Introduction to the GBS – A tool to assess the biodiversity footprint of businesses and financial assets July 5th, 2021

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Introduction to the GBS – A tool to assess the

biodiversity footprint of businesses and financial assets

July 5th, 2021

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Mentimeter

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 15:30 – 15:45: Welcome

 15:45-16:50:

• Context and overview

• Methodology of the GBS and MSA metric

• B4B+ Club

• Details about the evaluation process and GBS pricing

• GBS’s solutions for financial institutions

 16:50-17:50: Case Studies Presentation

 17:50-18:00: Common standard

Agenda

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Introduction to the Global Biodiversity Score

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A private subsidiary of the Caisse des Depôts Group, the French largest public financial institution

CDC Biodiversité, a Nature-Based Company

A trusted third party

Engagement over the long

run Technical and

financial risk management

Activities

 Biodiversity offsets operator

 Conducting voluntary biodiversity restoration actions for businesses

 Management of the Club for Positive Biodiversity Businesses (Club B4B+)

 Research and publication activities on biodiversity economics, biodiversity financing mechanisms and natural capital

Three characterics of our action

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Context and overview

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 Let’s start by getting to know each other…

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Context: a massive loss of ecological integrity

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This loss can be quantitatively linked to five main direct drivers, caused by

indirect drivers

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Most of the activities impacting biodiversity lack a satisfactory framework to measure, avoid, reduce and offset their impacts

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 Do you know the 20 Aichi targets?

Mentimeter

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The GBS makes it possible to take into account business actions and align them with international targets

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The planet crossed the planetary boundary for functional biodiversity and the contribution of businesses can be measured

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The GBS supports businesses involved in the Science Based Target Network to set relevant targets in

relationship with the planetary boundaries Step 1 must be

conducted within 1 year of joining the Corporate

Engagement Program

Ecosystems

Source: SBNTInterimGuidance

1 Assess

2 Interpret Prioritize

3 Measure

Set Disclose

4

Act 5

Track

Biodiversity Footprint assessment (BFA) Screening

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The prerequisites for a biodiversity footprint for businesses and financial institutions

 Quantitative

 Global

 Spatialized

 Transparent

 Cross-sectoral

 Scientifically consensual

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Multiple needs, multiple tools

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 What biodiversity measurement tools do you know of?

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The GBS fits within this context

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GBS Metric: MSA%

Describes ecosystems’ integrity between 0% and 100%

F o re st e co sy st em

MSA = 100%

MSA = 70%

MSA = 50%

MSA = 30%

MSA = 10%

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The Mean Species Abundance (MSA): computation

UNDISTURBED DISTURBED

Rules

- Only species present in undisturbed situation count - Abundance can’t exceed 100%

MSA

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1 MSA.m² loss

is equivalent to

artificialisation of 1 m² of pristine natural areas

GBS assessments unit

MSA% Area impacted

GBS unit: MSA.m²

Describes impacts in terms of artificialisation

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 According to you, what aspects of biodiversity are measured by the MSA?

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GBS: A corporate biodiversity footprint assessment tool evaluating the impact of companies and investments on biodiversity at a corporate level

 Links data on economic activity to pressures on biodiversity, and translates them into biodiversity impacts

 Results expressed in MSA.km² with MSA the Mean Species Abundance, a metric characterizing the intactness of ecosystems

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GLOBIO and the GBS cover the key pressures for the majority of sectors – terrestrial

biodiversity

- Land use

- Fragmentation of natural habitats - Human

encroachment - (Infrastructure)

Pressures due to resources extraction (crops, woodlogs, mining…)

Climate change

- Atmospheric

nitrogen deposition - Terrestrial

ecotoxicity

Not yet covered

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GLOBIO and the GBS cover the key pressures for the majority of sectors – freshwater

biodiversity

Wetland conversion

Hydrological disturbance due to direct water use Hydrological

disturbance due to climate

change

- Land use in

catchment of rivers - Land use in

catchment of wetlands - Freshwater

eutrophication - Freshwater

ecotoxicity

Not yet covered

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GBS accounts separately for permanent and

additional impacts. Static impacts inform on the state of biodiversity…

Static impacts

Biodiversity state

Remaining biodiversity

Static impact

0 MSA100%

0 MSA 100% 0 100%

MSA

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GBS accounts separately for permanent and additional impacts. Static impacts inform on the state of biodiversity while dynamic impacts inform on biodiversity changes

