Issued Thursday, the report from the IUCN-International Union for Conservation of Nature and Shell International Ltd. calls for policy reforms to increase the commercial rewards for conserving biodiversity.
Bioprospecting team from Merck explores the Costa Rican rainforest. (Photo courtesy IDRC)
One biodiversity business that is growing quickly is bioprospecting, the search for new compounds, genes and organisms in the wild. The report suggests the sector could be worth as much as US$500 million by 2050.
"For businesses to conserve biodiversity it must ultimately become more profitable to protect nature and use natural resources sustainably, rather than ignore or destroy it," says Sachin Kapila, group biodiversity adviser at Shell International and a co-author of the report.
Titled "Building Biodiversity Business," the report says some businesses that were historically responsible for the loss of biodiversity now are starting to lead the way by protecting biodiversity.
For instance, markets for organic agriculture and sustainably-harvested timber are growing at double-digit rates.
And there is an increasing demand for climate mitigation services, such as the protection of forests and wetlands to absorb carbon dioxide, the report finds.
"There are numerous pro-biodiversity business opportunities that can generate significant profits as well as benefits for nature," says Dr. Joshua Bishop, IUCN's senior adviser on economics and the environment and a co-author of the report.
"But a few inspiring examples aren't enough," Bishop says. "This report shows how to achieve a major increase in business investment in biodiversity conservation, by linking policy reforms, technical assistance and innovative financing tools."
Ecotourism is one obvious example of how money can be made from looking after species and their habitats. Worldwide, environmentally-friendly tourism is expanding at a rate of 20 to 30 percent annually, compared with a nine percent expansion rate for tourism as a whole.
Critics of ecotourism warn that the intrusion of large numbers of people into wild habitats can adversely influence the reproductive success and survival of the affected wildlife.
A key challenge facing all biodiversity businesses is the lack of accepted indicators to measure positive and negative contributions to biodiversity conservation, the report finds.
Some people remain sceptical of the motives of the private sector, the report acknowldges, while others worry that market-based approaches may distort conservation priorities. Still, the report argues that not exploring what markets can deliver is no longer an option.
Tourists meet rhinos in South Africa's Kruger National Park. (Photo courtesy South African Tourism)
With the goal of identifying potential market-based mechanisms and new business opportunities to conserve biodiversity, the authors consulted with more than 60 organizations, including commercial banks and insurance companies, private foundations, multilateral and bilateral aid agencies, ongovernmental organizations, think-tanks, academics and investment fund managers.
Today, the authors conclude, biodiversity conservation is mainly viewed by business as a risk or liability, rather than a potential profit center.But this perception is beginning to change.
An increasing number of companies see a business advantage in developing processes to integrate biodiversity into their operations, as well as seeking market-based solutions and opportunities.
Furthermore, even with modest initial returns from most biodiversity business investments, in the range of five to 10 percent per year, the report finds that there are "significant profits to be made as the sector grows from niche markets to mainstream business."
The IUCN, known for years as IUCN-World Conservation Union, has dropped the unwieldy part of its name in favor of a direct parallel to its initials - International Union for Conservation of Nature.
The organization maintains the Red List of Threatened Species and helps the world find pragmatic solutions to environment and development challenges by conducting environmental diplomatic relations, supporting scientific research; and managing field projects all over the world.
This work encompasses all types of animal and plant species on the planet; all types of ecosystems - the different types of natural places that exist on Earth; and a wide range of major environmental and sustainable development issues.
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