How Investors Can

INTEGRATEBIODIVERSITY
Into their Financial Strategies

Biodiversity plays a vital role supporting life onEarth, while contributing over half of global GDP.
Yet key species continue to be lost.
Source: United Nations, www.un.org/en/climatechange/science/climate-issues/biodiversity,
February 2024

This infographic shows how investors can integratebiodiversity into their investment strategies.

WHAT ISBIODIVERSITY?

Biodiversity refers to the rich diversity of species,
ecosystems, and genetic material that exists on Earth.
Source: United Nations, www.un.org/en/climatechange/science/climate-issues/biodiversity,
February 2024

WWF Living Planet Index
The index measures 31,821 populations of 5,230 species weighted by
species richness, across terrestrial, marine, and freshwater ecosystems.

Between 1970 and 2018, there was an average 69% decline in monitored
wildlife, with the greatest decrease among freshwater species (84%).

1.00

94%

In Latin America and the Caribbean alone, there
was a 94% drop in average population abundance,
the largest regional decline observed.

0.75

0.50

0.25

0.00

Source:Living Planet Index
Report by the World
Wildlife Fund, 2022

1970

1980

1900

2000

2010

2018

Year

"

Biodiversity is one of the paramount themes of our age andcalls for investors to understand and address its associatedrisks and opportunities in their investment portfolios.

"Axel Lomholt
General Manager, STOXXWHAT IS DRIVING
THE LOSS OF
BIODIVERSITY?

The current rate of biodiversity loss has
been called the Sixth Extinction, equivalent
to the end of the dinosaurs 65 million
years ago. Here are three key drivers:

1Source: The Sixth Mass Extinction by Elizabeth Kolbert, 2015

Land-Use:
Global Primary Forest Loss
Millions of Hectares
500M
400M

Between 2001 and 2022, over 459M hectares offorest were lost worldwide, due to a combinationof agricultural expansion, forestry, and wildﬁres.

300M
200M

2100M

Pollution: Annual Mean
Concentration of PM2.50Year

2005

2010

Air pollution in the form of particulate matter smaller than
2.5 microns can now be found everywhere on Earth,and at levels that are unsafe for both humans
and the wider ecosystem.

2015

2020

Source: Global Forest Watch as of December 22, 2023

PM2.5 in μg/m35.2

364.1

Source: World Health Organization, 2019

Climate Change:
Monthly Global
Average Temperature

2.0°C

Each degree of warming increases
the risk of extinction, especially forsensitive ecosystems like coral reefs.

0.0°C

1.0°C

-1.0°C-2.0°C
1850

900

1950

2000

Source: Berkeley Earth as of December 22, 2023

HOW CAN INVESTORS SUPPORTBIODIVERSITY IN THEIR INVESTING?

A key outcome of the UN Convention on Biodiversity was the adoption in 2022 of the Kunming-Montreal
Global Biodiversity Framework, which includes 23 goals for 2030 to help stop biodiversity loss.
Investors can play a part by taking biodiversity into account in their investment strategies.
One approach is to invest in ﬁnancial products that track a biodiversityrelated index, such as the ISS STOXX Biodiversity Indices.

Goal
Capital is allocated on
the basis of four elementsthat work together toreduce biodiversity loss.

ISS STOXX
BiodiversityIndices
The indices support
various UN Sustainable
Development Goals.
Biodiversity data comesfrom ISS ESG, a global
provider of ESG ratings,
norm-based research,and climate risk
assessments.

Avoid

Minimize

EnableExcludecompanies
involvedin activities
causing harm
to biodiversity

Exposure tocompanies with
low negative
impact on
biodiversity:
Reduce Potentially
Disappeared
Fraction of Species(PDF) / Enterprise
Value Including
Cash (EVIC)

Increase exposure
to companies
whose solutions
give themhigh scores inbiodiversity- andclimate-related
UN SDGs

Decarbonize

Carbonintensity is
reduced byat least 30%
relative toparent index

Source: STOXXHOW CAN BIODIVERSITYIMPACT BE MEASURED?
Assessing a company's biodiversity impact
involves evaluating the eﬀect that its operations
and activities have on the local and global ecosystem.
The ISS STOXX Biodiversity Indices use thefollowing biodiversity data from ISS ESG:

Norm-BasedFilters

ISS ESG Norm-Based ResearchProductInvolvement
Screening

ISS ESG product involvement screening:
controversial weapons, tobacco, thermal coal,unconventional oil & gas, civilian ﬁrearms, military contracting

Biodiversity
Filters

ISS ESG biodiversity-related product involvement ﬁlters:
palm oil, GMO agriculture, hazardous pesticides,
animail welfare and fur involvement

ISS ESG
Biodiversity Impact
Assessment Tool

SustainableDevelopment Goals

Economic activity identiﬁcation
Supply chain impact assessmentPotentially Disappeared Fraction of Species (PDF)
Mean Species Abundance (MSA)

ISS ESG SDG Rating and Solutions Assessment

Source: STOXX, ISS ESG

The ISS STOXX Biodiversity indices can provide a comprehensive framework
to help investors integrate biodiversity considerations into their portfolios.

Learn more about ISS STOXX Biodiversity indices

STOXX Ltd., ISS STOXX GmbH, ISS STOXX Index GmbH, Deutsche Börse Group and their licensors, research partners or data providers are not providing investment advice throughthe publication of indices or in connection therewith. Financial instruments based on the STOXX indices, DAX indices or on any other indices supported by STOXX are in no way
sponsored, endorsed, sold or promoted by STOXX Ltd., ISS STOXX GmbH, ISS STOXX Index GmbH, Deutsche Börse Group or their licensors, research partners or data providers.
Research, ratings, scores, and other analytical assessments are produced by Institutional Shareholder Services Inc. ("ISS") and may be used as an input for ISS STOXX indexes,
calculated by ISS STOXX Index GmbH or STOXX Ltd. ISS is a Registered Investment Adviser under the Investment Advisers Act of 1940.
This document has not been submitted to, nor received approval from, the United States Securities and Exchange Commission or any other regulatory body.
Copyright © 2024 STOXX Ltd.

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