In recent years a critical link has been identified between society, the economy and the natural environment (TEEB 2012). Many business leaders are recognizing that to remain competitive, especially in challenging economic times, biodiversity issues must be factored into their operations. In addition, the public are becoming increasingly aware of the impact their daily lifestyle choices are having on the natural environment both directly and indirectly through issues such as increasing loss of habitat and green space and climate change. Because biodiversity is not an infinite resource, many business leaders are making biodiversity a top priority by factoring biodiversity management into their corporate planning and mainstreaming biodiversity into their decision-making process.

A recent study completed by PricewaterhouseCoopers (2008) for The Economics of Ecosystems and Biodiversity (TEEB) examined the integration of biodiversity into the 100 largest companies internationally. Their results concluded that of the 100 companies’ annual reports studied, 2% reported biodiversity as a “strategic issue”, 6% identified programs to reduce their negative impacts on biodiversity, and 18% mentioned biodiversity. By contrast, when examining the 89 sustainability reports published, 9% reported biodiversity as a “sustainability issue” and 24% identified programs to reduce their negative impacts on biodiversity (TEEB 2010).

This indicator examines the extent to which Ontario companies have integrated biodiversity in their corporate planning and reporting. As this is the first time this indicator has been assessed, the results will serve as a baseline for future assessments.

This index surveyed the integration of biodiversity within the business operations of 70 companies in Ontario. Businesses were categorized into four main sectors: primary (extraction of natural resources), secondary (processing goods), tertiary (service activities) and quaternary (research and information activities) (Mayda 2012). Categorizing sectors in this way allows for a more accurate picture of the relationship between company operations and threats to biodiversity. The four sectors were further categorized into industries identified in Statistics Canada’s North American Industry Classification System (NAICS 2012) to produce a sector categorization (Table 1).

Table 1:  Industries used to study biodiversity integration into all sectors of business in Ontario.

Within each industry, the five most profitable publicly traded and private companies in Canada, as identified by The Globe and Mail’s Report on Business, were studied. Due to the globalized nature of the business sector in Ontario, companies that were chosen either had headquarters, operated, and/or sold products in Ontario. This decision was based on the interconnectedness and complexity of business supply chains. Companies’ publicly available annual corporate social responsibility and sustainability reports, as well as webpages were examined for each business based on key word search terms of biodiversity, biological diversity, ecosystem, nature, and sustainability. These documents were obtained from company websites.

The framework used to examine these companies was based on criteria developed to study the integration of biodiversity into the business sector. This evaluative model was developed based on several studies including The Economics of Ecosystems and Biodiversity in Business and Enterprise (TEEB 2012), The Ecosystem Services Benchmark: A guidance document (Grigg et al. 2009), Tread lightly: Biodiversity and ecosystem services risk and opportunity management within the extractive industry (Grigg et al. 2011), and Linking shareholder and natural value: Managing biodiversity and ecosystem services risk in companies with an agricultural supply chain (Grigg et al. 2009). For this index, these documents provided guidance on studies that examined the integration of biodiversity into different sectors. The degree to which the company is concerned with biodiversity conservation was categorized into one of five successive categories. These ranged from companies with no consideration of biodiversity or sustainable development/environmental issues to companies with developed and implemented biodiversity monitoring systems (Table 3). Further details on assessment criteria, analyses and results are available in a companion technical report (Potter et al. 2014).

Table 2: Stages of biodiversity concern for companies. See Potter et al. 2014 for list of criteria.

Web Links:

Canadian Business and Biodiversity Council http://www.businessbiodiversity.ca/

Fauna and Flora International http://www.fauna-flora.org/

Forest Footprint Disclosure Project www.forestdisclosure.com

Global Reporting Initiative www.globalreporting.org

ICMM Good Practice Guidance for Mining and Biodiversity www.icmm.com

Integrated Biodiversity Tool www.ibatforbusiness.org/

IPIECA/API Oil and Gas Industry Guidance on Voluntary Sustainability Reporting www.ipieca.org

The Keystone Centre www.keystone.org

Natural Value Initiative http://www.naturalvalueinitiative.org/

Roundtable on Sustainable Biomaterials www.rsb.org

Roundtable on Sustainable Palm Oil www.rspo.org

Stewardship Index for Specialty Crops www.stewardshipindex.org

The Economics of Ecosystems and Biodiversity Initiative http://www.teebweb.org/

Water Footprint Network www.waterfootprint.org

WBCSD Cement Sustainability Initiative www.wbcsdcement.org

References:

Grigg, A., M. Harper, and S. Verbunt. 2011. Tread lightly: biodiversity and ecosystem services risk and opportunity management within the extractive industry. The Natural Value Initiative. [Available at: http://www.naturalvalueinitiative.org/download/documents/Publications/NVI%20Extractive%20Report%20Executive%20Summary.pdf ]

Grigg, A., Z. Cullen, J. Foxall, L. Crosbie, L. Jamison, and R. Brito. 2009. The ecosystem services benchmark. Fauna & Flora International, United Nations Environmental Programme Finance Initiative and Fundacao Getulio Vargas – FGV. [Available at: http://www.naturalvalueinitiative.org/download/documents /Publications/EcoSysBenchmark.pdf]

Grigg, A., Z. Cullen, J. Foxall, and R. Strumpf. 2009. Linking shareholder and natural value. Managing biodiversity and ecosystem services risk in companies with an agricultural supply chain. Fauna and Flora International, United Nations Environmental Programme Finance Initiative and Fundacao Getulio Vargas – FGV. [Available at: http://www.naturalvalueinitiative.org/download/documents/Publications/LSNV_ Oct09.pdf]

Mayda, C. 2013. A regional geography of the United States and Canada: toward a sustainable future. Rowman & Littlefield Publishers, Lanham, MD.

Potter, K., A. Zohar and T. McIntosh. 2014. An evaluation of the integration of biodiversity into business in Ontario. State of Ontario’s Biodiversity Technical Report Series, Report #SOBTR-02. Ontario Biodiversity Council, Peterborough, ON. [Available at: https://sobr.ca/_biosite/wp-content/uploads/SOBTR-02-Final.pdf]

Statistics Canada. 2012. North American Industry Classification System (NAICS) Canada. [Available at: http://www.statcan.gc.ca/pub/12-501-x/12-501-x2012001-eng.pdf]

The Economics of Ecosystems and Biodiversity (TEEB). 2012. The economics of ecosystems and biodiversity in business and enterprise. Edited by Joshua Bishop. Earthscan, London and New York. [Available at: http://www.teebweb.org/publication/the-economics-of-ecosystems-and-biodiversity-teeb-in-business-and-enterprise/]

The Economics of Ecosystems and Biodiversity (TEEB). 2010. The economics of ecosystems and biodiversity report for business – executive summary [Available at: http://www.teebweb.org/media/2012/01/TEEB-For-Business.pdf].

The Globe and Mail. (25 June 2014). Canada’s top companies by industry. [Available at: http://www.theglobeandmail.com/report-on-business/rob-magazine/top-1000/rankings/canadas-top-companies-by-industry/article19344470/]

The Globe and Mail. (27 June 2013). Top 1000: Exclusive rankings of Canada’s most profitable companies. [Available at: http://www.theglobeandmail.com/report-on-business/rob-magazine/top-1000/top-1000/article12829649/#dashboard/follows/]

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