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Understanding Biodiversity Management: Best Practices and Innovation

 

Michael Torrance is joined by Dr. Mark Johnston, Strategy Lead for Nature-based Solutions & Biodiversity at BP, and member of the newly formed working group TFND (Task Force on Nature-related Financial Disclosure), to discuss how biodiversity applies to everything in a natural world and the private sector role in delivering a sustainable working framework.

In this episode:

  • BP’s role in managing its impact on biodiversity, and nature-based solutions for environmental sustainability strategy.

  • Mitigation hierarchy, managing risks and the idea of no net loss to biodiversity.

  • Why 2021 is going to be a landmark year for the topic of biodiversity and climate change.

  • The TFND (Task Force on Nature-related Financial Disclosure) and what it is trying to accomplish.


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Dr. Mark Johnston:

Governments, of course, have the accountability and responsibility to deliver on the biodiversity framework. But there is increasing focus and recognition that the private sector plays a really important role in helping to deliver the bio-diversity framework.

Michael Torrance:

Welcome to Sustainability Leaders. I'm Michael Torrance, Chief Sustainability Officer with BMO Financial Group. On this show, we will talk with leading Sustainability Practitioners from the corporate, investor, academic and NGO communities to explore how this rapidly evolving field of sustainability is impacting global investment, business practices and our world.

Disclosure:

The views expressed here are those of the participants and not those of Bank of Montreal, its affiliates or subsidiaries.

Michael Torrance:

Today I'm speaking with Dr. Mark Johnston. Mark is the strategy lead for nature-based solutions in the environmental sustainability team at BP. At BP, Mark provides technical advice and leadership on issues related to biodiversity, ecosystem services, nature-based solutions, including the relationships with international environmental NGOs and representation of businesses at international events. Mark is the current chair of the IPIECA, BES working group, and is a member of the newly-formed informal working group of the Taskforce for Nature-related Financial Disclosures or TNFD. He's also a member of the IPBES expert panel on business and biodiversity. Mark completed a degree in zoology and a PhD at Imperial College, and he has an MBA from Open University. Hi Mark. Thanks for speaking with me today.

Dr. Mark Johnston:

Great, my pleasure. Thanks so much for the invite. It's great to be here. Thank you, Michael.

Michael Torrance:

So, Mark, let's start off by learning a little bit more about yourself and your work. Can you tell me about your journey? How did you come to work on biodiversity and eventually biodiversity with BP?

Dr. Mark Johnston:

Great. Well, thanks for that. It's a great question. I won't go back too far anyway. My interest in nature conservation started near when I was knee high to a grasshopper. When I was about 10, 12, I used to go and do bird surveys and plant surveys. So, I was fully a bit of a geek to be honest at that time. And I've just been passionate about the natural world and conservation and then went on and followed a typical academic sort of career. I did a degree in zoology and then I went on to do a PhD in plant population ecology. And then did post-doctoral research, went into lecturing for about 10 years or so.

Dr. Mark Johnston:

And then I just felt I wanted to make change and hopped over to the private sector. So I went into consultancy for a few years. And actually, before that, I was actually involved in a range of different research activities based in Guyana, South America, a wide range of different research activities, but went over to consultancy and then joined BP. And my drive, I suppose, has always been about making change and just being passionate about nature conservation, wanting to embrace and get others involved in nature conservation. And that's what, I've been sort of following my passion since.

Michael Torrance:

So what do you do with BP exactly? What is your role and how do you advise the company?

Dr. Mark Johnston:

Yeah, certainly. So, I've been in BP just over nine years and I’m now also in a new role, but basically I'm the strategy lead for biodiversity and nature-based solutions in our new environmental sustainability team. BP have been going through a lot of changes recently, in terms of now having gone through something called re-invent, where we're reorganizing the organization to get behind sort of a new business strategy, which I can talk through a bit more later on, but I'll provide technical advice across the group on biodiversity and ecology issues. That's right from a project level, out to managing biodiversity, through to more corporate position and strategic issues around biodiversity.

Michael Torrance:

And until recently you were the chair of the Cross Sector Biodiversity Initiative or CSBI, and that's actually how we met because, of course, BMO is a member of CSBI now, and has taken up that chairmanship role, but you're one of the original leaders of that and have been so influential in that organization. Can you tell our audience what is CSBI and what types of activities and thought leadership did you work on as chair?

