Toward More Nature-Positive Outcomes: A Review of Corporate Disclosure and Decision Making on Biodiversity

Round 1

Reviewer 1 Report

Comments and Suggestions for Authors

Dear Authors,

 

I enjoyed reading your working paper and found it very informative. Especially Table 1, which gives a good overview of the different frameworks. As the table is quite large, it is a bit hard to read, a simple fix would be to add the column headings are added on each page. 

In addition, the proposal to design a procedure/framework similar to that for GHG emissions for biodiversity is very nice and useful indeed. As I was reading, I wondered if it would be possible to add a Scope 4 that would address the company's dependence on biodiversity, in a sense expressing the severity of the dependence.

on ecosystem services - the greater the dependency, the greater the risk? 

 

In addition, I have only a few minor comments. 

 

 

- Suggest adding biodiversity to the keywords.

- In the following paragraph, use indirect quote \citep{} S 4, line 183-185

- In this paragraph, you may want to consider adding these references as they are recent contributions to the field: Page 9, line 680 -

o Garel, A., Romec, A., Sautner, Z., & Wagner, A. F. (2023). Do investors care about biodiversity?

o Ahmad, M. F., & Karpuz, A. (2024). Beyond climate change risk:Biodiversity and corporate cash holdings. Economics Letters, 236, 111608.

- The first nine references in the bibliography appear to be placeholders.

Author Response

1. I enjoyed reading your work paper and found it very informative. Especially Table 1, which gives a good overview of the different frameworks. As the table is quite large, it is a bit hard to read, a simple fix would be to add the column headings are added on each page. 

Response: Thank you very much for the suggestions. We have edited the table with the table headings for all the pages as per the suggestion.

 

2. In addition, the proposal to design a procedure/framework similar to that for GHG emissions for biodiversity is very nice and useful indeed. As I was reading, I wondered if it would be possible to add a Scope 4 that would address the company's dependence on biodiversity, in a sense expressing the severity of the dependence. On ecosystem services - the greater the dependency, the greater the risk? 

Response: Thank you for your insightful suggestion regarding the inclusion of a Scope 4 to address a company's dependence on biodiversity. This is a valuable perspective. Suggestion 1 primarily focuses on the impacts that businesses have on biodiversity, emphasizing the assessment of these impacts. While biodiversity dependency is touched upon indirectly through Scope 1, particularly in relation to resource extraction for primary production, the main focus remains on the impact aspect. The dependency on biodiversity can indeed be considered a risk, which differs from the concept of impact and can be classified as a separate materiality concern. We have addressed these risk-related factors in Section 2.1, including relevant case studies. Integrating this into Suggestion 1 in Section 4.2 could be difficult. We hope you understand that we do not use the term Scope 4, as it could be misunderstood in this section of the paper (also in the context of the analogy Scope 4 for carbon emissions).

3. Suggest adding biodiversity to the keywords.

Response: Thank you very much for this suggestion. We have included the word biodiversity in the list of keywords as suggested.

4. In the following paragraph, use indirect quote \citep{} S 4, line 183-185

Response: Thank you very much for the suggestion. We have included the statement as a quotation as per the suggestion.

5. In this paragraph, you may want to consider adding these references as they are recent contributions to the field: Page 9, line 680 -

• Garel, A., Romec, A., Sautner, Z., & Wagner, A. F. (2023). Do investors care about biodiversity?
• Ahmad, M. F., & Karpuz, A. (2024). Beyond climate change risk: Biodiversity and corporate cash holdings. Economics Letters, 236, 111608.

Response: Thank you very much for introducing these recent studies. We have gone through this literature and incorporated this literature to our manuscript in the sections 4.2.4 Suggestion 4: Linking business profitability with biodiversity conservation

6. The first nine references in the bibliography appear to be placeholders.

Response: Thank you very much for mentioning this correction and we have removed the example references from our list of references in the manuscript.

We have thoroughly reviewed all the constructive comments and suggestions provided during the peer review process. After incorporating these insights, we are confident that the revised manuscript meets the high standards and quality expected by the journal. We convey our thanks to all the reviewers and editor corresponding to this manuscript.

