The business world is facing its ultimate stress test: thrive with nature or perish without it. In her article Pechaporn Pornpraipech, IMBA participant at School of Management Fudan University shows restoration isn’t just ethical – it’s the next frontier of competitive advantage, with smart money betting on biodiversity as the cornerstone of 21st century wealth creation

The Business Case for Restoring Nature: A call to action by Pechaporn Pornpraipech.

For more than 200 years since the Industrial Revolution in the late 18th century, industrial-scale exploitation of natural resources has been disrupting the natural balance and biodiversity on a global scale — and it hasn’t stopped. This ongoing exploitation continues to drive widespread deforestation, the destruction of crucial ecosystems, and a drastic decline in species populations far beyond natural levels. In the next 20 years, hundreds of animal species are likely to go extinct, and up to 1 million of the world’s 8 million known plant and animal species could face endangerment.

While companies in some industries drive biodiversity loss more obviously than others, there is no doubt that nearly every industry exacerbates biodiversity loss both directly and indirectly. It is estimated that four key value chains (food, infrastructure, fashion and energy) account for 90% of man-made impacts on biodiversity (Kurth et al., 2021).

Biodiversity is the foundation of key ecosystem services like soil fertility, natural pest control, pollination and water regulation. These resources contribute significantly to the global economic value. According to the World Economic Forum (WEF), more than half of the world’s gross domestic product (GDP), $44 trillion, depends heavily on functioning natural ecosystems (WEF, 2024). 85% of the world’s largest companies are estimated to have a significant dependency on nature across their direct operations (S&P Global Sustainable, 2023).

Given the interplay between businesses and biodiversity, biodiversity isn’t just an environmental issue — it’s a business issue. Businesses need to understand the relationship between addressing biodiversity and how it will affect their own operations. Businesses create a paradox in doing the most to destroy the ecosystems while simultaneously having the most capacity to save them. What this all means is the business sector has no option but to be a force for change.

Simply put, biodiversity restoration is an on-site, after-loss action. Often it refers to the recovery of an ecosystem to its pre-disturbed state (Panwar et al., 2023). The goal is to bring back the variety of life — plants, animals, fungi, and microorganisms — to an ecosystem that has been degraded or destroyed. In order to design and implement biodiversity restoration, companies must first measure their impact.

Companies can begin by identifying dependencies and the potential negative effects from the company’s direct operation and value chain, both up- and downstream, on the natural ecosystem. This can be done on different scales, from direct observation of company’s own operations, to identifying high risk commodities in the value chains, and to assessing trends in the company’s portfolio by assessing average impacts by sector. Useful tools like the ALIGN Project recommendations, SBTN assessment guidance, and WWF Biodiversity Risk Filter help companies assess, prioritize, and set measurable goals for restoration.

Different types of companies — primary producers, downstream manufacturers or retailers, financial institutions, and small and medium-sized enterprises (SMEs) — each has unique path on restoring nature. Primary producers may invest in ecological restoration or the rehabilitation of degraded lands and habitats. One example is CEMEX Spain, a construction materials company that partnered with the University of Barcelona and the EU LIFE program.

Together, they successfully transformed the degraded Pastor clay quarry into a blooming wetland that now supports various plant and wildlife species, including protected birds. This was achieved by retaining water on-site, improving off-site water quality, and mitigating soil degradation. Remarkably, this restoration also coexists with ongoing quarrying operations.

For downstream manufacturers or retailers, biodiversity restoration may involve requiring suppliers to adopt sustainable agricultural practices. For instance, Cargill, a multinational food corporation, is committed to agroforestry. Over the next decade, the company plans to support farmers in implementing regenerative agriculture practices across 10 million acres of North American farmland. This initiative aims to promote healthier ecosystems and create more resilient supply chains for Cargill.

Financial institutions, or other companies with indirect impacts, such as those in finance, technology, and communications, can also help restore biodiversity through strategic investments in innovative projects and research partnerships. Many companies collaborate with conservation NGOs on flagship biodiversity programs, invest in urban biodiversity initiatives at office sites, or fund research on ecosystem restoration.

Although SMEs and startups may not have the scale of multinational corporations, their agility, innovation, and deep local connections make them powerful drivers of grassroots biodiversity restoration efforts. For example, San Francisco-based Biome Makers has launched a digital soil-microbiome intelligence platform called BeCrop to help farmers measure the organic quality of their soil and take any necessary restorative actions. This highlights how small businesses can also lead in ecological innovation.

Overcoming Challenges in Biodiversity Restoration

Cost-effectiveness is a key consideration for companies taking action on biodiversity restoration. In this context, the hybrid nature-based solution (NBS) approach is the practical way forward (Anderson et al., 2022). This approach combines natural processes (green), like reforestation and wetland restoration, with engineered structures (grey), such as dams, levees, and habitat enhancements, to restore and enhance ecosystem resilience and functionality.