Dr. Mark Johnston:

Sure. Thank you very much. I know it's great to have BMO involved in the CSBI so fantastic for taking that role. So CSBI is quite unique and it's a really exciting initiative and it brings together three associations. It brings together IPIECA, the Oil and Gas Association for environment and social issues in oil and gas. You’ve got ICMM, for minerals and metals in terms of that association. And then they create a principal's association. So it's quite unique and it brings together those three different aspects. And actually the particular value in the CSBI is bringing in that financial sector, because you look at things slightly differently from a different perspective and bring challenges to those different sectors. And I think that's a real sort of value because you provide that thinking different perspective and that's how [inaudible] biodiversity initiative is really sort of being able to hopefully make change and really think about how we are addressing the biodiversity issues.

Dr. Mark Johnston:

So, it came about eight years ago now, and it's really off the back of the IFC Performance Standard 6, when that was relatively new from business, from the different groups coming together to think about how do we actually implement? How do we make the IFC Performance Standard 6 practical? And how do we provide support on the implementation of PS6 and the requirements there? So what we agreed, then we set up the number of different standards and something we should be involved in, is producing simple guidance about how to apply PS6 particularly around biodiversity baselines, around the mitigation hierarchy and about this project timeline, and we produced a whole range of different practical guidance through CSBI to support the members.

Michael Torrance:

I guess, just to start and set a baseline, biodiversity is becoming a topic within the context of sustainability alongside climate change as probably being the biggest imperative that we have around corporate sustainability and from a policy perspective. What is biodiversity? How should we think about that and how does it relate in your view to corporate sustainability particularly?

Dr. Mark Johnston:

Great and I thank you for that. And I think that it's great to have this focus now on biodiversity, and we’re seeing a huge number of initiatives going on in the space at the moment, but I think first of all, [inaudible] is biodiversity in its broader sense. Of course it's the diversity of life. It's everything natural in the natural world. Another way of looking at it is everything from ecosystems to species, to genetic diversity. So that's its broadest definition and approach. And why it's important? Well, I think, there's a real sort of pivotal report that came out a couple of years ago, but from BES which really clearly articulated the facts behind biodiversity and the loss of biodiversity. There's a lot of these facts going around, but 75% of the terrestrial environment, 66% of the marine environment is severely altered by industrial and human activity.

Dr. Mark Johnston:

1 million species are at risk of extinction. Current rate of extinction is around 100 times greater than natural background rate. It laid out the facts that biodiversity is in decline and we have to do something about it. And then earlier this year we had the BES group to review, which is also looking at the economics of biodiversity and biodiversity loss. And that really clearly articulated that the continued erosion of natural capital and the failure to put a value on nature. And actually we have to really rethink the way we value nature in order to halt that decline in biodiversity. So that's the background in terms of the sort of corporate perspective. I think we’re recognizing that the world is on an unsustainable path and therefore it makes long term business sense for the private sector to operate more sustainably.

Dr. Mark Johnston:

We have to change, we can't carry on, it's not business as usual anymore. We have to make these changes. And there's two really sort of quite important aspects. First of all, the private sector can help enhancing and storing biodiversity as well as reducing its impact and managing the risks. And then it's the dependencies on biodiversity, the corporates, private sector, et cetera, very much depend on biodiversity for economic growth and sustainability. So that dual aspect of dependencies and impacts is really critical to sort of the biodiversity components. And therefore we need to really get that bundled better.

Michael Torrance:

And Mark, you mentioned natural capital and this idea of valuing nature. Can you just develop that idea more? What do you mean by natural capital?

Dr. Mark Johnston:

Yeah, sure. There's a lot of jargon in this space, which is a lot to get your head around. So obviously natural capital, first of all, is much wider than just biodiversity. It's the world’s stocks of natural assets, including geography, geology, soil, air, water, not just biodiversity itself. So it's much wider than biodiversity. And I see it, biodiversity helps connect all these different aspects of natural assets, soil, water, air, et cetera. So it is a much broader concept.

Michael Torrance:

And is that related to this idea of ecosystem services, which I know plays a prominent role in IFC Performance Standard 6 and how we think about managing all of the natural systems that we rely on, maybe not advertently, but we are relying on them, for even business activity. How do you think of that idea of ecosystem services?

Dr. Mark Johnston:

So another sort of buzzword at the moment, is ecosystem services. So ecosystem services briefly as you know, the goods and services we as people or society get from natural capital. So you've got the natural capital or the natural assets, you've got people and how we use resources, and ecosystem services are the flows from natural capital to the people capital, if you like, or human capital. So it's how we use biodiversity. And that can, things like, to be able to include provisioning services like timber, food, fisheries, or use of natural resources. But it can also include things like cultural services as well, the outdoors, the culturally significant spiritual value. And I think what's been really quite poignant over the last 12 months or so as part of the pandemic is our connectivity with nature. And that actually the cultural importance of nature, biodiversity has really come home recently because we really value that open space during these very difficult times. So, there's just an element also of ecosystem services.

