Stakeholders disagreed on whether the "sector agnostic" ESRS E4 on Biodiversity and Ecosystems should apply to all sectors or whether it should only apply to high-impact sectors, during an EFRAG outreach event on the draft standards.
For Paul Schreiber, a campaigner on the regulation of financial institutions at Reclaim Finance, biodiversity data is too hard to compile, so a first step should be to focus on "high impact activities that we know are directly related to biodiversity loss or deforestation".
He took intensive livestock farming in South America as an example of such industry, acknowledging that a sector specific approach isn't a perfect solution but a necessary one in the short term.
However Jean-Francois Coppenolle, investment director on ESG at Abeille Assurances, and Philippe Diaz, project manager sustainable finance at the World Wide Fund for Nature (WWF), both beleive that biodiversity disclosures should apply to all industries.
Coppenolle said biodiversity loss was as important a topic as climate change and therefore needed to remain a topical standard rather than sector specific.
Diaz agreed with Schrieber that some sectors had a more substantial impact on biodiversity than others but that it would be very difficult to draw the line. He used the examples of the railway and restaurant industries, whose value chains both contribute to biodiversity loss, as examples.
He argued that it should therefore remain a topical standard, and companies can decide not to report on it when not material to them, under the rebuttable presumption provision in the standards – another heavily debated aspect of the ESRS.
"The principal assumption should be that biodiversity loss is happening not just in Brazil, not just in the Congo Basin, but also here (Europe), there's ecosystem loss as well," Diaz concluded.
