Natural capital is a term that is becoming increasingly prevalent, in part due to the existence of the government’s Natural Capital Committee. But what does it really mean?
Natural capital is a term that is becoming increasingly prevalent, in part due to the existence of the government’s Natural Capital Committee. But what does it really mean? The Natural Capital Committee has defined natural capital as: ‘The elements of nature that directly and indirectly produce value or benefits to people, including ecosystems, species, freshwater, land, minerals, the air and oceans, as well as natural processes and functions’ In other words, natural capital includes ecosystems, biodiversity and all sub-soil resources such as fuels and minerals. This definition represents the natural environment as a capital asset, i.e. something that has the productive capacity to generate value, in terms of the benefits that we derive from it. A report from the committee recommended that the government encourage the use of Corporate Natural Capital Accounting (CNCA) as a means of managing natural capital sustainably. So, in a world dominated by spreadsheets, a natural capital asset check (or register) would be a way of making natural assets and their benefits explicit. This would catalogue the significant assets owned by the organisation, which includes data on the asset extent, condition, services and benefits delivered. CNCA is a framework that collates natural capital information in a similar way to other capital assets. It records the benefit to both the organisation that owns the natural capital asset and to society, by answering four key questions:
JFA are naturally in full support of this approach which helps define and therefore encourage nature within development sites.
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