Contributions of the private sector to global biodiversity protection: case study of the Fortune 500 companies

Figures & data

Table 1. Assessment of primary and utility sectors' biodiversity policy

Sectors	Subsectors	No. of companies per sector	Percentage of companies among Fortune 500	Percentage of companies with biodiversity policies	Impact on biodiversity level and objectives to adopt specific policies on biodiversity
Primary industries	Mining and Crude Oil Production (MCP)	9	1.8	90	The extraction of oil is responsible for the deforestation, degradation, and destruction of lands across the globe. The oil extraction process also releases toxic drilling by-products into local rivers, whereas broken pipelines and leakage result in persistent oil spillage. The construction of roads for accessing remote oil sites opens wild lands to colonists and land developers. Due to these serious impacts created by their production process, 90% MCP companies adopt direct policies on biodiversity protection.
	Petroleum Refining (PR)	10	2.0	70	Gas flaring during oil refining produces highly poisonous chemicals that create severe negative impacts to the biodiversity. To mitigate these impacts, the 70% PR companies adopt direct policies to protect biodiversity and ecosystems.
	Chemicals	17	3.4	52	52% chemicals companies adopt biodiversity protection activities and policies to mitigate impacts on protected species and to reestablish complex ecosystems as their production process/operation is held in mines existing in the sensitive native ecosystems.
	Energy	13	2.6	38.5	While constructing new power plants (greenfield projects), biodiversity level gets hampered and sometimes restoration of the forest in a different place is required with necessary relocation of species living in the forest. Thus, 38.5% energy companies adopt biodiversity policies.
	Metals	8	1.6	50	Indigenous forest and its flora and fauna are affected during the mining activities. Rehabilitation of indigenous people from the mining area is also important for the metal industry. After the mining, site restoration plays a major role in terms of conservation and protection of the biodiversity. Thus, 50% metals companies take up biodiversity policy in their CSR activities.
	Tobacco	2	0.4	0	None among the two tobacco companies have any specific biodiversity policies. But they mention some activities related to wetland protection as tobacco industry's long-term success relies on sustainable sources natural resources, although they do not create significant impact on biodiversity level.
Utilities	Utilities: Gas and Electric	26	5.2	70	During the construction of new power plants for electricity production, biodiversity protection of the local areas is important. Sometimes, restoration of the forest is required with necessary relocation of species living in that forest. Route selection for the gas reserve and distribution is also important, as the routes may be gone through the sensitive areas (e.g., indigenous peoples, rich biodiversity, old growth forest, and conservation units). Thus, 70% utilities companies adopt biodiversity protection policy.