Author Response File: Author Response.pdf

Reviewer 2 Report

Comments and Suggestions for Authors

The paper provides a comprehensive review of the importance of biodiversity in the corporate sector, emphasizing the need for nature-positive actions. It discusses the materiality of biodiversity, the role of regulations in corporate environmental reporting, and compares prominent sustainability frameworks. The authors also offer suggestions for improving future frameworks and highlight the necessity of focusing on decision-making paradigms.

1. The paper covers a broad range of topics related to biodiversity and sustainability reporting, which may lead to a lack of depth in certain areas. The authors could consider narrowing the focus to specific aspects, such as the challenges and opportunities of integrating nature-related disclosures into financial decision-making, or the development of a more holistic approach to measuring biodiversity impact.
2. The paper primarily relies on a literature review and lacks empirical evidence to support its claims and suggestions. The authors could consider incorporating case studies or empirical data to illustrate the practical implications of their recommendations and strengthen the paper's overall impact. Or add this to the limitations section. Please also update the literature to include Moussa and Elmarzouky, 2023. Does Capital Expenditure Matter for ESG Disclosure? A UK Perspective. Journal of Risk and Financial Management. And Moussa and Elmarzouky, 2024. Sustainability Reporting and Market Uncertainty: The Moderating Effect of Carbon Disclosure. Sustainability. And Mintah and Elmarzouky, 2024. Digital-Platform-Based Ecosystems: CSR Innovations during Crises. Journal of Risk and Financial Management.
3. The paper's structure could be improved to enhance clarity and flow. Some sections, particularly the discussion, could benefit from a more organized presentation of ideas and a clearer connection between the literature review and the proposed suggestions. The authors could also consider using subheadings to guide the reader through the different sections of the paper.
4. The paper uses various terms related to biodiversity and sustainability, which may not be familiar to all readers. The authors could provide clear definitions of key terms, such as "nature-positive," "biodiversity mainstreaming," and "materiality," to ensure clarity and avoid confusion.
5. The reference list could be improved by ensuring consistency in formatting and adherence to a specific citation style. The authors should carefully review the references and make necessary corrections to ensure accuracy and completeness.
6. Page 3: The authors state, "The risks a company faces due to the loss of nature can be straightforward, like agricultural firms experiencing reduced crop yields from a decline in pollination or soil health." While this statement is generally true, it would be beneficial to provide specific examples or case studies to illustrate these risks.
7. Page 5: The authors mention that "The goal of these collective actions is to equip businesses with the necessary tools and standards to consider biodiversity effects and benefits in their decision-making processes." The authors could elaborate on the specific tools and standards that are being developed and how they can be effectively implemented by businesses.
8. Page 8: The authors state, "However, both the G20 and G7, which bring together the heads of state and governments of leading industrial nations, have identified a gap in best practices specifically addressing the management of natural risks." The authors could provide more details on the specific gaps identified by the G20 and G7 and how they relate to the current sustainability reporting frameworks.

 

Comments on the Quality of English Language

The English language used in the manuscript is generally clear and understandable, with only minor grammatical and stylistic errors. However, there is room for improvement in terms of conciseness and clarity. Some sentences are overly long and complex, which can hinder readability. The authors could benefit from simplifying sentence structures and using more precise language. There are occasional instances of awkward phrasing or word choice that could be refined.

Author Response

The paper provides a comprehensive review of the importance of biodiversity in the corporate sector, emphasizing the need for nature-positive actions. It discusses the materiality of biodiversity, the role of regulations in corporate environmental reporting, and compares prominent sustainability frameworks. The authors also offer suggestions for improving future frameworks and highlight the necessity of focusing on decision-making paradigms.

1. The paper covers a broad range of topics related to biodiversity and sustainability reporting, which may lead to a lack of depth in certain areas. The authors could consider narrowing the focus to specific aspects, such as the challenges and opportunities of integrating nature-related disclosures into financial decision-making, or the development of a more holistic approach to measuring biodiversity impact.