Michael Torrance:

And you mentioned some of the focus of CSBI has been on the interpretation and application of IFC Performance Standard 6. So just as background for the audience, the IFC performance standards set out an international benchmark for sustainability management and is really a bench line for good environmental and social risk management. And it cuts across many different industries. There's eight different performance standards. Performance Standard 6 is focused on biodiversity. And one of the areas of collaboration between CSBI, the mining sector, energy sector and finance sector was to really interpret and develop best practices in applying that standard. So I've given a bit of a background, but from your perspective as a real deep expert on this topic, what is IFC Performance Standard 6 all about and what is the role that it plays in terms of management of biodiversity in the corporate world?

Dr. Mark Johnston:

Great. And I think that's a great question and a really important one, because the IFC Performance Standard 6, when it came out really did set a very clear sort of new international standards for biodiversity. It set the expectations on how you manage biodiversity on the project or site level. So it really was a game changer when it came out. So it was a real sort of masterpiece behind on what it achieved. And now as the key component behind is about also requirements for projects to achieve a no net loss in biodiversity or a net gain depending on the project location and depending about the nature of the project activities. So it really introduced those key terms, which we are now seeing as really becoming embedded in sort of the language around biodiversity.

Michael Torrance:

And so what do you mean by no net loss of biodiversity? How would you evaluate that and what is the objective behind it?

Dr. Mark Johnston:

So no net loss, it's defined as a point at which project related impacts on biodiversity are balanced by appropriate mitigation measures. So more simplistically wise, a project has a negative impact on biodiversity and therefore what you have to do is then basically do positive things, things which restore biodiversity or produce a gains, and no net loss is then basically getting the balance between the negatives and the positives. So there's basically no change overall net in the actual baseline. Of course, that's not easy because biodiversity is complicated. It's very site-specific in terms of the nature of the project or the nature of the activities going on. And measuring your impacts is not always very easy as well. So it's not an easy thing to do, and it has its technical challenges. And also I think it’s important to recognize the social and local community aspects of achieving a net loss as well. And this is what the other aspect of the IFC Performance Standard 6, the way it's integrated and looking at ecosystem services in there as well, to make sure when you are doing things like biodiversity, no net loss, you do consider the ecosystem services and the local people use biodiversity, which is – that's actually a really important piece.

Michael Torrance:

And a related concept in the performance standards and environmental social risk management is an idea of a mitigation hierarchy. So it's best if you can avoid any impact, that's the top of the hierarchy. If you can minimize the impact that you have, that's the next best solution. And then there's an idea of offsetting, which is not ideal, but if it's the only resort, then it's better than nothing. But I think in biodiversity, the mitigation hierarchy is even more complex than that. Are you able to explain how do you think about this mitigation hierarchy idea in the context of biodiversity?

Dr. Mark Johnston:

Absolutely. So the mitigation hierarchy is a framework for managing risks and the potential impact, and there's actually really quite core to how you manage your impacts and biodiversity as you've highlighted. The emphasis must be in or should always be on avoidance and minimizing first, and then restore on offset your impacts if necessary. Honestly the focus, if you can avoid and minimize impacts in the first place, fantastic. But then really only move to restoring or offsets if need to, if you can't avoid to minimize natural impacts. So it's a really important aspect to it. And CSBI has been really fundamental in providing some practical guidance and how to do that. There are challenges to it, particularly as you move up the mitigation hierarchy. So, typically, doing biodiversity restoration or offsets can be very challenging because there's all sorts of unknowns and uncertainties.

Dr. Mark Johnston:

So as you move down the mitigation hierarchy, it becomes increasingly difficult to implement and less certainty about being able to deliver your final target or outcome, whether it's a net gain or net loss in biodiversity. So, hence again, the emphasis was on avoidance and minimization because you're finding land for doing offsetting, for example, it can be quite, challenging who owns that land, who manages it in the long term. And of course, achieving a no net loss in biodiversity may take you five, 10, 15, 30 years, depending on the nature of the impact. And there's all sorts of complications associated with it because also, when you look at a project or site level, you're not doing those restoration on offsets in isolation. There's other projects, there's other priorities, there’s local communities, so doing it in that wider landscape is one of the key challenges as well.

Michael Torrance:

Are there any examples that you'd be able to share with us about, how have you thought about these kinds of challenges in the context of a project or operations in your work?

