Governments endorse landmark report declaring biodiversity loss a major economic threat to business and financial stability

A groundbreaking assessment endorsed by governments in Manchester this week marks a pivotal shift in how the business world must view environmental destruction. The Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES) report makes a compelling case that biodiversity loss has evolved from an environmental concern into a fundamental threat to corporate profits, financial markets, and global economic growth.

The report’s central argument is straightforward yet profound: every business relies on nature’s life-support systems, whether directly or through complex supply chains. From crops that need pollinators and fertile soil to hydropower plants dependent on healthy watersheds, companies across all sectors face mounting risks as ecosystems collapse. Even businesses seemingly removed from natural environments depend on water availability, climate regulation, and stable ecological functions that underpin their operations and supply networks.

The numbers paint a stark picture of economic priorities gone awry. While human-made capital per person has roughly doubled since 1992, natural capital stocks have plummeted by nearly 40%. In 2023 alone, an estimated $7.3 trillion in public and private financing flowed toward activities directly harming nature—with private finance contributing two-thirds of this destructive investment. Meanwhile, conservation and restoration efforts received a mere $220 billion, and harmful government subsidies totaled $2.4 trillion.

This dramatic funding imbalance reveals that current market systems and policies continue to reward environmental destruction over stewardship. For companies, the IPBES assessment warns that ignoring these trends creates serious physical risks, from crop failures to supply chain disruptions, that could fundamentally reshape the global economy.