Nature-Based Solutions Are the Next Frontier for Corporate Climate Strategy

This blog was coauthored by Liv Gwilliam and Matthew Banks.

Conversations at the 2021 United Nations Climate Change Conference (COP26) highlighted the growing role of nature-based solutions (NbS) in global climate strategies. Companies—particularly those with large land use and agriculture footprints—will be critical stakeholders in advancing NbS as we move into an era of implementation during this decisive decade.

What Are NbS?

NbS encompass a broad range of strategies to address climate change in which both people and nature win real benefits. NbS include actions that protect existing ecosystems, such as forest and wetland conservation; efforts to sustainably manage ecosystems, such as agroforestry and stormwater management; and activities that create new ecosystems, such as green urban infrastructure. 

The Private Sector as a Key NbS Stakeholder

The spotlight was on nature at COP26, with over 130 countries committing to end deforestation and forest degradation by 2030 and strengthening national commitments to sustainable land use and biodiversity. With increasing pressure to address their environmental impact, private sector actors also actively explored the topic. Where NbS were not previously seen as a mainstream corporate climate strategy, companies are now demonstrating leadership by making industry commitments to reduce land-related emissions and scaling up NbS investments. Companies can employ NbS in their climate strategy through carbon insets, offsets, and supply chain engagement. When incorporating NbS as a measure in corporate climate strategy, companies should consider the following:

• Where to start: NbS can play a critical role in addressing Scope 3 emissions in the forestry, land, and agriculture (FLAG) sector, helping companies transition to net zero by 2050. One challenge will be how to develop an effective strategy to start abating FLAG emissions. Before considering NbS, companies can take a phased supply chain approach by ensuring the accuracy and completeness of their Scope 3 footprint. This can involve identifying emissions hotspots within key commodity supply chains, mapping out upstream activities, and engaging with top suppliers to develop activity-specific measures to abate these emissions.

• Ancillary benefits: NbS are not just last-mile solutions to meeting climate goals such as net-zero targets. They have unique attributes that address all three pillars of environmental, social, and governance initiatives. For example, the multinational food and beverage company McCormick & Company has been incorporating NbS into its vanilla supply chain in Madagascar’s Sava region through agroforestry and other good farming practices. In addition to reducing emissions associated with deforestation and forest degradation, this project is improving the livelihoods of 3,000 smallholding farmers and preserving land and biodiversity. Investing in NbS is a powerful signal to stakeholders that companies want to do good for the planet and people.

• Stakeholder consensus: The NbS landscape is evolving for improved clarity, especially for carbon removals, offsets, and insets, but there are still uncertainties about what role they will play in meeting climate goals such as net-zero targets. The good news is that the international community is expected to reach a consensus and scale up NbS quickly. COP26 marked a historic moment as parties came to an agreement on Article 6 of the Paris Agreement, establishing the criteria for an international carbon market. Leading NGOs are also developing knowledge products such as the Science Based Targets initiative FLAG project and the GHG Protocol Land Sector and Removals Guidance for companies with significant FLAG emissions (e.g., food and beverage, retail, and pharmaceutical companies).

As companies continue to advance their climate action journeys, NbS are the next frontier and will likely play an increasing role in helping us mitigate and adapt to climate change. Now is the time for sustainability leaders to take a deeper look into their supply chains around the world where nature-based opportunities are ripe for the picking so that a plan can be established to scale climate protection benefits by 2025.