A changing approach to natural capital?

Yesterday saw the launch of Defra's White Paper on the natural environment "The Natural Choice: securing the value of nature".

Building upon the National Ecosystem Assessment that was published last week, it presages the inclusion of natural capital values in the UK's economic thinking and its accounting for national economic progress, the valuation of ecosystem services in other contexts such as the planning regime and an expansion of green goods and ecosystem services in commercial markets. We are the first country to have developed this thinking, which is also being applied in Brazil and other countries.

The launch was met by warm, if not fervent, support by the roomful of NGOs who convened for the event. However, whether this initiative has the potential significantly to change public sector and private sector behaviour is hard to discern in isolation:  a bit like assessing the commercial viability of a Rubik's cube from a snapshot of one side. These proposals intertwine with forthcoming Defra White Papers on waste (expected next week), water (November/December 2011), and with Greg Clark's national planning policy framework (July).

While we wait for these to shed further light on the extent of the Government's ambitions to shift current behaviours, the following points are clear already:

  • economic growth and biodiversity gains are envisaged as co-existing and mutually compatible;
  • a Natural Capital Committee will be established to advise the Chancellor on the state of natural capital in England and natural capital will be included in the UK environmental accounts;
  • a business led ecosystem market taskforce is to be established that will look at opportunities for UK business in expanding trade in green goods, sustainable resources, services funds and markets. This will be chaired by Ian Cheshire of Kingfisher and will report back in 2012/13 through the Green Economy Council;
  • the Government will support a coalition of businesses and BINGOs to follow up on the TEEB for Business report;
  • Defra will publish an action plan in 2012 to expand markets and schemes pursuant to which payments are made for receipt of a natural service from the provider or facilitator of that service;
  • there will be experimentation with biodiversity offsetting on a voluntary basis involving a number of pilot areas;
  • new guidance for businesses will be published by 2012 on measuring and reporting corporate environmental impacts;
  • nature improvement areas will be supported under the planning regime
  • local nature partnerships will be established in the expectation that these will work with LEPs.
  • there is to be a taskforce in relation to commercial peat products that will be chaired by Alan Knight.

There is within this document the possibility of a significant shift in approaches to biodiversity and natural capital in the planning process for development projects and retail and consumer products in particular. How, if and when these ideas develop will become clearer over coming months as related White Papers are published and the nitty gritty of some of the high level objectives gets worked through. However it is already apparent that business organisations will need to engage more in relation to this area and we would expect Defra to wish to explore the practicalities of these different workstreams with commercial organisations in more detail over coming months.