Response: Thank you for the suggestion. We have rearranged the literature review to give the key focus to corporate biodiversity disclosure and the current situation of sustainability frameworks. We also have narrowed section 3.2 giving key focus to materiality and biodiversity disclosure approaches of available sustainability frameworks. We modified section 4 by giving recommendations for a more holistic approach to measure biodiversity impact.

 

2. The paper primarily relies on a literature review and lacks empirical evidence to support its claims and suggestions. The authors could consider incorporating case studies or empirical data to illustrate the practical implications of their recommendations and strengthen the paper's overall impact. Or add this to the limitations section. Please also update the literature to include Moussa and Elmarzouky, 2023. Does Capital Expenditure Matter for ESG Disclosure? A UK Perspective. Journal of Risk and Financial Management. And Moussa and Elmarzouky, 2024. Sustainability Reporting and Market Uncertainty: The Moderating Effect of Carbon Disclosure. Sustainability. And Mintah and Elmarzouky, 2024. Digital-Platform-Based Ecosystems: CSR Innovations during Crises. Journal of Risk and Financial Management.

 

Response: Thank you very much for this suggestion and introducing this literature. We have gone through the suggested papers and updated the paper accordingly in section 4.2.3. Furthermore, we incorporated possible case studies to the sections 4.2.1, 4.2.2, 4.2.3 and 4.2.4 which shows the suggestions for to improve biodiversity disclosure.  However, since the suggestion one is novel, we could not find any empirical data to support that, hence we have mentioned it as a limitation at the end of the conclusion section.

 

3. The paper's structure could be improved to enhance clarity and flow. Some sections, particularly the discussion, could benefit from a more organized presentation of ideas and a clearer connection between the literature review and the proposed suggestions. The authors could also consider using subheadings to guide the reader through the different sections of the paper.

Response: Thank you very much for the suggestion. We have improved the discussion section by segregating it into sub sections according to the facts that we discuss. Furthermore, we have made the discussion section more organized and linked with the literature.

4. The paper uses various terms related to biodiversity and sustainability, which may not be familiar to all readers. The authors could provide clear definitions of key terms, such as "nature-positive," "biodiversity mainstreaming," and "materiality," to ensure clarity and avoid confusion.

Response: Thank you very much for the suggestion. We have added the definitions for "nature-positive," "biodiversity mainstreaming," and "materiality," in the sections where we first talk about those concepts.

5. The reference list could be improved by ensuring consistency in formatting and adherence to a specific citation style. The authors should carefully review the references and make necessary corrections to ensure accuracy and completeness.

Response: Thank you very much for the suggestion. We have checked the references and amended them according to APA style.

 

6. Page 3: The authors state, "The risks a company faces due to the loss of nature can be straightforward, like agricultural firms experiencing reduced crop yields from a decline in pollination or soil health." While this statement is generally true, it would be beneficial to provide specific examples or case studies to illustrate these risks.

Response: Thank you very much for the suggestion. We have incorporated few case studies to support this statement in the section 2.2

 

 

7. Page 5: The authors mention that "The goal of these collective actions is to equip businesses with the necessary tools and standards to consider biodiversity effects and benefits in their decision-making processes." The authors could elaborate on the specific tools and standards that are being developed and how they can be effectively implemented by businesses.

Response: Thank you very much for the suggestion. We have incorporated information about related tools and how they can support in assessing biodiversity impact, using existing literature. This information are included in section 2.2.

 

8. Page 8: The authors state, "However, both the G20 and G7, which bring together the heads of state and governments of leading industrial nations, have identified a gap in best practices specifically addressing the management of natural risks." The authors could provide more details on the specific gaps identified by the G20 and G7 and how they relate to the current sustainability reporting frameworks.

Response: Thank you very much for the suggestion. We have incorporated more information about G20 and G7 and described their gaps according to the existing literature. We also mentioned how they can be related to sustainability reporting frameworks. This information is included in section 3.1.

