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Sustainable futures: Focus on ocean health risk horizon

As an increasing number of insurers commit to achieving net zero, our insight examines how they can steer the emissions associated with underwriting to net zero.

Going into the weekend, we had our first day of a two-day event focusing on nature and land use. Awareness was given to the impact climate change is having on our food and farming systems — both land and ocean.

Notably, there was a call for nature-based solutions and global support for the protection of at least 30% of the global ocean by 2030. The main focus was therefore how nature can support climate plans — with action needing to be taken to reform agricultural policy and improve ocean health.

Sir David Attenborough became the voice of Nature, reminding us that “nature is a key ally in bringing back balance to our planet” and we can only tackle the climate challenge by restoring and protecting nature.

The Nature day headline event was “Facing the facts and unpacking forest, agriculture, and commodity trade dialogue to tackle deforestation”. There was a clear call for a global action to transform food chains and make food trade sustainable — how the world produces, consumes, and thinks about food, to trace the agricultural commodities by deploying technology and more importantly acting as a system globally.

The six scientifically proven commodities of which consumption is driving deforestation globally have been announced as, beef, soya, palm oil, wood, cocoa, and coffee. Those will be considered in sustainable forest management and governance inside and outside of EU legislations, in supporting forest-related value chain in sustained production and commodity trade.

On November 2, at COP26, 134 countries signed the Glasgow Leaders’ Declaration on Forests and Land use, which aims to end net forest loss by 2030. Also, 12 leaders committed US$12 billion towards reversing forest loss by 2030. Some 28 countries endorsed the COP26 FACT joint statement.

As outlined in our Ocean Health podcast series, oceans are also critically important for life and the environment, providing 99% of our oxygen. They also play a key role in sequestering CO2. This is due to the activity and balance of marine life. 

Oceans have changed dramatically over the last 70 years, due in large part to the chemical revolution of the 1950s. The synthetic chemicals and materials (namely plastics) produced could not be broken down by nature, and as such have had a profound impact on the marine ecosystem and environment.

These plastics and chemicals are toxic to marine life, and have even affected the ocean’s PH balance. To date, we have lost roughly 50% of all ocean life due to the impact of chemicals and plastics, and the decline continues at a rate of 1% year on year.

Addressing ocean health could significantly impact manufacturing and packaging. It could also drive change through the cosmetic and clean product industries, as adjustments are made in the chemicals we use.

In June 2021, the taskforce for nature-related disclosure (TNFD) was formed to provide a risk management and disclosure framework for nature-related risks.

According to the TNFD, more than half of the world’s economic output is either moderately or highly dependent on nature.

With nature loss representing significant risk to corporate and financial stability, financial institutions need to consider nature-related risks and opportunities in their decision-making.

This blog is part of the COP26 series.

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