Dynamic impacts

Biodiversity changes

The extension of urban area over natural areas generates a dynamic impact

- =

Dynamic impacts

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GBS key features: an aggregated metric considering impact stocks and flows in the whole value chain

• Ecosystem integrity

• MSA.km²

1. Aggregated metric

• Permanent impacts (static) and additional impacts (dynamic) are separated

2. Stocks and flows of impacts

• Impacts are computed per Scope of the value chain

3. Whole value chain

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Frequently asked questions

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

What is the reference used by the GBS for the biodiversity state?



MSA = 100% refers to an “undisturbed” ecosystem (no historical baseline).



Note that it is different than the reference in the context of a company’s footprint computation which refers to the biodiversity state at the

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 Are regulatory compensation measures taken into account in the GBS?

 The GBS is not a substitute for existing tools and approaches for applying the regulatory mitigation hierarchy sequence.

 The co-benefits of these measures for ordinary biodiversity can be assessed with the GBS, outside the mitigation

hierarchy framework.

 Does the GBS also offer a qualitative assessment of the biodiversity performance of companies?

 Yes, the Biodiversity Footprint Assessments that the GBS will allow provide for a screening phase going beyond the impacts assessed with the GBS and a qualitative analysis phase.

FAQ

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Towards corporate biodiversity targets – Companies and brand with quantitative targets

Company

or brand Industry Targets

State of biodiversity Pressures Others

Acciona Building Neutral biodiversity footprint

Alpro Food

No official target yet But seek to be one planet compatible ASN Bank Finance Net positive effect on

biodiversity in 2030

Danone Food

• 0 deforestation by the end of 2020

• Promotion of regenerative agriculture practices in favor of animal & plant biodiversity

• Reduction in the total volume of water consumption by 25% by 2030 & action plan for water- stressed watershed

• Carbon neutrality by 2050

Grupo Red

Eléctrica Energy

Positive net impact on natural capital in the vicinity where its facilities

• Reduction of water consumption in all work centres to 6.5

m³/employee/year in 2030

• 100 % reduction in the use of

• 0 % single-use plastics in 2030

• 0 % waste to landfill in 2030

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Towards corporate biodiversity targets – Companies and brand with quantitative targets

Company

or brand Industry Targets

State of biodiversity Pressures Others

GSK Pharmaceu -ticals

Net positive impact on nature by 2030

Iberdrola Energy

No Net Loss of biodiversity by 2030 working to ensure that new facilities deliver a net positive impact on

biodiversity, where possible (Scope 1)

•Reducing its CO2 emissions by 50% in 2030 with respect to 2007 and becoming carbon

neutral by 2050, with its emissions in Europe projected to be almost zero by 2030.

Avoiding new infrastructures in designated conservation areas

Kering Luxury

Net positive impact on biodiversity by 2025 (regenerating &

protecting 6x the total land footprint of its supply chain)

Convert 1 million ha of farms and rangelands in its supply chain landscapes into regenerative agriculture by 2025

Protect an additional 1 million ha of critical, ‘irreplaceable’ habitat outside of its supply chain by 2025

L’Oréal Cosmetics

Flat land occupancy vital to the sourcing of ingredients compared to 2019

• 100% sustainable sourcingof bio-based materials by 2030 (none linked to deforestation)

• 100% of sites with positive impacts on biodiversity compared to 2019, by 2030 Solvay Chemistry -30% pressure on biodiversity

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A stepwise approach to use the best data

available

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Stepwise approach

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The data yielding the most precise impacts are also the less available

• Fauna inventories

• Flora inventories

Survey

• GHG

• Land use type

• Pollutions

Pressure

• Extraction

• Emissions

Raw materials Physical flows

• Turnover

• Purchases

Financial

Precision

Availability

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The "Scope" concept allows to take into account biodiversity impacts throughout the value chain

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 Do you use the notions of Scope 1, 2, and 3 from the GHG Protocol in your company?

