to a greater decline in already fragile ecosystems.
This challenge requires concerted action on the part of governments and business. Governments need to implement enabling policies and create frameworks to encourage ecosystem protection while ensuring that crucial energy requirements are met. At the same time, these policies must seek to guarantee equitable energy access. Business can contribute through the development of clean, renewable technologies to meet global energy demands.
For WBCSD, the challenges and opportunities presented by the competing demands of energy systems and ecosystems will require a coordinated approach spanning its energy, development, forestry, water and ecosystem work areas.
James Griffiths is Director, Sustainable Forest Products Industry and Ecosystems Focus Area,
World Business Council for Sustainable Development (WBCSD).
Recent WBCSD publications on business, biodiversity and climate change are listed in the publications section of the issue (page 35) in the pdf format available in low res here.
