The All Party Parliamentary Group (APPG) on Biodiversity met for the third time yesterday, and having enjoyed the last meeting (I wrote a blog about it here) I thought it would be worth going along again.
The billing looked very good – Pavan Sukhdev, founder of TEEB and hero of our times was talking, as was eco-warrior Lord Deben aka John Selwyn Gummer, for those of you old enough to remember burgergate .
Despite being castigated for feeding a burger to his daughter to prove beef was safe (as its turned out he was right!) he is truly an environmental hero as he was one of the leading lights behind the Rio Summit of 1992 which gave us amongst other things, the biodiversity convention and the first international climate change convention. Now he runs GLOBE International – doing vital work helping legislators across the world share best practice and develop environmental laws. Hardly a hotbed of rightist libertarianism! I wonder what he makes of this Government’s antics? He was not forthcoming on that subject.
We also heard talks from Natural England vice chair and Environment Bank founder David Hill, not surprisingly promoting the biodiversity offsets concept. We heard from two environmental economists – Tim Jenkins from the NewEconomics Foundation and Giles Atkinson from LSE – to be honest a lot of what they said went over my head but I think the gist of it was that economists for far too long have ignored the value of the environment and that this basically meant that historical approaches to economics were fatally flawed. Now there’s a great opportunity to fundamentally rethink the whole of economic theory to include the value (monetary and non-monetary) of the environment (natural capital), to include measures of wellbeing as well as GNP. And we should be encouraging the Treasury to integrate environmental accounting into the Government’s overall economic strategy, which they are starting to do through the natural capital committee. Apparently.
Roddy Fairley from SNH explained how they had developed an index to reflect changes in both the quantity of natural capital and its quality, based on Countryside Survey definitions of ecosystems, as well as things like SSSI condition, river invertebrate diversity and the number of salmon. This index fell from the 1950s to 1990s but now shows a slow recovery, indicating a shift towards sustainability.
All the speakers agreed that monetising the value of natural capital was one approach to ecosystem valuation, and a necessary one. But it was only one of several equally valid approaches.
Pavan Sukhdev took up this point in his short but brilliant presentation – asking the fundamental question “what is valuation?” he laid it out in simple terms – the need to recognise value, demonstrate value and capture value in natural systems.
Sukhdev explained that Recognising Value can take place in a number of different ways – through planning systems, legislation, certification, protected areas and payment for ecosystem services. Note many of these do not place a monetary value of ecosystems.
He gave some fantastic quotes – “the economic invisibility of nature is a big problem”
He went on to say that Demonstrating value is not the same of economic valuation – and private profit is only one yardstick of valuation, even commercial logic usually only looks at this one metric, which is often skewed by invisible public subsidies. He showed a great example from TEEB where superifically it made sense to replace mangrove swamp with shrimp farm, but once all the factors are take into account the mangrove was masssively more valuable. I expect you can easily find this on the TEEB website.
“We need to stop looking (at nature) through the lens of private profit” he said.
He gave some chilling statistics that showed how the top 3000 global corporations generated an estimated 2 trillion dollars of environmental costs annually, and just five industrial sectors were responsible for 60% of all those costs.
He gave five reasons to stop the economic invisibility of nature:
- The costs and risks to society of Business as Usual (BAU) were too great
- BAU nature losses exacerbate poverty
- Economic policy solutions exist – they need to be scaled up (eg the Natural Capital Initiative)
- There is a huge employment potential in sustainable economic models.
- We now know that the economic compass we’ve been relying on is faulty.
There was time for a few questions and I asked him whether he thought that the current clamour for Sustainable Intensification of global agriculture made sense from an environmental economics perspective – or was it an economic canard. He said nobody knows but TEEB has set up TEEB for Agriculture to look at exactly this question.
I have my doubts about ecosystem valuation, but I have to say I am more convinced now, after listening to the talks yesterday, that there is an important role for monetary approaches to ecosystem service valuation. As someone said ” you’ll only start achieving change within Treasury thinking by talking to them in their own language.”