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Linkages between the default and refined approaches

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The B4B+ Club

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Members and partners of the B4B+ Club

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Members and partners of the B4B+ Club

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Companies and investors will be able to conduct their own Biodiversity Footprint Assessments or to work with assessor companies or rating agencies

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GBS Licenses

Use of the software

No Yes, internal use

Yes, external use (selling BFA)

No No license License

B4B+ Club (including

License Extension) + Assessor level 2

Publication of the results

Yes

License

+ Assessor level 2

(if the brand is used) License

+ Assessor level 2

B4B+ Club (including

License Extension) + Assessor level 2 License

License fee for investors and companies (out of the B4B+ Club) : 1500€ excl. VAT/ year

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The B4B+ Club

• 1 license for internal use

• 2 nominative licenses for commercial use

Included licenses

• 3 annual meetings

• Regular literature updates on biodiversity footprint assessment

• Presentation of GBS upgrades and new developments

• Network of businesses and experts on biodiversity footprint

• Sharing best practices

• Technical support via quarterly webinars and telephone

Content

• 6500€ excl. VAT / year

Membership

NB: please be aware that written supports shared via the B4B+ Club are mixed English/French

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• Since the GBS 1.2 is still under development and some technical problems can still occur, the B4B+ members have access to some technical support, via quarterly webinar and telephone

• CDC Biodiversité will also ensure that software problems that make it impossible to calculate impacts are resolved within one working week

• Please be aware that the technical support is limited to users running Windows and using Microsoft Excel.

The technical support via the B4B+ Club

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 Do you think that your company might be interested in joining the Club of Businesses for Positive Biodiversity (B4B+ Club)?

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GBS Trainings & Evaluations

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LEVEL 1 TRAINING

Introduction to the GBS tool and to Biodiversity Footprint Assessments

- Draw a link between biodiversity erosion and companies’

activities

- Get familiar with the good unfolding of a Biodiversity Footprint Assessment (BFA)

- Understand requirements to use the GBS and its results

- 1 day, 15 trainees

- Next session in 2021: 23rd – 24th September (online) - EUR 1600 / trainee VAT excluded

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LEVEL 2 TRAINING

- Lead a comprehensive GBS-based Biodiversity Footprint Assessment (BFA) of your organization

- Accompany your client in a BFA and formulate effective recommendations

- Manage all the functionalities of the tool

- Level 1 training required - 2 days, 8 trainees maximum

- Next session in 2021: 4^th to 7^th October (half-day online) - EUR 3500 / trainee VAT excluded

Mastering the tool and conducting Biodiversity

Footprint Assessments

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3 promotions already

57 financial or non-financial

institutions, or consulting companies

Next sessions online:

• Level 1:

• 23-24 September 2021 (Half- day still needs to be confirmed)

• Level 2:

• 4-7 October 2021 (Half-day still needs to be confirmed)

More information and pre-registration for the next sessions here

32 financial or non-financial

institutions, or consulting companies

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 Would you be interested in doing a GBS training ?

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Steps of a GBS-based Biodiversity Footprint Assessment

1. Framing 2. Data

collection 3.

Computation 4. Analyses 5. Strategy and action

plan

Perimeter Screening of

biodiversity issues Perimeter Screening of

biodiversity issues

Surveys Pressures Inventories

Financial Surveys Pressures Inventories

Financial

Quantitative Qualitative Quantitative

Qualitative

Targets Objectives

Actions Monitoring

Targets Objectives

Actions Monitoring

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Modalities of a biodiversity footprint assessment with the GBS

Duration : 3 – 6 months Price : 40 – 60 k€ HT

For more information on the assessments:

gbs@cdc-biodiversite.fr

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Who can conduct a BFA?

Our trained consultants are also available to you!