Dr. Mark Johnston:

I can try, I guess, aspects of it. I think certainly in terms of specific ones where we've looked at ourselves. So, for example, for a typical oil and gas project activity is seismic in terms of seismic surveys, doing that to do to your physical surveys, particularly in the marine environment for oil and gas and the emphasis, there is you’re obviously trying to – the key issues there's also in terms of marine mammals and potential impacts on marine mammals from, for underwater sound. And therefore you basically design your schedule, your seismic plan around the seasonal constraints. So basically doing seismic activities when marine mammals are not there or when they're not carving in that location.

Dr. Mark Johnston:

So it's that first stage of avoidance mechanism. So we've done that several times in operations where we've basically timed the seismic activities specifically when the wild populations of marine mammal populations are not in that location. And critical to that, of course is understanding the baseline. Plus you need to know exactly when the marine mammals are going to be there or not going to be there. So the other key aspect of the mitigation hierarchy is really understanding about vested baselines so you can then apply different parts of the mitigation hierarchy.

Michael Torrance:

And on that, just as a follow-up, what role does data play in all of this? Like you're talking about baselines. I've been recently speaking with GBIF and other types of databases, but can you just speak a little bit to how you think about acquiring that type of baseline data and are there these kinds of international repositories. Is that important for your work or do you do these studies on your own?

Dr. Mark Johnston:

So incredibly important. So the data itself drives the whole management of your impacts because it's so critically important, but it has to be at scale appropriate to the nature of the particular project you're doing. Obviously if you're going to be doing large projects in potentially sensitive areas, you need very detailed data. And also to inform the nature of activities, where other sites, where you may be working – in a brownfield site, also must be lessons to varied. There may already be a lot of existing historical data.

Dr. Mark Johnston:

So it very much depends on the nature of the project, but these sorts of projects like GBIF and other platforms are increasingly important as we better understand some of the sensitivities and issues and the nature of the impacts. So we have that data available to actually understand what is actually there, what isn't there, et cetera, and the challenges of biodiversity have highlighted it. It changes. You have to consider the whole seasonal effects from one month to the next, because biodiversity is continuously changing.

Dr. Mark Johnston:

And typically, for relatively short projects, you don't necessarily have time to do detailed baselines. You can't do baselines for two or three years before you implement the project. You have a short time window to collect the data, therefore getting access to historical data and sharing data between different operators or different groups is actually really important and really valuable. And I think that's progressing really nicely and nice to see some of the initiatives there, but importance of data sharing. And I think that's a real area which we need to be doing more of across the different sectors.

Michael Torrance:

Yeah. And as I understand relatively new that the private sector is now sharing information of the baselines they've adopted and the equator principles, as you mentioned, the cross sector biodiversity initiative also includes the Equator Principles Association, which is a group of banks that are implementing environmental and social risk management approaches, including BMO. When we now collect this data in the context of a project finance, there's a requirement in the Equator Principles agreement framework to share that information with this international data collective GBIF. So that it's a good opportunity for more historical data and data sharing. And maybe with that, let's pivot squarely to your work with BP and the energy sector more broadly. What is the goal of BP around biodiversity and biodiversity management? And how do you think of it in that context?

Dr. Mark Johnston:

Yeah, so before talking, especially about BP, I think first of all, it's important to recognize we're seeing the focus on biodiversity at the moment, which is fantastic. That we understand that transformative change is needed. Businesses like BP have a significant part to play in managing our impacts on biodiversity and of course enhancing or restoring biodiversity as well. So for a large corporates like ourself at BP, biodiversity is much more than just an add on, it's very much embedded in how we do things. And you may have seen, we recently launched our sustainability aims and framework. And part of that's about caring for our planet.

Dr. Mark Johnston:

Recognizing again, we're on an unsustainable path. We have to do something about it. Biodiversity has been embedded into our thinking and the processes for a good 14, 15, 16 odd years or so, but recognized now as highlighted by BES and the other reports come out, we have to up our game a bit. We have to do a bit more than we are doing at the moment. So I recognize we don't of course have all the answers yet, but we do realize we have to make these changes. So I think that the goal for business as a whole should be about applying the mitigation hierarchy across different activities, whether it's a project level or the supply level. And then in BP, we've made an aim to enhance biodiversity and the enhancing biodiversity and making a positive impact through actions to restore, maintain, and enhance biodiversity where we work, because we recognize that intrinsic link and the importance of nature.

Michael Torrance:

And BP launched a new biodiversity position last year as I understand it. Can you take me through what that position is?

