Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss. This
is an extract from Finextra's The Future of ESGTech 2022 report.
Like many other SDG topics, the issue of biodiversity and ecosystem preservation is far-reaching and multifarious. Arguably, a key pillar in this story is the preservation of our forests, since they harbour much of the planet’s life. There is no end to the
climate crisis if we do not accelerate afforestation.
Despite this fact, we are living through a deforestation epidemic. In 2020, the tropics
lost 12.2 million hectares of forest cover. Loses of humid tropical primary forests – which are hotspots for biodiversity, home to indigenous communities and vital in halting climate breakdown –
accounted for 4.2 million hectares. As long as these natural environments, the world’s greatest carbon sinks, are not valued in our financial system, they will continue to be destroyed.
The financial sector, informed by ESG data, can play a starring role in reversing deforestation. Enter fintech firm, Sylvera, a technology firm that plugs a biodiversity data gap by putting boots on the ground in remote tropical forests, capturing satellite
data, and working with proprietary ML models. This work enables the company to measure forest environments in three-dimensional detail – from the ground up. The learnings are then compiled to provide carbon offset buyers with a mechanism to compare project
quality and performance across several different criteria. This ESG data has the potential to catalyse billions of dollars of investment into ecosystem restoration.
There are other fintech firms hard at work preserving our forests and lands by mining meaningful information from the land. Treeconomy, for instance, uses satellite and
Light Detection and Ranging (LiDAR)-derived data to measure a woodland’s ecosystem services – providing an additional layer of granularity to carbon offset volume and natural capital calculations. Fintech
start-up, Mantle Labs, meanwhile, deploys
earth observation and AI technology to provide a risk assessment solution for banks and insurance companies to manage their agriculture portfolios.
Although considered the trickiest of all environmental metrics to measure, biodiversity is attracting the planet’s best intellectual capital. With satellite and LiDAR data as a starting point, we have at our disposal the information needed to compare project
quality and performance, and deliver on the 15th SDG, Life on Land.
ACTION FOR 2022: Use technology to plug biodiversity data gaps, and enable accurate comparisons of carbon offsets for afforestation.