B&L évolution SCOP EC ^Sylvain ^Boucherand Biodiv'Corp ^Véronique ^Dham

BioPerf.biz ^Olivier ^Schär

Blooming ^Kevin ^Mozas

I Care & Consult ^Eliette ^Verdier INDEFI ^Clémence ^Laurencel

Nomadéis ^Stéphane ^Baudé

The Biodiversity Consultancy (TBC) ^Adeline ^Serckx

Utopies ^Pierre ^Viard

can conduct your biodiversity footprint assessment.

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 Do you think that your company might be interested in performing a Biodiversity Footprint Assessment?

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GBS for financial institutions

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GBS proposals for financial institutions

Biodiversity Impact Analytics powered by the GBS®

database Global biodiversity score for

financial institutions

GBSFI BIA-GBS

Launch of BIA-GBS on 8^th July 2021 : registration here.

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 Would you be interested in the GBS’s proposals for financial institutions?

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GBS critical review committee

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Objectives of the review committee

The robustness and transparency of the tool are reinforced by a GBS critical review committee

Verifying the consistency and quality of the tool based on its stated goals, scope and limits

Suggesting improvements to the tool

Assessing the consistency / relevancy with other

existing tools and public policies

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Technical assistance

The robustness and transparency of the tool are reinforced by a GBS critical review committee

Experts panel

Methodological review

Stakeholder- panel

Utility of the GBS and coherence with other

existing tools

Secretariat

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Deliverables

 From CDC Biodiversité : 11 technical reports

 From the committee: final report (experts and stakeholders)

Pressures on biodiversity

• Pressures on terrestrial biodiversity

• Pressures on

aquatic biodiversity (eau douce)

• Ecotoxicity

Raw materials

• Crops

• Livestock & Grazing

• Woodlogs

• Metals and minerals

• Oil and gaz

Overall methodology

• Core concepts

• Input/Output models

• Quality assurance

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Case studies - application of the GBS

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Overview of the case studies already published

GRTgaz - Arc de Dierrey

C/ Biodiversity management &

performance Business application

supported

1/ Public policy

2/

Corporate

& portfolio

3/ Supply options

4/ Product

& service 5/ Project / site

A/ Assessment / rating by and for third parties with

external data

B/ + C/

B/ Biodiversity accounting for external

audited disclosure

GRTgaz - Arc de Dierrey Mirova – 6

companies BNPP AM -

portfolio

Veolia - VEDIF

Solvay – Ferulic acid

Michelin - Rubber Schneider

Electric

AFD – Wolong

lake EDF

Suez CDC GDA

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Schneider Electric – First full scale

Biodiversity Footprint Assessment (BFA)

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Case study in brief (1)

 Footprint use category: Corporate level

 Business application: Biodiversity accounting for internal reporting and/or external disclosure (Biodiversity accounting for external audited disclosure)

 Assessment time: Year of assessment 2020, based on 2019 data

*

*dynamic

Reference : Schneider Electric, & CDC Biodiversité. (2020). Assessing biodiversity footprint, the occasion to accelerate corporate biodiversity strategy. Link

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 Why

: Quantify biodiversity hotspots and opportunities all along

Schneider Electric’s value chain, with a global and scientific approach

 What: End-to-end (Scope 1, 2 and 3 upstream) impacts

 When: 2019

 For whom:

• Environmental & strategy teams at Schneider Electric

• External stakeholders, including a call to action to other businesses

 How often: to be defined, depending on GBS updates. Foreseeable

updates every 3 years, to monitor progress

 How detailed: Corporate level, aggregating data from different levels,

such as environmental sites reporting or procurement data by

GDA – Assessment of a portfolio with the GBS

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 Caisse des Dépôts signed the Finance for Biodiversity Pledge on September 25^th, 2020

 Finance for Biodiversity Pledge is supported by 26 financial institutions from

10 countries and representing €3,000 bn of assets managed

 “…..contribute to the protection and restoration of biodiversity in our financial activities and investments.” Eric Lombard, CEO.

