EU ETS: what you need to know about the EU carbon market
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In this article, we'll explore the EU Emissions Trading System (EU ETS), a European initiative for reducing greenhouse gases through a cap-and-trade scheme.
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Ecosystem: Definition, Components, and Structure
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By Kara Anderson, UK Copywriter, on 02/10/2022
Updated by Agnès Potier-Murphy, on 15/06/2026
An ecosystem is a community of living organisms — plants, animals, fungi, and microorganisms — interacting with each other and their physical environment as a single, self-sustaining system that cycles nutrients, flows energy, and supports life at every scale.
These natural networks not only support biodiversity but also regulate our climate, cycle nutrients, store carbon, and underpin the food and water systems that human life depends on. As climate change accelerates, understanding what ecosystems are and how they work has never been more urgent.
Key points:
Ecosystems range from a rock pool to the Amazon rainforest — any system where living organisms interact with their physical environment counts
Every ecosystem depends on two components: biotic (living) and abiotic (non-living) factors
Producers, consumers, and decomposers form the trophic structure that drives energy and nutrient flow
Ecosystems deliver four categories of services — provisioning, regulating, supporting, and cultural — that underpin human economies
Ecosystem health is now a material business risk, tracked through frameworks like TNFD and the CSRD's biodiversity reporting requirements
What is an ecosystem?
To understand what an ecosystem truly is, let’s start by breaking down the word into its components: “eco” and “system.”
“Eco” is rooted in ecology - ie. the study of how living organisms (plants, animals, and microorganisms) interact with each other and with non-living elements like soil, air, and water. When combined with “system”, it describes an organised network of these interactions, where every part - whether living or non-living - is intricately connected.
However, understanding the different components and interactions within an ecosystem is only the start - these networks are also heavily influenced by external factors that can tip the balance.
Climate factors, for example, play a vital role in shaping ecosystems, influencing everything from plant growth to animal behaviour. As climate conditions shift due to human activity, these ecosystems face new pressures, often disrupting these delicate balances.
Components of ecosystems
Ecosystems are made up of two primary components: biotic and abiotic elements, which together create a self-sustaining environment that supports entire communities of organisms.
- Biotic components: These are the living parts of an ecosystem, such as plants, animals, fungi, and microorganisms. Each biotic element fulfills a specific role in the ecosystem, contributing to energy flow and nutrient cycling.
- Abiotic components: These are the non-living elements essential for life, including sunlight, water, soil, and temperature. Abiotic factors shape the conditions in which organisms live and influence the distribution and behaviour of species within the ecosystem.
Together, biotic and abiotic components interact through ecosystem processes - such as nutrient cycling and energy flow - that sustain ecosystem stability and resilience. For example, plants (biotic) use sunlight and soil nutrients (abiotic) to grow, providing food and energy for other organisms.
These interactions form the foundation of ecosystem structure, supporting the balance that allows ecosystems to function and thrive.
| Biotic components | Abiotic components | |
|---|---|---|
Definition |
Living parts of an ecosystem | Non-living parts of an ecosystem |
Examples |
Plants Animals Fungi Bacteria | Sunlight Water Soil Temperature |
Role |
Drive energy flow and nutrient cycling | Shape the conditions in which life exists |
Depends on |
Abiotic conditions to survive and reproduce | Not dependent on biotic factors |
Structure of an ecosystem: Producers, consumers, and decomposers
As we've already touched on, ecosystems rely on the continuous flow of energy and nutrients - a cycle that sustains all forms of life.
At the heart of this system are three essential roles that species play: producers, consumers, and decomposers. These roles help drive vital cycles, such as the carbon, water, and nitrogen cycles, that make Earth habitable and keep ecosystems functioning.
Producers
Producers, like trees, grasses, and algae, are the foundation of all ecosystems.
Through photosynthesis, they harness energy from sunlight and absorb carbon dioxide, water, and nutrients from their environment to create new growth (essentially they make their own food).
These organisms don’t just sustain themselves - they produce the organic matter that serves as the starting point for the entire food web. Producers enable life to thrive by converting abiotic components into energy-rich biomass that consumers rely on.
Consumers
Consumers are organisms that cannot produce their own energy and must instead consume other organisms - whether plants, animals, or both - to survive.
Herbivores, carnivores, and omnivores all fall into this category. For example, a rabbit grazing on grass acts as a primary consumer, while a wolf preying on these primary consumers is considered a secondary consumer.
Consumers help regulate populations within ecosystems and keep the balance between species.
Decomposers
Decomposers, such as fungi, bacteria, and certain insects, play a critical role in breaking down dead material from producers and consumers. They transform organic waste into simpler substances, enriching the soil with nutrients that plants need to grow.