Dr. Mark Johnston:

Yeah, certainly. So last June, our CEO Bernard Looney launched our new biodiversity position, which was very exciting and the position itself basically, there's two main parts of the position, one around protected areas and one about biodiversity. So the first one on protected areas is a commitment not to undertake any new oil and gas exploration or production activities inside UNESCO world heritage sites, that's cultural and natural world heritage sites. And also not go into IUC and strict nature reserves and wilderness areas. That's IUC 1A and 1B. So we made that commitment. It's a commitment set in stone and actually we're the only extractive company to I think, to make that no-go commitment for the strict nature reserves and wilderness areas. So if you link it back, it's because we recognize that some of these highly sensitive areas need protection.

Dr. Mark Johnston:

And if you like, it's that first step of the mitigation hierarchy we have set in stone. These are the areas we won’t go into. That’s the avoidance steps in a mitigation hierarchy, if you like. So that's the first part. The second part is around biodiversity itself and we have set out three objectives under that position. First one is we aimed to achieve a net positive impact on biodiversity in our new projects. That's from 2022. It's for new BP operated projects whose planned activities have a potential for significant direct impact on biodiversity. And those projects will be required to develop net positive impact action plans. Our target at a group level is then to deliver 90% of those actions within five years of the project startup. So we've set a sort of a band of when those actions need to be met. That requirement will apply to all projects across our portfolio.

Dr. Mark Johnston:

That's not just oil and gas. It’s renewables and anything and everything else in between and whether or not it’s in a sensitive area or not. It doesn't really matter whether you are in a critical habitat or not. You still should be aiming to achieve a net positive impact on biodiversity. In that respect, it goes a little bit beyond the IFC Performance Standard 6 in terms of that sort of technical level. So that's the first one on NPI. We have two others. One is about enhancing biodiversity around the major operating sites.

Dr. Mark Johnston:

These are the protection hubs, if you like, and we're starting off by introducing enhancement plans for those major operating sites from straight away over the next couple of years, and then expanding that to all of our major operating sites from 2025, I think it is. And then the final piece is about supporting biodiversity restoration and sustainable use of natural resources in countries where we operate. So this is supporting local conservation efforts, conservation projects, working with local partners, not related to our projects, not related to operations, but just helping the world get there in terms of that transformative change. So that's just a quick summary. There's also more details on our website, et cetera.

Michael Torrance:

So how does this biodiversity plan fit into your broader sustainability strategy?

Dr. Mark Johnston:

Yeah, so that's actually really important. So last year we announced a new purpose to reimagine energy for people in our planet. And more recently, we've actually set out more details behind that. Our ambition to become a net zero company by 2050 or sooner and help the world get there and get to net zero. We launched our new strategy to reshape our business, and we've been going through that process for change recently. And that new strategy is underpinned by a new sustainability frame, focusing on three key areas, getting to net zero, improving people's lives and caring for the planet. And literally just last week we launched 10 new aims, five around improving people's lives, five around the caring for the planet. And one of those is biodiversity. Because there's a recognition that we have to take a holistic approach. You can't just look at biodiversity on its own.

Dr. Mark Johnston:

You have to consider not just the social aspect, but the other aspects of the environment. So we've set out plans to aim to achieve to be water positive and the need to conserve water catchment areas, managing impact through a supply chain and greater focuses on circular economy, plastics, et cetera, and nature-based solutions. So all those other areas of course also have benefits basically directly or indirectly to biodiversity as well. So I think it's really important. It's not just about biodiversity. Yes, biodiversity is important, but it has to be considered as a holistic. And that's the approach we've recently put forward.

Michael Torrance:

And there's a real emphasis on collective action and there's phrases like mainstreaming biodiversity, I guess raising awareness. What does that mean to your strategy? How do you see the role of mobilizing and convening companies or people on this topic?

Dr. Mark Johnston:

I actually think this is really important and it's very similar in terms of our climate ambitions as well, that collective action is needed. Individual companies and governments themselves can't do it alone. We all have to work together in order to make the transformative changes which we keep talking about. So no one group can do this on their own. So that collective action is really important. We do emphasize the importance of influencing. So we will be talking and do talk to our business partners, but also some of the associations and other institutions where we have links into, and trying to also, first of all, just talking about what we're doing within BP and our new position, but also trying to influence them and say, "This is our approach. We’re very happy to help you along the same journey." Because we think that's really important.

