News & Trends

Why functioning ecosystems are so important for the economy

Over half of global GDP depends on a functioning ecosystem. Yet the issue of biodiversity is not given the same weight as climate change – with serious consequences. An index from the Swiss Re Institute is designed to remedy this situation.

What is it about

Ten years ago, the UN member states set themselves almost two dozen targets to preserve and improve biodiversity. By the end of 2020, none of these targets had been achieved. Compared to climate change, the issue seems to be a minor one – even though climate change and biodiversity influence each other. With the index of the Swiss RE Institute, companies and states can include questions of ecological diversity in their economic decisions.

Why this is important

Around 55 percent of global GDP – or US$ 41.7 trillion – is dependent on well-functioning ecosystems. An ecosystem collapse also means an economic collapse. The Swiss RE Institute’s Biodiversity Index provides a global overview of the various ecosystems of the world – and their condition. This helps not only the affected economies, but also companies and private investors.

The Globalance View

Like CO2, the “output” of nature must also have a rising price. Companies that depend on environmental services must contribute to improving biodiversity. In agriculture, for example, this means maintaining and improving soil quality. The Biodiversity Index shows which countries take this issue seriously.

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