Why Biodiversity Matters for Business

Anthony Hahn
Coordinator, International Strategy & Global Initiatives, U.S. Chamber of Commerce

Published

November 20, 2024

The 16th Conference of the Parties (COP16) to the Convention on Biological Diversity, held recently in Cali, Colombia, was characterized by an unprecedented turnout from business. After all, biodiversity is vital for the planet and for economic stability and growth.

This year, the Chamber participated in Biodiversity COP, with a firm commitment to helping businesses protect biodiversity. With nearly three times as many business representatives at COP16 compared to COP15, companies are advancing bold, practical solutions that balance conservation with business realities.

Here is why companies are making biodiversity a priority—and the challenges ahead:

Balancing Financial and Legal Obligations in Digital Sequence Information

Among the most complex issues discussed at COP16 was establishing a framework for Digital Sequence Information (DSI), the genetic data crucial for R&D and conservation across industries. Negotiators agreed on a multilateral benefit-sharing fund for DSI, dubbed the “Cali Fund.” This fund will allow companies profiting from DSI to contribute to biodiversity restoration in the data’s countries of origin. It is the only global mechanism designed to fund conservation with money almost exclusively drawn from the private sector.

Questions remain, however: While many companies see the merit in contributing, the complexity and the lack of strong incentives for participation remain sticking points. These factors may stymie the Cali Fund’s success, potentially taking years to make a substantial impact. Additionally, key issues for companies remain unsolved, including simplified global compliance for DSI use and stronger IP protections.

For businesses, especially in biotech and agriculture, clarity in DSI governance is essential—not just for legal compliance but to build the confidence needed for investment and innovation. Industry is ready to comply with DSI guidelines, but if the process becomes overly complex, it risks becoming commercially unsustainable. Protecting biodiversity is too urgent to wait—yet ambiguity over who pays what and when could continue stalling investments and slowing the development of new, nature-positive products.

Shaping Practical, Science-Based, Biodiversity Regulations

Another focus at COP16 was creating global indicators measuring biodiversity progress through the Global Biodiversity Framework (GBF). These indicators—focused on land use, pesticide pollution, and harmful subsidies—could impact operations in agriculture, energy, manufacturing, and beyond. Agreements were reached on nearly all indicators, though pesticides and sustainable consumption remain in negotiation. The draft decision was not yet adopted.

For the private sector, the challenge here is one of balance. Regulations on land use, pesticide reduction, and subsidies are essential for biodiversity. However, if indicators are negotiated without fully understanding on-the-ground realities, they could hinder industries already working to reduce environmental impacts. For instance, farmers use drones to monitor crop health and apply pesticides precisely, reducing chemical use and minimizing environmental impact. In other cases, agricultural practices are shifting toward regenerative farming techniques that build soil health, enhance biodiversity, and ultimately increase yield. If new indicators do not account for these innovations, we risk misjudging the true impact of technological advancements on biodiversity.

Ensuring Transparent, Scalable Funding Models for Conservation

Funding is always a tricky subject in global negotiations, and COP16 was no different. No consensus was reached on a global financing structure. Our goal is to bridge an estimated $700 billion funding gap to protect biodiversity, aiming to mobilize $200 billion by 2030. Commitments at COP16 totaled just $163 million, and this matter will need to be revisited at an inter-sessional meeting next year. So, what is the path forward? Traditional global tax discussions are unlikely to succeed, and nature’s destruction is unfolding too quickly to allow for drawn-out discussions, which could continue for decades.

Companies need assurance that their contributions directly support impactful biodiversity projects and that new funding mechanisms don’t place an undue burden on the private sector. Innovative solutions are sorely needed. Take the LEAF Coalition, for example, in which governments and companies have already raised $1.5 billion to invest in local communities protecting rainforests and other valuable habitats. To reach the $700 billion goal, we need more initiatives like this. Here, we see firsthand how we can accelerate investing in nature if companies, NGOs, and governments work together.

Bottom Line

Protecting biodiversity is immensely complex work. Engaging in these discussions reveals the many pieces that must align—from government policies and business commitments to community involvement—to move forward in a way that’s ambitious yet achievable.

But we must stay focused. If we continue losing nature at this rate and ignore warning signs, humanity faces severe risks with unavoidable economic repercussions. Recent storms in the U.S., for example, caused damage that even our robust economy struggled to absorb. It’s time to move past old debates and take decisive action to stop pushing ourselves outside the climate comfort zone. By creating policies that are accountable, clear, transparent, and adaptable, we can build a future where economies and ecosystems thrive together.