Integrating Biodiversity Conservation into Oil and Gas ... - EBI

2. INTEGRATING BIODIVERSITY INTO THE BUSINESS CASE
What is the business case for integrating biodiversity conservation into oil and gas development?
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It is widely acknowledged that biodiversity is valuable
and that consideration of biodiversity issues should
be a part of oil and gas development. But what are the
drivers for business to support this assertion? Outlining
the business reasons why a company should include
biodiversity in the risk-benefit analyses that drive much
of company decision-making will make it easier for
managers to express these issues in familiar terms.
The “business case” for integrating biodiversity
considerations into company management systems and
operations is not just an off-the-shelf line of reasoning.
Rather, the individual business case for each company
is created, based on a company’s values and principles.
By tailoring basic arguments to their own particular
company, health, safety and environment (HSE)
managers, corporate officers and business unit leaders
can better educate colleagues and shareholders about the
value of biodiversity as a factor in business decisions.
See the EBI PowerPoint Presentation on
Integrating Biodiversity Conservation into Oil and Gas
Development.
Most energy companies are keenly aware that
failure to operate in an environmentally and socially
responsible manner can present significant risks
to a company's operations and reputation. Thus,
companies have increasingly recognized the business
case that exists to support environmentally and socially
responsible performance. Within the spectrum of
environmental issues a company may face, biodiversity
excites high societal interest and captures the public
imagination. Nevertheless, many companies do not
yet explicitly identify biodiversity conservation as a
singular component of the company's environmental
performance needs and objectives. Therefore, the
discussion in this section focuses specifically on
biodiversity to highlight attention to it, recognizing
that the rationales presented are equally applicable
and relevant to the business case for responsible
environmental and social performance in general.
The first argument in favor of including biodiversity
considerations in decision-making – and one
that is the most important driver for many leading
companies – is a moral and ethical one. In other words,
conserving biodiversity is simply “the right thing to do.”
Increasingly, shareholders, employees and the public
expect companies to do the right thing and to share the
public’s concern for environmental issues, including
biodiversity.
For example, at BP's 2002 annual general meeting,
a shareholder resolution was received that required
clarity in how the company manages risk in the process
of deciding whether to operate in protected areas.
The resolution was unsuccessful, but in response BP
committed to providing information on risk assessments
undertaken when decisions were made to operate in
IUCN Management Categories I-IV. During 2002 no such
decisions were made, but in the interest of transparency
the company published details of sites where existing
operations were located in categories I-VI.
A risk- or financial-based business case is a complement
to the values-based arguments that exist around
environmental and social issues. Faced with an
increasingly competitive energy market, companies
still need to find a way to fit the intuitive arguments
around biodiversity into the economics-driven
paradigm of oil and gas development. The basic drivers
for integrating biodiversity into management systems
and operations are fundamentally grounded in the
discipline of risk management – minimizing risks and
maximizing opportunities (see Figure 3). Failing to
address biodiversity considerations at the project level
can lead to delays and problems on the ground, impeding
a company’s ability to operate efficiently. Repeated
problems at project sites can damage a company’s overall
reputation, negatively affecting its access to land, oil and
gas resources, capital, employees and public goodwill,
and constraining future business opportunities.
16 The Energy & Biodiversity Initiative