The implementation of biodiversity footprinting – examining supply chains

Biodiversity is foundational to human health, economic stability and industrial resilience – particularly within the pharmaceutical sector, which is intrinsically dependent on natural ecosystems. Over 60 percent of pharmaceuticals originate from biological sources, including plants, microbes and marine organisms.¹ Yet pharmaceutical supply chains often contribute to biodiversity loss through land degradation, pollution, water abstraction and habitat conversion.^2,3

As global environmental risks intensify and regulatory frameworks such as the Kunming-Montreal Global Biodiversity Framework (GBF) and the Corporate Sustainability Reporting Directive (CSRD) introduce new disclosure and governance obligations, businesses must move beyond climate-only metrics towards more holistic environmental accountability.⁴

A standardised approach for analysing the biodiversity impact within supply chains is therefore crucial to addressing more than carbon emissions as part of sustainability. Supply chain biodiversity footprinting (SCBF) is a science-based, spatially explicit methodology rooted in the Life Cycle Impact Assessment (LCIA) that aims to quantify biodiversity impact.

SCBF enables organisations to quantify, disclose and manage biodiversity-related risks across complex value chains. By aligning with emerging biodiversity regulations and global frameworks, SCBF supports strategic decision making, supply-chain resilience and credible progress towards nature-positive outcomes.

Nature as a business imperative in the pharmaceutical sector

The pharmaceutical industry is deeply intertwined with biodiversity. Natural compounds derived from plants, microorganisms and marine organisms underpin much of modern drug discovery and therapeutic development.⁵ These biological resources form the foundation of pharmaceutical innovation, from antibiotics and antivirals to oncology and pain management treatments.

Despite this reliance, pharmaceutical operations can exert significant pressure on ecosystems. Large-scale cultivation of medicinal crops, water-intensive manufacturing processes, chemical synthesis and waste discharges all contribute to biodiversity degradation.^6,7 These impacts are often spatially removed from end markets, disproportionately affecting biodiversity-rich regions in the Global South.⁸

To safeguard innovation and operational continuity, pharmaceutical businesses must transition from reactive environmental compliance towards proactive, systems-based environmental governance"

The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) estimates that over one million species face extinction within decades due to human-driven pressures. For the pharmaceutical sector, this presents not only an ethical concern but a material business risk. Biodiversity loss can constrain access to novel compounds, disrupt the sourcing of key ingredients and increase volatility across global supply chains.⁹

To safeguard innovation and operational continuity, pharmaceutical businesses must transition from reactive environmental compliance towards proactive, systems-based environmental governance. Supply chain biodiversity footprinting offers a structured mechanism to identify, quantify and address biodiversity risks embedded within value chains.

Biodiversity: what it is and why it matters to business

According to the Convention on Biological Diversity (CBD), biodiversity encompasses the variability of life at three interconnected levels:

• Genetic diversity
• Species diversity
• Ecosystem diversity.

Together, these levels support ecosystem functionality and the delivery of ecosystem services, commonly grouped into provisioning, regulating, supporting and cultural services. These services underpin economic activity, human health and industrial productivity.

Biodiversity loss directly affects business resilience by increasing exposure to supply disruptions and reducing access to unique biological materials"

The pharmaceutical sector has historically benefitted from this diversity. Soil microorganisms have yielded critical antibiotics such as actinomycin and erythromycin, while marine biodiversity has contributed compounds such as ziconotide for pain management.⁵ However, ecosystem degradation driven by deforestation, wetland loss, pollution and climate change threatens the availability of these natural resources.²

Biodiversity loss directly affects business resilience by increasing exposure to supply disruptions and reducing access to unique biological materials. The COVID-19 pandemic highlighted vulnerabilities in natural supply chains, particularly where reliance on specific biological inputs intersected with environmental stressors.⁹ For pharmaceutical companies, safeguarding biodiversity is therefore integral to long-term innovation, risk management and market stability.

The importance of environmental compliance and transparency

Regulatory expectations related to biodiversity are increasing rapidly at both national and international levels. Key frameworks and regulations relevant to pharmaceutical businesses include:

• The GBF, particularly Target 15 on corporate disclosure
• The UK Environment Act, including mandatory biodiversity net gain requirements
• The EU CSRD, notably ESRS E4 on ecosystems and biodiversity
• The EU Biodiversity Strategy for 2030.