Without decomposers, ecosystems would accumulate dead material, and the soil would eventually be depleted of nutrients. By returning essential nutrients to the environment, decomposers ensure that ecosystems remain healthy and self-sustaining.
Types of ecosystems and ecosystem biomes
Ecosystems around the world vary widely, shaped by differences in climate, geography, and available resources.
These ecosystems can be grouped into larger biomes - expansive regions that share similar climate patterns, vegetation, and wildlife. Biomes, such as forests, grasslands, deserts, and aquatic areas, serve as categories that encompass multiple, diverse ecosystems.
Terrestrial ecosystem
Terrestrial ecosystems exist on land and include various types, each adapted to unique climates and landscapes:
- Forest ecosystems: Forests, including tropical rainforests, temperate forests, and boreal forests, are among the most biodiverse terrestrial ecosystems. They provide habitat, regulate climate, and support a wide range of species due to their layered structures, such as canopy and understory zones.
- Grassland ecosystems: Grasslands, found in regions with seasonal rainfall, support large herbivores and predators. Grasses are resilient, and adapted to periodic drought, grazing, and fire, which help maintain these ecosystems’ structure.
- Desert ecosystems: Defined by low rainfall and extreme temperatures, deserts are home to specialised plants and animals adapted to survive with minimal water. Deserts also play a role in regulating Earth’s temperature.
- Mountain and tundra ecosystems: Located in high-altitude or polar regions, these ecosystems feature colder temperatures and shorter growing seasons. Tundras support hardy plants, while mountainous regions host diverse species that adapt to rugged terrain.
Aquatic ecosystem
Aquatic ecosystems cover the majority of Earth’s surface and can be divided into freshwater and the marine ecosystem:
- Freshwater ecosystems: Rivers, lakes, ponds, and wetlands provide essential habitats for species and supply resources like drinking water. Wetlands are especially productive, supporting diverse wildlife and playing a role in flood control and water filtration.
- Marine ecosystems: Covering over 70 % of the planet, the marine environment includes diverse ecosystems within the ocean:
- Shallow coastal zones: Home to coral reefs and mangroves, these areas support marine biodiversity and protect shorelines from erosion.
- Open ocean: The vast mid-ocean regions, where larger animals like whales and dolphins roam.
- Deep-sea zones: Harsh, high-pressure environments where specialised species thrive - often around hydrothermal vents.
The importance of tropical rainforests
Among the various ecosystems, tropical rainforests are especially crucial due to their unparalleled biodiversity.
These ecosystems remain warm and humid year-round, providing stable conditions that support numerous species. Rainforests produce oxygen, store carbon, and offer a unique layered structure - such as canopies and understories - each supporting specialised species.
This structure makes rainforests some of the most resilient and complex ecosystems on Earth.
The role of keystone species
In every ecosystem, some species play disproportionately large roles in maintaining the balance and health of their environment. These are known as keystone species.
Named for the central stone in an arch that holds all other stones in place, keystone species have a stabilising effect on ecosystems, often influencing the diversity and structure of their communities.
When a keystone species is removed, ecosystems can experience dramatic changes, often leading to a decline in biodiversity and ecosystem stability.
Examples of keystone species
One well-known example is the sea otter in kelp forest ecosystems along the Pacific Coast. Sea otters prey on sea urchins, which feed on kelp. When otter populations decline, sea urchin numbers grow unchecked, leading to overgrazing on kelp and the collapse of the forest ecosystem. By keeping urchin populations in check, sea otters help protect the kelp forests that provide shelter and food for many marine species.
The beaver tells a different story. Widely recognised as both a keystone species and an ecosystem engineer, beavers transform rivers and streams into wetland habitats by building dams, creating conditions that support a wide range of species — from fish and amphibians to birds and invertebrates. Hunted to extinction in Britain around 400 years ago, beavers are now being actively reintroduced across Scotland and England, with Natural England licensing wild releases specifically to restore wetland habitats and increase biodiversity.
Why keystone species matter
Keystone species highlight the interconnectedness of ecosystems, demonstrating that even a single species can significantly impact biodiversity and ecosystem function. Their presence supports ecological stability by maintaining food webs, nutrient cycles, and habitat structures.
Protecting keystone species, therefore, often helps safeguard entire ecosystems, making them a focal point for conservation efforts.
What is the difference between an ecosystem and biodiversity?
While ecosystems and biodiversity are closely related, they refer to different aspects of the natural world. An ecosystem is a community of living organisms interacting with each other and their physical environment, including all the biotic (living) and abiotic (non-living) components that support life in a given area.
In contrast, biodiversity refers specifically to the variety of life within that ecosystem, encompassing the range of species, genetic diversity, and the complex interactions that occur among them. Biodiversity is what makes ecosystems dynamic and resilient, providing a rich array of organisms that fill unique roles and create balanced, self-sustaining systems.
