Published on December 12, 2008
The Economics of Ecosystems and Biodiversity (TEEB) Second phase of the TEEB Initiative Presentation to the EEB Biodiversity Seminar Thursday 11 December 2008 Patrick ten Brink, An initiative of the G8+5, BMU (D) & the Head of Brussels Office, European Commission IEEP Supported by TEEB D1 Co-ordinator Defra (UK), UNEP, the EEA, email@example.com OECD and the CBD Secretariat D1 Building on and borrowing from the work & insights of the wider TEEB team and contributors of supporting studies, call for evidence and other contributions 1
Presentation Structure 1. TEEB Background and Aims 2. TEEB Phase 1: Recap on results & impacts from phase 1 3. TEEB Phase 2: Ambitions, Activities, Content and Process 4. TEEB and some reflections 1. Role of NGOs 2. Communication 3. TEEB and the financial crisis 2
Background: TEEB’s Genesis Potsdam 2007: meeting of the environment ministers of the G8 countries and the five major newly industrialising countries “Potsdam Initiative – Biological Diversity 2010” 1) The economic significance of the global loss of biological diversity In a global study we will initiate the process of analysing the global economic benefit of biological diversity, the costs of the loss of biodiversity and the failure to take protective measures versus the costs of effective conservation. 3
TEEB’s Goals • Assess and communicate the urgency of action to address ecosystems and biodiversity loss – by presenting the economic, societal and human value of the benefits of ecosystems and biodiversity, and the scale of the benefits lost, • Show how we (can) take into account the value of ecosystems and biodiversity in our decisions and choices, • Address the needs of policy-makers, local administrators, business and citizens (the “end-users”) – interests, opportunities, & responsibilities. Phase 2 (2008-2010): Phase 1 (2007-2008): • Additional analysis within wider • Preliminary scoping work, Valuation framework • Some first analysis, • Broaden the scope of studies (methods; • Clarification as to how to address the ecosystem services (ESS) and biomes) wider goals, • Focus on End-user products • Preliminary identification of experts and • Stronger Involvement from different organisations to contribute experts & organisations Source: adapted from Pavan Sukhdev 4
Recap: why the concern? Past Losses Global Forest Area has shrunk by approximately 40% since 1700. Forests have completely disappeared in 25 countries . Since 1900, the world has lost about 50%of its wetlands. . Some 20% of the world’s coral reefs - have been effectively destroyed by fishing, pollution, disease and coral bleaching and approximately 24% of the remaining reefs in the world are under imminent risk of collapse through human pressures. In the past two decades, 35% of mangroves have disappeared. Some countries have lost up to 80% through conversion for aquaculture, overexploitation and storms. The rate of species extinction is estimated to be 100 to 1,000 times more rapid than the “natural” extinction rate (MA 2005).  United Nations Forest and Agriculture Organisation, 2001.Global Forest Resources Assessment 2000; United Nations Forest and Agriculture Organisation, 2006 Global Forest Resources Assessment 2005.  http://www.ramsar.org/about/about_wetland_loss.htm  Wilkinson C., 2004: Status of Coral Reefs of the World: 2004 report  Millennium Ecosystem Assessment, 2005: Global Assessment Report 1: Current State & Trends Assessment. Island Press, Washington DC. Detail: Chapter 19 Coastal Systems. Coordinating lead authors: Tundi Agardy and Jacqueline Alder. Original reference: 35%: Valiela et al. 2001; 80% reference: Spalding et al. 1997 5
Biodiversity loss - 1700 to 2050 73% 62% MSA statistics indicate that in the “Policy Inaction” scenario : Global objective (significant reduction in rate of loss) unlikely by 2050 Stricter European goal (halting further loss ) unlikely by 2050 CBD goals (for 2010) unlikely over short term 6 Source: building on Ben ten Brink (MNP) presentation at the Workshop: The Economics of the Global Loss of Biological Diversity 5-6 March 2008, Brussels, Belgium.