Table 2. Assessment of consumer sectors' biodiversity policy

Sectors	Subsectors	No. of companies per sector	Percentage of companies among Fortune 500	Percentage of companies with biodiversity policies	Impact on biodiversity level and objectives to adopt specific policies on biodiversity
Consumer goods	Food Production (FP)	5	1.0	40	Around 40% companies in the FP sector report clearly about their biodiversity policies. The main objective behind it is to create a sustainable food supply chain.
	Motor Vehicles and Parts (MVP)	15	3.0	18	Only 18% MVP companies have specific biodiversity policies as they do not create much impact on biodiversity level through their operation process.
	Food Consumer Products (FCP)	14	2.8	50	Among the FCP companies, around 50% have policies on biodiversity. The objective is mainly to maintain environment friendly agricultural supply chain.
	Household and Personal Products (HPP)	6	1.2	80	For the HPP companies, around 80% have specific policies related to biodiversity as they consider biodiversity as important environmental indicator for their business operations.
	Beverages	6	1.2	16	Only 16% beverages companies have policies on biodiversity protection. Although this sector does not create much impact directly on the biodiversity level, the only company in this subsector, that is, Pepsi Bottling, takes up biodiversity policy as sustainable agriculture principles.
	Forest and Paper Products (FPP)	3	0.6	100	All three companies in the FPP sector have specific biodiversity policies and they take up different certification, that is, FSC, as the major Fortune 500 companies in the US look for biodiversity certified companies in the supply chain for their paper procurement policy.
	Miscellaneous	3	0.6	33	Only one company, 3M, mentions its biodiversity policy as its objective is to preserve and enhance biodiversity as an important part of its environmental sustainability strategy.
	Apparel	4	0.8	0	No company has biodiversity policy as their business process does not create any direct impact on biodiversity level.
	Home Equipment and Furnishings (HEF)	3	0.6	0	Biodiversity policy not adopted.
	Building Materials and Glass (BMG)	2	0.4	50	Only one of two companies, Owens Corning, has biodiversity policy. The objective is to take care of environmental damage including biodiversity loss and stressed vegetation while evaluating potential properties and operations for acquisition purposes.
	Toys and Sporting Goods (TSG)	1	0.2	100	Here, only Fortune 500 company Mattel has biodiversity policy regarding their paper procurement process in the supply chain.
	Furniture	1	0.2	0	Biodiversity policy not adopted.
Consumer services	General Merchandisers (GM)	10	2.0	0	Biodiversity policy not adopted.
	Specialty Retailers (SR)	24	4.8	8.3	Only 8.3% companies have biodiversity policies, mainly related to forestry policy and paper and wood procurement policy.
	Food and Drug Stores (FD)	10	2.0	20	Here, 20% companies has biodiversity protection policy related to food standards through research and engagement with the relevant stakeholders in the food.
	Entertainment	6	1.2	33.3	33.3% entertainment companies' reports on biodiversity protection policies as tourism can generate revenue to protect and preserve biodiversity and environment especially in developing countries. Besides preserving the environment, profits have a greater potential to reach local and rural communities compared to other sectors.
	Airlines	7	1.4	0	Biodiversity policy not adopted.
	Mail, Package, and Freight Delivery (MPF)	2	0.4	50	50% (one out of two) companies, that is, FedEx, report on their biodiversity concern and policies, mainly for reforestation.
	Automotive Retailing and Services (ARS)	8	1.6	0	Biodiversity policy not adopted.
	Wholesalers: Diversified (WD)	9	1.8	0	Biodiversity policy not adopted.
	Wholesalers: Food and Grocery (WFG)	4	0.8	0	Biodiversity policy not adopted.
	Packaging and Containers (PC)	7	1.4	0	Biodiversity policy not adopted.
	Food Services (FS)	4	0.8	0	Biodiversity policy not adopted.
	Hotels, Casinos, and Resorts (HCR)	5	1.0	0	Biodiversity policy not adopted.
	Publishing and Printing (PP)	4	0.8	0	Biodiversity policy not adopted.
	Temporary Help (TH)	2	0.4	0	Biodiversity policy not adopted.
	Waste Management (WM)	2	0.4	0	Biodiversity policy not adopted.
	Transportation and logistics (TL)	2	0.4	0	Biodiversity policy not adopted.
	Trucking and Truck Leasing (TTL)	2	0.4	0	Biodiversity policy not adopted.