In short, ecosystems are the environments or systems in which life exists, while biodiversity is the richness of life within these systems. Healthy ecosystems depend on high biodiversity to remain stable, as diverse species contribute to vital processes like pollination, nutrient cycling, and natural pest control. When biodiversity thrives, ecosystems are better equipped to adapt to changes, recover from disruptions, and continue supporting life — including human life — on Earth.
WWF Living Planet Report 2024
World Wide Fund for Nature, October 2024
What are ecosystem services and why are they important?
Ecosystems are essential to both human life and the planet’s overall health, providing what are known as ecosystem services - the benefits that natural systems deliver to humanity and other living beings.
These services support everything from agriculture and clean water to climate regulation and cultural enrichment.
Understanding and preserving these services is crucial to maintaining the balance of life on Earth.
Types of ecosystem services
Ecosystem services are generally categorised into four main types:
| Type of Service | Description |
|---|---|
| Provisioning services | Direct natural resources ecosystems provide, such as food, water, timber, and medicinal plants. Forests supply wood and natural medicines, while freshwater sources provide drinking water and fish. These resources form the foundation of human economies and are essential for our survival. |
| Regulating services | Help maintain environmental stability. Forests and wetlands act as carbon sinks, absorbing CO2 and mitigating climate change, while wetlands filter pollutants to improve water quality. Coastal ecosystems like mangroves and coral reefs buffer shorelines from storms and prevent erosion, protecting both people and property. |
| Supporting services | Underlying processes that sustain ecosystems and allow other services to exist, such as nutrient cycling, soil formation, and photosynthesis. Decomposers break down organic matter, enriching the soil and supporting plant growth, which sustains food chains. |
| Cultural services | Offer cultural and recreational value. Activities like hiking, birdwatching, and visiting national parks provide peace, inspiration, and connection to nature. These services contribute to mental well-being, cultural practices, and tourism economies. |
Why ecosystems matter
Ecosystems are not just resources for human use — they are intricate, self-sustaining networks that maintain the stability of life on Earth.
By supporting biodiversity, they create habitats for countless species and regulate natural systems, such as water cycles and our climate. Ecosystems also build resilience, enabling natural systems to adapt and recover from changes or disruptions.
The stakes are significant. PwC estimates that 55% of global GDP — around $58 trillion — is moderately or highly dependent on nature, a figure that cuts across every major sector. As ecosystem health deteriorates, so does the foundation on which those economies rest. The emergence of the TNFD, with over 730 adopters in 2026 and a mandatory ISSB biodiversity standard currently in development, reflects growing recognition that this is no longer just an environmental concern, but also a financial one.
Protecting ecosystems, therefore, means safeguarding the foundational systems that make life on our planet possible, for both current and future generations.
Human impact on ecosystems
Europe's Environment 2025
European Environment Agency, September 2025
Human activity has altered ecosystems on a global scale, threatening biodiversity, reducing ecosystem resilience, and disrupting the natural processes that sustain life.
These impacts come from both direct actions - like deforestation, urban expansion, and pollution - and from broader changes driven by climate change.
Direct impacts
- Deforestation and habitat loss: Clearing forests for agriculture, industry, and urban development destroys habitats and displaces countless species. Forests act as critical carbon sinks, storing CO2 and regulating the climate. When trees are removed, not only is this climate regulation lost, but biodiversity declines and the risk of species extinction increases.
- Pollution: Pollution affects ecosystems on land and in water, introducing toxins that can harm or kill organisms and disrupt food chains. Chemicals from industrial waste, pesticides, and plastics contaminate soil, air, and water. Marine life, for example, is severely impacted by plastic pollution, with animals ingesting plastic or becoming entangled, which can lead to injury or death. Over time, pollution degrades ecosystems, reducing their ability to support life and provide clean resources.
- Habitat fragmentation and urbanisation: Expanding cities and infrastructure often fragment habitats, breaking large ecosystems into smaller, isolated patches. This separation makes it difficult for species to move freely, access resources, and maintain genetic diversity. Fragmented habitats are more vulnerable to changes, leading to reduced resilience and higher extinction risks.
Climate change impacts
- Rising temperatures and coral bleaching: As global temperatures increase, ecosystems are directly affected. For example, even slight warming of ocean temperatures causes coral bleaching, where corals expel the algae they rely on for energy. Bleached corals are more vulnerable to disease, and widespread bleaching events can devastate coral reefs, which serve as critical habitats for marine species.
- Shifting species ranges: Many species are moving toward cooler regions, higher altitudes, or deeper waters to escape rising temperatures. Forest and grassland species are adjusting their ranges, which disrupts established food webs and increases competition among species. This shift risks displacing native species that cannot adapt quickly enough, leading to a decrease in biodiversity.