CDC Engagement

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 Case study on a European Large Cap Equity universe performed by CDC (GDAP) and analysis conducted by CDC Biodiversite with the Global Biodiversity Score® tool

 Data input: financial data only, based on Factset® data, using the EXIOBASE nomenclature for regions and industry groups.

 Questions explored:

What are the impacts on biodiversity of the Large Cap Equity universe?

Because of which industries and which pressures?

How does the assessment inform strategies to reduce impacts on biodiversity?

Introduction to the case study

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The analysis reveals the most impacting industries within the universe

Manufacture of food products companies represent 4% of the turnover but 52% of the stock of (static)…

… and for 20% of the additional (dynamic) impacts

Manufacture of coke and refined petroleum products (11% of the turnover) and

Electricty, gas, steam and air conditioning supply (5% of the turnover) cause significant flows of additional impacts due to their GHG emissions : 19% and 17% respectively

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Impacts can be broken down by Scopes and by Pressures, to understand the impacts sources

+50

5700

+50

5700

Footprint in MSAppb/b€ by Scope

Footprint in MSAppb/b€ by pressure

+ 4 1

75% of the dynamic impact is due to climate change pressure, driven by electricity, gas and petroleum companies

Most of the impacts occur within the supply chains : including upstream Scope 3 in assessments is thus critical

The main driver of static impact is land use (spatial pressures)by food processing and manufacturing companies

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Different investment strategies and ESG solutions are available to reduce biodiversity impacts

Source : Finance for Biodiversity Pledge guidance (CDC biodiversité & Actiam)

1. Exclusion

When companies/countries do not adhere to our responsible investment criteria

2. Voting

Voting at AGMs and EGMs of companies

3. Engagement

Active ownership by stimulating responsible business conduct by entering into a dialogue with the company on violations made

4. ESG-criteria

Integrate ESG-criteria in the portfolio management process

5. Impact Investing

Investing in assets where, next to a financial, the aim is to achieve a measurable positive social and environmental return

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Example of a using the results: the measure the performance improvement of a simulation portfolio against its benchmark

a a EXCLUSION OF HIGH IMPACT

INDUSTRIES/COMPANIES

BEST GEOGRAPHICAL BREAK DOWN FOR THE INDUSTRY

Average intensity of the vertically integrated benchmark

Reading : each point on the figure is a company.

10 companies from a simulation portfolio appear twice : in blue (share from the simulation

portfolio) and green (share from the benchmark).

High impact intensity threshold

INCREASE SHARE OF LOW IMPACT INDUSTRIES

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The low impact portfolio performs significantly better than the index and is near the low to intermediate impact zone

Aquatic

Aquatic Terrestrial

Terrestrial

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*

+41

*: the equivalent in MSA.m²/k€ are: 0.2 (aquatic dynamic), 3 (terrestrial dynamic), 20 (aquatic static) and 500 (terrestrial static)

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The low impact portfolio performs significantly better than the index and is near the low to intermediate impact

Aquatic

Aquatic Terrestrial

Terrestrial

+41

*

+41 Simulation portfolio’s

aggregated score : 76 MSAppb*

(=(41+5500/50)/2)

Benchmark’s aggregated score : 82

MSAppb*

v s

/5 0 / 2

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A portfolio from GDAP has been assessed to start the journey towards the protection and restoration of biodiversity

GDAP porfolio’s aggregated score :

107 MSAppb*

v s

Benchmark’s aggregated score : 82

MSAppb*

GDAP portfolio 7500

+59

(in 2020)

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MIROVA – GBS test on Bonduelle

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 Périmètre étudié

GBS test on Bonduelle – Studied perimeter

LUEFN pressures CC pressure Aquatic pressures

Tier 1

Rest of the value chain Downstream

Entreprise évaluéeRefined assessment Default assessment

LU: Land Use E: Encroachment F : Fragmentation N : Atmospheric Nitrogen Deposition CC : Climate Change

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• Phase 1 - financial default assessment: estimate based on financial data only

• Phase 2 – Refined assessment based on published data (annual report, CSR report): estimate based on Bonduelle public data reworked by Mirova analysts.

