The Harmonious Coexistence of Creatures and Firms: A Review of Quantifying Biodiversity Contribution for Corporate Performance Evaluation

As pollution and ecological damage to the environment increase, there exists growing global concern about biodiversity loss, which could jeopardize the goods and services that people derive from the ecosystem, with far-reaching implications for the economy. This review paper examines the current literature regarding the impact of corporate contributions to biodiversity on their performance, as well as the potential transfer of biodiversity risk in the credit market. The following reflections can be derived. First, the literature quantifies corporate biodiversity activities through textual analysis and business surveys, then establishes a risk management system to manage biodiversity exposures. Second, existing research suggests that corporate biodiversity contributions may initially reduce performance due to the consumption of resources for “greenwashing” and competition for public attention. However, with digitalization and green productivity, companies contributing to biodiversity conservation are expected to see long-term improvement in performance. Furthermore, some scholars suggest that biodiversity shocks to a single firm could lead to financial risks spreading through supply chains and credit networks. The critical reflection expressed in this literature review paves the way for future studies on the economic impacts of biodiversity risk.