Landmark Global Business and Biodiversity Assessment Calls for End to Harmful Subsidies

Introduction

A landmark global Business and Biodiversity Assessment has captured the attention of sustainability experts worldwide, with particular significance for Canada’s resource-dependent economy. The comprehensive study, which takes aim at harmful government subsidies contributing to biodiversity loss, signals a critical shift in how businesses must approach environmental risk management.

Thomas Walker, Executive Director (Academic) at the Institute for Sustainable Finance (ISF), emphasizes that Canadian business leaders should pay close attention to these findings. Given Canada’s position as a resource-based economy where nature underpins the productive capacity of key industries, the implications of this assessment could reshape how companies approach environmental stewardship and risk management.

Understanding the Global Biodiversity Crisis

Biodiversity loss represents one of the most pressing environmental challenges of our time, with potentially devastating consequences for global economic stability. The new assessment comes at a crucial moment when governments and businesses worldwide are grappling with how to balance economic growth with environmental protection.

For Canada, the stakes are particularly high. The country’s economy relies heavily on natural resource extraction, agriculture, and forestry – sectors that are intrinsically linked to healthy ecosystems. As biodiversity continues to decline at unprecedented rates, the business community faces mounting pressure to understand and address nature-related risks that could significantly impact their operations, supply chains, and long-term viability.

Key Findings of the Assessment

The global Business and Biodiversity Assessment presents several critical findings that should concern business leaders across all sectors:

• Subsidies Harm Biodiversity: Government subsidies, often intended to support economic development, frequently contribute to biodiversity loss by encouraging unsustainable practices
• Economic Dependencies on Nature: Businesses worldwide are more dependent on healthy ecosystems than previously recognized, with many industries facing significant risks from nature degradation
• Financial System Implications: Biodiversity loss poses systemic risks to financial markets, potentially triggering economic instability
• Regulatory Changes Coming: Governments are increasingly likely to implement policies that internalize biodiversity costs, affecting corporate profitability

Why Canadian Businesses Must Act Now

Canada’s unique economic structure makes the findings of this assessment particularly relevant. As Walker notes, Canadian companies should seriously consider nature risk in their business decision-making processes for several compelling reasons:

First, Canada’s resource-based economy means that nature directly underpins the productive capacity of numerous industries. From forestry and mining to agriculture and fisheries, the health of ecosystems directly affects business performance and sustainability.

Second, Canadian companies are increasingly operating in global markets where environmental standards and expectations are rising. International customers, investors, and partners are demanding greater transparency and action on environmental issues, including biodiversity protection.

Third, regulatory trends both domestically and internationally are moving toward requiring companies to disclose and manage nature-related risks. Proactive companies that address these issues early will be better positioned to comply with future regulations and avoid potential liabilities.

Implications for Corporate Strategy

The assessment’s findings have profound implications for how companies should approach corporate strategy and risk management. Traditional business models that treat environmental impacts as externalities are becoming increasingly untenable in a world facing biodiversity crisis.

Integration of Nature Risk into Decision-Making

Companies must begin integrating nature-related risks into their core business strategies, similar to how they currently manage financial, operational, and market risks. This includes:

• Conducting comprehensive assessments of how biodiversity loss could affect operations and supply chains
• Developing metrics and key performance indicators related to nature impacts and dependencies
• Engaging with stakeholders, including Indigenous communities, whose knowledge and rights are crucial for biodiversity conservation
• Investing in nature-positive solutions that create business value while protecting ecosystems

Global Context and Policy Implications

The assessment’s focus on harmful subsidies reflects growing international recognition that current economic policies often incentivize environmental destruction rather than protection. This misalignment between economic incentives and environmental sustainability represents a significant barrier to addressing biodiversity loss.

For policymakers, the assessment provides crucial evidence for reforming subsidy programs to better align with biodiversity conservation goals. For businesses, it signals that policy changes are likely coming that could significantly alter the competitive landscape.

Moving Forward: Recommendations for Canadian Companies

Based on the assessment’s findings and the Canadian context, companies should consider taking the following actions:

1. Conduct Nature Risk Assessments: Evaluate how biodiversity loss could impact operations, supply chains, and markets
2. Develop Nature-Positive Strategies: Create business strategies that contribute to biodiversity conservation while creating value
3. Engage in Policy Discussions: Participate in consultations on biodiversity-related policies and regulations
4. Invest in Innovation: Support development of technologies and practices that reduce nature impacts
5. Collaborate Across Sectors: Work with other companies, NGOs, and government agencies on biodiversity initiatives

Conclusion

The landmark global Business and Biodiversity Assessment represents a wake-up call for the Canadian business community. As a resource-dependent economy, Canada faces unique challenges and opportunities in addressing biodiversity loss. The assessment’s findings highlight the urgent need for businesses to integrate nature risk into their decision-making processes and move toward nature-positive business models.

The path forward requires collaboration between government, business, and civil society to create economic incentives that support rather than undermine biodiversity conservation. Canadian companies that proactively address these challenges will not only help protect the ecosystems on which they depend but also position themselves as leaders in the emerging nature-positive economy.

As the world grapples with the interconnected challenges of climate change and biodiversity loss, the findings of this assessment provide crucial guidance for creating a more sustainable and resilient economic system. The question is no longer whether businesses should address biodiversity risks, but how quickly and effectively they can adapt to this new reality.

References

Corporate Knights. (2026, February 24). Landmark biodiversity study takes aim at subsidies. Retrieved from https://corporateknights.com/finance/a-landmark-study-on-biodiversity-loss-takes-aim-at-harmful-government-subsidies/

Institute for Sustainable Finance. (2026). ISF News. Retrieved from https://smith.queensu.ca/centres/isf/news-index.php