In 2025, the business case for biodiversity is no longer theoretical—it’s urgent, material, and transformative. As climate risk intensifies and ecosystems degrade, companies across sectors are waking up to a new reality: biodiversity is not just an environmental issue. It’s an imperative and when it’s well managed, it’s an opportunity.

From agriculture to tech, finance to infrastructure, biodiversity is becoming a central concern for investors, regulators, and consumers alike. The European Union’s Nature Restoration Regulation, introduced this year, is a clear signal.

With binding targets to reverse ecosystem degradation and a roadmap for nature credits to mobilise private investment, the Regulation is reshaping expectations for corporate responsibility and opportunities.

And it’s not the only regulation.

The Taskforce on Nature-related Financial Disclosures (TNFD) is gaining global traction, setting the stage for biodiversity risk to be embedded in financial decision-making, just as climate risk has been.

Nature is the Next Frontier

Why biodiversity? Because more than half of global GDP depends on nature, according to the World Economic Forum. From pollination to water cycles, genetic diversity to soil health, nature underpins the systems that businesses rely on. Yet we’ve lost over 60% of global biodiversity in the last 50 years.

Companies that treat biodiversity as a compliance box to tick are missing the point. Biodiversity is a source of innovation, resilience, and growth. Firms that integrate nature into their business models are already seeing returns—financial, operational, and reputational. Unilever, for example, is on track to generate €1.5 billion annually from plant-based products that reduce deforestation. Nestlé’s regenerative farming practices are improving soil fertility and water availability, while stabilising yields in drought-prone regions.

These are not fringe examples. Biodiversity-positive business models, such as nature-friendly products or circular economy platforms that reduce resource extraction, could unlock $10 trillion in opportunities by 2030.

The Cost of Inaction

Ignoring biodiversity is not just a missed opportunity, it’s a growing risk. Supply chain disruptions, reputational damage, and regulatory penalties are becoming more common.

In agriculture, reduced pollination from insect loss threatens up to US$577 billion in annual food production. In pharmaceuticals, declining genetic diversity hampers research and development. In mining, nearly 40% of global activity occurs in ecologically fragile regions, with biodiversity loss threatening both operations and social license to operate.

Investors are paying attention.

Capital is shifting away from companies that harm biodiversity and toward those that restore it. Firms without a biodiversity strategy risk being left behind—facing sudden costs, limited access to capital, reputations risks and declining market relevance.

Leadership in the Nature-Positive Economy

In this context, leadership means recognising the complex relationship between business and biodiversity—not just as a risk, but as a strategic opportunity. True leadership is reflected in the willingness to test innovative models, set ambitious nature-positive targets, and transparently share lessons learned.

A leading company understands the intrinsic value of biodiversity to its operations and sets clear goals that turn environmental responsibility into a source of long-term business viability, creating a win-win dynamic that fosters resilience not only for itself but also across the sector.

In Latin America, Grupo AJE partnered with the UK-funded Partnerships for Forests to scale Amazonian juices from non-timber forest products, creating new value chains while protecting forests. These examples illustrate a broader shift: nature-positive business models are already driving returns, reputational strength, and long-term viability

Financial Innovation: Unlocking Scale

Blended finance is emerging as a powerful tool to scale biodiversity investment. By combining public and private capital, it mitigates risk and aligns incentives. Instruments like first-loss guarantees and de-risking facilities make biodiversity projects more attractive to commercial investors, especially in ecologically vital but financially underserved regions like the Amazon.

Innovative mechanisms such as impact-linked loans, green or biodiversity bonds, and biodiversity credits tie financial returns to tangible conservation outcomes. Multi-layered capital structures—like those used in the Energy Entrepreneurs Growth Fund or the Acumen Resilient Agriculture Fund—enable flexible, scalable financing. Financial innovation also creates new markets by monetising ecosystem services through habitat banking and payments for ecosystem services, transforming nature into a tradable asset class.
Ultimately, these tools foster public-private partnerships that support Indigenous-led conservation, sustainable land use, and long-term biodiversity resilience.

Biodiversity Credits: The Next Market Frontier

Despite growing interest and transactions, biodiversity credits still face some barriers to scale. Unlike carbon credits, which are valued based on a standardised metric (CO₂e), biodiversity credits lack a universal unit.
Biodiversity is inherently place-based, making it difficult to compare values across geographies.

To overcome this, two approaches are gaining traction: standardising measurements within the same biome and developing cross-biome indicators—such as levels of natural disturbance or ecosystem integrity—that allow comparability across different ecosystems.

These efforts are essential to building trust, transparency, and liquidity in biodiversity markets.

What Good Looks Like

In the coming months, a best-in-class biodiversity strategy should be embedded across governance, operations, and finance. It will include:
• Science-Based Targets for Nature aligned with guidance from the Science Based Targets Network.
• TNFD-aligned risk disclosure integrated into enterprise risk management.
• Nature-positive business models or income streams that conserve or regenerate ecosystems.
• Landscape-level collaboration with governments, Indigenous communities, and peers.
• Biodiversity-linked finance through green bonds and nature credits.
• Digital traceability using satellite data, AI, and blockchain.
• Inclusive governance that respects Indigenous rights and promotes equity.
To get there, companies must build capabilities now: nature risk assessment, data literacy, supply chain mapping, restoration expertise, and policy intelligence. They must also rethink finance—mobilising capital for nature-positive outcomes.

A Call to Action

The message is clear: biodiversity is not a niche concern. It’s a strategic frontier. Companies that act now will lead the transition to a nature-positive economy. They will build resilience, unlock new value, and earn trust in a world that increasingly demands accountability.

The time for half-measures is over. In 2025 and 2026, every company needs a biodiversity strategy—not just to survive, but to thrive.

Learn more about Palladium’s nature-based solutions, Terrasos, and the team’s collaborations.