Carbon Emissions and Biodiversity

As the world continues to discuss efforts to mitigate against climate change, one peculiar phenomenon has been observed: Carbon emissions and biodiversity are often treated as separate priorities. Carbon is calculated, reported, offset and regulated. Biodiversity? Too often it's relegated to a future ambition, or worse a compliance afterthought. This siloed thinking is not just outdated; it can be detrimental to our fight against climate risks.

Case in point, the recently held UN COP16 biodiversity conference in Cali, Colombia achieved important results like the adoption of the ‘Cali Fund’ which mandates companies using DSI from genetic biodiversity resources in their products and research to pay a percentage of their profits into the fund and the allocation of 50% to indigenous communities. COP 16 however saw negotiations on several other important issues like a wider biodiversity development fund and implementing a progress monitoring system for the Kunming-Montreal Global Biodiversity Framework (KMGBF), also known as the Paris agreement for Nature, to halt and reverse nature loss by 2030 suspended.

If governments, businesses and global organisations continue to prioritise decarbonisation while sidelining biodiversity, they risk undermining both climate action and the resilience of the ecosystems they rely on.   Both carbon and biodiversity are interlinked components of our planet’s natural capital (the stocks of natural assets like soil, air, water and living organisms that sustain human and economic life).

In this article, we explore why tackling carbon and biodiversity together is essential, and how integrated reporting and strategy can unlock greater impact, resilience and value.

The Carbon Tunnel Vision: A Problem of Focus

The push for Net Zero has brought significant attention to carbon emissions, and rightly so. Regulatory frameworks like the Corporate Sustainability Reporting Directive (CSRD), investor demands, and global commitments to limit warming to 1.5°C have catalysed an era of emissions accounting and reduction.

But in this carbon-focused race, we’ve developed what experts call “carbon tunnel vision”: the habit of viewing sustainability almost exclusively through a carbon lens. According to a 2023 report from Climate Focus, this narrow framing has led to well-meaning decarbonisation strategies that inadvertently harm biodiversity. For example:

• Monoculture afforestation projects designed for carbon sequestration degrade local habitats.
• Carbon offsetting schemes overlook ecosystem health in pursuit of carbon credits, by trying to squeeze in the numbers of trees to sequester rather than asking will this benefit the entire ecosystem balance in the identified location.

Biodiversity Isn’t Optional Anymore

Biodiversity, a term that encompasses the variety of life on our planet, is the foundation of food systems, water regulation, disease prevention and, crucially, climate stability. Yet despite its critical role, biodiversity is still poorly integrated into corporate sustainability strategies. 

A report from global consulting company McKinsey & Co found that only 5% of Fortune Global 500 companies had disclosed biodiversity impacts or dependencies, even though nearly all are reliant on nature for raw materials, water, or stable operating conditions.

Source: McKinsey & Co 

The evidence is clear:

• Biodiversity supports carbon storage: Species-rich ecosystems like mangroves and peatlands are far more resilient carbon sinks.
• Loss of biodiversity accelerates climate risks: Degraded ecosystems are more vulnerable to floods, droughts and invasive species.
• Nature-positive solutions offer dual wins: Such as rewilding or agroecology, which improve ecosystem health while sequestering carbon.

Organisations that continue to decouple carbon emissions and biodiversity risk falling behind as regulation catches up. The Global Biodiversity Framework (GBF), Taskforce on Nature-related Financial Disclosures (TNFD), and Science Based Targets for Nature (SBTN) demonstrate that we are beginning to acknowledge Nature as the vital asset it is to our health, environment, economy, and in turn business resiliency.

