“We have unleashed a mass extinction event, the sixth in roughly 540 million years, wherein many current life forms could be extirpated or at least committed to extinction by the end of this century.”
This 2017 statement signed by 15, 364 scientists from 184 countries was the second “warning to humanity” issued by the global research community. Six years on, we remain far behind on global conservation targets.
Historically, many human societies have left destroyed habitats in their wake. What’s different now is that this collapse is happening at a global scale, with extinction rates hundreds, likely thousands, of times higher than the natural baseline.
Biodiversity is the basis of all our food, water, and medical resources. The world’s ecosystems are also critical in regulating the climate – consider how around 40% of global warming since before the industrial era has resulted from habitat degradation rather than direct fossil emissions. It is also, of course, the non-negotiable bedrock of the entire bioeconomy.
Stemming the tide will require an international effort. Yet a lot depends on what happens within developing countries, where most global biodiversity is located. Part of the solution will come in building new bioeconomies in these regions, ones where businesses embed biodiversity protection within its operating models.
Mainstreaming this type of enterprise is an ambitious goal given that most value creation today involves the destruction rather than the sustenance of natural habitats.
Yet in Southeast Asia, which contains around 20% of the world’s plant and animal species, and Brazil, which holds between 15 to 20%, investment platforms and biobased companies are taking on the challenge.
New biodiversity incubators in Southeast Asia
Asia was the most underperforming continent when it came to meeting conservation targets according to a study last year, with just 12.3% of land designated a protected area in 2020.
Yet the continent also hosts some of the fastest growing economies in the world, offering a large potential stock of capital to support ecologically-minded enterprises.
Biodiversity-focused Asian startups still lack the visibility of their Western counterparts. Two new biodiversity-focused incubators may change this, one of them launched by a Singapore-based company called Silverstrand.
In May 2023, Silverstrand unveiled what it called Asia’s first biodiversity accelerator programmes. The programme called for eight “high impact”, early-stage companies in Southeast Asia using technology to protect or restore vulnerable landscapes.
Silverstrand offers candidates a potential $250, 000 investment each as well as introductions to a network of relevant investors. Its portfolio is already filling up and bio-based agtech looms large.
Another new Asian biodiversity business platform that started this year was Indonesia-based Terratai, which calls itself Asia’s first ‘venture builder for nature’.
Terratai offers resources and investments to early-stage, biodiversity-focused startups on the Asian continent. It is particularly focused on businesses that bring “measurable positive impact in Asia’s most vulnerable marine and terrestrial ecosystems”. Potential venture partners must provide evidence on how their business model is going to achieve this.
In one interview, founder and CEO Matt Leggett framed Terratai’s objective in more picturesque terms: “It’s relatively easy to start a company that produces boutique nature-sensitive coffee that sells for a premium in Europe. But that’s like laser surgery on the problem. What we need is radiotherapy across the system,”
ASEAN’s coordinating role in building a sustainable bioeconomy
Policy changes are also slowly trickling through from ASEAN, an intergovernmental organisation that counts ten Southeast Asian countries among its members. This powerful organisation could become crucial in stimulating and scaling the region’s bioeconomy.
ASEAN’s most important task will be to cultivate a macroeconomic environment that allows biodiversity-supporting businesses to thrive. Apart from backing nature-aligned startups financially, the organisation has a key role to play in harmonising legislation and standards around private investments into the area. Without clear definitions for what counts as a sustainable business, private and public investors alike are flying blind.
Already, ASEAN nations have been collaborating on a Taxonomy for Sustainable finance, with version 2 released earlier in 2023. One component of the taxonomy is ‘protection of healthy ecosystems and biodiversity’, alongside climate change mitigation, adaptation, and resource resilience through circular economies.
As elsewhere, the region faces challenges in mounting a truly sustainable bioeconomy. CEO and founder of Terratai Matt Leggett recently posted about the travails of a biodiversity-focused venture capital startup on the continent.
At the ASEAN Inclusive Business Summit in September, Legget spoke of how regional political initiatives to de-risk sustainable development-aligned SMEs often skipped over references to nature, climate, and biodiversity, focusing on more conventional definitions of economic development.
Since old paradigms die hard, this issue is not confined to Asia. The global community as a whole must reevaluate traditional measures of economic success that have played such a significant role in driving climate change and biodiversity loss.
