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- The Earth systems underpin the well-being of our societies, but, worryingly six of the nine planetary boundaries are now breached . It is essential, more than ever, that we move economic growth onto a more sustainable footing. This requires a framework for economic growth that is not detrimental to the stock of natural capital and helps to reduce societal inequalities
- In this report, we extend our investor agenda for ocean sustainaiblity to the broader Earth systems’ nexus of climate, biodiversity, land, water and oceans, with a specific focus on forests, land and agriculture
- Global leadership at December’s COP15 biodiversity summit is required and it must be aligned to the COP climate summits. This may materialise since Climate COP27 and COP28’s hosts Egypt and the United Arab Emirates have high food import requirements
- It requires broadening the agenda from simply focusing on climate change and greenhouse gas emission reduction to addressing all of the planetary boundaries in unison given the interconnectivities between them
- Not only must biodiversity ambition include turning 30% of land and sea into protected areas, putting an end to deforestation and land degradation and reducing pesticide use by 50% but also avoiding food loss and waste, the wider adoption of sustainable agricultural practices, increasing company commitments to science-based nature targets, and the development of an Earth systems’ taxonomy.
- Investor engagement with companies and policy-makers have a role to play to help advance these goals. We believe forests, land and agriculture also need to be at the heart of this agenda since the agricultural sector accounts for 70% of the world’s total freshwater withdrawal , spurs up to 80% of deforestation , causes around 70% of the projected loss of terrestrial biodiversity and is responsible for around 25% of greenhouse gas emissions
- A coordinated approach across all Earth systems and involving multiple stakeholders may then begin to address the significant investment gap that exists since for those Sustainable Development Goals (SDGs) directly related to the biosphere, namely life below water (SDG14), life on land (SDG15), clean water and sanitation (SDG6) and climate action (SDG13), which are amongst the least funded
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1 / The cost of wealth
The Anthropocene epoch: human activities impact on the Earth’s climate and environment
For the past 11,650 years, the earth’s climatic environment has been relatively stable and supported the conditions for human societies to develop and thrive. However, this stability is now threatened as the planet transitions from the Holocene to the Anthropocene epoch whereby humans have become the dominant influence on the climate and the environment.
The onset of the industrial revolution marked the advent of the Anthropocene epoch such that over the past 100 years the world has enjoyed unprecedented prosperity in terms of wealth and living standards. For example, since the middle of the last century, economic output is up more than thirteen-fold in real terms, and human life expectancy has risen by 27 years globally.[1] However, these achievements have come at a cost. The stock of natural capital, such as forests, fisheries, agricultural land and minerals, have fallen by 40% on a per capita basis. [2]
Moving economic growth onto a more sustainable footing requires a framework for economic growth that is not detrimental to the stock of natural capital since, on current projections, demand for energy by 2050 will double while the demand for water and food is expected to increase by up to 30%[3]In doing so, a more comprehensive approach to the climate crisis will emerge that addresses both restoring ecosystem services and nature’s role in climate regulation.
Planetary boundaries: The safe operating of the Earth’s systems
Not surprisingly, the systemic risks posed by environmental factors have become an increasing focus for investors as illustrated by the World Economic Forum’s annual Global Risks Reports. The findings show that over the past decade environmental risks have been displacing economic and financial factors as the greatest perceived threats to the financial system. The health of the planet - specifically climate change and biodiversity loss - are now viewed as among the main long-term threats to the world, with damaging impacts on people and societies.
To help better understand these risks, in 2009 the Stockholm Resilience Centre[4] (SRC) first published their concept of planetary boundaries. Their work, which continues to be updated, identifies the nine processes or planetary boundaries which regulate the stability and resilience of the Earth’s systems.
These processes can be clustered into four categories:
- Global biogeochemical cycles of carbon, water, nitrogen and phosphorous
- Major physical circulation systems of the planet, namely climate, oceans and stratosphere
- Biophysical features of the Earth which which support the self-regulatory capacity of the planet via marine and terrestrial biodiversity and land systems
- And finally, aerosol loading and chemical pollution which are associated with anthropogenic global change
When these boundaries are crossed, and the Earth moves outside of its safe operating system, it increases the risk of generating large-scale abrupt or irreversible environmental changes.
