Plummeting biodiversity: A wave of mass extinctions is surfacing

• Author:
• Author name

  Quantumrun Foresight
• October 19, 2022

Insight summary

The loss of biodiversity is accelerating, with current rates of species extinction exceeding historical averages by a thousandfold. This crisis, driven by factors like land use changes, pollution, and climate change, poses significant economic threats, costing the global economy trillions in lost natural services. Actions such as stricter environmental legislation, corporate initiatives for biodiversity, and sustainable business practices are increasingly important in mitigating this crisis.

Plummeting biodiversity context

The increasing loss of biodiversity is a global environmental crisis that affects everyone. Meanwhile, considering that most corporations contribute to biodiversity loss, some experts wonder why companies are not more concerned about the crisis’ long-term economic effects. Agricultural practices in the 20th century, such as farming on large expanses of land, mono-cropping, and heavy use of pesticides and fertilizers, have destroyed natural habitats for insects and other wildlife.

For example, approximately 41 percent of the world’s land surface is now used for crops and grazing. In the tropics, natural vegetation is destroyed at an alarming rate and frequently replaced with export crops like oil palm and soybeans. Similarly, many ecosystems are suffering droughts and flooding due to climate change. 

According to the US Proceedings of the National Academy of Sciences (PNAS), most biologists believe the world is experiencing the early stages of a Sixth Major Extinction event, with species disappearing at an alarmingly rapid rate. Scientists can most accurately estimate extinction rates by studying groups of organisms with a long, uninterrupted fossil record, like terrestrial vertebrates and mollusks. Researchers used these references to calculate that over the past 66 million years, Earth has lost roughly 0.1 per million species annually; as of 2022, the rate is around 1,000 times greater. Considering these numbers, scientists estimate that one-fifth of eukaryotes (e.g., animals, plants, and fungi) will disappear within the next few decades.

Disruptive impact

Some scientists point to chemical pollution as one of the main drivers of plummeting biodiversity. However, little research highlights the direct link of different chemicals to the disappearance of large populations of insects. Few chemical effects on biodiversity have been investigated thus far, with the majority focusing on pesticides, while other chemical pollutants have generally been neglected.

As a result, policies are limited. For example, the EU biodiversity strategy includes occasional regulations intended to minimize pesticide pollution, yet it barely discusses any other type of pollutants. These toxic chemicals include heavy metals, volatile air pollutants, and fossil fuels. Another example would be the highly diverse plastic additives and chemicals used in consumer products, food packaging, or pharmaceuticals. Many of these components, alone and in combination, can be deadly to living things.

According to consultancy firm BCG, the biodiversity crisis is a business crisis. The five main reasons for the decline in biodiversity are: change in land and sea utilization, overtaxing of natural resources, climate change, pollution, and invasive species. In addition, the operations of four leading value chains—food, energy, infrastructure, and fashion—currently impact more than 90 percent of human-driven pressure on biodiversity.

This number is particularly influenced by activities involving resource extraction or farming. The decline in ecosystem functionality costs the global economy over USD $5 trillion annually from lost natural services (e.g., food provisioning, carbon storage, and water and air filtration). Finally, the deterioration of the ecosystem poses significant risks for businesses, including higher raw material costs and a consumer and investor backlash.

Implications of plummeting biodiversity

Wider implications of plummeting biodiversity may include: 

• Governments pressuring corporations to advance initiatives related to improving biodiversity; repercussions may include hefty fines and suspension of licenses.
• Progressive governments enacting stricter environmental and biodiversity protection legislation that includes stricter guidelines for managing industrial waste and pollutants.
• Governments creating new and expanding existing protected national parks and wildlife reserves. 
• Increasing interest and investment in beekeeping to assist in pollination and restoration efforts. Likewise, declining bee populations may prompt businesses to partner with agritech firms to develop synthetic or automated pollinator systems. 
• Increasing ethical consumer consumption resulting in companies altering internal procedures and being more transparent in their production processes.
• More businesses voluntarily joining green initiatives and adopting global standards to attract sustainable investments. However, some critics may point out this is a marketing strategy.
• Fashion brands promoting upcycled and circular fashion to reduce the number of chemicals and plastics used in their production processes.

Questions to consider

• How has the loss of biodiversity affected you personally?
• How can governments ensure that businesses do their part in preserving ecosystems?