What's Causing the Disconnect Between Carbon Emissions and Biodiversity

It's not because of malice or ignorance that carbon emissions and biodiversity policies are separate but often because of several complex issues. Factors that contribute to the siloing include: 

1. Different Measurement Systems 
   Carbon is relatively straightforward to measure. It's usually reported in tonnes of CO₂-equivalent and tracked through supply chain and operational data. Biodiversity, on the other hand, is much more complex. It varies by region, ecosystem, and species, and there’s no single number that captures it all. This makes it harder to fit biodiversity into reporting systems originally built for carbon.
2. Fragmented Teams and Responsibilities
   Carbon tends to fall under climate or energy teams. Biodiversity often sits with CSR, land management, or health and safety departments. Without clear coordination across teams, biodiversity risks and opportunities can fall through the cracks and remain disconnected from wider sustainability efforts.
3. Business Incentives Favour Carbon
   Decarbonisation brings quicker rewards such as lower energy bills, regulatory benefits, and reputational improvement. Biodiversity, while essential for long-term value and resilience, is harder to quantify and therefore harder to dig out the monetary gains. This misalignment makes it less visible in business decision-making.
4. Slower Policy Development
   Carbon has had well-established targets and frameworks in place for years. Biodiversity has been slower to catch up, with fewer clear rules or expectations. However, this is changing quickly with the rise of frameworks like the TNFD, Natural Capital approaches, and new national strategies that aim to stop nature loss. Biodiversity reporting is finally gaining momentum.

The Business Case for a Holistic View

The good news is that integrating carbon and biodiversity can deliver much greater value than managing them separately. Companies that take a nature-positive, climate-aligned approach can benefit in several ways:

Stronger Risk Management

Ecosystem degradation is already contributing to challenges like water scarcity, which can disrupt supply chains and reduce site-level effectiveness. A combined carbon and biodiversity strategy helps identify these links, protect natural capital, and reduce overall risk.

Improved Regulatory Alignment

Bringing carbon and biodiversity reporting together helps businesses stay ahead of emerging regulations. This includes frameworks like the Corporate Sustainability Reporting Directive (CSRD), which increasingly expect integrated disclosures across climate and nature.

New Market Opportunities and Incentives

Nature-based solutions and regenerative business models are opening access to new funding, partnerships and income streams. This is particularly relevant in sectors such as agriculture, construction and forestry. Demonstrating positive impacts on natural capital can also help attract sustainability-linked financing.

Greater Resilience and Long-Term Impact

Projects that consider both carbon and biodiversity, such as mixed-species reforestation or wetland restoration, are more likely to deliver lasting environmental and social benefits. These integrated approaches support the health of natural capital, improve resilience, and contribute to long-term sustainability goals.

Practical Steps to Break the Silo

Moving from separate carbon and biodiversity goals to a truly integrated sustainability approach requires a strategic approach with cross functional collaborations. Here’s where companies can start:

1. Map Nature Dependencies and Impacts
   Use double materiality and site-level assessments to understand where your operations depend on or impact nature. This includes water, land use, pollination, and soil health.
2. Adopt Integrated Reporting Frameworks
   Align your reporting with frameworks like TNFD, CSRD (ESRS E4), and SBTN. These frameworks encourage cross-cutting insights between climate and nature data.
3. Build Interdisciplinary Teams
   Bring together biodiversity specialists, carbon experts, ESG leads and procurement to co-develop solutions and investment cases.
4. Design Joint Interventions
   Prioritise interventions that deliver both emissions reductions and biodiversity gains such as natural capital, nature-based solutions, habitat restoration or circular material flows.
5. Engage in Sector-Wide Collaboration
   Join sectoral coalitions such as the Business for Nature coalition, the Nature Positive Initiative, Science-Based Targets for Nature Network, or We Value Nature campaign, to accelerate knowledge sharing and standard-setting.
6. Work with Trusted Partners
   You can partner with trusted scientific and sustainability specialists who understand how to measure and manage both carbon emissions and biodiversity at site and value chain level.

The Bottom Line

It’s long time we as a society moved past the carbon tunnel vision. Climate goals cannot be achieved without thriving ecosystems, and biodiversity cannot be protected in a warming, unstable climate. Addressing carbon emissions and biodiversity together is the strategic path to take. If you’re exploring ways to align your carbon management strategy with your biodiversity management, book a free consultation below.