Why biodiversity is becoming a core economic and investment issue

For many years, biodiversity conservation was largely viewed as the responsibility of governments, conservation agencies and environmental organisations. Today, that reality is changing rapidly. Biodiversity finance is emerging as one of the next major investment and economic conversations, driven by a growing recognition that healthy ecosystems are foundational to economic resilience, water security, food production, infrastructure protection and long-term business sustainability.

The adoption of the Convention on Biological Diversity’s Kunming-Montreal Global Biodiversity Framework (the framework) marked an important shift in how biodiversity is viewed and managed. The framework recognises that public resources alone will not be sufficient to halt and reverse biodiversity loss and calls for systemic changes in how economies, institutions and societies value, govern and finance nature.

This shift is reflected in Targets 14, 15 and 19 of the framework, which call for greater integration of biodiversity into financial systems, business practices and public policy. Collectively, these targets highlight that biodiversity conservation has become an economic and development imperative.

Nature underpins SA’s economic resilience

Recent findings from the SA National Biodiversity Institute’s (SANBI’s) National Biodiversity Assessment (NBA) 2025 report paint a concerning picture. Nearly half of SA’s ecosystem types are now threatened, while freshwater ecosystems remain among the most vulnerable nationally. These ecosystems support delivery services such as water provision, climate resilience, food systems and economic productivity across the country.

Healthy ecological infrastructure, including wetlands, mountain catchments, dunes and estuaries, supports water regulation, reduces disaster risks and protects critical infrastructure. As climate pressures intensify, the value of these natural systems will become increasingly important.

SA has been actively advancing the biodiversity finance agenda, yet the country’s biodiversity funding gap continues to widen. Research through the Biodiversity Finance Initiative has shown that current funding levels are insufficient to conserve and sustainably manage the country’s biodiversity assets. Traditional public financing models are incapable of meeting the scale of the challenge. Mobilising resources from all sources, including through stronger partnerships with the private sector, is becoming essential.

Why biodiversity matters to business

Increasingly, biodiversity is recognised as a strategic economic asset and a critical component of business resilience. Research estimates that ecosystem services contribute at least R275-billion annually to the South African economy, equivalent to approximately 7% of GDP. Biodiversity-related sectors support hundreds of thousands of jobs, including in ecotourism, agriculture, fisheries, wildlife economies and traditional medicine.

Globally, investors, regulators and financial institutions are paying closer attention to the relationship between business performance and nature. Companies are increasingly expected to understand not only their climate-related risks but also their dependencies and impacts on biodiversity.

The rise of nature-related disclosure frameworks

This shift is reflected in the emergence of frameworks such as the Taskforce on Nature-Related Financial Disclosures, which provides guidance for assessing, managing and disclosing nature-related risks and opportunities. The framework aims to support the transition of financial flows away from nature-negative activities and towards nature-positive investment.

Yet SA remains in the early stages of this transition. While awareness is growing, relatively few organisations have formally adopted Taskforce on Nature-Related Financial Disclosures reporting. Many businesses are still uncertain about how to measure biodiversity impacts, assess nature-related risks or report meaningfully against emerging disclosure standards.

This is where the SA National Biodiversity Institute plays a critical role.

Through its participation in the taskforce’s Nature Data Public Facility pilot and engagements during the National Biodiversity Strategy and Action Plan review process, including collaboration with Business Unity South Africa, the institute identified growing demand for practical biodiversity information and reporting tools.

In response, it is strengthening biodiversity data-sharing platforms, developing biodiversity indicator workflows and exploring opportunities to integrate corporate biodiversity information into the national biodiversity information system. This work will be further advanced through the FEXTE CAP4NATFIN partnership with the Agence Française de Développement (AFD) and OFB.

How biodiversity institutions can support corporate reporting

Biodiversity institutions such as the SA National Biodiversity Institute can support organisations on their nature-reporting journey by providing authoritative scientific and spatial data. Through biodiversity mapping tools, ecosystem threat assessments, the National Biodiversity Assessment and the Biodiversity Indicators for Reporting and Decision-Making platform, businesses can access localised biodiversity intelligence to strengthen sustainability reporting and decision-making.

For companies seeking to align with frameworks such as the Taskforce on Nature-Related Financial Disclosures, access to credible biodiversity data is essential. Businesses need to understand where their operations intersect with sensitive ecosystems, where biodiversity-related risks exist across supply chains and where opportunities for positive contribution can be identified.

Looking beyond compliance to competitive advantage

Leading businesses are increasingly recognising that integrating biodiversity and climate considerations into core strategy goes beyond regulatory compliance, and it is becoming a competitive advantage. Companies that proactively address nature-related risks are often better positioned to secure investment, strengthen supply chain resilience and respond to evolving stakeholder expectations.

Biodiversity finance also presents opportunities for innovation and partnership. SA’s biodiversity stewardship model has demonstrated the value of collaborative conservation, but scaling these efforts will require blended finance mechanisms and greater private sector participation.

Collaboration will define the future

SA already has many of the building blocks required for a nature-positive economy, including strong biodiversity science, sophisticated financial markets and growing corporate awareness of nature-related risks. Unlocking this potential will require stronger partnerships among the government, scientific institutions, financial institutions, businesses and communities.

Businesses need access to credible science and practical tools. Policymakers and biodiversity institutions need stronger collaboration with industry to ensure biodiversity priorities are integrated into economic planning and investment decisions.

Building a nature-positive economy

Biodiversity is not separate from economic development. It underpins the water we drink, the food we produce, the infrastructure we rely on and the resilience of our economy.

As global markets increasingly reward nature-positive business practices, South African organisations have an opportunity to lead this movement. Through stronger partnerships, better data and informed investment, biodiversity can become a driver of both conservation and sustainable economic growth. DM

Ntakadzeni Tshidada is Director Biodiversity Policy Advice at the South African National Biodiversity Institute (Sanbi).