Defining Ecosystem Assets for Natural Capital Accounting

Abstract

In natural capital accounting, ecosystems are assets that provide ecosystem services to people. Assets can be measured using both physical and monetary units. In the international System of Environmental-Economic Accounting, ecosystem assets are generally valued on the basis of the net present value of the expected flow of ecosystem services. In this paper we argue that several additional conceptualisations of ecosystem assets are needed to understand ecosystems as assets, in support of ecosystem assessments, ecosystem accounting and ecosystem management. In particular, we define ecosystems’ capacity and capability to supply ecosystem services, as well as the potential supply of ecosystem services. Capacity relates to sustainable use levels of multiple ecosystem services, capability involves prioritising the use of one ecosystem service over a basket of services, and potential supply considers the ability of ecosystems to generate services regardless of demand for these services. We ground our definitions in the ecosystem services and accounting literature, and illustrate and compare the concepts of flow, capacity, capability, and potential supply with a range of conceptual and real-world examples drawn from case studies in Europe and North America. Our paper contributes to the development of measurement frameworks for natural capital to support environmental accounting and other assessment frameworks.

Germany’s Ecosystem Services – State of the Indicator Development for a Nationwide Assessment and Monitoring

“…An exception is the group of intangible values for cultural ES. Usually, several service providers can be identified for a final ES (Hein et al 2016, Syrbe et al 2017b. It is to be noted that the indicators include a more technical part (such as measurability, data processing/quality, survey methods) and on the other hand socio-cultural aspects (Who values what and how?, problem recognition, deliberations, communication, etc.…”

“…The implementation of the EU Biodiversity Strategy requires this by 2020 (EC 2011). The concrete implementation of such an ecosystem accounting will be a challenge in the coming years (Hein et al 2016). National Capital Accounting needs a database that is at least partially provided by the ongoing ecosystem service and condition assessment.…”

“…In order to operationalize and present such indicators cartographically, they must be formalized and derived in terms of a basic spatial unit. In general, these are 1 km² grid fields (see CICESand SEEA-Systems, Hein et al, 2016). The geo-spatial interpretation of indicators necessarily involves the simultaneous analysis of related aspects of spatial structure or processes with a spatial impact (e.g., www.IOER-monitor.de).…”

The role of enabling actors in ecosystem service accounting

“…In the specific case of water purification, the biophysical model used does not allow the reporting of any contribution to other ecosystem types. Sections C and D represent the System of National Accounts (SNA) Supply and Use tables that are completed according to the standard conventions (European Commission et al 2009). No data were filled in this case since no standard SNA products are of relevance for water purification.…”

“…Consequently, a proper quantification of the contribution and reliance of human activities on ecosystem services is being pursued. Several international initiatives are contributing to this effort, for example: the work led by the United Nations Statistical Division which coordinates the System of integrated Environmental and Economic Accounts-Experimental Ecosystem Accounts (SEEA-EEA) (United Nations et al 2014a), the work developed by World Bank with the Wealth Accounting and the Valuation of Ecosystem Services (WAVES) initiative (WAVES 2014) or the Integrated system for Natural Capital Accounting (INCA) project supported by the European Commission (European Commission 2016). After the adoption of the SEEA -Central Framework (SEEA-CF) as the first international standard for environmental-economic accounting (United Nations et al 2014b), the SEEA-EEA approach has been endorsed as a reference structure for ecosystem services accounting, with calls for its testing, application and further development at the global scale.…”