Figure 2 – How actions to tackle climate change can have positive ( blue ) & negative ( orange ) effects on biodiversity Note : Source - IPCC
The entire conversation on sustainability and nature easily shifts into business jargon , while risk becomes the element to add into the equation . Plausible risk scenarios are , for any company , an established way to manage uncertainty . Reporting on nature risks — and how you manage them – will boost stakeholders ’ confidence in operations .
Two types of risk
Physical risks relate to how the effects of climate change and degradation of nature directly impact an organisation . This section is connected to quantification of the dependencies on the ecosystem services . Transition risks relate to the risks any company faces in the transition to a lowemission economy , and have to do with technology , market access , compliance and regulation changes .
What is next for sustainability in the chemical sector ? First , companies need to assess their current sustainability strategy and aim to transition from carbon-biased , to a holistic nature perspective . Halting climate change and nature loss are inextricably intertwined , as climate change is one of the five key drivers of biodiversity loss . Any chemical company should first look to conserve and restore nature , complementing their net-zero plans with a credible nature strategy .
Advanced nature strategies are risk-based , meaning that rather than thinking solely about how to reduce the impacts of their products , companies need to consider their resource use as well . Conducting risk assessment would result in a futureoriented approach , where naturebased solutions can contribute up to 37 % of the emissions reductions required by 2030 to keep the global temperature increase below 2 ° C .
A planetary boundaries-savvy chemical sector has a critical role to play here . Let ’ s take , for example , nitrogen and phosphorus cycles and novel entities . Environmental issues arise from the uncontrolled or inappropriate application of pesticides , the overuse of nitratebased fertilisers , the discharge of pharmaceuticals into water bodies and the persistent nature of certain chemicals .
Another illustration of the key role assigned to the chemical sector is in a UN public pledge . Target five of the Global Biodiversity Framework released after COP15 in 2022 explicitly makes a call to “ reduce by half both excess nutrients and the overall risk posed by pesticides and highly hazardous chemicals ” by 2030.4
What should the chemical industry do ? The answer is to commit to nature-based strategies that encompasses the following :
• Climate – with results such as increased efficiency and expanded use of renewable energy
• Water – in the sense of recognising the risks and possible consequences related to decreased water availability or quality in supply chains
• Pollution – given the many boundaries it skirts
64 SPECIALITY CHEMICALS MAGAZINE ESTABLISHED 1981