03/12/2020 11:49
Businesses worldwide have a critical role to play in addressing the inherent, existential risks of biodiversity loss. Yet, 23% of companies worldwide at risk from the loss of biodiversity are currently disclosing that risk in their corporate reporting, according to The Time has Come, KPMG International’s Survey of Sustainability Reporting 2020.
While it is notable that 80% of the world’s 250 largest companies now report on sustainability, biodiversity-related risk remains significantly under-reported by the global business community.
28% of at-risk companies currently disclose biodiversity-related risks. The survey revealed that this is despite repeated warnings about destruction of ecosystems and potentially dire consequences for people and the economy. Mining is the only industry sector, according to the survey, in which a slim majority (51%) of companies currently report biodiversity-related risks.
Latin American companies are the most likely to report biodiversity-related risk (31%), while North American companies are the least likely (13%).
Furthermore, the survey found that the two UN Sustainable Development Goals (SDGs) focused on addressing the global biodiversity challenge (SDG 14 - Life Below Water and SDG15 - Life on Land) are the least prioritised of all the 17 SDGs by businesses worldwide.
Richard Threlfall, Global Head of KPMG IMPACT, said: “Businesses have a responsibility to play their part in helping address the crisis of biodiversity loss, and a first step in doing so is recognising that their supply chains are highly dependent on nature and ecosystem services. It is critical for all businesses to disclose the risks that biodiversity loss poses to their companies, as well as the impact their companies have on ecosystems. Our survey suggests that most companies have a long way to go when it comes to providing a full picture of business risks from biodiversity loss.”
Antonis Bargilly, Board Member at KPMG in Cyprus said: “It is definitely worrying that loss of biodiversity is not a material issue for the majority of companies worldwide. Putting this matter in the Cyprus perspective however, where the size of the economy is small and there is lack of a comprehensive legal framework governing mitigation of these risks, this is just an item in a long list of initiatives that are yet to take off. Nevertheless, the results of this report indicate that the Cypriot companies disclosing non-financial risks have almost doubled since 2017. Despite the various reasons for this, an important progress is recorded, giving hope for further progress in the years to come. KPMG in Cyprus is at the forefront, assisting clients report their non-financial disclosures and maintain a functional sustainability strategy.”
Further key findings from the KPMG Survey of Sustainability Reporting 2020 include:
- North America has the highest regional reporting rate ─ 90% of North American companies report on sustainability
- 65% of reporting companies worldwide now have targets in place to reduce their carbon emissions
- 69% of reporting companies now connect their business activities with the UN SDGs in their corporate reporting, but few (14%) disclose how they contribute to the global problems the SDGs seek to solve
- The SDGs most often prioritised by businesses worldwide are SDG 8 -Decent Work and Economic Growth, SDG 13 -Climate Action and SDG 12 -Responsible Consumption & Production.
About the survey
This research was conducted in 2020 by climate change and sustainability professionals at KPMG firms. They reviewed corporate reporting from the 5.200 largest companies by revenue across 52 different countries and jurisdictions including the world’s 250 largest companies, as defined by the Fortune Global 500 ranking for 2019. Reporting included annual financial or integrated reports, sustainability reports, stand-alone reports and company websites published between 1 July 2019 and 30 June 2020. This is the 11th edition of the KPMG Survey of Sustainability Reporting, which was first published in 1993.
This research has been conducted by KPMG IMPACT, a newly-established initiative of KPMG International. KPMG IMPACT brings together professionals and subject matter experts from across KPMG’s global organisation to support the delivery of the UN SDGs.