The Global Loss of Biodiversity 2000 Source: L Braat presentation COP9 Bonn May 2008 on the COPI Study; building on MNP data 7
The Global Loss of Biodiversity 2050 Europe – at Risk India - at Risk Africa – at Risk. The World – at Risk. Source: L Braat presentation COP9 Bonn May 2008 on the COPI Study; building on MNP data 8
Mapping changes : from Biodiversity & Ecosystems to Economic Values (Human) Drivers Change Change in in Change Economic Natural Land use, in Change Value Drivers Climate, Biodiversity Pollution, In Water use Ecosystem Services Policies Change Nat. Reg. in Loc. Int. Ecosystem functions Source: L. Braat & P. ten Brink (eds.) 9
Valuation & Ecosystem service losses COPI calculation: A Annual Loss of economic value of ecosystem services that would have been Relative to 2000 available had biodiversity remained at 2000 levels. Estimate for 2050. Services that `would have been there, had biodiversity A Ecosystem been halted. service level Losses continue into the future 2000 2010 2030 2050 Source: P ten Brink in L. Braat & P. ten Brink (eds.) 2008 COPI Study 10
TEEB – Interim Report COP-9, Bonn, May 2008 Key Messages from the Interim Report….. Economic Size & Welfare Impact of Losses is enormous MDG1: Eradicate extreme poverty and hunger Strong Links between MDG5: Improve Poverty / MDG’s material health & Biodiversity Losses MDG4: Reduce child mortality Discount Rates are an ethical choice Source: Pavan Sukhdev 11
Change of Landuse (area coverage) across all biomes – Global Total Actual 2000 2050 Difference Area million km2 million km2 2000 to 2050 Natural areas 65.5 58.0 -11% Bare natural 3.3 3.0 -9% Forest managed 4.2 7.0 70% Extensive agriculture 5.0 3.0 -39% Intensive agriculture 11.0 15.8 44% Woody biofuels 0.1 0.5 626% Cultivated grazing 19.1 20.8 9% Artificial surfaces 0.2 0.2 0% World Total * 108.4 108.4 0% Natural areas loss is 7.5m km2 - broadly equivalent to the area of the Australia. Losses: natural, bare natural areas & extensive agriculture broadly equals the USA Source: L. Braat & P. ten Brink (eds.) 2008 COPI 12
Loss of Quality / Degradation Global total Loss of quality - due to pollution, fragmentation, infrastructure and climate impacts (Global average all biomes) Mean Species Abundance indicator Mean species abundance change for different land use categories MSA loss 2000 to 2050 Natural areas 11% Bare natural 8% Forest managed 20% Extensive agriculture 8% Intensive agriculture -2% Woody biofuels 0% Cultivated grazing 14% World Total 18% Source: L. Braat & P. ten Brink (eds.) 2008 COPI 13
COPI - Some key results • The welfare loss grows with each year of biodiversity and ecosystem loss. • Over the period 2000 to 2010 this amounts to around 50 billion Euros extra loss per year, every year. • By 2010 the welfare losses from the loss of ecosystem services amount to 545 billion EUR in 2010 or just under 1% of world GDP. • The value of the amount lost every year rises, until it is around 275bn EUR/yr in 2050. • The loss of welfare in 2050 from the cumulative loss of ecosystem services between now and then amounts to 14 trillion (10^12) Euros under the fuller estimation scenario • This is equivalent in scale to 7% of projected global GDP for 2050 – across land-based biomes Source: P ten Brink in L. Braat & P. ten Brink (eds.) 2008 COPI Study 14
Global COPI Loss of Ecosystem services from land based ecosystems Relative to 2000 Relative to 2000 Equivalent to % Area Billion EUR of GDP in 2050 Natural areas -15678 -7.97% Forest managed 1852 0.95% Extensive Agriculture -1109 -0.57% Intensive Agriculture 1303 0.67% Woody biofuels 381 0.19% Cultivated grazing -786 -0.40% World Total -13938 -7.1% Land based ecosystems only Other biomes - need for complementary focus in Phase 2 The loss grows with each year of biodiversity and ecosystem loss. Source: P ten Brink et al in L. Braat & P. ten Brink (eds.) 2008 COPI Study for DGENV 15
