Counting Creatures, Not Just Carbon

A single oak tree can support over 2,300 species, from bats to beetles, mosses to moths. But in the spreadsheets of most companies, that life is still invisible. Businesses have spent the past decade refining how they measure carbon, tracking emissions with increasing precision. Yet the climate crisis is just one piece of a much bigger ecological puzzle. Today, investors, regulators and consumers are turning their attention to a new frontier: biodiversity. From soil health to pollinator decline, biodiversity metrics are emerging as essential tools in environmental, social and governance (ESG) reporting. As the Taskforce on Nature-related Financial Disclosures (TNFD) shows in its final framework, companies are being asked a new question: not just how much carbon they emit, but how much nature they depend on, and what they do to protect it.

Why Carbon is No Longer Enough

For years, carbon has dominated the sustainability agenda. Net-zero targets, carbon credits and emissions audits have become the standard tools in corporate climate strategy. But carbon-only metrics offer a narrow lens. A company can hit its carbon targets while still contributing to deforestation, soil degradation or water pollution. For example, planting fast-growing monoculture trees may sequester carbon, but it often destroys local ecosystems and reduces biodiversity.

Nature loss is now accelerating at a pace that rivals climate change. Over half the world’s GDP is moderately or highly dependent on nature, according to the World Economic Forum. Yet most firms still lack visibility into how their operations impact ecosystems. This blind spot is becoming unsustainable.

The turning point came in 2022 with the UN Kunming-Montreal Global Biodiversity Framework, which committed 196 countries to halt biodiversity loss by 2030. For businesses, this marks a shift in environmental reporting from simply reducing carbon footprints to protecting the complex web of life that sustains economies, supply chains and societies.

What Are Biodiversity Metrics?

Biodiversity metrics quantify the variety and health of natural systems, going well beyond counting carbon. They include species richness (how many different species there are), habitat quality (such as intact forests or wetlands), ecosystem services (like pollination or water filtration), and soil health (microbial diversity, nutrient cycling, structure)

These metrics are far more complex than a simple carbon figure. Biodiversity is inherently location‑specific and requires tailored measurements, what matters in a tropical rainforest differs from an Irish peat bog. This makes it harder to develop one‑size‑fits‑all calculations.

That’s where frameworks like the TNF and Science‑Based Targets for Nature (SBTN) come in. TNFD’s LEAP approach guides companies through locating, evaluating, assessing andprioritising nature-related impacts, while SBTN helps organisations set measurable, science‑aligned targets for species and ecosystems. Together, they’re turning ecological complexity into actionable business insights.

Biodiversity Becomes a Boardroom Issue

Biodiversity is no longer a peripheral concern confined to sustainability reports. It’s becoming a central business issue with direct implications for risk, resilience and revenue. The degradation of ecosystems poses real threats to supply chains, pollinator decline jeopardises crop yields, soil erosion affects agricultural productivity, and overfished waters destabilise food security. For businesses reliant on natural inputs, such as Nestlé (which depends on sustainably sourced cocoa and coffee), biodiversity loss is a supply-side risk with significant material financial consequences.

Financial institutions are also beginning to recognise the exposure of portfolios to nature-related risks. The Network for Greening the Financial System and TNFD are pushing firms to assess and disclose nature dependencies. Poor biodiversity management can lead to higher insurance costs and reduced investor confidence.

Conversely, embracing “nature-positive” strategies offers competitive edge. Kering’s regenerative agriculture projects and Unilever’s commitment to deforestation-free supply chains have boosted brand value and investor appeal. Holcim’s nature restoration efforts show how even heavy industry can integrate biodiversity into core strategy.

The Biodiversity Balance Sheet

As the focus shifts beyond carbon, businesses are turning to increasingly sophisticated tools to quantify their impact and dependence on nature. Platforms like ENCORE (Exploring Natural Capital Opportunities, Risks and Exposure) and the Integrated Biodiversity Assessment Tool (IBAT) are helping companies identify biodiversity risks linked to specific geographies and sectors.

Real-world innovation is already under way. Consumer goods giant Procter & Gamble has used satellite imagery and AI to monitor deforestation risks in its palm oil supply chain, improving traceability and reducing reputational exposure. Similarly, Nestlé is using geolocation and farm-level data to model nature dependencies in critical sourcing areas.

Nature-related scenario analysis and ecosystem service mapping are becoming essential in risk planning. Location-specific biodiversity assessments enable companies to prioritise interventions where they matter most, such as high-conservation value forests or coastal wetlands.

Crucially, biodiversity metrics are beginning to be integrated into financial reporting frameworks. Pioneers like GSK and Holcim are aligning nature impacts with enterprise risk management and investor disclosures, bringing nature’s assets firmly onto the corporate balance sheet.

Regulatory and Investor Pressure

The pressure to report on biodiversity is no longer a matter of goodwill, it’s fast becoming a regulatory and financial imperative. Investors, particularly in Europe, are demanding broader ESG disclosures, with biodiversity now firmly on the radar. The EU’s Corporate Sustainability Reporting Directive (CSRD), in force since 2024, mandates detailed reporting on nature impacts and dependencies. Meanwhile, the TNFD) framework offers a standardised structure for biodiversity risk reporting.

Financial institutions and insurers are beginning to price in nature-related risks. For example, AXA has called for stronger biodiversity disclosures to inform underwriting and investment decisions. Companies failing to keep up face mounting legal, financial and reputational risks. As Larry Fink of BlackRock noted, nature loss is “a material financial risk” that markets can no longer ignore. Nature is now a central, boardroom issue, and a balance sheet one too.

Nature’s Numbers

The future of business sustainability is evolving beyond mere compliance and carbon counting, toward regeneration. As biodiversity metrics mature, so too will expectations. Companies are already exploring nature-positive models such as regenerative agriculture, where soil health, pollination and biodiversity are central to long-term productivity. Nestlé has committed over £1 billion to such initiatives. The rise of biodiversity credits, modelled after carbon credits, promises market-based mechanisms for funding habitat restoration and conservation.

Forward-thinking firms will move from minimising footprints to growing forests, from measuring loss to fostering life. Restoring wetlands, rewilding landscapes and investing in ecosystem resilience could become competitive differentiators. In a circular economy, waste reduction and biodiversity protection go hand-in-hand.

Rather than seeing biodiversity as a cost, progressive businesses are beginning to view it as a living asset—one that underpins supply chains, brand value and long-term viability. As biodiversity enters mainstream ESG reporting, leadership will be defined not just by how little harm is done, but by how much good is cultivated.

Biodiversity metrics are not a passing trend, but a fundamental shift. The companies that count life, not just emissions, will be those that thrive. After all, the bottom line is the living world.

And what about you…?   

  • Do you feel confident in your understanding of biodiversity-related risks to your business or sector? Why or why not?
  • How might a shift toward nature-positive or regenerative business models create new opportunities for your organisation?