Biodiversity litigation – the next frontier of environmental litigation

  • Market Insight 22 December 2021 22 December 2021
  • Global

  • Insurance 2022 - the year ahead

Biodiversity litigation is set to rise as the race to save the world’s natural capital gathers pace.

The biodiversity crisis is imminent; there has been an estimated 58% decline of vertebrate population sizes since 1970 and rates of species extinction are 100 to 1,000 times higher than the natural extinction rate. 2021 was a pivotal year for biodiversity action as commitments were made at significant conferences, with disclosure standards put in place to ensure both climate action and biodiversity restoration.

New initiatives include a new Global Biodiversity Framework that will be adopted at COP15 in May 2022 in China to guide actions worldwide through to 2030 to preserve and protect nature and its essential services to people, a disclosure framework being created by the Taskforce on Nature-related Financial Disclosures, and new biodiversity standards drawn up by the European Financial Reporting Advisory Group and GRI.

Several commitments to protect natural capital were also made by leaders at COP26 including an agreement to end deforestation by 2030. Meanwhile, the New York Stock Exchange and the Intrinsic Exchange Group have established a new asset class, Natural Asset Companies, which will be listed and traded on the exchange to provide funding for the protection of the natural assets they represent. With an increasing number of schemes to protect natural capital, both governments and the private sector will be under pressure to conform to new standards to protect both their financial success and reputation.

The growing number of climate change litigation cases has set the wheels in motion for further biodiversity litigation. In March 2020, indigenous peoples from the Brazilian and Colombian Amazon and NGOs from France and the US filed a lawsuit against French supermarket chain Groupe Casino for selling beef products linked to deforestation and land expropriation. At the beginning of September 2021, two French NGOs Notre Affaire à Tous and POLLINIS commenced the first ever legal action against a state - France - for its alleged failure to protect biodiversity.

Momentum is growing for future biodiversity litigation and corporations may begin to undertake a thorough review of their relationship with natural capital in anticipation of closer scrutiny in the future by not only the public, but also shareholders and other stakeholders, such as banks and insurers.


View all our Insurance 2022 Predictions here


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