The natural world plays a crucial role in many of the sectors that dominate the economies of Latin America, from forestry products and fishing, to mining and agriculture. In the first of two features, we look at the Latin American experience and how businesses are starting to take a nature-first approach.
Colombia is recognized as one of the most biodiverse countries in the world, with an estimated 10% of the planet’s species living within its borders. As a result, says Dora Moncada, director of the National Center for Water and Biodiversity, part of the National Business Association of Colombia (ANDI): “Biodiversity constitutes a fundamental engine of the national economy; people understand that nature is essential for the continuity, resilience and long-term outlook of the economy.”
ANDI is a non-profit organization whose role includes working with businesses and encouraging them to see nature as an opportunity.
“Colombian companies are starting to recognize that embedding nature in their business strategy makes them more resilient to the impacts of climate change and biodiversity loss,” explains Moncada. “In a country like Colombia, where the economy is largely agro-industrial, such resilience translates into the viability and sustainability of businesses, as well as their value and supply chains.
“In addition, working with a nature strategy creates key opportunities, opening new markets, improving access to finance and strengthening corporate reputation among stakeholders.”
It is a similar story in Chile, says Alejandra Arochas, project lead for the Business Biodiversity Action Plan at Acción Empresas, a non-profit that works with over 120 Chilean businesses around sustainability.
Chilean companies are starting to act on nature and manage their impacts and dependencies on biodiversity, she explains. Several are now working on developing nature strategies as part of actions proposed in Chile’s Business Biodiversity Action Plan, which recommends frameworks such as the Taskforce on Nature-related Financial Disclosures’ (TNFD) assessment. Others are also conscious that addressing nature can help them to get ahead of the curve when it comes to anticipating new regulations and influencing emerging policies – positioning themselves to be viewed more favourably and better evaluated by investors.
“Chile’s changing climate has already caused multiple consequences, motivating companies to move forward on adaptation,” says Arochas, with some incorporating nature into their climate strategies too.
Nature-first approaches in energy and forestry
Colbún is Chile’s second largest power generator, producing energy from a range of renewable resources, from solar and wind, to hydroelectric. “We rely on natural systems to produce energy, so nature is essential for our long-term viability,” says Lorena Carvallo, the company’s deputy environmental manager.
Colbún has developed a business strategy that puts nature and biodiversity first, including a blueprint for building new facilities that ensures the company doesn’t impact environmentally sensitive areas.
“It’s a nature-first approach,” says Carvallo. “It’s all about minimizing our impacts and ensuring projects don’t have a negative effect on local biodiversity.”
So when Colbún discovered that a rare sea bird, the Golondrina de mar, or sea swallow, nested close to a new solar and battery plant it was developing in Arica in northern Chile, it designated nearly half the site as a protected area to prevent disturbing the bird and its habitat.
It’s this respect for nature that also builds trust with local communities and helps gain their approval for new facilities, continues Carvallo. “Issues such as environmental stewardship and nature-positive actions are increasingly important to communities and authorities. That’s why we are transparent with the impacts we have and what we are doing to mitigate and avoid them”.
Beyond individual projects, Colbún is institutionalizing this approach by adopting the TNFD framework. By integrating these standards, the company is systematically evaluating its dependencies, risks, and opportunities associated with the natural world.
Arauco is a global forestry product company based in Chile that also recognizes its reliance on a healthy natural environment. “We have a close interaction with nature, and have always understood how connected we are,” explains environmental manager, Juan Anzieta.
Nature is hard-wired into the business model, he says, and for over fifty years the company has run its own research center dedicated to nature and biodiversity. As well as helping to manage their impacts, the center works on issues such as soil health, he continues. “Good soil is crucial for nature; it also means our trees grow stronger, improving productivity – it’s a simple but strategic relationship,” he says.
The majority of Arauco timber is grown on its own estates, all of which have non-cultivated areas left for nature, with natural corridors that connect the plantation with the wider environment. They also focus on protecting the ecosystems services that nature provides, from clean water to the nuts, fruits and mushrooms that grow in the forest and are a larder for wildlife.
