Revealing Plato’s ‘Shadow Kingdom’: rendering pandemic risk explicit in extinction engagement

Abstract

Institutional investors have bemoaned a lack of corporate disclosure on environmental issues. Consequently investor engagement and dialogue on environmental issues has evolved with evidence that these private reporting channels are driving corporate accounting and accountability and investment decisions (Solomon and Solomon, 2006; Solomon et al., 2011). To date there has been no research into the views of the institutional investment community on investor engagement and corporate reporting on biodiversity and species extinction, despite research showing that companies are increasingly reporting on these issues, although extinction accounting and engagement frameworks have been developed in the literature which incorporate biodiversity and species protection (Atkins and Maroun, 2018; Maroun and Atkins, 2018; Atkins and Atkins, 2019). Given growing evidence of links between biodiversity loss, species extinction and Covid-19, we anticipated that investors and companies will have a heightened focus on biodiversity and extinction in the wake of Covid-19. This paper reports the findings of interviews with 27 members of the international institutional investment community and governance experts on their perceptions of the impact of Covid-19 on investor engagement and corporate reporting on biodiversity and extinction, and whether these accountability mechanisms could assist in reducing the risk of future pandemics, or at least lessen their impact. The participants perceived that as a result of Covid-19: investor engagement on biodiversity and extinction will grow; investor demand for corporate reporting on biodiversity will increase, and; there will be a corresponding increased focus on biodiversity in corporate reporting. The findings are interpreted through a Becksian theoretical framework drawing from Plato's ‘Allegory of the Cave’ to show that Covid-19 has acted as a catalyst, heightening awareness and consciousness in society, and among investors and companies, around the importance of enhancing biodiversity and habitats and reducing species extinctions. From combining our interview findings with interdisciplinary research, we then incorporate potential mechanisms for managing and preventing pandemic risk into the existing extinction accounting and engagement frameworks

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https://uws.pure.elsevier.com/en/publications/f49f48e7-4e0b-4e60-a049-357a7103d009