Biodiversity matters

What does nature have to do with business? Well, quite a lot, actually. In fact, the connection between companies and the natural environment is profound, multifaceted, and increasingly recognised as essential for both long-term corporate success and the future of our planet. 

Nature provides businesses with invaluable resources, ecosystem services and inspiration. Businesses, in turn, have a significant impact on the health and vitality of natural systems. That means they also have the power, influence and capability to help restore nature, protect ecosystems and enhance biodiversity – all of the things necessary for human health and animal wellbeing.

Governments have made moves to encourage corporate action to boost biodiversity. The Kunming-Montreal Biodiversity Framework, agreed by many nations in 2022, includes a host of 2030 targets designed to restore 30% of our degraded or lost ecosystems, both on land and sea.

Yet, most businesses are still unaware of their connection to nature, and how inaction in protecting it might put what they do at risk. Recent research by the World Benchmarking Alliance suggests that fewer than 1% of companies have a handle on their operational dependence on nature and biodiversity. The latest Sustainable Business Tracker shows that biodiversity is not yet considered to be a priority. Just a third of respondents claim biodiversity to be either “business critical” or “high priority’”. This lack of focus is supported by the fact that less than half of the companies disclosing their ESG data to CDP include data on nature and biodiversity.

For SD Guthrie (formerly known as Sime Darby Plantation), one of the world’s biggest certified sustainable palm oil producers, the need to act on biodiversity is not lost on the leadership team. “We are highly dependent on nature, and we can also have a high impact on nature,” says Rashyid Redza Anwarudin, the company’s chief sustainability officer. “So, we need to make sure that we reduce our impacts on nature, while also ensuring that we maintain the ecosystem services we get from nature.” 

The company has a business presence in 12 countries, producing almost 2m tonnes of certified sustainable palm oil every year. For long, the most significant impact of the palm oil industry on nature has been deforestation. Thanks to a robust no deforestation, no peat and no exploitation (NDPE) policy and dedicated initiatives adopted by many responsible industry players such as SD Guthrie for both own operations and suppliers, losing trees to make way for plantations is a thing of the past for their businesses. 

Now, SD Guthrie’s focus is on restoring and protecting land within the company’s operations (especially that which is identified as being of high conservation value) and connecting land in a way that encourages biodiversity to thrive. “We actually look at where our existing land is in the context of the surrounding landscape,” Anwarudin says. “We have forest areas and wildlife areas, so we try to create forest buffers or stepping stones so that wildlife can access small patches of forests inside our estates, where they can find food or nest.” Getting such projects off the ground demands effective collaborative partnerships. SD Guthrie works with some of its big customers, research institutions and universities to help fund and implement these types of initiatives. 

Enhancing biodiversity within plantations is crucial for supporting the pollination of trees and producing fruits, among other benefits. SD Guthrie has an integrated pest management approach to maintain its sites, using natural predators to combat pests. For example, by encouraging owls to nest within its estates, rat infestations are managed naturally, minimising the use of chemicals. The company also grows beneficial plants that attract natural predators and parasitic insects that attack bagworms, a leaf-eating caterpillar that damages oil palm fronds, thus protecting the estates’ palm trees. “Essentially, we reduce our dependence on chemicals and pesticides in our operations, albeit not completely. It just allows us to be more targeted in applying chemicals in areas which natural predators can't control,” Anwarudin says. 

There has also been a focus on helping humans and wildlife coexist within SD Guthrie’s sites. In certain areas, there are issues with elephants making their way into plantations, trampling and destroying younger trees and plant nurseries. One of Anwarudin’s team did a master’s degree in human wildlife conflict, helping to create a new human-elephant conflict manual, which is being used in operations where there is a risk. 

Anwarudin says: “Of course, elephants are not just within our concessions; they are within the landscapes that we operate in. So, our teams also go out to engage with other growers and stakeholders within a particular landscape to share our learnings and help with capacity building so that others can use the same policies and procedures we use to coexist with elephants.”

The company is doing something similar to protect orangutans found throughout the rainforests of Indonesia and Malaysia as well as helping them thrive in their natural habitat. By creating nature corridors and planting ficus trees to connect different parts of estates, it is allowing the animals to travel and find food more easily. Anwarudin says that SD Guthrie needs to keep raising awareness. “Estate managers need to understand that if there’s an orangutan in their estate, they shouldn’t be alarmed. We’ve done plenty of studies and research through the Sime Darby Foundation and other partners to help us understand what’s needed on the ground to coexist with orangutans.”

Protecting and restoring nature to enhance biodiversity must also be encouraged along the supply chain if SD Guthrie is to meet its long-term net zero targets. Anwarudin recognises it’s crucial to support suppliers to adopt similar practices. But action should not be limited to SD Guthrie’s supply chain, he says. 

Anwarudin says that while the company might not buy from a particular smallholder farmer or mill, the work being done by SD Guthrie on human-animal conflict may extend to that particular landscape. “It transcends concession boundaries, and we need all actors within the landscape to adopt similar practices. A lot of our work is on outreach to people within that landscape, and also awareness raising and capacity building.”

Unlike reducing greenhouse gas emissions, which can be tracked using spreadsheets and concrete data, companies have to be more creative and dynamic when it comes to measuring progress on enhancing biodiversity. “After all, you can’t say one tiger equals one biodiversity credit, for example,” Anwarudin points out. 

Instead, SD Guthrie is using, for example “areas of land reforested” as useful metrics. Team members are monitoring wildlife across estates and within landscapes too, setting up camera traps to examine what animals are present to help measure the levels of biodiversity. 

The presence of otters is a good indicator of river quality, for example. The presence of hornbill birds, which might be nesting within plantations, also points to a healthy natural environment. The company has employed the help of an NGO to keep an eye on hornbills throughout its sites in Sarawak. “However, it is important to remember that there is no accounting standard similar to carbon accounting for biodiversity at this point in time,” Anwarudin says.

Nature provides businesses with invaluable resources, ecosystem services, and inspiration for meeting net zero goals. By recognising and harnessing the power of nature, we can accelerate progress towards achieving net zero emissions while simultaneously safeguarding the health and resilience of ecosystems for future generations. 

But, to give biodiversity the attention it deserves, companies will need to prioritise the issue at board level and give it the same credence as carbon reduction. This will help to channel more investment into projects and initiatives that will make a difference.