Valuing nature: mainstreaming natural capital in policies and in business decision-making
A broad range of economic activities are dependent upon natural capital, but natural assets are not unlimited. However, many ecosystem services and benefits to society and business, such as food provision, air and water filtration, disaster risk reduction, pollination, or climate regulation, are not visible because they are not priced on markets and hence not currently accounted for in socio-economic decision-making. Incorporating natural capital – and especially ecosystems – into national accounting systems as well as policy and business practices is needed to promote more resource efficient and sustainable choices, and to support smart, sustainable and inclusive growth.
Further to the work and progress at international level, important results have been achieved at European level under the initiative on Mapping and Assessment of Ecosystems and Services (MAES), as well as on categorising ecosystem services through the Common International Classification of Ecosystem Services (CICES). In addition, the KIP-INCA project aims to design and implement an integrated accounting system for ecosystems and their services in the EU. KIP-INCA aims to develop a comprehensive set of European-level natural capital accounts.
In addition, all businesses impact and depend on natural capital to some extent. The Natural Capital Protocol (NCP) has been published as a framework to help generate robust and actionable information for business managers to inform decisions. National and corporate accounting is still in early phases of development and long-term coherence between these two strands of work is needed.
Actions should address only one of the following sub-topics:
a) Valuing nature: developing and implementing natural capital and ecosystem accounts in EU Member States and Associated Countries: Actions should develop and implement natural capital and ecosystem accounts in Member States/Associated Countries, according to the SEEA-EEA recommendations and the methodological work and guidance of KIP-INCA.
Actions should further refine and implement in practice European/international guidance standards in European countries, leading to their replicability.
Actions should exploit available large scale data and link them to the EU layer for more detailed analysis, and experiment with different solutions for biophysical accounts and their valuation and monetisation. The natural capital and ecosystem services accounts developed should be published for use by different stakeholders and for different policy and business applications. Actions should promote the inclusion of natural capital and ecosystems services accounting in national statistics.
Actions should involve organisations both from Member States/Associated Countries that are more advanced with natural capital and ecosystem services accounts and from those that are only just starting to deal with such accounts. More experienced participants should primarily share their experience with, provide advice to and mentor less experienced participants, to enable them to rapidly implement and mainstream the methodologies. In addition, more experienced participants may choose to also develop further their own natural capital and ecosystem accounts (for instance, testing new valuation approaches and methods).
Participation and strong commitment from public authorities in charge of natural capital and ecosystem services accounts (for example, Ministries or Environment Agencies), as well as National Statistical Offices or other statistical authorities, is strongly encouraged for the success of this action.
Actions should exploit the experience of KIP-INCA partnersand the ongoing work of MAES.
The Commission considers that proposals requesting a contribution from the EU in the range of EUR 3 million would allow this specific challenge to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts.
b) Operationalisation of natural capital accounting in business decisions: Actions should facilitate the implementation of the Natural Capital Protocol at corporate level. They should therefore take stock of the work undertaken by ongoing initiatives, such as European and national platforms on business and biodiversity and the Natural Capital Protocol and should establish a “Valuing Nature Programme and Network”. The network should bring together work being undertaken by business in relation to natural capital and come up with optimal scientifically rigorous solutions for operationalising and mainstreaming natural capital, including nature-based solutions, green infrastructures and biodiversity, in companies' decision making frameworks and business models. It should aim to build a community of practice through an EU network of networks of businesses, administrations and academia, engaging key stakeholders from business, government, the knowledge and research community and civil society in open source collaboration. Together they should shape the business perception of the value of nature as a business opportunity and as a means of reducing economic risks and fostering sustainable businesses. This will also incentivise business investments in nature-based solutions. There is a need to stimulate early adoption, since potential first-movers may be risk-averse. This can be mitigated through life-long learning, training and guidance, and by demonstrating the benefits at corporate level.
The Commission considers that proposals requesting a contribution from the EU in the range of EUR 2 million would allow this specific challenge to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts.
The project results are expected to contribute to:
- mainstreaming natural capital and ecosystem services accounts at appropriate administrative or corporate levels;
- decision-makers acknowledging the macro-economic and the micro-economic perspective of natural capital;
- recognition of the value of natural capital and ecosystem services accounts, attracting private and public funding for further adoption;
- the acknowledgment, operationalising and mainstreaming of, and accounting for, natural capital, including nature-based solutions, and its wider value in public authorities and companies' decision making frameworks and business models.
Delegation Exception Footnote
This activity directly aimed at supporting the development and implementation of evidence base for R&I policies and supporting various groups of stakeholders is excluded from the delegation to EASME and will be implemented by the Commission services.
- Socio-economic science and humanities
- Open Innovation