Press Conference: New data reveals nature loss could put millions of jobs in Europe at risk, UN Convention on Biodiversity - COP 17

Hello. Thank you very, very much for coming to this Global Canopy press conference. My name is Darren McKenzie. I'm the head of communications at Global Canopy. And alongside me is my colleague Claudia Gray, who is our director of nature-related finance. Global Canopy is a data-driven nonprofit delivering transparency and accountability for market impacts on nature and on people. And what we're here to do today, to do, is to reveal the latest data from the Encore Insights Country Dashboard, which shows that tens of millions of jobs across the EU, the UK, and Switzerland could be at risk from nature loss and nature degradation. The Encore Insights Country Dashboard provides quantitative data revealing how far countries' economies could be impacted from nature loss and nature degradation, and we find that it can put jobs at risk, it can threaten exports, and it can put real pressure on standards of living. And that's very simply because nature is the foundation of our economies. Jobs depend upon nature, products depend upon nature, infrastructure depends upon nature, environmental protection depends upon nature. What this latest tranche of data does is it goes into granular detail about employment, about exports and about living standards and how they can be impacted by nature loss and nature degradation. And we'll also bring some sort of tangible examples of how our data shows these things. So, Claudia, give us the top lines.

Afternoon, everyone. My name is Claudia Gray. As Darren said, I'm the director of nature-related finance at Global Canopy. So we know that people are really concerned about the effect of AI and global insecurity on their jobs and their livelihoods. They may be overlooking how important nature degradation is to economic stability. We found that 140 million jobs just across the EU, UK, and Switzerland could be put at risk or disrupted due to nature degradation. That's 60% of the workforce, 60%. It's a massive number, it's a scary number, and it really underpins how urgent the need for action is. We also found that 8.2 trillion euros worth of goods and services consumed in the EU, UK, and Switzerland could be also put at risk by nature degradation. That will lead to price shocks, it will lead to inflation, and the countries that are highly dependent on imports are going to be particularly put at risk. We also found that 3.5 trillion worth of exports from these countries could be at risk. That will be because production processes within the countries are disrupted by floods, by droughts, by soil erosion, by the loss of pollination. I'll just explain quickly how we arrived at the data. We combined two data sets, firstly, ENCORE, which gives the information on how economic sectors depend on nature, and secondly, ExioBase, which gives insights into the supply chain and the amounts of goods and services flowing into and out of countries in the EU and actually worldwide. By combining those two data sets, we were able to quantify economic dependencies on nature for a wide range of different economic subsectors in each country. We quantify the economic values and the jobs at risk in every sector in all of these countries, and we split the data by origin. So are risks arising domestically from ecosystems within the countries, or are they arising via imports from ecosystems at risk overseas? We also split the data by destination. So ultimately, are those goods and services being used within the country or are they being exported? And that breakdown is really important for policymakers at national level and for central banks to understand how and where they need to act to address nature loss. So our data covers all countries in the EU, UK, and Switzerland. We intend to extend it for international coverage, but we'll just look at some examples first. So in Spain, we found that 31 billion worth of agricultural domestic production could be put at risk, and that relates to 14 billion worth of agricultural exports. 600,000 jobs in the Spanish agricultural sector highly exposed to nature loss. One example is the production of strawberries. So we know that in 2023 and 2024, strawberries in particular regions within Spain suffered a 9% yield loss due to reductions in water availability alone. In Hungary, about half of the energy supply is reliant on nuclear power plant. This year, for the first time, nuclear power plant had to close. hasn't had to do so in 44 years, just due to drought and the lack of water for cooling the power plant. We found that 1 billion worth of production in the energy sector in Hungary would be at risk from nature loss. In the UK, 17 billion euros worth of domestic production is exposed to nature loss, translating to about 320,000 jobs. One of the factors feeding into the risks for the agricultural sector from nature degradation is the soil asset stripping. So, for example, for wheat production, over the last 50 years, yields have increased from two to 10 tons per hectare, but those yields are now plateauing. The nutrients in the soils have been degraded, and we're already seeing across Europe the financial implications of nature degradation. The UK imports 40% of its food. We cannot afford for agricultural production to be at risk from nature loss.

So those are just a few examples that we can bring you. What the data does is it looks into each one of the EU countries, the economies, and then it also looks at the UK and Switzerland. So you can have a look at specific numbers for those countries on the Encore Insights country dashboard website. These numbers are stark, and they need to provide a wake-up call to governments, to regulators, to companies, to financial institutions, and to voters as well, because it is a huge economic mistake not tackling nature loss and nature degradation. The State of Finance for Nature report, which was released earlier this year, finds that for every $1 spent protecting nature, $30 is spent destroying nature. A wave of public and private money is pouring in the wrong direction. And that's something that we have to address. Nature is infrastructure. So allowing nature loss and allowing nature degradation is damaging sort of the foundations of the economy. And what these numbers bear out, what they show, is the scale of our dependence. So in many ways, they're specifically designed for regulators and central banks. So I'll just hand back to Claudia for our call to action, what we want to happen with these numbers, what we want them to make regulators, to make central banks do.