Dr. Mark Johnston:

And then you also mentioned mainstreaming, which is one of the buzzwords, which is going around at the moment. And actually we've got this in our position as well, about an importance of mainstreaming. And I think this is actually one of the really quite exciting areas. So this for me is about integrating biodiversity into decision-making, beyond that of just manage your impacts and risks on projects, but actually getting the value of biodiversity into the decision-making process within the companies, embedding into things like the risk management processes within a company, within your capital allocation. So it's actually embedded into the decision-making, not just about managing impacts and risks. And I think actually this is why it's really quite exciting to see encoding, to see the finance sector taking increasing active interest in how Corporates like ourselves manage those biodiversity risks, because it is about the importance of that mainstreaming and to what we do.

Michael Torrance:

And so on that mainstreaming point, just as a follow-up question, one of the podcast episodes we did was with the Value Balancing Alliance and I've been learning a lot about the different accounting methodologies that are being used to put value on natural capital. Is that part of the strategy at all? Or how do you bring this topic into the decision-making framework from a business strategy perspective?

Dr. Mark Johnston:

Oh, that's a great question. And a really important one and it's, for biodiversity anyway, it is really difficult. How do you put a value on biodiversity? People who have been your economists and others have been trying to do this for years and realize you can't do it. And then there's the whole premise behind the scope to review as well. I don't have the answer to that, unfortunately. We have been looking at how we can do that. And I think you can measure it from a risk perspective in terms of the risk of biodiversity loss and how that may impact the company and vice versa. So I think there's opportunities there, but actually putting an actual figure or value on biodiversity to then incorporate into your accounts is something which, if we can do it, that'd be fantastic. I think that's a good way of doing it, but I think biodiversity is so difficult. And how do you actually put a value on it? Because you can technically try and put a price or a value on carbon or certain commodities, but biodiversity is so much more complicated and fairly difficult to do.

Michael Torrance:

2021 is going to be a very landmark year for the topic of biodiversity and for climate change, of course the COP26 will be happening in Glasgow this November. And there's also around that time going to be another COP process called COP15. We don't know exactly when it will happen because of COVID, but it's in the works and it's going to be focused on the Convention on Biodiversity. So this framework is really critical, I think, in terms of setting out the global policy objectives around biodiversity. So as an expert in this field, can you take us through your thoughts on what the Convention on Biodiversity is, what the upcoming COP15 process will mean? What's the goal of all of that work?

Dr. Mark Johnston:

Sure. No. Great. Thank you. As you highlighted, 2021 is another big year for biodiversity and in terms of activities going on and we do actually now have a date as I think it’s launched recently. The ninth to 11th of October is the plan for the COP which is great to see. Bit of background; so the convention on biological diversity is a multilateral treaty and it was agreed in 1992, ratified by 196 countries. And it has three main goals. One is about the conservation of biological diversity, sustainable use of its components and the fair and equitable sharing of benefits from the genetic resources. So there's three different parts to it and there's protocols against those. It is, of course, a part of the UN and a UN process and over the last 20, 30 odd years or so, it has been setting out a range of different roadmaps of how do we address the conservation of biological diversity. Back in 2010, the convention developed a strategic plan for biodiversity from 2011 to 2020, which included the IHE targets, which people might be familiar with.

Dr. Mark Johnston:

And that set out 20 globally accepted targets to halt the decline in biodiversity. So that's the premise, the focus of it is to halt the decline in biodiversity. Some of you may well know, and have heard that the recent analysis has basically shown that none of those targets have been met, which is a huge, not just a disappointment, but yet a huge setback in terms of trying to do things. So I think what's realized now that actually, and you've heard this terminology, that now we actually have to take a slightly different approach. These targets haven't worked. We need to up our game on biodiversity and we need to make these transformative changes so that the COP15 in Kunming in China is going to be critically important because it's going to set out the road and the goals and the targets for the next 10 to 50 years.

Dr. Mark Johnston:

They're looking for out of 2030 and 2050 as well in terms of a longer time period. Very broadly, it’s looking at this general agenda is to achieve or halt the decline in biodiversity or ideally trying to achieve a no net loss in biodiversity by 2030. This is of course globally. And then starting to restore biodiversity globally, going out to 2050. It’s sometimes been called, like bending the curve, you've got this downward trajectory of biodiversity globally. We need to bend, level it off and bend it upwards to help restore.

Dr. Mark Johnston:

So that's the overall intent. And then lastly, just on the COP itself, what I think is really exciting, I've been seeing a lot of at the moment, is all the initiatives which are coming on behind the COP itself. And that's great. Of course also we've had the Business for Nature initiative, which over 600 companies have signed up for. We've also got the Leaders’ Pledge for Nature, which is set up by governments, but also now being signed by corporates for more ambitious goals and targets for the COP15. So it'd be really interesting to see what comes through and that's going to be hopefully setting for more ambitious targets for governments and the need for collective action.

