As we are heading to this year’s COP 29 climate submit, the recently concluded COP16 marked another significant step in the global biodiversity agenda. With new commitments and frameworks emerging, companies around the world are paying close attention to the implications these have on policy, compliance, and investment opportunities.
This year’s COP16 at Cali, Colombia, has attracted more than 23,000 delegates to the event from Oct 21 to Nov 1, 2024. By the summit’s end on November 2, 44 out of 196 parties had produced new NBSAPs(countries with new biodiversity pledges).
This means emerging biodiversity-related policies could be higher up on the regulatory agendas for these pledged countries such as the EU Regulation on Deforestation-free Products (EUDR, though the compliance deadlines have been postponed for another 12 months, making the law applicable on December 30, 2025 for large companies and June 30, 2026 for micro- and small enterprises.).
From Carbon Brief
COP16 brought critical advances in biodiversity governance, with significant implications for businesses and investors across multiple sectors. Here’s a summary of the major takeaways and their potential impacts:
I. Marine Conservation:
COP16 advanced protections for critical marine areas, emphasising science-driven conservation in international waters.
Marine-based businesses (fishing, shipping, tourism) may face stricter regulations around resource extraction and pollution. Companies can invest in sustainable practices like habitat restoration and marine-friendly tourism. Investors will likely have new avenues in sustainable aquaculture, innovative fishing technology, and marine conservation, all of which could gain traction in ESG-focused portfolios.
According to Morningstar's latest studies on the global top 20 biodiversity-themed funds, these funds have a significantly higher allocation in industrials and materials sectors, averaging three times the global market benchmark, making them more sensitive to economic cycles. Although they are relatively underweight in information technology, this sector still represents a substantial portion, while they have minimal exposure to the energy sector.
II. Digital Sequence Information (DSI) and the Cali Fund:
Potential compliance for biotech and pharma. The establishment of the Cali Fund to support benefit-sharing from DSI underscores the need for fair distribution of resources derived from genetic data, though final guidelines are pending.
Biotech and pharmaceutical companies, heavy users of genetic data, may need to comply with evolving DSI benefit-sharing standards to avoid reputational or regulatory risks.
However, Efforts to regulate digital genetic sequences remain unresolved due to opposition from biopharmaceutical companies and major corporations, and operative decisions postponed to the next summit in 2026 (COP17). These entities resist paying for genetic data, which they often access freely online and use in biotechnology, without financial obligations toward its sources. This lack of consensus on who should bear the cost—whether multinationals, larger companies, or others—led to disagreements that were not resolved at COP16.
III. Financing Biodiversity:
While COP16 aimed to establish a biodiversity finance fund, disagreements delayed its launch. If approved, this fund would direct resources into biodiversity projects globally.
Green bonds, sustainability-linked loans, and biodiversity-focused funds may gain prominence, allowing financial institutions to support biodiversity while catering to growing sustainable finance demand.
Forestry, agriculture, and natural resources companies may need to meet biodiversity compliance standards to qualify for future funding, positioning them for favourable financing terms.
IV. Accountability and the GBF Monitoring Framework:
COP16 emphasized accountability in biodiversity reporting, with a focus on national strategies and community-based monitoring.
Firms operating in GBF-committed countries* might need to align with national biodiversity metrics. Location or community-based monitoring could foster collaboration, particularly in industries like forestry, agriculture, and tourism.
Strengthened accountability measures by reporting on international biodiversity standards like TNFD may prompt ESG-focused businesses to integrate biodiversity goals into their reporting frameworks, enhancing investor appeal and preparing for future compliance.
* The Kunming-Montreal Global Biodiversity Framework (GBF) was adopted in December 2022 at COP15 by the 196 parties to the Convention on Biological Diversity (CBD).
V. Indigenous-Led Conservation:
COP16 solidified the Indigenous Peoples and Local Communities’ (IPLCs) role in biodiversity policy, creating a dedicated body for Indigenous knowledge sharing and conservation. For the first time, Afro-descendant communities were also acknowledged.
Industries like agriculture, natural resources, and ecotourism can benefit by forming partnerships with Indigenous-led projects, gaining sustainable insights and improving local relations. Supporting IPLC initiatives may also enhance brand reputation and access to biodiversity-aligned financing.
Looking Ahead
COP16 urges businesses to partner with Indigenous-led projects, adopt sustainable practices in marine industries, comply with evolving DSI benefit-sharing standards in biotech, and leverage biodiversity-focused financial instruments. Forestry, agriculture, and related sectors should align with biodiversity standards, while all industries can expect greater transparency requirements under the GBF monitoring framework. Aligning with biodiversity initiatives, from Indigenous conservation to marine and genetic resource management, offers competitive advantages, access to new funding, and a stronger market presence.
COP16’s outcomes will likely intensify supply chain compliance expectations, especially for companies operating in biodiversity-sensitive sectors. With the Global Biodiversity Framework (GBF) pushing for ecosystem protection and resource sustainability, businesses in industries like agriculture, forestry, and natural resources may face new requirements to track and report biodiversity impacts across their supply chains.
Read more about TNFD and our top tips for measuring biodiversity impact and setting biodiversity targets here:
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For an overview of international actions on biodiversity, methods for measuring biodiversity for companies and assets, and the latest recommendations from the TNFD for reporting on biodiversity, please visit this link
For highlights of sector exposures to nature loss and their dependence on nature and the UN’s “30 by 30” biodiversity targets, and more biodiversity insights for investors, please visit this link
• • Contact us if you would like to discover more topics in nature and biodiversity, targeted research is also available. For example, this report discusses the importance of the "Blue Economy" and "Water Footprint" as Key Performance Indicators (KPIs) for asset managers, highlighting the role of water resources management, water risks management, and the potential financial impacts of water risks. Read more here: Link