As global co-leaders of McKinsey Sustainability, we know that sustainability is both a priority and a challenge. As an ever-evolving topic, it’s also something that must be integrated holistically across all operations to achieve true impact.
That’s why we’re sharing a curated selection of the most pertinent, in-the-now insights and resources from McKinsey each month, with short perspectives from our expert practitioners.
In this first edition, we’re focusing the lens on nature or natural capital.
The world’s next big challenge is becoming nature positive
Over the next ten years, extreme weather-related risks are ranked #2, 3 and 4 of on the World Economic Forum Global Risks Report 2024. That means that half of the world's GDP that's highly dependent on nature is also at risk.
The upside is that the world is ready to engage. At COP28, multiple initiatives kickstarted tangible progress, including actions to protect, restore, and invest in nature for achieving nature-positive outcomes and climate mitigation—including major initiatives like the World Bank’s roadmap for scaling high-integrity forest carbon credits, a comprehensive framework for ensuring the integrity of overall voluntary carbon markets; and a plethora of new financing for nature-focused climate projects. And, the World Economic Forum, in partnership with McKinsey is launching the CEO Action Group for Nature.
What can companies do to restore natural capital?
Given all the demands facing companies in a challenging macroeconomic environment, it can be hard to know where to start. These four steps below, outlined in further detail in Nature in the balance: What companies can do to restore natural capital, could help companies find their way:
- Assess your company’s nature footprint—that is, the types, magnitude, and materiality of their impacts and dependencies on nature.
- Identify which of your activities have the potential to both reduce impacts on nature and improve company performance.
- Set initial targets for nature and levels of commitment, define a set of actions, and integrate them into a broader portfolio of initiatives.
- Closely monitor progress against your goals and prepare to disclose progress according to the Taskforce on Nature-related Financial Disclosures (TNFD) recommendations.
What does this look like in practice? The links below provide further insight. And if this sparks any questions, please feel free to contact our experts to discuss further.
Recommended McKinsey Sustainability Insights on Nature
Companies are broadening their commitments to nature beyond carbon
Nature in the balance: What companies can do to restore natural capital
Taking action on nature: How to get started
With gen AI, we are helping green businesses strengthen our ‘blue economy.’
Voices on Nature: Patagonia shows how turning a profit doesn’t have to cost the Earth