The Economics of Biodiversity – Can we afford NOT to change our ways?

"Humanity has fabricated the illusion that somehow we can get by without biodiversity or that it is somehow peripheral to our contemporary world: the truth is we need it more than ever on a planet of 6 billion [people], heading to over 9 billion by 2050. Business as usual is no longer an option if we are to avoid irreversible damage to the life-support systems of our planet."

                -Achim Steiner, executive director of the United Nations Environment Programme (UNEP)

There are numerous ethical, health and environmental reasons to be concerned about the ever-diminishing biodiversity on our planet. In addition to these compelling reasons, the economies of the world depend on the availability of diverse natural resources. In the US, at least $3 trillion of our economy is dependent on Earth's species. Below are some of the areas that are most affected by biodiversity and therefore have the potential for the greatest financial consequences:

1. Food

Biodiversity in our food source is critical to producing crops that have the genetic variety to adapt to our changing environment, are resistant to disease, and produce better yields. Numerous insect and animal species can provide biological pest control that is preferable to pesticides. Pollinators are threatened by climate change and are crucial to crop health and reproduction. The economic value of insect pollinators is estimated at $189 billion.

2. Medication

 “There is no question that the templates for most drugs are in the natural world.” (Eloy Rodriguez, Biochemist at Cornell University). Over 50% of our medications come from plant sources, most of them found in rain forests. If we were to lose these diverse ecosystems, prices for medications would be higher, creating a world where the poor are at an even greater health disadvantage with even less access to life-saving resources.

3. Industry

Agriculture, forestry and fisheries all depend on healthy ecosystems to thrive. According to the United Nations, the annual global economic losses due to deforestation and land degradation alone were between $2 trillion and $4.5 trillion in 2008.

4. Tourism and Recreation

Tourism is often a contributor to the environmental changes that cause a loss of biodiversity. At the same time, tourism in most countries stands to experience huge losses without the natural, native beauty upon which the industry is built.

A more direct financial loss can be seen in the changing consumer attitudes towards companies that neglect responsible environmental practices. According to “The Economics of Ecosystems and Biodiversity (TEEB),” 60% of consumers in the U.S. and Europe are aware of biodiversity loss and over 80% say they would stop buying products from companies that disregarded ethical considerations.

What is nature worth?