Multinationals as pioneers of ecosystem restoration

October 7, 2023

The need for economic growth and environmental sustainability has become the defining challenge of our era. As the world races forward in pursuit of progress, the pressing need to conserve and restore our natural environment has assumed a paramount role, and must be done in a way that supports the long-term viability and security of food and water systems. The delicate balance between these objectives brings multinationals, the giants of the global business arena, into a pivotal spotlight.

Multinationals are often blamed for environmental crises, including biodiversity loss, habitat degradation, climate change, resource depletion, and threats to human health stemming from environmental and human rights risks. That being said, the globalized value chains of multinationals also represent a tremendously powerful opportunity for ecosystem and community restoration.  How can this be achieved concretely?  Through people, partnerships and policy.

• People

First and foremost, multinationals attract some of the world’s most talented individuals: scientists and engineers, technicians, experts in supply chains, logistics, finance, law and management… the employees of multinationl companies are truly the world’s best placed group to tackle the climate crisis. Empowering them to do so not only requires the right corporate and management strategy, but requires providing them with the appropriate incentives: first, training and compensation, but most importantly, time and resources.

It is a mistake to think that the climate crisis can be solved by raising billions and billions in funds for climate innovation. What is needed most urgently is the right mix of time, resources and expertise. What would happen if each of the world’s biggest multinationals granted each employee a few hours a week of paid leave to participate in ecorestoration activities in their own local town, ideally with their family and members of their community? Under certain tax regimes, employee hours and materials (agri inputs, tools and equipment) can even be tax deductible.

In addition, multinationals can leverage their most senior skilled employees for long-term restoration or humanitarian missions: rather than incentivizing employees to retire, they can propose more flexible working arrangements that will allow long-term employees to end their “traditional” careers on a high note, using their expertise to further the Sustainable Developement Goals and, in doing so, creating a positive legacy for the company and helping the employee achieve a truly meaningful life purpose.

In Japan, people do not retire, but simply work in different ways towards their ikigai, or life purpose. What would happen if today’s petroleum engineers chose not to retire, but instead to spend their senior decades designing agriculture and water systems, on a flexible basis and in coordination with the company’s young recruits? In this way, the concept of transformational, two-way mentoring can truly be achieved between generations with different working cultures.

• Partnerships

Second, multinationals can also enter into partnerships with conservation organizations, governments, or local communities to support and undertake large-scale restoration efforts. Projects such as mangrove restoration can provide critical habitats for marine life, protect coastlines from erosion, and sequester carbon. Partnerships with communities are also of pivotal importance, not only in supporting climate-positive business models, but by building local economic ecosystems that will ultimately rebalance our globalized economy into one that also supports growth of communities.

Historically, in order to achieve their profitability margines, multinationals have depended on access to low-cost and abundant raw materials (petroleum, minerals, palm oil, cocoa…), which lead to high-value finished products (oil, metals, consumer goods). Without building localized value chains, the current business models not only increase climate risks, but keep host countries trapped in a cycle of endless poverty in which the required local expertise needed to transform these resources is never appropriately acquired.

Climate restoration efforts need to be accompanied by vocational and skill-building programs that will allow host countries and local communities to become the masters of their own natural resources, and ultimately allow them to achieve the best prices. Higher prices charged in the Global South will necessarily have a chilling effect on consumption patterns in the Global North.

• Policy

Third, multinationals can also contribute innovative approaches to conservation efforts through supporting restoration policy. For example, corproations with expertise in data analytics and remote sensing could collaborate with environmental organizations to monitor deforestation rates in the Amazon rainforest, and can help detect and cease illegal logging activities and inform conservation strategies in a more long-term way.  These technologies exist; making them available to monitor deforestation will not only curb illegal activity, but will significantly strengthen the impact of new EU regulations that ban the use of products that have been linked to deforestation, which currently only require companies to understake due diligence and issue a compliance statement.

Policy is useful, but will not be effective without the right actions and equipment, most of which are in the hands of the private sector.  Indeed, the Paris Agreement is the perfect example of this: while the commitments are made at the state level, the key to reaching them is in the hands of business and consumers.  The right mix of measures probably includes a mix of tax incentives, rebates and reductions (particularly in partnership with insurers of homes, automobiles and other equipment) to help businesses help consumers make the right consumption decisions.

Multinationals have the tools to help measure and achieve environmental restoration, and can use their voices to be heard by governments, industries, and consumers alike. Participating in international forums is a first step, including by engagement with policymakers, and actively promoting sustainability initiatives. But more critically, multinationals must make their expertise and tools available to ensure policy goals are met, such as the deforestation regime outlined above. They can also help governments implement more efficient systems for measuring and managing carbon emissions, waste management, recycled materials and consumption of water and energy.

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Multinationals are very well-placed to contribute to environmental restoration by virtue of their global scale, resources and efficient operating systems. Implementing nature-based restoration programs is not only compatible with existing business models in the energy, mining, agriculture, construction, transport and manufacturing sectors, but can be managed in a way to support community and employee engagement with minimal pressures on profitability. In doing so, multinationals can help formulate the right mix of offers to incentivize appropriate consumption habits, and ultimately bridge the gap between local communities, policy goals and markets.

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