• Phase 3 – Refined from Bonduelle data: estimate based on data provided directly by Bonduelle following consultation with Mirova analysts.

GBS test on Bonduelle – Summary of the three phases

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GBS test on Bonduelle - Results

 Important ability of the GBS to differentiate between players in the same sector on the basis of company-specific data

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 A very positive outcome on the ability of the methodology to differentiate activities in a given sector.

 A shared observation of the interest of integrating certifications/good practices (e.g.

agricultural) into the tool, in the long term, to further refine the assessments.

 A clear confirmation of the need for serious estimation of input parameters, which involves:

• To clarify the most critical parameters, by sector, to be collected or estimated

• To devote resources to analysing companies in order to be able to assess the impact of responsible investment strategies.

• In the long term, to widely disseminate this list of useful information by sector in order to facilitate company communication and analysis by investors.

GBS test on Bonduelle - Conclusions

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AFD - Pilot ex ante and ex post assessments of the

biodiversity footprint of a loan

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Context: the Wolong lake is at the chokepoint of a major migratory path

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Methodology: ex post assessments use

biodiversity state and pressure data to assess impacts

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1. This pilot demonstrates the possibility to estimate MSA based on direct measurements of biodiversity state

2. It provides guidance on data requirements and order of magnitude for ex ante screening of projects

3. The ex post assessment of the project demonstrates the biodiversity gains achieved

 A relatively conservative evaluation indicates a gain of 4.5 MSA.km

²

 Equivalent to 640 football pitches

 Equivalent to the yearly Scope 1 impact of 1 million tons of wheat produced in France

Lessons learnt

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Towards a common standard for biodiversity footprint – work with ASN Bank, ACTIAM and Finance in Motion and the

Aligning Biodiversity Measures for Business collaboration

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CDC Biodiversité and the GBS are aligned and involved in the major convergence and reporting frameworks

EU Green taxonomy

Task force on Nature-related Financial Disclosures

(TNFD) Corporate

Sustainability Reporting Directive

(CSRD)

Disclosure Regulation

Align

Article 29 of the French

Energy and Climate law

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 Aligning Biodiversity Measures for Business (ABMB) is a major

collaboration that brings together all the developers of corporate biodiversity measurement tools known internationally

 ALIGN is its direct heir at the EU level

 Objective: to converge from a technical point of view on these subjects, in order to allow companies to have a common vocabulary and to have

compatible and coherent tools for different uses

 Deliverables:

 Assessment of biodiversity measurement approaches for businesses and financial institutions(Lammerant 2019)

 Biodiversity Measures for Business: Corporate biodiversity measurement and disclosure within the current and future global policy context (UNEP-WCMC 2020) which will be the basis for an information document for the Convention on Biological Diversity

ALIGN and ABMB

ALIGN 2021

2023 Measurement

standard

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 A protocol providing a common conceptual

framework on accounting for biodiversity impacts

 Very promising initiative, the first report was published in March 2021 (consultation report)

Biological Diversity Protocol

Example of application of the BD Protocol to a GBS-basedassessment (CDC Biodiversité, 2020)

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 Measuring the contributions of business and finance towards the post- 2020 global biodiversity framework – 2019 technical update (2020)

 Global Biodiversity Score: a tool to establish and measure corporate and financial commitments for biodiversity – 2018 technical update (2019)

 Common ground in biodiversity footprint methodologies for the

financial sector – CDC Biodiversité, ASN bank, ACTIAM, Finance in Motion (2018)

 Global Biodiversity Score: measuring a company’s biodiversity footprint (November 2017)

Learn more

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gbs@cdc-biodiversite.fr

Antoine Cadi

Director Innovation and Research E-mail:

antoine.cadi@cdc-biodiversite.fr Phone : +33 (0)1 80 40 15 16 Mobile : +33 (0) 6 21 63 18 00

Joshua Berger

Head of biodiversity footprint department

E-mail:

joshua.berger@cdc-biodiversite.fr Phone : +33 (0)1 80 40 15 41 Mobile : +33 (0) 6 21 86 16 81