Table 3. Assessment of industrial sector's biodiversity policy

Sector	Subsectors	No. of companies per sector	Percentage of companies among Fortune 500	Percentage of companies with biodiversity policies	Impact on biodiversity level and objectives to adopt specific policies on biodiversity
Industrials	Aerospace and Defense (AD)	10	2.0	10	One out of 10 companies has a biodiversity policy in its CSR reports that considers only renewable fuel sources that minimize biodiversity impacts.
	Computers and Office Equipment (COE)	8	1.6	37.5	37.5% companies take up biodiversity policy with main emphasis on forest stewardship for their paper procurement.
	Industrial and Farm Equipment (IFE)	13	2.6	7	7% companies take up biodiversity policy considering biodiversity as an important environmental indicators.
	Homebuilders	11	2.2	27.3	27% companies adopt biodiversity policies to show that ecology and biodiversity are considered at the design and planning stage, and to describe how ecology is managed on-site.
	Network and other Communications Equipment (NCE)	6	1.2	33.3	In the coming years, the network will be the key technology enabler to monitor, manage, and reduce environmental impacts and to deliver solutions for energy and resource management, and will apply these solutions for their own operations. Thus, 33.3% companies adopt biodiversity policy.
	Wholesalers: Electronics and Office Equipment (WOE)	7	1.4	0	Biodiversity policy not adopted.
	Semiconductors and Other Electronic Components (SEC)	7	1.4	42.9	Different organic compounds and metals used by the WOE manufacturers have carcinogenic effect and also act as neurotoxicants that can affect biodiversity level and ecosystem severely. To mitigate these impacts, 42.9% companies adopt policy related to biodiversity protection.
	Pipelines	6	1.2	33.3	Pipeline impacts on biodiversity could be measured by many ways. If a hydrocarbon reserve is located inside a ‘sensitive area’ (e.g., indigenous peoples, rich biodiversity, and old growth forest), directional drilling can avoid damage to the sensitive area by drilling laterally as far as possible. To mitigate these impacts, 33.3% companies adopt biodiversity policies.
	Oil and Gas Equipment and Services (OGE)	5	1.0	80	80% companies mention their biodiversity policy and action plan in relation to the sustainable technology and environment protection. Route selection for the oil and gas reserve and distribution is very important in this regard, as the routes may be through the sensitive areas (e.g., indigenous peoples, rich biodiversity, old-growth forest, and conservation units).
	Railroads	4	0.8	0	Biodiversity policy not adopted.
	Electronics and Electrical Equipment (EEE)	4	0.8	0	Biodiversity policy not adopted.
	Medical Products and Equipment (MPE)	5	1.0	40	Two out of five companies (40%) report their biodiversity activities and policies in their CSR reports. The connections between human health and a healthy environment are inseparable. So the objective behind the MPE companies takes up policies on biodiversity.
	Engineering and Construction (EC)	5	1.0	60	60% EC companies report their biodiversity policies mainly for the protection of wildlife habitats and the biodiversity protection as environmental stewardship.
	Scientific, Photo, and Control Equipment (SPC)	3	0.6	33.3	One out of three SPC companies (33.3%), that is, Eastman Kodak, reports on its biodiversity and natural habitat policy for maintaining its environmental stewardship.
	Computer Peripherals (CP)	3	0.6	66.7	66.7% companies with biodiversity policy claim that they have indirect impact on biodiversity, but they also claim to use system approach for environmental sustainability including biodiversity to influence their business.
	Transportation Equipment (TE)	2	0.4	0	Biodiversity policy not adopted.
	Real Estate (RE)	2	0.4	0	Biodiversity policy not adopted.