A landscape approach is crucial, says Anzieta: “It’s important to look beyond your own operations because your actions can have an impact across a much wider area.
Arauco back this up with its ABC Plus Strategy covering water, biodiversity, carbon and circularity, which says Anzieta, makes the clear link between the climate crisis and nature loss: “It’s part of the triple crisis – contamination, carbon and biodiversity loss.”
Data challenges and pathways forward
There are still barriers, says Arochas, which are making it hard for businesses to include nature in their everyday activities. This is especially true around areas such as aligning with material issues and setting and monitoring measurable targets, which have become important touchpoints for the support that Acción Empresas provides.
Since 2022, the organization has been working with companies on the World Business Council for Sustainable Development’s (WBCSD) ‘Five Key Sustainability Criteria’ initiative, which is being implemented as a pilot initiative in Chile. Nature and biodiversity are one of the criteria and Acción Empresas has been encouraging companies to diagnose their impacts and dependencies on nature, before setting targets to address at least one ‘pressure point’, backed by a commitment to report on progress and make the results publicly available.
“Throughout this work, we have seen that many companies face challenges in evaluating their interactions with nature and identifying dependencies, impacts, risks, and opportunities,” says Arochas.
To help guide companies through the process of creating a corporate nature strategy, that incorporates global trends, Acción Empresas has launched the Acción Empresas It’s Now for Nature Accelerator in Chile, targeting companies in the early stages of developing a nature strategy.
As It’s Now for Nature recently reported in the Pulse: “Methodologies for identifying nature dependencies and opportunities are new and evolving. Many companies struggle with consistent measurement across complex supply and distribution chains, limited traceability and incomplete datasets.” In short, good data remains the number one barrier for companies look to accurately assess their impacts on nature and start to mobilize their actions on nature management.
“You need good data and a good way of measuring things,” says Anzieta, “then you can own your strategy, be open about it, and disclose on it.”
Technology is crucial to data collection at Arauco, with satellites and imaging, environmental analysis and camera traps all helping to measure biodiversity measurements and create an accurate picture of how the business is impacting the environment.
Much of this data is also shared on a public platform: “the more companies collaborate, the better it is for biodiversity,” says Anzieta.
In Colombia, ANDI has worked with the United Nations Development Programme (UNDP) and its Biodiversity Finance Initiative (BIOFIN) to identify the environmental, financial, and business information needed by businesses to calculate the metrics proposed under the Taskforce on Nature-related Financial Disclosure.
This analysis, which prioritized five sectors based on their progress in nature management: electricity services, oil and gas, chemicals, construction materials, and food and agriculture, revealed that of the 291 metrics proposed by TNFD, 211 can be calculated using internal company data, with 80 requiring external data.
“What we found was that existing documents, maps and environmental licensing requirements often already contain sufficient information to include in TNFD reporting,” explains Moncada. Based on this, a dashboard has been developed to help companies identify the most relevant metrics for their sector.
Arochas agrees that a nature strategy can give structure to work that may already be happening in a business, and can be a useful mechanism to guide information communicated to the boardroom around corporate performance on biodiversity, as well as allocating resources, and capturing multiple opportunities. These include improving long-term resilience and sustainability, strengthening reputation and brand value, and accessing new financing and markets that value sustainable practices.
Acción Empresas is also working with businesses to overcome the data issue by creating a set of biodiversity assessments and disclosure metrics that can be adopted nationally.
However, adds Arochas: “The greatest barrier we face is including the financial sector in these issues, this is why we are conducting awareness-raising workshops with the financial sector to help them understand the critical importance of their role in project evaluation and the need to prioritize measurable, nature positive initiatives”
Looking ahead, Carvallo is optimistic that the momentum around nature will continue to grow. “As businesses realize how important nature is, they will change the way they are working and become more committed to taking care of nature and biodiversity,” she says.