Nature Risk Rising Report 2020 Highlights

March 3, 2020
SEBI Grade A Test Series

Nature Risk Rising Report is published by the World Economic Forum in collaboration with PwC. It is the first in a series of reports from the New Nature Economy project. It explains how nature-related risks matter to business, why they must be urgently mainstreamed into risk management strategies and why it is vital to prioritize the protection of nature’s assets and services within the broader global economic growth agenda.

Nature Risk Rising Report

Nature risks become material for businesses in the following three ways:

  1. When businesses depend directly on nature for operations, supply chain performance, real estate asset values, physical security and business continuity
  2. When the direct and indirect impacts of business activities on nature loss can trigger negative consequences, such as losing customers or entire markets, legal action and regulatory changes that affect financial performance
  3. When nature loss causes disruption to society and the markets within which businesses operate, which can manifest as both physical and market risks

Nature Risk Rising Report Highlights

The major highlights of Nature Risk Rising Report are:

  • $44 trillion of economic value generation – more than half of the world’s total GDP – is moderately or highly dependent on nature and its services and is therefore exposed to nature loss
  • Industries that are highly dependent on nature generate 15% of global GDP ($13 trillion), while moderately dependent industries generate 37% ($31 trillion). As nature loses its capacity to provide such services, these sectors could suffer significant losses
  • the three largest sectors that are highly dependent on nature generate close to $8 trillion of gross value added (GVA): construction ($4 trillion); agriculture ($2.5 trillion); and food and beverages ($1.4 trillion). This is roughly twice the size of the German economy
  • six industries – chemicals and materials; aviation, travel and tourism; real estate; mining and metals; supply chain and transport; retail, consumer goods and lifestyle – with less than 15% of their direct GVA highly dependent on nature, still have “hidden dependencies” through their supply chains. More than 50% of the GVA of their supply chains is highly or moderately dependent on nature
  • Around 25% of assessed plant and animal species are threatened by human actions, with a million species facing extinction, many within decades
  • larger economies have the highest absolute amounts of GDP in nature-dependent sectors: $2.7 trillion in China, $2.4 trillion in the EU, and $2.1 trillion in the United States

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