Biodiversity: From Pledges to Portfolios

Integrating biodiversity into financial decision-making is proving more complex than climate. Institutions face missing or inconsistent data, costly manual reconciliation, and unclear regulatory expectations. Client engagement adds friction: corporates and SMEs often resist detailed questionnaires, citing confidentiality or commercial risk. At the same time, biodiversity dependencies such as soil fertility, pollination, and water scarcity lack a unifying financial metric like climate has with CO2.

The result? Public commitments risk outpacing operational readiness. Without clear metrics and data governance, firms face reputational gaps, slower product innovation, and vulnerability when regulation such as ESRS E4 under CSRD tightens. Yet the same systems that made climate integration possible (data modelling, automated disclosure, and digital assurance) can now accelerate biodiversity action.

Key compliance challenges 

Data integration remains fragmented

Biodiversity indicators exist, but pulling them into governed banking systems is slow and resource-intensive. Analysts spend time cleaning, linking, and reconciling fragmented vendor feeds. Without robust infrastructure, biodiversity insights remain at a qualitative disclosure level.

Lack of financial translation

Dependencies such as pollinator decline or water scarcity do not translate easily into credit or valuation models. This limits integration into core risk processes and balance-sheet decisions.

Regulatory divergence & immature scores

Expectations vary across jurisdictions, and vendor scores remain inconsistent and often sector-level. Institutions hesitate to invest heavily until requirements stabilise, which slows the shift from pilots to production.

Biodiversity Timeline

The biodiversity regulatory landscape is shifting rapidly from voluntary guidance to binding disclosure. This simple timeline shows how expectations evolve:

• Now: Early movers embed biodiversity into ESG data systems and start disclosing.
• Next 2–3 years: Broader groups of financial institutions and corporates fall into scope.
• By 2029: SMEs and non-EU companies join, creating supply-chain pressure across markets.

“Understand when biodiversity reporting will hit you directly and why acting early reduces compliance costs and future rework.”

Key findings of our peer analysis of publicy available sustainability reports

Our peer analysis benchmarks how financial institutions are addressing biodiversity. Few disclose at a granular level today, and many rely heavily on assumptions. Leaders, however, are already aligning data infrastructure with ESG data solutions to capture site- and supplier-level inputs.

This analysis benchmarks biodiversity disclosures across six major financial institutions, providing a systematic overview of how biodiversity considerations are integrated into core organisational functions. Using a 23-point framework, the assessment evaluates institutions’ public disclosures across nine categories, from governance and risk management to investment practices and business opportunities.

The findings highlight clear variation in the maturity and depth of biodiversity integration, revealing that while most institutions have made commitments, these often lack translation into concrete actions or investment strategies. By identifying sectoral frontrunners and common gaps, the analysis supports peer learning and sets the foundation for stronger, more actionable biodiversity disclosures across the financial sector.

• Biodiversity commitments: to different extents, all financial institutions assessed have biodiversity commitments and pledged in place.
• Business opportunities: however, it is rarely evidenced how these commitments translate yet to investment decision-making and business opportunities.
• Key drivers to comply: reputation and peer benchmarking, rather than regulatory requirements, are the principal forces pushing firms to adopt biodiversity targets.
• Future outlook: as biodiversity frameworks continue to evolve and collective ambition grows, financial institutions are expected to strengthen the rigor of their disclosures, laying the groundwork to turn commitments into actionable, investable strategies.