Biodiversity and economic growth: the mutual benefits

© Joel Vodell

What if biodiversity were an asset to be maintained and enhanced by business, rather than a risk factor? Something that will only be possible if we can measure the value of this “natural capital”. This is the goal of Dr. Kathy Willis’ work, Professor of Biodiversity in the Department of Zoology, University of Oxford.

 A biologist by training, she has been developing maps and software for about 10 years that enable companies to quantify the ecological value of the natural ecosystems in which they operate. An innovative approach that extends beyond the approach adopted by Corporate Societal Responsibility (CSR). Explanations and case study.

 

How does your approach differ from the traditional CSR approaches?

These approaches contributed to create a bond between biodiversity and businesses. As such, companies generally focus on protecting species, communities and landscapes considered as “threatened”, “rare” or “vulnerable”. Thus, there are examples of CSR programmes funded by companies that have successfully taken action to safeguard them.

We actually need to go further and teach that biodiversity can be an important resource in itself, that adds value to the business. This is what we call “natural capital”, referring to economic capital. This is the global stock of natural resources, made up in particular of living organisms, soil, air and water, that provide flows of environmental services. For example, these flows include the capturing of carbon in the biomass, the regulation of water cycles, the reduction of soil erosion, etc. They also provide Man with numerous socio-cultural services, in the recreational or aesthetic spheres, for example.

Consequently, by protecting and increasing the assets of this natural capital, businesses can create a form of reciprocity between business and biodiversity.

Why and how does this approach create interdependency between economic activity and biodiversity?

There are many examples of how valuing biodiversity in this way improves the economic development of businesses. Mars Inc. in particular is studying the impact of its activities on biodiversity, from the amount of water extracted to the resources used to manufacture its packaging. Aiming to reduce the impacts of its production processes on natural resources, this company managed to improve the biodiversity around its sites while reducing its operating costs. It is a win-win relationship. And a few others have bravely gone one step further by including the assets of this natural capital in their main accounts. Very few companies do this but I hope others will follow. This requires a real paradigm shift, with a need for proper investment in tools and processes that can quickly assess stocks and flows of natural capital. For example, by creating dedicated metrics and by including functional and ethical values in the calculation of their economic performance. To achieve this, it requires specialists in modelling, Big Data and IT who can create user-friendly tools that take account of biological diversity or of the company’s economic responsibility for ecosystems.

How can this paradigm shift be encouraged, and what are the main obstacles you have encountered so far?

I started working on this subject about 10 years ago with a Norwegian oil company. The company wanted a tool to remotely measure the potential ecological risks on its sites. The engineers could assess the geology, the hydrography, the electricity supply, etc., but they didn’t take into account the ecological value. This was particularly true outside protected areas, which cover just 13% of the Earth’s surface. Since then, we have developed a tool that works the world over to enable companies to calculate ecological risk of their area and another that models natural capital value. We are now facing the question of how these tools can be funded. Because, ultimately, it is essential to turn these new approaches into a standard and to enter partnerships with businesses. But most of them are not inclined to fund the development or the upgrading of these tools. This is due to a number of reasons: a resistance to change in valuation methods or the fact that legislation only demands the assessment of impacts, that is the potential damage to natural assets, and not of the sustainable and equitable use of the living world. Indeed, the underlying idea that natural capital is inexhaustible remains in people’s minds. The idea of paying to map out and measure its true value, remains counter-intuitive.

 

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This article was published in the sixth issue of open_resource magazine: “Towards a bio-inspired future

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