Open Access

Vera Henrike Austrup, Clarissa Bohn, Markus Kühlert

• Biodiversity is fundamental to healthy ecosystems and enables the provision of ecosystem services that societies and economies depend on, from food supply to climate regulation. Over the next ten years, loss of biodiversity and ecosystem collapse are expected to be the second-biggest risk for the global society and economy after extreme weather conditions, according to the World Economic Forum. Despite its recognized importance, the assessment of the state of biodiversity - from the local to the global scale - remains challenging. It involves complex ecological relationships and a wide variety of impacts across different locations and species, which often entails limitations and inconsistencies in data availability. This is furtherBiodiversity is fundamental to healthy ecosystems and enables the provision of ecosystem services that societies and economies depend on, from food supply to climate regulation. Over the next ten years, loss of biodiversity and ecosystem collapse are expected to be the second-biggest risk for the global society and economy after extreme weather conditions, according to the World Economic Forum. Despite its recognized importance, the assessment of the state of biodiversity - from the local to the global scale - remains challenging. It involves complex ecological relationships and a wide variety of impacts across different locations and species, which often entails limitations and inconsistencies in data availability. This is further exacerbated by the lack of standardization, which hinders the comparability of data across different regions. Measuring biodiversity loss or improvement therefore often relies on imperfect or incomplete information and requires careful interpretation. Against this background, the Wuppertal Institute, was tasked on behalf of the GLS Bank to define a conceptual and methodological approach for the biodiversity assessment of their loan portfolio, either by developing a proprietary framework or building upon existing methodologies and standards. This approach can be applied to GLS Bank's loan portfolio assessment and takes into account relevant sustainability characteristics within individual economic sectors. Conducting in-depth biodiversity impact assessments requires granular data on specific locations and planned activities. However, as client confidentiality restricts the availability of such detailed information, the applied assessment focuses on a higher-level analysis. The objective is to highlight hot spots that have a particularly strong impact on biodiversity (on the individual as well as on the portfolio level) and to identify potential conflicts of interest arising from loan allocation across different economic activities and their effects on distinct impact domains. These can help to identify possible scopes of action fields, constitute the basis for including biodiversity impacts in the portfolio management and provide a starting point for a detailed assessment of selected financed activities and their impacts. In this document, the approach, available data, as well as the methodology itself are described. Whilst no specific results are included, the document concludes with identified limitations, an outlook and recommendations for application.…