Natural capital accounting perspectives: a pragmatic way forward

Abstract

Introduction: Recent debates surrounding the application of natural capital accounting (NCA) have produced several approaches to further develop this system, as well as highlighted a number of conceptual and methodological issues that need to be resolved before mainstreaming NCA into policy and decision making. We argue that prolonged debate over the value concepts (i.e., exchange versus other values) underpinning different modifications to NCA has slowed progress in experimentation and uptake by policymakers. Outcomes: Consequently we propose three broad approaches which can be progressed in parallel to reinvigorate experimentation with the NCA principles and practice, while at the same time generating policy relevant tools and evidence bases for decision support. The three approaches are; extended SNA accounting anchored to the use of exchange values; a complementary accounts network (CAN) that utilizes plural values as supplementary accounts to the SNA system; and wealth accounting that focuses on measures of welfare and wellbeing. The three approaches are complementary and data developed in any one can inform the other two. Conclusions: We contend that CAN offers the most flexibility and opportunities to progress short term support for decision making on environmental issues which are now becoming urgent.

Opening accounting: a Manifesto

“…Nature's value is multidimensional, requiring both monetary and non-monetary measures (Turner et al, 2019). Two main changes in our treatment of the environment must occur: nature must be imbued with legal rights, and economic systems need to recognise the inherent value of nature.…”

“…NCA is a United Nations (UN) initiative that captures a quantitative value for ecological inputs (UNSD, 2021). The goal of NCA is to transform the inherent value of nature into a quantifiable value that can appear on an accounting balance sheet (Turner et al, 2019). NCA would operate as a translation tool, taking the inherent value that exists in our biosphere and presenting it in a form that corporations and global economies can understand.…”

Climate Action to Unlock the Inclusive Growth Story of the 21st Century

“…Despite these difficulties, the wealth indexes are an important step in the right direction, and should benefit further from continued research into the natural capital accounting (Turner, Badure and Ferrini 2019).…”

Climate action requires new accounting guidance and governance frameworks to manage carbon in shelf seas

“…The use of international data integration and sharing would help to overcome these limitations. A complementary account network providing information coming from other sources outside standard accounts, such as the IPCC inventories, may also be considered 84 , 85 . Other challenges in harmonising Ocean Accounts with the EEA arise from the mobile and transboundary nature of the ocean processes.…”