Enhancing nature


Ecosystems are formed by the interaction of living creatures with their environment. Although intrinsically valuable, ecosystems also provide the natural capital which underpins our economy.

The Natural Capital Committee defines ‘natural capital’ as the elements of nature that produce value for people, such as forests, water, land, minerals and oceans. These benefit us in many ways, providing us with food, clean air, wildlife, energy, wood, recreation and protection from hazards.

In its latest report, the Committee highlights areas that are at particular risk and could undermine the health of our economy. These are clean water, wildlife, carbon storage, hazard protection, recreation, clean air and marine fisheries. According to the TEEB Study, between US$1.9 and 4.5 tn of value is lost each year through deforestation alone.

Ecosystems intersect with the economy in three main ways: they contribute to economic value, their natural capital can depreciate through economic activity, and response measures to restore ecosystems can have wider economic effects.


An Economy That Works would explicitly recognise and maintain the benefits that ecosystems provide.
It would protect land and other natural resources while preventing the loss of plants and animalspecies.
It would also recognise the costs associated with not protecting ecosystems, such as loss of climate change adaptation functions and depletion of resources.


To understand the economic benefit we need to take a step back and understand what the UK National Ecosystem Assessment describes as “ecosystem services”. These include:

  • Provisioning services, for example the goods obtained from ecosystems such as food and water from rivers, lakes and aquifers
  • Regulating services that include pollination, control of pests and diseases, as well as climate and hazard regulation

  • Supporting services that provide the basic infrastructure of life, such as soil formation and capturing the sun’s energy
  • Cultural services in the form of places where we can enjoy the natural world

While valuing ecosystem services is challenging, the UK has carried out a provisional assessment:

  • Terrestrial, wetland and marine biodiversity deliver or underpin ecosystem services believed to be worth in excess of £3 bn annually
  • Carbon sequestration by UK woodland is worth £680 mn, while pollination services are worth £430 mn
  • UK fish landings are valued at £600 mn per annum
  • Safe, green spaces may be as effective as prescription drugs in treating some forms of mental illnesses which cost the UK economy over £26 bn
  • Air and noise pollution are detrimental to wellbeing


The UK’s natural capital underpins our economic development. Maintaining our natural capital makes good business sense, making our supply chains more resilient and providing a source of competitive advantage to the UK.

As well as general advantages, specific revenue opportunities arise from a more diverse and well-protected ecosystem, such as organic products, sustainable timber and eco-tourism.

Furthermore the protection of ecosystems is a growing industry. For instance, global certification and offsetting markets are rapidly expanding and are predicted to be worth in excess of U$250 bn by 2020.

Ecosystems support innovation, both through the replication of natural processes at industrial scale and through the medicinal properties of fauna and flora.

Employers benefit from a healthy workforce that has access to green spaces.

Conversely, being associated with damage to ecosystems creates huge reputational risks for businesses.

How can business help achieve a biodiverse economy

  • Promote agricultural practices that conserve soil fertility and maximise value for society across all ecosystem services
  • Develop policies that ensure environmental impacts are integrated into planning and accounting systems
  • Use natural capital accounting to measure the impact of environmental risk on business operations and integrate this into annual reports
  • Apply best practice standards of environmental protection in financing infrastructure and industrial development, such as those defined by the IFC
  • Work with local communities and authorities to develop joint stewardship approaches


  • Develop a long-term ecosystems recovery plan that values, protects and enhances natural capital
  • Make no net loss of biodiversity an explicit policy target, and aim for net gains in biodiversity and protection of threatened ecosystems
  • Identify and avoid thresholds beyond which biodiversity cannot be restored and/or its contribution to ecosystem services is significantly diminished – such as wild fish stock collapse

  • Develop policies to stay within these margins, including the targeted use of markets, standards, subsidies, taxes and protected zones, as well as ensuring government procurement promotes the protection of nature
  • Strengthen the government’s handling of biodiversity by including the economic value of natural capital in the national accounts, with a natural capital budget presented by the Chancellor of the Exchequer alongside the fiscal budget

Ecosystem services

Source: Please download or view our Report online for a full list




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