As ocean usage surges with technological advancements, a new study reveals significant gaps in how corporations disclose their impacts on marine ecosystems, urging for better transparency and accountability.
As scrutiny from policymakers and financiers over corporate environmental impacts intensifies, a recent study highlights a significant shortfall in how companies report their effects on ocean health.
The study, published in the journal Nature Sustainability, investigates the discrepancies between industrial impacts on the ocean and the disclosures made by leading corporations within the ocean economy sectors.
Lead author Jean-Baptiste Jouffray, a Wallenberg postdoctoral fellow at Stanford University’s Center for Ocean Solutions and the Stanford-based Natural Capital Project, remarked on humanity’s historical reliance on the ocean.
“Humanity has relied on the ocean for millennia, yet today’s scale and diversity of use are unprecedented,” he said in a news release. “While this offers opportunities for human wellbeing, it also poses severe risks to ecosystems and the communities that depend on them.”
Surging Ocean Economy and Its Impact
The ocean, which covers nearly three-quarters of the planet, has become a bustling hub of activity.
Technological advancements have led to tremendous growth in industries such as shipping, offshore wind energy and seabed fiber-optic communications.
In just two decades, shipping has increased fivefold, offshore wind energy has expanded over 500 times, and almost 1 million kilometers of seabed cables are now utilized for global communication.
Despite this rapid growth, the challenge lies in managing the severe risks posed to marine ecosystems. The introduction of invasive species — highlighted by the fact that one new species is introduced to a new part of the ocean every three days — has had profound and far-reaching consequences.
The Study’s Findings
Jouffray and his research team analyzed annual and sustainability reports from the top 10 companies in eight core sectors of the ocean economy. These sectors include cruise tourism, marine equipment and construction, offshore oil and gas, offshore wind, port activities, seafood, shipbuilding and repair, and container shipping.
The study spanned the years 2018 to 2020, aiming to identify how companies report their environmental impacts, what measurements they use, and what targets they set, if any.
The research unveiled crucial gaps in corporate disclosures.
Companies primarily focused on energy use and greenhouse gas emissions but paid little attention to ocean-specific impacts such as habitat destruction, overfishing, underwater noise or the spread of invasive species.
Less than one-third of the companies reported indicators related to biodiversity impacts, and there was a noticeable lack of standardization in the indicators used across companies.
Moving Towards Better Regulation and Financial Responses
The implications of improved disclosures could be far-reaching. Once climate and nature-related information is made public, investors and lenders can better assess the risks associated with their investments.
“In theory, the more information companies disclose about their operations, the better you can influence their behavior. But that requires someone to act on that information,” Jouffray added. “Transparency alone is a necessary, but far from sufficient, basis for corporate accountability.”
Several voluntary climate and nature reporting frameworks are already working to incorporate ocean impacts into their standards. Initiatives like the Taskforce for Nature-Related Financial Disclosures and the World Benchmarking Alliance are pivotal in driving transparency, potentially making such disclosures as standard as financial reporting is today.
The researchers are now focusing on building consensus around which indicators to include and identifying gaps in current data and policy. Their efforts extend to collaborating with monitoring systems similar to Global Fishing Watch to potentially provide third-party data, ensuring more accurate and comprehensive reporting.
The Role of Investors
The next phase of the research involves analyzing the role of financiers in encouraging better corporate practices.
Co-author John Virdin, the director of the Ocean Policy Program at Duke University’s Nicholas Institute for Energy, Environment and Sustainability, expressed significant interest in this area.
“Now that we have a baseline of the ocean impacts that companies report, we’re curious to know: if this reporting is improved, would financiers act on that information? Would it change investment decisions in the ocean economy? These are questions we are turning to now,” he said.
Source: Stanford University