January 18, 2024

Invest in nature to build trust and unlock prosperity

Delivering on global climate and nature goals is a business opportunity too important to ignore.

‍As global leaders gather for the World Economic Forum Annual Meeting in Davos under a rallying cry of ‘Rebuilding Trust’, David Bloch, WWF’s Director of Global Corporate Engagement, argues that delivering on global climate and nature goals is a business opportunity too important to ignore.

In many countries, economic uncertainty, inequality, and anxiety about climate change, conflict and shortages have brought trust in government to an all-time low.

For business, for now, reserves of this most precious of currencies appear to be robust - but they cannot be taken for granted.

With trust comes expectation and responsibility, which makes doing nothing unwise, especially in the face of growing societal polarisation and division.

Rebuilding trust is the theme of this year’s World Economic Forum (WEF) Annual Meeting, and in doing that, one of the challenges posed by WEF for global leaders in Davos is determining how to secure a net zero, nature-positive world by 2050 while providing affordable, secure and inclusive access to energy, food and water.

It’s a formidable challenge but the business case for taking it on is compelling.

Transitioning to a nature-positive economy could generate $10 trillion in new annual business value and create 395 million jobs by 2030. And while the latest Global Risks Report from WEF suggests environmental risks could hit the point of no return, the World Bank has estimated that protecting nature could avert $2.7 trillion in annual economic losses.

At the same time, globally agreed goals on climate, development, and most recently nature, offer a blueprint for a sustainable future - but the window of opportunity to achieve them is shrinking and governments are failing to deliver the necessary scale and pace of change.

In this context of government inaction and global polycrisis the private sector has an opportunity to lead, working across public and private sectors to forge pragmatic solutions that maintain trust and support resilience, prosperity and security. And people are increasingly looking to business to act.

Leading companies are already taking climate action and many are now contributing to sustaining and restoring nature and its services - from pioneering regenerative agriculture, scaling renewable energy, and investing in bankable nature solutions, to setting science-based targets for nature, engaging in water stewardship, designing for a circular economy, and calling for policies and economic models that recognise nature’s true value.

Yet change is not happening fast enough.

2023 saw 240 climate-related disasters globally, and we continue to push nature to the brink, depleting natural capital - the world’s stock of natural assets on which business and our economies depend - and undermining financial and economic stability.

Tackling climate and ecosystem breakdown requires rapid transformation across key economic sectors, including:

how we feed, fuel, and finance ourselves.

Food and agricultural production depends on healthy ecosystems and yet paradoxically is also the sector with the greatest environmental impact. Transforming food systems could keep global heating to 1.5°C, prevent further land conversion, and guarantee global food security while also generating positive returns. Without change, continuing land degradation could significantly reduce global food productivity and increase food prices by 30% over the next 25 years.

Energy transition is also essential for the world to reach net-zero by 2050. Solar and wind generation must displace fossil fuels and 90% of the world’s electricity could come from renewables. While this needs $4 trillion in annual investment until 2030, the reduction in pollution and climate impacts could save more and expected investment returns on renewables exceed 10%.

The finance sector is a powerful lever for change - but while many private sector financial institutions already have ambitious transition plans designed to shape portfolios that work with nature rather than against it, the pace of change in the real economy is painfully slow. To help close a $4.1 trillion financing gap for nature, we need innovative financial mechanisms that leverage private capital for investment in nature-based solutions that tackle climate breakdown.

Prosperity for all on a healthy planet is the promise of a net zero, nature-positive future.

For all sectors, realising this promise means forging a new relationship with nature, rethinking business models, and shaping a new economic paradigm that meets societal needs while respecting planetary limits.

Doing this will transform physical, reputational, and regulatory nature-related risks into opportunities, including to attract employees, customers and investors, strengthen accountability and licence to operate, and anticipate and shape ambitious policies and regulations.

But no single company can make the change alone. Most need expert help but the plethora of support and guidance can be confusing, and from greenwashing to sectoral or political inertia, pitfalls abound.

At WWF, we support companies to reshape the nature of business for a nature-positive future.

As a credible and trusted international NGO leader with deep expertise in sustainability, connected locally and globally to decision-makers, communities, and nature in value chains and landscapes that matter, we are uniquely placed to engage with companies and catalyse lasting change.

With global partners, we’re helping transform critical sectors, including food, energy and finance through more sustainable production, ambitious climate action, and innovative green financial solutions.

Forward-looking companies in Davos have an opportunity to shape a net zero, nature-positive global economy, to thrive rather than merely survive, including by strengthening trust and creating value - but it won’t last forever.

The way we do business is fundamentally changing, and the age of nature-positive business is here. Join us in leading the transition to a better future and prosperity for all.