Yet one indicator that a biodiversity-conscious economy could take root in southeast Asia is that the population there is already well acquainted with the importance of ecosystem health, with many livelihoods still closely dependent on it.
The ASEAN bioeconomy employs around 8.2% of the labour force, generating over $2.3 trillion annually. Three quarters of this lies in agriculture, food manufacture and primary resource extraction. Over the coming years, the makeup of the sector could shift as higher value bio-industries grow.
Fruits of the Brazilian rainforest
Brazil is the most biodiverse country on the planet and a growing cluster of startups there are working for and with its natural riches.
Nutraceutical companies that trade on their ethical status as organic, forest-sustaining enterprises are abundant in Brazil. This is down to the immense range of flora and fauna that exist in the country, including an abundant range of antioxidant-rich fruit.
Awi Superfoods is serving these health-giving forest crops up to a global market through ultra-nutritious snacks cultivated in ways that limit soil quality degradation. It is also pursuing a circular approach to farming by turning its agricultural waste streams into biogas.
To obtain its harvests, the company practises agroforestry, a method of farming that involves growing diverse crops interwoven into forest habitats, avoiding forest clearance and wildlife-killing monocultures.
Sustainable biomass harvesting is at the heart of many ecosystem-sustaining Brazilian startups and CourageLand is another company pioneering agroforestry around Brazil, specialising in sustainably grown organic coffee, acai, coca, spices, fruits, nuts, native hardwoods and beauty ingredients.
For agroforestry to maximise its environmental benefits, the system must be installed in areas with high biodiversity potential which have been degraded through unsustainable.
From a regenerative company’s perspective, then, the São Paulo region offers prime real estate: although a historically fertile coffee region, years of intensive export crop cultivation have led to collapsing ecosystems and soil degradation. CourageLand opened a new agroforestry hub there this year, adding to existing plots in Bahia in the Atlantic Rainforest and Raraima in the Amazon Jungle.
A one-stop agroforestry consultancy
Finding low-impact, cost-effective feedstocks for complex biochemicals is challenging. The agroforestry projects being conducted in Brazil offer one pathway towards achieving this.
Yet shifting towards an agroforestry planting system is not a decision that can be taken lightly. Productive and sustainable agroforestry relies on intensive local ecological and agricultural knowledge. This is because the method replaces capital and fossil-intensive synthetic inputs with a deeper understanding about how interactions between species and environments can enhance crop productivity.
Belterra is a startup that offers a one-stop-shop for farmers wishing to adopt agroforestry, offering credit, technical assistance, logistical support and commercialisation to bring products to market. Depending on the farmer, they also offer plot-specific expertise from university researchers and other consultancies.
The startup tries to achieve ecological restoration goals by targeting farmers that own degraded soil plots. Belterra offers financing options to transform these areas into agroforestry systems but also supports clients right down to the planting process, drawing on their network of machinery rental companies, labour, nurseries, and organic input companies.
The bioeconomy and climate justice
Scaling biobased businesses that place ecological conservation at the core of their operations will be necessary if we are going to keep the biosphere in a state capable of supporting advanced human life.
Yet rigorous reflection on the ecological impacts of the biobased industries today would also serve the interests of the sector itself. Certain parts of the biobased industry are now drawing widespread scrutiny from consumers thanks to growing awareness that renewable feedstocks can come at the expense of carbon-storing, wildlife-rich habitats.
For ecologically sound enterprises to become the norm rather than the exception, massive collective efforts are still in order to scale. This is none more apparent than sustainable businesses in developing economies, which still struggle to attract the same media attention and capital as their Western counterparts.
Yet the crippling debt burden of some developing countries – which have contributed least to historic emissions – is constraining their ability to stem the biodiversity crisis. Economies structured around servicing debt repayments will also inevitably hold back private sector growth too.
Movements to redress this are happening now. Many national leaders, NGOs, and economists argue the only viable, just and ecologically sound way of approaching the investment gap is a combination of debt cancellations and reparations.
In short, the bioeconomy cannot expand where we need it most without climate justice. Today, the priority is to divert debt repayments into more fruitful goals, including investment into sustainable enterprises in the most ecologically complex parts of the planet.