Biodiversity determines the capacity of an environment to mitigate and adapt to the effects of climate change, according to climate experts at Zurich Insurance Group.

The group’s fifth annual Climate Change Scorecard also suggests that voluntary carbon markets have a much greater potential for positive impact on climate change if they factor in biodiversity.

In 2022, the world is further from its goal to keep global temperature rise below 2°C than in previous years, the report’s authors contend, adding that governments are putting on hold their energy transition plans as a result of Russia’s invasion of Ukraine.

Stephan Van Vliet, group chief investment officer, said: “Nature-based solutions can provide significant amount of the emission reductions needed to keep global temperature increases under 2°C, though this would require investment to triple. As a large investor and global risk manager – and a founding member of the Net-Zero Asset Owner Alliance and Insurance Alliance – we want to see the development of a robust and credible voluntary carbon market. Incorporating a metric on the wider impact of projects on nature can be supportive as there are huge potential benefits for nature and society in supporting nature-based carbon sequestration projects that also enhance biodiversity.”

Alison Martin, CEO EMEA and Bank Distribution, added: “Business, governments, scientists and NGOs need to collaborate to fast-track the development of a globally agreed biodiversity metric that can be readily integrated into carbon projects. This is key to transforming the voluntary carbon market into a driver of positive outcome for biodiversity and to further operationalise the link between carbon offset projects and biodiversity.”

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