Mission (gray bloc)

   
Valuing Nature
Samuel Vionnet
Sustainability Expert and Founder
Switzerland
+41 (0)76 372 90 27

I support organisations to integrate the value of natural and social capital into decision making, by providing innovative methodologies, data and expertise.

780% return on investment

For every US dollar invested by Novartis in each of the four carbon-sink projects, an average of USD 7.8 worth of societal value is created thanks to climate change mitigation, ecosystem services,...

How sustainable is hydroelectricity?

The Las Cruces hydroelectric project in Mexico might lead to a negative outcome for the Mexican if built. A natural and social capital accounting method has been used to assess the project's impact,...

There is no sustainability without a balance sheet

Measuring social and natural capital only makes sense when we consider balance sheet. So far, very few organizations have managed to do this. We only see P&L published. But P&L is like GPD, it only...

Jobs at all costs

The private sector is exploring new ways to measure its societal impact, moving beyond traditional economic indicators. We developed an innovative model based on social determinant of health studies....

Achieving net positive impact using the SDGs

If not already done, you will have to use SDGs for defining your net positive impact. But how to measure it? I discuss four steps to support you in this difficult task: your theory of change, your...

Honey is worth more than you think

The Association mellifera is developing a high impact social project around honey bees. Valuing Nature sponsored the creation of one bee colony and calculated the societal value created by the...

Solving half the world’s problems

This article explores the role of Natural Capital within the SDGs and addresses in particular the connexions that exist between SDGs targets. It provide as well some statistics on the maturity of a...

The Sustainable Development Goals and the Mont Blanc

An innovative analysis of the SDG’s targets is unlocking barriers and triggering efficient actions to reach these goals by 2030. By understanding that these targets are inter-connected and that...

The wider benefit of water recycling in a water scarce region

ENGIE, a global energy company, used a water valuation approach to assess the benefits of a water recycling project with the help of Valuing Nature. It showed that the overall benefit generated per...

Water scarcity is not a problem… Undervalued water is

This article summarizes the outcome of a session held at the World Water Week 2015, managed by Valuing Nature, which explored the benefits and limitations of the use of water valuation metrics and...

And now what? The future of Natural Capital Accounting

This article presents the results of a survey, of executives working for private companies and consultancies, on the trends and future challenges of the Natural Capital Accounting approach.

Valuing Water – The Basics

The basic concepts of water valuation as an ecosystem service are presented in this article. Water valuation can fulfil the need for a Natural Capital Accounting method for the private sector. This...

Why is Investment in Watershed Services the future of conservation?

Successful conservation projects have mostly targeted low opportunity cost areas in remote locations until now. Conservation has now entered a new phase by competing with humans needs. Investment in...

The Opportunity Cost of Biodiversity Loss in the Swiss Plateau

Measures to maintain the biodiversity on the Swiss plateau would generate 136 millions CHF of benefit for the society. It is urgent that we realize that the sharp decline in biodiversity in...

Global Land Use Dataset

Data is critical to assess the reliance of companies on natural capital. A new model is available to fill this data gap with a global coverage of land use related externalities.

The Value of Rain

A study showed how to link water footprint and ecosystem services valuation to identify the value of rain and freshwater in Santa Cruz (Bolivia) region. This study was done in partnership with Forest...

Natural Capital Accounting - An Introduction

Recognizing the benefits we obtain from nature is key to ensuring long term profit while creating shared value. This article presents shorty the interest for the methodology, illustrated by a case...

Load more

Contact

Valuing Nature
Samuel Vionnet
Switzerland - Guatemala
CH: +41 76 372 90 27
GT: +502 4490-5633‬
sv@valuingnature.ch
 

Valuing Nature is member of

 

And now what? The future of Natural Capital Accounting

This article presents the results of a survey, of executives working for private companies and consultancies, on the trends and future challenges of the Natural Capital Accounting approach.

Release date: 03.08.2015
Category: Ideas

- Originally published on Sustainable Brands

 

Natural Capital Accounting (NCA) is an emerging methodology in the private sector, aimed at measuring the dependency and impact of companies on natural systems. NCA helps in quantifying the value of usually intangible assets from nature (such as water, pollination, etc.). NCA allows mitigating risks but also identifies opportunities to reduce costs, innovate and become more resilient.