Michael Torrance:

And will those targets be set out in what I've heard referred to the post 2020 global biodiversity framework? That's the output of this process? Do you have any sense of the types of things that, that will aim to include or is that still to be determined?

Dr. Mark Johnston:

So you're absolutely right. The post 2020 global biodiversity framework will be the key instrument for delivery of the convention and the path basically for the next 10 years or more. And it sets out a vision, a mission, then comprises of four or five goals and then 20 targets on how those goals would actually be met. And that also includes information about resource mobilization, national reporting and metrics and things like that as well. So in terms of it, it is still a draft. It is out there as a draft version. It’s going to go through a lot of reiterations I'm sure before we get to the COP later this year. They haven't yet agreed in terms of the actual targets.

Dr. Mark Johnston:

But I mean, for example, one of the goals is about an X percentage increase in the area, connectivity and integrity of ecosystems by 2030 or 2050. Again, there's also square brackets in the tech state because they haven't really decided what percentage or when the actual targets are going to be going on. So that's the thing to watch over the next six months. But the real core from certain governments is really to make sure this is actually ambitious, that we really do push the agenda.

Michael Torrance:

And the focus of it would be on government policy. But what is the role of the private sector in your view?

Dr. Mark Johnston:

And that's absolutely right. So governments of course have the accountability and responsibility to deliver on the biodiversity framework, but there is increasing focus and recognition that the private sector plays a really important role in helping to deliver the biodiversity framework. Now, obviously the global advocacy framework would be, we've agreed by parties. That should then manifest itself into national policies and action plans, and then potentially down to regulations, depending on the individual countries. But there is an increasing recognition that the private sector does play a really important role in being able to deliver those ambitions, more so than any before.

Dr. Mark Johnston:

And part of that underpinning the global biodiversity framework is something called the long-term approach to mainstreaming, probably called the L term. And that basically outlines the voluntary guidance, basically outlines the roles of governments, the roles of private sector and the roles of civil society to deliver the biodiversity framework. So it outlines of that sort of frame, but also what we're seeing increasing number of companies, private sectors, getting behind this, making commitments, making pledges, again, pushing for a more smart objectives and sort of more ambitious targets.

Michael Torrance:

And one of those initiatives that I've been following closely is the task force on nature-related financial disclosure, which is, I think modeled in concept with the Task Force on Climate-related Financial Disclosure. TNFD is at a fairly early stage, but I understand you've been very closely involved in it so far. Can you tell us what the TNFD is and what is it trying to accomplish?

Dr. Mark Johnston:

Yeah, certainly. Really exciting initiative. And as you already highlighted, conceptionally, the TNFD is nature's version of the TCFD. Got my acronyms right doing that bit – about the disclosure of nature related risks. So we are on the informal working group of the TNFD along with 60 or more other financial institutions and corporates, and we're basically developing the scope and the work plan for the TNFD with the idea that the TNFD will be actually be stood up and then launched later this year. So probably three aspects in relation to TNFD. First of all, intended to provide a framework for companies and financial institutions to disclose their dependencies and impact on nature, and that will be very similar to the TCFD, provide a framework for four pillars and governance, strategy, risk management, and metrics and targets.

Dr. Mark Johnston:

And of course the details of those are the frameworks on the sort of the counting process that was being worked by the IWG at the moment, and then the TNFD eventually. So it serves as a mechanism to help companies identify and understand the risks, particularly in relation to the transition to economy aligned with future nature-related international agreements, like the post 2020 bio-diversity framework. So it's fairly similar to the sort of the climate journey we've been on with the TCFD. And it's also there to help companies and fund institutions build awareness and transparency about those nature related risks. But of course, nature is much more complicated than I dare say carbon and climate, because it is quite site-based. So we still have got quite a bit work to do in the TNFD to actually just formulate exactly what is going to be the ask on corporates and the financial institutions in terms of that disclosure and reporting. But it's quite exciting because this is really sort of pushing some of the boundaries.

Michael Torrance:

It is very exciting. And did you say that the TNFD is looking to be launched by the end of this year? Or would the work be completed by the end of this year?

Dr. Mark Johnston:

So yeah, quickly on the framework. So the informal working group is working at the moment. It will then form the TNFD. The TNFD will basically be stood up, hopefully this year. Not sure of the exact timing of when that will be. So they’ll form the TNFD and then over the next two years, the TNFD itself will then develop the framework by which companies and financial disclosure will then be requested voluntarily. And it's only in the first instance any way to report against... So it's going to be about 2023 before we actually see the framework being available for corporates and others to report against. So that's the overall plan.