- Extreme weather and loss of resilience: Climate change is causing more extreme weather events, such as hurricanes, droughts, and wildfires. These events not only harm ecosystems directly but also reduce their resilience, making it more difficult for ecosystems to recover. As ecosystems become less resilient, their ability to support biodiversity, regulate climate, and provide essential services decreases.
Human activity and climate change together place immense pressure on ecosystems, destabilising the natural systems that support life. Protecting ecosystems from further harm requires urgent action to limit pollution, reduce deforestation, and mitigate climate change.
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Request a demoFuture of ecosystems and the need for proactive action
As ecosystems face increasing pressures from human activity and climate change, the path forward depends on our commitment to restoration, conservation, and proactive efforts to protect these vital systems.
Without meaningful intervention, ecosystems will continue to lose resilience, reducing their ability to support biodiversity, regulate climate, and provide essential resources.
Restoration and conservation efforts
Restoring and conserving ecosystems is critical for reversing damage and ensuring a stable future. Key initiatives include:
- Reforestation: Planting trees in deforested areas not only restores habitats but also helps sequester carbon, mitigating climate change.
- Wetland and coral reef restoration: Wetlands improve water quality and reduce flood risks, while coral reefs provide essential habitats for marine species. Efforts to restore these areas help strengthen ecosystems that have been heavily impacted by pollution and climate change.
- Establishing protected areas and wildlife corridors: Protected areas create safe havens for biodiversity, while wildlife corridors connect fragmented habitats, allowing species to migrate, find resources, and maintain genetic diversity.
Innovation and policy
In addition to on-the-ground restoration, emerging technologies, and protective policies are also helping to protect ecosystems:
- Technological advances: Remote sensing, satellite monitoring, and data analytics allow scientists to track ecosystem health and detect changes in real time, facilitating more timely interventions.
- International and local policies: Policies like the Paris Agreement and the Kunming-Montreal Global Biodiversity Framework — which committed nearly every country to protecting 30% of land and sea for nature by 2030 — represent significant international commitments to conservation. Progress, however, is falling far short: a 2025 UK progress report found that just 2.83% of English land is effectively protected and well managed for nature.
A call for collective action
The future of ecosystems relies on our collective efforts to protect and restore them. Governments, organisations, communities, and individuals all play a role in fostering sustainable practices and reducing harmful impacts on the environment.
That collective responsibility extends to the business world too. The same ecosystems that regulate our climate, filter our water, and sustain our food systems are directly affected by how companies operate, and increasingly, businesses are being asked to account for that relationship. The science is unambiguous about what that accountability must look like.
Leena Ylä-Mononen
Executive Director, European Environment Agency, September 2025
Close
Ecosystems FAQs:
What is the difference between an ecosystem and a biome?
A biome is a large geographical region defined by its climate, vegetation, and wildlife — such as tropical rainforest or tundra. An ecosystem is smaller and more specific: a self-sustaining community of organisms interacting with their physical environment. One biome can contain many ecosystems.
Can you give some examples of ecosystems?
Ecosystems exist at every scale and in every environment. Common examples include coral reefs, kelp forests, tropical rainforests, temperate grasslands, freshwater lakes, desert scrublands, and Arctic tundra. Even a rock pool or a patch of woodland counts: any system where living organisms interact with their physical environment forms an ecosystem.
What are some examples of keystone species?
Keystone species have a disproportionately large effect on their ecosystem relative to their abundance. The sea otter is a classic example: by preying on sea urchins, it prevents the collapse of kelp forest ecosystems. The beaver is another, transforming rivers into wetland habitats through dam-building and increasing local biodiversity. Sea stars, elephants, and certain fig tree species in tropical forests count as other well-known examples.
What is ecosystem degradation?
Ecosystem degradation occurs when human activity reduces an ecosystem's ability to function and support life. Key drivers include deforestation, pollution, habitat fragmentation, and climate change. The European Environment Agency's 2025 report found that the state of Europe's terrestrial, freshwater and marine biodiversity is poor and continuing to deteriorate, which is a direct consequence of sustained ecosystem degradation.
What is TNFD and how does it relate to ecosystems?
The TNFD (Taskforce on Nature-related Financial Disclosures) is a global framework that helps companies assess and disclose their dependencies and impacts on nature, including ecosystems. Published in September 2023, it recognises that ecosystem degradation creates direct financial risk for businesses. For companies subject to CSRD, ESRS E4 — the biodiversity and ecosystems standard — makes nature-related disclosure a legal requirement, giving TNFD alignment growing regulatory urgency.
How Greenly can help your company protect ecosystems
Every business operation leaves a footprint on the natural systems this article describes, from the carbon stored in forests to the water filtered by wetlands. Greenly gives companies the tools to measure their impact accurately, set science-based reduction targets, and report transparently against frameworks like CSRD and TNFD.
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