Despite being a praised concept, the approach still faces challenges at its early development stage. This is the reason why we interviewed more than 30 executives, of which two thirds are working for private companies – including Natura, Nestle, Olam, Holcim, Engie, AkzoNobel, DuPont Nutrition, Kering and Cementos Argos - and the remaining third for consultancies, to identify trends and future development needs for the Natural Capital Accounting approach. While all interviewees have a basic understanding of NCA, two thirds have used this method in projects. Of the latter group, most have applied it at a corporate level, covering supply chains in particular, and at a site level.

 

- Now – The observation round -

 

For those having applied NCA, their company’s executive board was often cited as the driver for exploring this approach, as well as the department in charge of sustainability. External drivers do not currently seem to be present. The stated objectives of those studies were mostly exploratory, to support corporate strategy, but also for risk identification and mitigation (physical as well as reputational and other risks). It is not yet used as a tool for cost savings, brand reputation and market access, although some companies already use it for this purpose, in particular early adopters. It goes without doubt that NCA could fulfill many more applications in the future.

 

- The future – Finding its place outside the sustainability department -

 

Very few interviewees have doubts about the future of NCA; most respondents see it as a key resource for company management, although complementary to existing tools used by sustainability managers. Businesses needs metrics for management, in particular to prioritize investments based on ROI calculations and for current risk assessment approaches. NCA, with its easily communicable financial results, is easier to integrate into existing financial metrics than other sustainability metrics, such as CO2 or water use, for example. However, it still needs to find its place in companies’ toolkits, even though sustainability executives seem convinced it will become mainstream.

 

- Show me the business case -

 

When evoking the future development needs of NCA, standardization work is seen as critical by almost all interviewees. The Natural Capital Coalition is currently addressing this point. However, according to the private sector, the next big priority is to strengthen the business case of NCA. It seems that there is a clear need to prove the concept and its business value. Companies and in particular sustainability executives can grasp the concept of this approach pretty easily and can imagine its value, however the gap between the theory and practice still remains. Andrew Prosser, from Capitalactiv, states: “Something that may have a strong logic for sustainability practitioners is still a long way from making sense to most other people in the business."

On the other hand, consultants put more priority on technical aspects such as databases, valuation methods and management tools. These are definitely critical areas to develop NCA, but given the level of maturity of the approach, companies are first looking at the business case to get internal traction. There is no doubt that the approach brings interesting information and insight, however the mechanism by which it can change the course of action still needs to be invented. Which decisions can be influenced by NCA, by whom and how? These are the questions that are still not adequately addressed in the private sector.

 

- The remaining challenges -

 

NCA is again an emerging approach in the private sector, which is being developed in a fairly short period of time. The lack of available and reliable data and methods (after its standardization) is certainly the next topic to address within the NCA community and the Natural Capital Coalition. “The Natural Capital Protocol aims to help businesses build considerations of nature into their decision making. To achieve mainstream uptake though we also need to focus on the role of data in natural capital assessments and the enabling policy environment” said Mark Gough, Executive Director of the Natural Capital Coalition.

However, interviewees highlighted the lack of internal support (and thus business cases), and even more importantly the lack of adequate knowledge and training, which is currently a limitation in the deployment of NCA. Consultants clearly underestimate those barriers, although there is no doubt that knowledge transfer can become a priority in the short term with the wide choice of experts in the NCA community.

 

- At the heart of informed decision-making -

 

When exploring where NCA could provide the highest added value for companies, a vast majority of companies and consultants/NGOs indicated that cost-benefit analysis was where they see the highest value (see figure below). It was followed by corporate strategy, and only after risk assessment, internal awareness raising and reporting.

Areas of highest added value of NCA for the private sector – Relative score

 

- Get it out of the hands of sustainability professionals! -

 

When asked for their advice in making NCA a mainstream tool, interviewees had quite different points of view, focused either on methodologies, business cases or development process. However, two of the most straightforward comments were “get it out of the hands of the sustainability professionals” and “make it practical.” If we want decision-making to be influenced by NCA, we must put a simple, concrete and robust tool in the hands of financial and operational executives.

 

NCA is still facing challenges, although its use and acceptance are growing. We are in the early days and hope to see more business cases published, showing the value of NCA for the private sector, as well as knowledge development and sharing. It is critical if we want to use Natural Capital Accounting in our daily decision-making.

Back to homepage