Ecosperity 2024 spotlight: Keynote by WBCSD | Video transcript

Thank you very much for being here because we're in Ecosperity, and I always say, climate is about five years ahead of nature; nature is about five years ahead of social impact and understanding of it.

We're doing great things on climate in Singapore - we have seen examples in the video, and will hear of them over the next few days.

But nature is where we need to step up, and where nature is now stepping up through TNFD - It is fantastic to see Emily here who will be talking about that.

We are destroying nature and we do not even know how dependent we are on it.

Less than 5% of companies in the world make assessments on their relationship to nature.

Less than 1% of companies actually understand their dependencies on nature.

And yet in ASEAN, 63% of GDP is dependent on nature.

So having a massive gap between the dependence and the understanding, and therefore the action, to restore nature.

I am Peter Baker, CEO of the World Business Council for Sustainable Development. I will tell you a bit about who we are, but this is how I got to be here.

CEO of a large transport group for many years, became a sustainability junkie, made it to the World Business Council, and once you are in that space, you get on all kinds of advisory boards.

This is more interesting - WBCSD brings together more than 240 global companies to work on the acceleration of a systemic transformation to a more sustainable world.

240 companies may sound like a lot or not, but this is more than 20% of all emissions in the world on one slide. So if we can move this slide, we set an example and we impact many value chains around the world.

Sustainability, as you all know, is a very popular theme, but also an industry in itself - as a jargon that if you are not comfortable with it, you can easily get lost in all the acronyms in the alphabet soup.

So for WBCSD, we have said there are only three things that we should all focus on - obviously the climate emergency, nature loss or biodiversity loss is second, and inequality or social impacts as the third (focus).

All of those are completely interconnected, and we are now at the stage where we have sharp photos of what is wrong in the system and pretty good ideas of what are the solutions that we need to get the system to fix.

So at the bottom - and I will talk about that a little later - we now really need to integrate all of this into corporate decision making, into corporate performance management and eventually into corporate disclosures.

And that is where today's session plays such a critical role.

There is no doubt in my mind, and I hope in any mind here, that climate and nature are completely interconnected.

We cannot solve the climate challenge without the services that nature provides us.

Simply, the amount of carbon that is being stored in the oceans is an example of that.

But equally, we cannot restore nature if the climate is not stable - droughts, floods, whatever the causes may be.

So this is actually one agenda, and that will mean for those of you who are in companies, if you have a net zero target today, that's great - you need to start thinking, working and soon set a nature positive target as well. These two are completely one storyline.

I do not need to tell you that every business, in some way or form, depends on nature - whether it is your resources, whether it is the services that nature provides you, or whether it is actually a livable world in which we all are.

The garden city of Singapore is a fantastic example of how we can develop, and still create a good green environment around us.

But more importantly, and this is what I said at the beginning, we are destroying nature at an unprecedented rate.

The scientific framework for that is the planetary boundary framework. If you have never seen it, there are nine boundaries that have been identified by science, and what you can see here is that six of those boundaries have already been passed - we are borrowing against the future.

Climate is an obvious one, but many of the others - biosphere integrity, land system change, freshwater change - are all nature based boundaries that we are pushing through. That means the decline of biodiversity is now unprecedented.

That is going to not just make us lose special species that you may enjoy, but it will also make us lose pollinators, soil quality - and that is where our food system in particular is totally dependent upon.

Like I said, this is an incredibly busy slide, but the thing to remember is nature is now developing at a pace that climate could only have dreamt of a few years ago.

We have the Global Biodiversity Framework - I think it is now called the biodiversity plan.

At the end of 2022 in Montreal, the Kunming-Montreal Corp, the convention of parties, all governments in the world came together and made an unexpected, very ambitious plan.

Four goals, 15 (now 23) targets, of which target 15 - for anyone in business, you can google the biodiversity plan article 15 - that's going to determine your life on how you need to assess and eventually disclose your performance against nature.

Then, guidance and standards massive developments - Emily will talk about it, the TNFD have copy pasted and then (deep dived) much deeper from TCFD.

So this is what I mean, the sustainability acronyms, alphabet soup - TCFD, the Task Force on Climate-Related Financial Disclosures, TNFD, the Taskforce for Nature-related Financial Disclosures, took the success that TCFD had, took the same framework and has now done deep work and launched it last year in the in the New York Stock Exchange (I think it was the recommendations for TNFD).