Michael Torrance:

Has there been any engagement with IFRS that you're aware of, of what they’re recently discussed sustainable standards board that they're standing up? It seems to me that biodiversity and the TNFD could well be influential in that process.

Dr. Mark Johnston:

Yeah, absolutely. Yes, it has been. I've not been involved in those discussions but I'm aware of it. And lots of other initiatives going on in this space as well. And that's part of the TNFD is to make sure that whatever we do aligns with those and takes into consideration and aligns with those types of initiatives, but there's a lot of work to do in that space.

Michael Torrance:

One thing I wanted to ask you about the position that you announced, you also announced a partnership with FFI. What can you tell us about that partnership?

Dr. Mark Johnston:

Yeah, certainly. BP has been working with Fauna and Flora International for a good number of years. And so what we wanted to do is now to formalize that partnership, through a five-year partnership agreement with them. FFI are a great team, they're a great NGO, there's some great people, a lot of experience in this field, biodiversity. And so we've developed this agreement, and the agreement is basically for us to work with FFI to help us develop our approach to biodiversity, because we recognize we can't do this alone. We need their technical input and support to be able to do that. And initially the folks with FFI were helping us develop the NPR methodology and the metrics. So that's our primary focus, but we’re also talking to them about how do we embed nature-based solutions into our activities? How do we address the water sustainability agenda? So it's a really exciting partnership, we're really excited about working with them. We will be ongoing for and working with them for a good number of years.

Michael Torrance:

Well, thank you so much for your time today, Mark. Just as a final thought, what do you see as the key challenges facing biodiversity loss, or I guess the challenge is to try to improve the situation and what would you like our audience to take away from this discussion about what areas of action there should be and your thoughts on the future?

Dr. Mark Johnston:

Great. Well, I'll probably say that a few times. It's a really exciting time at the moment for biodiversity. I've never seen such a focus on conserving biodiversity and the importance of nature. So it's fantastic to see it. And I think the important thing is to keep that momentum going. I think we're seeing that now, which we weren't seeing before, but the next 10 years are going to be really critical for conserving biodiversity globally.

Dr. Mark Johnston:

We have to be sort of turning the policy, which is being set now, and initiative into actual action. And that's where the focus should actually be particularly for corporates and for governments as well. In terms of the global challenges, I think sort of getting the right balance between sort of the use of land and sea is to provide people with the natural resources, with conserving areas for biodiversity, just an example of that sort of trade off in terms of, we're seeing huge growth in renewables at the moment, which is fantastic, but of course those renewables still have an impact on biodiversity as well.

Dr. Mark Johnston:

As we upscale those, we need to be aware of that. And what's the tradeoff there? What sort of scale are we going to be able to accept at the societal level? So there's going to be this sort of issues that we're going to have to deal with, and then more locally, it's about how we value and measure biodiversity, how we value it around society and how do we incorporate that into our basic decision making. But I'm a firm believer that we can all make a difference. We all play a part in it. It's not just about governments, not just about NGOs or public sector. We can all do that, whether it's supporting local conservation groups or like ourselves, sort of embedding biodiversity into the companies and organizations we work with. So just raising awareness about the importance of biodiversity and driving action to actually make things happen is really important.

Michael Torrance:

Thank you very much for your time, Mark. It was a very insightful discussion.

Dr. Mark Johnston:

Great. Thank you very much.

Michael Torrance:

Thanks for listening to Sustainability Leaders. This podcast is presented by BMO Financial Group. To access all the resources we discussed in today's episode, and to see our other podcasts, visit us @bmo.com/sustainabilityleaders. You can listen and subscribe free to our show on Apple podcasts or your favourite podcast provider. And we'll greatly appreciate a rating and review and any feedback that you might have. Our show and resources are produced with support from BMO's marketing team and Puddle Creative. Until next time, I'm Michael Torres have a great week.

Disclosure:

The views expressed here are those of the participants and not those but bank of Montreal, its affiliates or subsidiaries. This is not intended to serve as a complete analysis of every material fact regarding any company, industry, strategy or security. This presentation may contain forward looking statements. Investors are cautioned not to place undue reliance on such statements as actual results could vary. This presentation is for general information purposes only and does not constitute investment, legal or tax advice and is not intended as an endorsement of any specific investment product or service individual investors should consult with an investment, tax and or legal professional about their personal situation. Past performance is not indicative of future results.

Michael Torrance Chief Sustainability Officer



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