Australia has the second most fragile biodiversity among G20 economies, Swiss Re says, underscoring the risk of ecosystem collapse that major economies are exposed to.

The result comes ahead of a United Nations Summit on Wednesday which is set to call for “urgent action on biodiversity for sustainable development“ as global efforts to halt biodiversity loss have fallen well below UN targets.

The Swiss Re Institute’s new Biodiversity and Ecosystem Services (BES) Index shows that both developing and advanced economies are susceptible to changes in these natural systems.

BES includes water security, regulation of air quality, food provision and other services based around natural ecosystems that are vital to maintaining the health and stability of communities and economies.

Group CEO Christian Mumenthaler says the impact of biodiversity risk on the economy is “just as important” as climate change and the new index gives stakeholders a new tool to manage the operational, transitional, and reputational risks connected to BES decline.

Since the late 1990s, economists have better understood the essential contributions of nature to functioning economies, for example animal pollination of crops is estimated to add up to $US577 billion ($818 billion) a year to the global economy.

Just over half of global GDP, equal to $US41.7 trillion ($59.1 trillion), is dependent on high-functioning biodiversity and ecosystem services.

“BES underpin all economic activity in our societies globally and should be part of strategy discussions across financial services,” Mr Mumenthaler says.

“In recent times, we have noticed an increasing interest among our clients in the topic as all stakeholders start to understand how BES affect asset values and the economy in general.”

This has implications for the insurance industry, but also offers opportunities.

In a fifth of all countries, ecosystems are in a fragile state for more than 30% of the entire country area.

Australia ranked 8th of all countries, with a 34% fragile ecosystem share. South Africa came 6th with a 40% share and topped the G20 list. Japan scored just 4% and New Zealand 2%.

Water scarcity is a driver for Australia’s high ranking, alongside coastal protection and pollination, and the nation “should prepare for ecologically driven disturbances – and look for opportunities in ecosystem services improvements and restoration,” Swiss Re says.

“A long-term policy goal (for Australia) could be to first become less vulnerable and then ‘move’ towards the area where for example Japan is positioned,” it says.

Japan has vast areas of intact habitat and its economy relies on secondary and tertiary sectors. It scored the 12th best for intact BES in the world, one notch above New Zealand.

Brazil and Indonesia enjoy the highest percentage of intact ecosystems within the G20.

Biodiversity measures the number, variety, and variability of living organisms. Ecosystem services (ES) are the benefits people obtain from ecosystems and can be classified as provisional (fibre, food, freshwater), regulative (disease management, climate regulation, freshwater purification), supportive (nutrient cycling, pollination, soil formation) and cultural (recreational, aesthetic, educational, spiritual/religious).

The most notable direct drivers of loss of BES are habitat and land use change, including fragmentation of forests; invasive species; overexploitation of natural resources; pollution – particularly from excessive fertilizer use; and climate change.

Swiss Re says 39 countries have ecosystems in a fragile state on more than a third of their land. Malta, Israel, Cyprus, Bahrain and Kazakhstan have the lowest ranking.