Then you see the ISSB (International Sustainability Standards Board), the CSRD (Corporate Sustainability Reporting Directive) and other regulators are beginning to shape up how we also disclose nature metrics - big pieces of work.

In the investor world, we begin to see initial interest. The Nature Action 100 group is bringing (I think now) 130 financial institutions together to say how do we actually integrate nature into our financial decision making.

And then last but not least, more and more consumers around the world will want to know what is the sustainability performance of the products that I am buying.

So the direction is clear - we need to get to nature positivity by 2030. That is the net zero equivalent for climate, nature positive by 2030, and then we need to globally fully restore nature by 2050 - that is in essence what this movement is trying to achieve.

So that's great, we know where we need to go collectively - now what if you're in the business? What do you do?

And that is what, without a doubt, Emily will talk a lot more about, but you need to begin to understand where your material impact and your dependencies are?

Once you know that, you set your priorities, you set targets, you set priorities, you make plans, you integrate it into your corporate strategy. Then once you're under way, you begin to disclose what your performance is. Just like you're disclosing your greenhouse gas emissions, you will be asked to disclose your performance in nature, elements, dependencies and impacts.

This may all sound a bit overwhelming.

So with the support of TNFD, we , WBCSD, have done two things:

We have run a global preparer for pilots with and for the TNFD practical companies - 23 global companies coming together to say how TNFD works.

We did a consultation effort here in ASEAN with more than 200 companies from this region to say what TNFD is and what would it mean to implement it.

These are the key messages: Do not be afraid. You are already doing quite a bit, whether it is in your procurement, in your operational data, in your environmental impact assessment, in your stakeholder dialogues that you may have in your company.

There is more data than you probably know that you have.

If you are into TCFD, then it is even easier because TNFD has copy-pasted it in many ways.

Then focus on core disclosure metrics first - do not try to boil the ocean, get every metric right, focus where impact is most material, start there.

Emily will talk about the LEAP approach, so I am not going to spend much time on it, but those are the stages of actually getting to the data and then eventually disclosing them.

The one thing though, that is critical - you need to set up whole new forms of collaboration inside your company, because it is not the finance department that has the data, it is the procurements, its is the operations, it is the risk department, and you need to bring all of those together to get to a coherent story.

There are now lots of resources out there to help you. So my shop, WBCSD, has published roadmaps - what does it mean for a company in the energy, the agriculture and food, the built environment, or the forest sector to be nature positive and how do you get there? What are the steps you need to take?

We have published the TNFD pilot so all of you can learn from what the 23 large global companies experienced.

And the one thing I want to leave with you, because that is the risk I often see, is that this is about disclosure, I need to find metrics to disclose - and that's not true.

Disclosure is an important part of it, but this is an effort to change the system, to make sure that the system provides you the economic incentives to become nature positive, to become net zero.

And we all know, and that is one of the biggest hurdles that the world has today - the economic system is not yet providing the incentives.

More sustainable companies do not yet have a lower cost of capital - and that is the flip in the system we need to make.

So what we are building here, the corporate performance and accountability system, is the internal governance circle.

You need to have governance, you need to assess your risk, you need to set targets, you need to manage the performance and disclose that performance in a decision-usual way to financial markets who can then absorb it into their valuation models.

But setting those targets should be integrated into your corporate strategy, and then become the driver for the innovation in the company to get better, to reduce the negative impacts on nature or the emissions in climate.

And when we get these three circles to work together, you will see that the capital market will reward companies that do more, will give you a lower cost of capital, will get more capital to flow to the solutions and therefore accelerate this transformation.

And so think about nature as something like a journey - we will hear from Esther An later on, she is already quite far down the track of this journey.

Some of you in this room may only have heard about nature for the first time this afternoon and think, jeez, what do I do?

But if you think about it as a journey, you will be okay. The first step in your journey is to begin to understand what are your dependencies and your impacts. Just do the assessment. There are lots of people, PwC and others, who can help you do that, but just try to understand where you are in touch with nature, positive, negative and the likes.

Then once you are able to do that, once you have assessed where the most material impact is, set a target, put it in your strategy, allocate CapEx to get there and begin to move - that is called action.

Once action begins to get traction, you are able to disclose that action to capital markets who will then begin to support you. Then over time, you build impact and you'll move to nature positivity.

So it is a journey, but it is a journey that is ultra urgent to start now. Thank you very much.