Failure to comply with regulatory requirements may result in financial penalties, restricted market access, or investor withdrawal. Beyond compliance, transparency delivers strategic value by strengthening stakeholder trust, improving environmental, social and governance (ESG) integration and enabling early identification of nature-related risks and opportunities.

Organisations that integrate biodiversity into ESG reporting are better positioned to anticipate regulatory change and secure resilient procurement and investment pathways"

Embedding biodiversity into disclosure processes encourages cross-functional collaboration and long-term planning, transforming environmental reporting from a compliance exercise into a strategic capability. Organisations that integrate biodiversity into ESG reporting are better positioned to anticipate regulatory change and secure resilient procurement and investment pathways.¹⁰

Transparent, science-based biodiversity data also enhances access to green finance instruments, including sustainability-linked loans and nature-aligned investment vehicles.¹¹

Supply chain biodiversity footprinting: what it is and why it matters

While carbon accounting is now well established, it captures only one dimension of environmental impact. Biodiversity footprinting broadens this perspective by assessing multiple pressure pathways, including land use change, pollution, freshwater impacts and climate-driven ecosystem change.

These pressures can be evaluated using LCIA models, which translate supply chain activities into potential biodiversity impacts. A key output metric is species.year, representing the potential loss of species over time attributable to business activities. This metric expresses biodiversity impact as a fraction of global species affected annually, linking operational pressures to extinction risk.⁸

Supply chain biodiversity footprinting builds on LCIA approaches to assess upstream impacts across the full product lifecycle, from raw material extraction to manufacturing and distribution. Key features of SCBF include:

• Coverage of complex, global supply chains
• Quantification of biodiversity impacts across multiple environmental drivers
• Compatibility with existing LCA and sustainability reporting frameworks
• Actionable outputs to support risk mitigation and decision making.

By translating complex ecological data into decision-relevant metrics, SCBF enables businesses to prioritise high-impact areas, engage suppliers effectively and align biodiversity action with broader sustainability strategies.

Aligning with global frameworks and standards

Supply chain biodiversity footprinting plays a critical role in helping businesses to align with the rapidly evolving landscape of biodiversity-related frameworks. As expectations for nature-related disclosure increase, SCBF provides a robust, science-based foundation for compliance and strategic alignment.

SCBF supports alignment with key initiatives including the Global Biodiversity Framework, CSRD ESRS E4, emerging Taskforce on Nature-related Financial Disclosures (TNFD) recommendations and science-based targets for nature. By linking operational impacts to global biodiversity goals, SCBF enables businesses to integrate biodiversity into corporate strategy, risk management and capital allocation.

This alignment reduces legal and reputational risk while unlocking opportunities such as enhanced supply chain resilience, improved access to finance and competitive positioning in markets increasingly shaped by environmental performance.

The role of suppliers and shared responsibility for nature

Biodiversity impacts are often most concentrated upstream in supply chains, where pharmaceutical businesses rely on a globally dispersed network of raw material suppliers, contract manufacturers, agricultural producers and logistics providers.⁹

Key biodiversity risks arise from practices such as land-use change for crop cultivation, overharvesting of biological resources, wastewater discharges and infrastructure expansion. Because these impacts occur beyond direct operational control, addressing them requires collaboration across value chains rather than isolated corporate action.²

Environmental supply chain biodiversity footprinting provides a common evidence base to support supplier engagement, responsible sourcing strategies and collective action. By identifying priority hotspots and pressure pathways, SCBF enables businesses to work with suppliers to reduce impacts, build resilience and contribute to shared nature-positive outcomes.

About the author

Dr Tara Garraty is Senior Scientist and Biodiversity Lead at Tunley Environmental. She is a sustainability and conservation scientist with a specialised background in ecology and conservation biology. She holds a BSc and MSc degree in conservation biology, focusing on ecosystem services and ecosystem health, and has completed her PhD in conservation biology. Her career has concentrated on research and education in tropical and marine conservation, climate change, sustainability science, ecosystem function, biodiversity and general ecology.

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