Impact Blog
Species extinction - a threat to people and the planet

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      By Yijia Chen, ESG Quantitative Research Analyst, Calvert Research and Management

      Washington - As we recognize Endangered Species Day today, the upcoming 1,500-page United Nations Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) Global Assessment report,1 compiled by hundreds of international experts and based on thousands of scientific studies, again casts light on the decline in biodiversity across the globe and the dangers that creates for human civilization.

      The released summary of the report points out that biodiversity - which includes the diversity within species, between species and of ecosystems - is declining faster than at any time in human history. One million flora and fauna species now face extinction within decades, including 40% of amphibians, almost one-third of reef-building corals, more than one-third of marine mammals and 10% of all insects, according to IPBES.

      Causes of the biodiversity crisis

      The main threats to species extinction are clearly human-related, according to the report. With the world's population exceeding 7 billion, increases in farming, logging, poaching, fishing and mining are threatening native habitats. Over one-third of the world's land and close to 75% of freshwater are now devoted to crops or livestock.2

      Pollution is another major contributor. Plastic pollution has increased more than tenfold since 1980, affecting 86% of marine turtles, 44% of seabirds and 43% of marine mammals. An estimated 300 to 400 million metric tons of heavy metals, toxic slurry and other waste enter the water cycle from industrial facilities every year. Fertilizer solvent has created 400 "dead zones," affecting an area the size of the U.K.

      At the same time, global warming has become a major driver of wildlife decline by shifting or shrinking local climates and habitats. Hardships for species have increased in many ways: Polar bears in the Arctic are losing ice to hunt upon and marine life is suffering from hotter temperatures year-round, depleting oxygen as ocean waters warm.3

      Biodiversity critical to human life

      Preserving biodiversity goes far beyond saving nature for its own sake. The IPBES report shows clear links between biodiversity and concerns like food security, clean water, energy and medicines. For example, more than 75% of global food crop types rely on animal pollination. An estimated 4 billion people rely primarily on natural medicines for their health care. Around 70% of cancer drugs are natural or synthetic products inspired by nature, according to the report.

      The biodiversity crisis means we may be setting ourselves up for a food crisis as well. When pollinators like bees die off, flowering plants will no longer produce new seeds, and fewer varieties and breeds of plants and animals are being cultivated.

      A call to action

      The IPBES report calls on countries to increase measures to restore habitats, devote less land to agriculture, stop illegal logging and fishing, protect marine areas, and stop the flow of heavy metals and wastewater into the environment. It also suggests that countries reduce their subsidies to industries that are harmful to nature, and increase subsidies and funding to environmentally beneficial programs.

      These recommendations align with the Calvert Principles for Responsible Investment, which emphasize environmental sustainability and resource efficiency as part of our framework for evaluating companies for investment. Calvert believes that the consideration of these issues is not only important to the health of the planet, but also supports sustainable economic growth globally.

      Responsible investors can make a difference

      We believe investors can exert influence by driving capital to companies that are leaders in addressing issues like clean water, sanitation, energy and resource efficiency, and curbing greenhouse gas (GHG) emissions.

      Freshwater is critical to preserving biodiversity. Via our Calvert Global Water Index and Global Water Fund, we seek to invest in companies working to address water scarcity, water quality and access to clean water across four key areas:

      • Water utilities and distributors: Companies that responsibly deliver and provide clean water at affordable rates, which we view as essential for economic growth and development.
      • Water technology: Companies with proven or emerging technologies that test, monitor or improve the quality of water, or address the efficient use of water, helping reduce consumption globally.
      • Water infrastructure: Companies that are rehabilitating aging infrastructure or expanding infrastructure in order to deliver clean water to communities and drive economic growth.
      • Solution providers: Companies that are leading their peers in water efficiency and reuse practices in the most water-intensive industries, effectively reduce overall water demand, or companies that offer unique products that are addressing global water challenges.

      As emerging economies industrialize, their growing energy and land requirements can negatively affect the environment and species' habitats. Through the Calvert Global Research Energy Index and Global Energy Solutions Fund, we look to mitigate these types of impacts and identify companies involved in:

      • Renewable-energy sources, which contributes to the growth, innovation and commercial adoption of the solar, wind, biomass, waste-to-energy, geothermal, biofuels, hydropower and landfill gas-recovery industries.
      • Technologies to minimize GHG emissions, provide energy-storage solutions and distribute renewable-energy sources.
      • Energy efficiency, which reduces the need for energy and, thus, GHG emissions.
      • Cleaner modes of transport for cargo and people through electric vehicles, which reduces the global demand for fossil fuels.
      • Solution providers that are leading their peers in reducing energy usage and transitioning away from reliance on fossil fuels toward clean sources of energy.
      Bottom line: Biodiversity plays a critical role in all aspects of life, from food to commerce to medicine. Preserving biodiversity is in our self-interest. Directing capital toward sustainable companies can help preserve the world's intricately linked ecosystems.