For example, planting mangroves or restoring coastal wetlands alongside engineered coastal defenses, like seawalls, to enhance biodiversity and protection against storms. Each measure has its strengths and limitations. Green measures typically have lower initial costs and long-term benefits but may lack immediate impact. In contrast, grey measures often deliver quick results but tend to be less adaptable and more locked-in (Pontee et al., 2016). This synergy between green and grey measures balances their respective trade-offs and provides both effectiveness and affordability.

However, the real challenge may not lie in implementing biodiversity restoration but rather in aligning it with the companies’ strategic interest and evaluating its feasibility. The solution is to focus on the biodiversity restoration location where sufficient financial and human resources are available (Katic et al., 2023). Bringing together different types of stakeholders, from local communities, supplier to shareholders, means bringing together knowledge and best practices.

This collaboration ensures companies receive the support they need to secure ‘early wins’ as learning opportunities with stakeholders and as stepping-stones to long-term goals. The potential co-benefit is the secret ingredient that makes biodiversity restoration more feasible and scalable.

Another Step in the Right Direction: Harnessing innovation and technology

How can companies improve their efforts in restore nature? If companies start to apply technological innovation to address the challenges of restoring biodiversity, they can start repairing the planet and the well-being of every species on it with speed.

At the 2025 WEF, one area of focus was the increasing use of technology, particularly how artificial intelligence (AI), sensors, and satellites can better support businesses and communities in nature restoration and emissions reduction efforts. For example, computer vision techniques using satellite images can map past and present vegetation in restoration areas, while geo-tagged photos of plants and animals collected by people on the ground provide valuable biodiversity data.

Over the next three years, 92% of companies plan to increase their investments in AI (McKinsey, 2025). Although these investments may not immediately translate into biodiversity restoration use cases, they signal a promising future where AI and other technologies will play a bigger role in overcoming barriers for companies tackling biodiversity challenges. Fontoura et al. (2025) suggest that AI can provide end-to-end solutions from assessing biodiversity impacts to monitoring and reporting. By combining human expertise with data from previous restoration projects, AI can help companies to make informed decisions and to improve the design and implementation of restoration efforts.

The Benefits of Taking Action and the Cost of Nature

Protecting nature and biodiversity is increasingly important for companies to ensure sustainable growth and mitigate risks associated with their operations. Companies found that their investments in ecosystem restoration in operating areas have not just reduced supply-chain emissions but also generated tangible business value through reductions in raw material and energy costs. Improving water security, potential for financial returns, and overall business resilience were cited as particularly important reasons for nature investments (TIME CO₂ , 2023). By responding to public demand for sustainability, companies also improve their value proposition and their brand.

On the flip side, failing to address biodiversity loss exposes companies to significant legal and financial risks. As the legal landscape evolves, companies may face lawsuits and regulatory fines for biodiversity degradation. In the worst-case scenario, the cost of inaction can erode stakeholder goodwill and ultimately result in the loss of a company’s license to operate.

Rather than allowing biodiversity risks to manifest themselves in mainstream business, companies can take early steps to secure biodiversity, and seize opportunities that enable them to remain at the forefront of their sector. Taking proactive steps in biodiversity restoration isn’t just about environmental responsibility — it’s a strategic move toward long-term business stability and growth.

Useful links:

• Link up with Pechaporn Pornpraipech on LinkedIn
• Read a related article: Your Firm’s Most Undervalued Asset? Try Nature
• Discover School of Management Fudan University
• Apply for the Fudan International MBA.

Learn more about the Council on Business & Society

The Council on Business & Society (CoBS), visionary in its conception and purpose, was created in 2011, and is dedicated to promoting responsible leadership and tackling issues at the crossroads of business, society, and planet including the dimensions of sustainability, diversity, social impact, social enterprise, employee wellbeing, ethical finance, ethical leadership and the place responsible business has to play in contributing to the common good.  

• Follow the CoBS on LinkedIn
• Download magazines and learning content from the CoBS website downloads page.

Member schools of the Council on Business & Society.

• ESSEC Business School, France, Singapore, Morocco
• FGV-EAESP, Brazil
• School of Management Fudan University, China
• IE Business School, Spain
• Indian Institute of Management Bangalore, India
• Keio Business School, Japan
• Monash Business School, Australia, Malaysia, Indonesia
• Olin Business School, USA
• Smith School of Business, Queen’s University, Canada
• Stellenbosch Business School, South Africa
• Trinity Business School, Trinity College Dublin, Ireland
• Warwick Business School, United Kingdom.