Table 4. Assessment of service sector's biodiversity policy

Sectors	Subsectors	No. of companies per sector	Percentage of companies among Fortune 500	Percentage of companies with biodiversity policies	Impact on biodiversity level and objectives to adopt specific policies on biodiversity
Health care	Wholesalers: Health Care (WHC)	5	1.0	0	Biodiversity policy not adopted.
	Pharmaceuticals	9	1.8	67	67% major pharmaceuticals companies including Pfizer and Wyeth (now Pfizer) mention their biodiversity protection policies under their water policy. These corporations are undergoing research in the rainforests for a variety of reasons. There is a great deal of pharmaceuticals research going on in the laboratories of these particular companies; only 1% of all known plant and animal life have been examined for their medicinal potentials. So the main objective behind adopting biodiversity policy is to discover new drugs to treat human diseases worldwide.
	Health Care: Insurance and Managed Care (HIM)	7	1.4	0	Biodiversity policy not adopted.
	Health Care: Pharmacy and Other Services (HPO)	5	1.0	0	Biodiversity policy not adopted.
	Health Care: Medical Facilities (HMF)	6	1.2	0	Biodiversity policy not adopted.
Financials	Diversified Financials (DF)	9	1.8	33.3	33.3% DF companies have biodiversity policy as their environmental liability, although they do not create any impact on biodiversity directly.
	Commercial Banks (CB)	21	4.2	23.8	The CB may not have direct policy for biodiversity or ecosystem protection policies, but for their paper procurement policy in the supply chain, they mentioned their biodiversity and forest conservation.
	Insurance: P & C (stock) (IPCS)	18	3.6	5.6	5.6% (18) IPC companies have policies on biodiversity mainly as their part of environmental stewardship, as their business process does not create any direct impact on biodiversity level.
	Securities	7	1.4	83	Five out of six securities companies report their biodiversity consciousness and policies in their CSR or sustainability reports, mainly for their major service related to the market-based solutions to environmental issues.
	Insurance: Life and Health (stock) (ILHS)	10	2.0	20	No but only 20% ILHS companies have policies on biodiversity as a part of environmental stewardship, but their business process does not create any direct impact on biodiversity level.
	Insurance: Life and Health (mutual) (ILHM)	8	1.6	0	Biodiversity policy not adopted.
	Insurance: P & C (mutual) (IPCM)	2	0.4	50	50% companies mention their biodiversity and ecosystem protection concerns in their environmental responsibility section of CSR, although their business process does not have any direct impact on biodiversity level.
	Savings Institutions (SI)	2	0.4	0	Biodiversity policy not adopted.
	Financial Data Services (FDS)	4	0.8	0	Biodiversity policy not adopted.
Technology and business service	Advertising and Marketing (AM)	2	0.4	0	Biodiversity policy not adopted.
	Telecommunications	13	2.6	0	Biodiversity policy not adopted.
	Computer Software (CS)	2	0.4	0	Biodiversity policy not adopted.
	Information Technology Services (ITS)	5	1.0	20	20% ITS companies mention their biodiversity policy, mainly in their forest policy. Their business process does not create any direct impact on biodiversity level.
	Internet Services and Retailing (ISR)	6	1.2	16.7	Only 16.7% companies (one out of six), that is, Google, mention their biodiversity concerns and policies as a part of their overall environment concern, but other companies do not have any policy as their business process does not create any impact directly on biodiversity level.
	Diversified Outsourcing (DO)	1	0.2	0	Biodiversity policy not adopted.
	Payroll Services (PS)	1	0.2	0	Biodiversity policy not adopted.

Figure 1. Comparative ranking of revenue and percentage of biodiversity policy acceptance of the Fortune 500 companies. FPP, Forest and Paper Products; MCP, Mining and Crude Oil Production; SCT, Securities; PTR, Petroleum Refining; CP, Computer Peripherals; EC, Engineering and Construction; BMG, Building Materials and Glass; FDC, Financial Data Services; MPF, Mail, Package, and Freight Delivery; WM, Waste Management; FP, Food Production; MPE, Medical Products and Equipment; COE, Computers and Office Equipment; ENT, Entertainment; NCE, Network and Other Communications Equipment; SPC, Scientific, Photo, and Control Equipment; HOM, Homebuilders; WFG, Wholesalers: Food and Grocery; FS, Food Services; ISH, Insurance: Life, Health (stock); BVR, Beverages; AD, Aerospace and Defense; IFE, Industrial and Farm Equipment; ADM, Advertising, Marketing; APP, Apparel; CSS, Computer Software; EEE, Electronics and Electrical Equipment; FRS, Furniture; HIM, Health Care: Insurance and Managed Care; HPO, Health Care: Pharmacy and Other Services; INL, Insurance: Life, Health (mutual); RAL, Railroads; SI, Savings Institutions; TH, Temporary Help; TL, Transportation and Logistics; TTL, Trucking and Truck Leasing; WHS, Wholesalers: Health Care.

Figure 2. Comparison between business risk due to biodiversity loss, policy acceptance, and Fortune 500 revenue rank.