Carbon Offsetting

Businesses, in general, rely heavily on numerous ecosystem services while simultaneously exerting significant pressure on natural capital, contributing to biodiversity loss. To ensure long-term resilience and responsible growth, a shift towards a sustainable strategy is crucial – with biodiversity serving as a key component of such a strategy.

What is Biodiversity?

To begin, it’s important to remind the concept of biodiversity. According to the definition presented in the United Nations Convention on Biological Diversity, it is "the variability among living organisms from all sources, including, inter alia, terrestrial, marine and other aquatic ecosystems and the ecological complexes of which they are part: this includes diversity within species, between species and of ecosystems". But what does it actually mean?

• Within species diversity – this level of diversity covers genetic variety found within species; this ability allows the population or species to adapt and evolve in response to changing environments and natural selection pressures
• Between species diversity – species diversity refers to the number, types, and distribution of different organisms present in a specific area, encompassing all groups of fauna, flora, fungi, and bacteria. Beyond the large organisms we typically associate with biodiversity – such as birds, mammals, fish, or trees – this aspect of diversity also includes an innumerable array of microscopic organisms. These often play key roles in the ecosystem, performing essential functions that enable ecosystems to fulfill their vital processes.
• Ecosystem diversity – encompasses the full range of habitats and the plant, animal, and fungal communities found within a specific geographic area. The value of this diversity is not determined solely by the number and area of habitats, but rather by their degree of naturalness and alignment with distinct physical and geographical conditions.

These definitions highlight the complexity of biodiversity, which should always be considered when evaluating potential and actual impacts of businesses. Biodiversity means far more than the number of species and habitats’ area. It is an essential and integral characteristic of nature that enables ecosystems to be productive, resilient and able to adapt.

What is Not Considered Biodiversity?

Equally important issue is to distinguish what is not biodiversity. Ecosystems dominated by alien and invasive species that have appeared due to human activity do not contribute to biodiversity as it is commonly understood. These species often disrupt native ecosystems by outcompeting native species, lacking natural predators, or causing the decline of indigenous species. This results in the formation of new ecosystems with altered networks of dependencies, which often lack the complexity and balance of natural biodiversity. Nevertheless, it is always worth considering whether a native ecosystem dominated by alien species has a potential to be restored to better condition.

We also should not include common habitats created through human intervention, consisting predominantly of synanthropic species – those thriving in human-dominated environments in vast numbers – among the valuable elements of biodiversity. Likewise, gardens, squares, parks, and other green spaces established and maintained by humans are not typically regarded as integral elements of natural biodiversity. While they may offer ecosystem services, they do not represent the complexity and ecological integrity of natural habitats.

When a Company May Need to Assess Its Impact on Biodiversity?

Businesses may need to evaluate their impact on biodiversity for a variety of reasons, including:

• Fulfillment of EU Taxonomy objectives
• Meeting standards for B Corp Certification
• ESG (Environmental, Social, Governance) reporting
• Conducting double materiality assessments (DMA)
• Carrying out environmental impact assessments (EIA)
• Executing environmental due diligence (EDD) procedures
• Applying for funding and meeting requirements specified in international performance standards (e.g., Performance standard 1 or 6)

Each of these drivers will require consideration of environmental factors, including biodiversity, at different scales and within different contexts, both spatially and temporally.

However, the process should always begin with identifying business dependencies on biodiversity and the impacts on biodiversity – the latter generated by the company at different stages of its operations. Without the recognition of impacts, even the most innovative ideas to enhance sustainability can be perceived as greenwashing. It is essential to understand where the company’s strengths lie and where critical improvements are needed. The second stage involves enhancing the business strategy through measures focused on avoidance, mitigation, and compensation with respect to biodiversity. Both stages should incorporate a science-based approach to ensure credibility and effectiveness.

Prioritizing Impact Detection and Mitigation for Effective Biodiversity Strategy

When integrating biodiversity into a corporate strategy, the first and most crucial step for businesses is to identify dependencies on biodiversity as well as potential and actual impacts on biodiversity resulting from their operations, supply chains, or projects. This detection process ensures that companies understand the extent and nature of their influence on local or global ecosystems and species. The recognition of dependencies and impacts also enables to provide a basis for determining the scope of the biodiversity strategy the company will ultimately adopt. Since every company is unique, biodiversity strategies must be customized to fit the specific needs and context of each organization. The scope of a strategy should be viewed as dynamic, evolving over time and revisited iteratively as the company develops. Therefore, a deep understanding of business-biodiversity interactions is essential for effective strategy formulation.

Circular Ecology, headquartered in the UK, partners with organizations globally to enhance sustainability. Their services encompass carbon offsetting, resource efficiency, life cycle assessment (LCA), carbon and water footprinting, circular economy, and overall environmental sustainability. Their expertise extends to diverse sectors, including materials, products, buildings, food, services, textiles, organizations, and supply chains.

Established in 2005 due to climate change concerns, Clear provides certified carbon offsets. Despite challenges, they empower individuals and businesses to offset emissions, focusing on customer service and innovation. Clear aims to swiftly fund effective decarbonization through scientifically validated projects, covering unavoidable emissions to combat climate change effectively.

Agricarbon offers extensive, cost-effective soil carbon testing services across the UK and Europe. They excel in assessing soil organic carbon across vast agricultural areas, employing a globally recognized scientific methodology. Leveraging mechanization, automation, and economies of scale, they achieve this at a remarkably low cost. Their processing facility analyzes thousands of samples weekly, furnishing businesses, farmers, and landowners with valuable insights into soil carbon stocks.

Climate Impact X (CIX) is a global marketplace, auctions house and exchange for trusted carbon credits. Our vision is to drive environmental impact at scale. We build resilient platforms, collaborate with innovative partners and foster ecosystems that help companies take practical climate mitigation action through trusted carbon credits.

MIKOKO PAMOJA is a small-scale carbon offset initiative centered around mangrove conservation. They encourage community involvement in preserving mangroves by engaging in conservation efforts, raising awareness, and selling carbon credits. The revenue from these credits is reinvested in local development initiatives covering water, education, health, and environmental conservation, showcasing a win-win-win model for climate, community, and biodiversity preservation.

Planted supports companies holistically and individually in the implementation of their sustainability goals. To do this, they combine local climate protection with technological software solutions, enabling companies to actively manage emissions together with their employees: Starting with the calculation of CO₂ emissions, the identification of savings potential, and ending with the offsetting of unavoidable emissions. In addition, they plant mixed forests in Germany for companies with our own climate forester or enable the protection of local forests.