Absolutely. We absolutely see this as part of the wake-up call. Firstly, at a national level, we need governments to give the central banks, to give the financial regulators the mandate to act on nature. And where central banks are already beginning that journey and those assessments, we need to see improvements in the inclusion of nature degradation and ecosystem services in their macroeconomic modeling, and therefore also to inform the way in which they regulate the financial sector, the way in which they supervise. And only then will we see financial sector across Europe and eventually worldwide respond to the systemic risk that is facing us as a result of nature degradation.

Yeah, so I mean, if I If you would like the data, you can scan that QR code and that will take you directly to the Encore Insights country dashboard website. And then you can have a look at sort of country by country data. But the top lines of what we've said, 140 million jobs across EU countries, the UK, and Switzerland could be put at risk by nature loss and nature degradation. Nature loss could reduce the availability and the affordability of 8.2 trillion euros of goods and services. And nature loss could put at risk 3.5 trillion euros of exports each year from the EU countries, the UK, and Switzerland. As I said, these numbers are stark. And, but they don't come out of a vacuum. They are backed up by other reports, by other organizations that shows the scale of the problem that nature loss and nature degradation could cause. So that's all from us. Thank you very, very much. We're more than happy to take Any questions you want to throw at us? Or you can come and have a chat to us afterwards, and we can share more information and more data. Yeah. Thank you.

Do raise your hand if you have any questions. We'll stick around. Go ahead.

Ryu Kosaka from University of Tokyo and was also involved in IPBES.

Sorry, I'm still really struggling to hear.

Hello, can you hear me? Yeah. Okay. Ryu Kosaka from University of Tokyo and was also involved in business and biodiversity assessment at the IPBES. ANKOR is, we have this impression that it's more like sector specific, but this time you use this datasets more for region and countries and also assessing risks to job security. So, i'm sorry, it's a basic question, but the datasets is in Encore, and then you calculated these risks, or how did it work?

So. I'll let Claudia answer sort of the specifics. Yes, the ENCORE database is generally used by companies and financial institutions, but it has also been used by a number of central banks to have a look at the impact and the dependence of their economies on nature. What the ENCORE Insights Country Dashboard is, is it uses part of the ENCORE database, and then adds ExioBase as well. But Claudia, do you want to get into the specifics?

Is your question whether we have spatially adjusted the materiality ratings to each country? The straightforward answer is no. We have used the same global sector averages, and the economic risk measures are tailored for each individual country using ExioBase national statistics. Having said that, we are actively working on the methodologies for spatial adjustment. So there will be more work coming out of the Oncor Partnership later this year that calculates, in the first instance, we've looked at it just for Colombia, Peru, South Africa, and Indonesia, taking the materiality ratings and doing a spatial adjustment. What we would absolutely like to do is see how these figures have the potential scale of jobs, consumption, exports that could be at risk actually relate to risks in the short kind of three to five year time frame, because that data is the next step towards driving the action that we need to see.

Thank you.

Hi, I'm Alison O'Reilly. I'm a researcher from Lund University in Sweden. So thank you very much for giving these slightly scary and stark values. But I was wondering, because you are calling, I guess, on sort of an economic reform from government and regulatory bodies, but I was wondering if there's anything you would call on the academic community, what we could continue to do to kind of help push this maybe from a different aspect.

Excellent question, thank you. So many things, but I think one of the really critical ones is quantifying the economic impacts of dependencies and also particularly the full transmission chain. So there are very sparse quantified studies that have been done with academic rigor on how nature loss translates to a hazard to a company balance sheet, through to the impacts on financial institutions, and then ultimately the economic impact. So one example that we do know of is in New Zealand, where Cyclone Gabrielle in 2023 hit areas that had been converted to monocrop plantations. As a result of that, the natural ecosystem that would mitigate flooding had been removed. The presence of logs also means when rainfall comes through, it clogs up the rivers, it increases the flood risk further. There was, I think, over 2 billion worth of insurance payout in New Zealand dollars as a result of the flooding, and it translated into a 0.3% increase in inflation. So that kind of, the studies on that full transmission chain. are really crucial. Also, just the earliest stages of that chain where we're quantifying the economic impacts of dependencies at the company level, the evidence base at the company level is not as strong as it needs to be. We need that evidence base to power up these spatially explicit examples of dependencies within on-call, which is like the starter motor for the financial sector to respond. Thank you.

Any more questions? As I say, you can also reach out to us straight. Thank you. You can also reach out to us after the press conference. We're happy to have a conversation or have a look at the data and then come back to us at Global Canopy. And we're always happy to talk about our data and our methodology and how we get to it, and then what that means, what the practical impact of our data is. So thank you very much for your time.