There is a growing recognition of the importance of protecting, conserving, and restoring biodiversity, particularly as over 50% of global GDP is dependent on nature and ecosystem services. Biodiversity refers to the variety of life on Earth, while ecosystem services are the benefits that living ecosystems provide to people, including food, water regulation, climate regulation, and cultural value.
The Kunming–Montreal Global Biodiversity Framework (GBF) sets out a 2050 vision of a world living in harmony with nature where biodiversity is valued, conserved, restored, and sustainably used, ecosystem services are maintained, and the planet continues to support human well-being. To achieve this vision, the framework establishes four 2050 Goals: protect and restore nature, prosper with nature, share benefits fairly, and invest and collaborate for biodiversity conservation. These goals are supported by 2030 targets designed to reduce the drivers of biodiversity loss, meet people’s needs through sustainable use and benefit-sharing, and enable implementation through appropriate tools, finance, and governance mechanisms.
Human activities remain one of the primary drivers of biodiversity loss, with approximately one million species currently threatened with extinction. Achieving the GBF’s 2050 goals therefore requires coordinated action not only from governments but also from the private sector. In this context, Target 15 of the GBF plays a critical role by explicitly encouraging businesses to assess, disclose, and reduce their biodiversity-related risks, impacts, and dependencies.
This target reflects the growing understanding that biodiversity loss poses material financial, operational, and strategic risks. Both private and public sector organizations depend on biodiversity and ecosystem services across their operations, markets, and supply chains. Businesses are therefore increasingly expected to examine both how their activities impact biodiversity and how biodiversity loss affects business performance, applying a double materiality lens. This is especially relevant for sectors with high nature dependencies and impacts, including agriculture, aquaculture, fisheries, forestry, apparel, food and beverage, mining, real estate, tourism, energy, and pharmaceuticals.
In response, there is increasing alignment across global sustainability standards and frameworks that articulate the business case for addressing biodiversity and provide guidance on assessing and reporting nature-related risks and impacts. Biodiversity has become more prominent in recent years, notably through GRI 101 and the revised GRI Biodiversity Standard (formerly GRI 304), which strengthen biodiversity-related disclosures. The Carbon Disclosure Project (CDP) has also integrated nature-related disclosures into its core questionnaire from 2025. In the European context, CSRD ESRS E4 on Biodiversity and Ecosystems requires organizations to disclose their impacts, dependencies, risks, and opportunities related to biodiversity.
In parallel, the International Sustainability Standards Board (ISSB) is developing a Practice Statement to support location-specific reporting of nature-related risks and opportunities, as well as engagement with Indigenous Peoples, local communities, and affected stakeholders, complementing the existing requirements under IFRS S1. The Science Based Targets Network (SBTN) further supports companies by providing a three-step methodology to set science-based targets for nature starting with assessing impacts and dependencies, prioritizing action for maximum benefit to nature and business resilience, and setting measurable targets for land and freshwater systems. Additionally, the Taskforce on Nature-related Financial Disclosures (TNFD) offers a comprehensive framework for integrating nature into corporate governance, strategy, risk management, and metrics.
Under the TNFD architecture, the LEAP (Locate, Evaluate, Assess, Prepare) methodology provides practical guidance for biodiversity disclosure, emphasizing the importance of location-specific data. Through LEAP, companies identify operations and value chain activities located in sensitive or high-value ecosystems, assess their impacts and dependencies on nature, analyze associated risks and opportunities, and integrate nature considerations into governance and strategic decision-making. The alignment of LEAP across multiple standards and frameworks underscores the central importance of identifying biodiversity-related impacts, dependencies, risks, and opportunities.
In practice, businesses must assess their geographic footprint and areas of operational influence in relation to biodiversity-sensitive areas. They should evaluate dependencies on ecosystem services and identify impacts on biodiversity by examining the key direct drivers of biodiversity loss, including land- and sea-use change, overexploitation of natural resources, pollution, and the introduction of invasive alien species. Conducting a double materiality assessment enables companies to determine both the impact and financial materiality of these issues across their operations and value chains.
Stakeholder engagement is also critical when assessing biodiversity impacts. Companies should actively engage Indigenous Peoples, local communities, and other affected stakeholders to understand how business activities may affect ecosystem services on which these groups depend. This helps illuminate the social dimensions of biodiversity loss and supports more informed, equitable decision-making.
Where organizations have taken steps to avoid, minimize, and restore biodiversity impacts, they may address residual impacts through biodiversity offsets. Biodiversity offsets are typically compliance-based measures intended to compensate for significant adverse impacts that cannot be further mitigated, with the objective of achieving no net loss or a net gain of biodiversity. Examples include averted loss, ecosystem restoration, and one-off conservation actions.
Beyond offsets, there has been rapid growth in voluntary biodiversity credits, with the global biodiversity credit market surpassing USD 2 billion in cumulative transaction value by the end of 2025. Biodiversity credits represent measurable and verified investments in positive biodiversity outcomes that are additional, durable (typically over 20–30 years), and aligned with the Kunming–Montreal Global Biodiversity Framework. These mechanisms can help unlock financing for biodiversity conservation, generate income for Indigenous Peoples and local communities, and support progress toward nature-positive outcomes by 2030.
Despite this momentum, biodiversity reporting remains challenging. The absence of a universally accepted metric, combined with limitations in data availability and quality, makes consistent measurement and disclosure difficult for many companies.