 

9. Comments on the Quality of English Language. The English language used in the manuscript is generally clear and understandable, with only minor grammatical and stylistic errors. However, there is room for improvement in terms of conciseness and clarity. Some sentences are overly long and complex, which can hinder readability. The authors could benefit from simplifying sentence structures and using more precise language. There are occasional instances of awkward phrasing or word choice that could be refined.

Response: Thank you very much for this suggestion, we have done the language edition of the manuscript and checked the grammar and improved the readability.

Author Response File: Author Response.pdf

Reviewer 3 Report

Comments and Suggestions for Authors

 

The core contribution of the paper is acknowledged, but several critical issues were identified that must be addressed before the paper can be considered for publication.

1)      While the manuscript addresses an important issue—corporate disclosure and decision-making on biodiversity—the conceptual framework lacks clarity. The connection between corporate actions, biodiversity outcomes, and the broader sustainability frameworks needs to be more explicitly articulated. The manuscript should better define key terms such as "nature-positive outcomes" and "biodiversity" within the context of corporate ESG performance.

2)       The literature review is comprehensive but somewhat fragmented. It includes a wide array of references, yet it fails to synthesize them effectively to create a coherent narrative. I suggest reorganizing the literature review to focus on the most relevant studies that directly support the research questions and hypotheses of the paper.

3)      The policy implications section was seen as underdeveloped. I encourage the authors to elaborate on how their findings could inform corporate policies and practices related to biodiversity. This could involve discussing the role of regulatory frameworks and the potential for businesses to lead in biodiversity conservation efforts.

4)      The conclusion was criticized for being too brief and not fully capturing the significance of the research. I recommend expanding the conclusion to include a more thorough discussion of the study’s contributions to the field, as well as its limitations and suggestions for future research.

Comments for author File: Comments.pdf

Comments on the Quality of English Language

Minor editing

Author Response

     The core contribution of the paper is acknowledged, but several critical issues were identified   that must be addressed before the paper can be considered for publication.

1. While the manuscript addresses an important issue—corporate disclosure and decision-making on biodiversity—the conceptual framework lacks clarity. The connection between corporate actions, biodiversity outcomes, and the broader sustainability frameworks needs to be more explicitly articulated. The manuscript should better define key terms such as "nature-positive outcomes" and "biodiversity" within the context of corporate ESG performance.

Response: Thank you very much for the comment. We have defined key terms such as nature-positive, biodiversity and materiality in the manuscript and improved the content in discussion (section 4) in order to clearly discuss the connection between corporate actions and biodiversity outcomes. We have used case studies to support the facts.

 

2. The literature review is comprehensive but somewhat fragmented. It includes a wide array of references, yet it fails to synthesize them effectively to create a coherent narrative. I suggest reorganizing the literature review to focus on the most relevant studies that directly support the research questions and hypotheses of the paper.

Response: Thank you very much for the comment. We have reorganized the literature review as per your comment. We have incorporated related studies and improved the flow of the literature review.

 

3. The policy implications section was seen as underdeveloped. I encourage the authors to elaborate on how their findings could inform corporate policies and practices related to biodiversity. This could involve discussing the role of regulatory frameworks and the potential for businesses to lead in biodiversity conservation efforts.

Response: Thank you very much for this suggestion. We have incorporated the role of mandatory and non-mandatory regulations on biodiversity disclosure and how it affects corporate disclosure using case studies in section 2.2. Furthermore, we have highlighted the importance of policies in the discussion section and enriched the discussion with related case studies and findings.

 

4. The conclusion was criticized for being too brief and not fully capturing the significance of the research. I recommend expanding the conclusion to include a more thorough discussion of the study’s contributions to the field, as well as its limitations and suggestions for future research.

Response: Thank you very much for the suggestion. We have expanded the conclusion with a more descriptive presentation of recommendations as well as by adding limitations and scope for future studies.

Author Response File: Author Response.pdf

Round 2

Reviewer 2 Report

Comments and Suggestions for Authors

The authors have addressed my comments, and I recommend the paper for acceptance and publication.

Reviewer 3 Report

Comments and Suggestions for Authors

the paper is ready to be published