Global COPI Loss of Ecosystem services Forestry biomes Partial Forest biomes Estimation Fuller Estimation Boreal forest -163 -1999 Tropical forest -536 -3362 Warm mixed forest -249 -2332 Temperate mixed forest -190 -1372 Cool coniferous forest -47 -701 Temperate deciduous forest -133 -1025 Forest Total -1317 -10791 Natural areas -1552 -12310 World GDP in 2050 (trillion (10^12) EUR)* 195.5 Losses of ESS from forests as share of % GDP -0.7% -5.5% Losses of ESS from natural areas in forest biomes as share of % GDP -0.8% -6.3% Source: P ten Brink et al in L. Braat & P. ten Brink (eds.) 2008 COPI Study Building on FEEM forestry per hectare values16
What ESS could already be included (forests)? Included - (8 services) Not included - (10 services) Provisioning services Provisioning services Food, fiber, fuel Biochemicals, natural medicines, pharmaceuticals Regulating services Ornamental resources Air quality maintenance Fresh water Soil quality maintenance Regulating services Climate regulation (i.e. carbon storage) Temperature regulation, precipitation Water regulation (i.e. flood prevention,, Erosion control aquifer recharge etc.) Technology development from nature Water purification and waste management Regulation of human diseases Cultural services Biological control and pollination Cultural diversity, spiritual and religious Natural hazards control / mitigation values, educational values, aesthetic and cultural Cultural services Recreation and ecotourism • Living comfort due to environmental amenities Need for focus in Phase 2 Source: L. Braat & P. ten Brink (eds.) 2008 COPI Study 17
COPI – Forestry Biome Different ways of calculating the loss A : 50-year impact of inaction B : Natural Capital Loss every year Lost Welfare equivalent Natural Capital Lost from to 5.5 % of GDP (from forest USD 1.35 x 10 12 to 3.10 x 10 12 (@ 4% Discount Rate) (@ 1% Discount Rate) biomes overall) … or… Source: P ten Brink in L. Braat & P. ten Brink (eds.) 2008 COPI Study for DGENV 18
Impacts of Phase 1 Impacts of Phase 1 • Press coverage and visibility – the buzz • Awareness and understanding – broadening the audience & new perceptions • Formal Engagement by other into the TEEB process – voting with their feet/pockets • Integration of TEEB into other processes and activities – others are listening • Policy debate – TEEB in the corridors of power And in TEEB phase II, the above + • Policy influence – Realising commitments +Words turn to commitment • Practical influence – Action on the ground 19
Press Echo to TEEB I, May 2008 Source: Dr Carsten Neßhöver, Heidi Wittmer & Christoph Schröter-Schlaack, Presentation in Vilm, 26.8.2008 20
Awareness & understanding – broadening the audience & new perceptions Broadening the audience & high level access…. • Into realms of Economics and Finance experts – nature: natural capital: value • Other Government departments reaches - reaches the parts of government that other studies cannot reach • other sectors “integration” – understanding of value of nature and need to safeguard inputs • Court of auditors: national responsibility of dealing with limited resources. New Perceptions (in some quarters) / strengthened perceptions • The dangers of discounting as done to date / dispute the dogma • New understanding of reliance, resilience and risk • GDP of the Poor • Not Economy vs Ecology, but ecology underpins much of the economy • Nature is fundamental to welfare and wellbeing • Need to re-orientate the signals within our economies/societies • Need to reward practice that offers benefits, • Ensure responsibility for damages 21
Deep Links with Poverty “GDP of the Poor” most seriously impacted by ecosystem losses… “India” Example (from GIST’s Green Accounting for Indian States Project, 2002-03 data) 480 Million people in small farming, animal husbandry, informal forestry, fisheries…. ESS add “only 7.3%” to classical GDP or ESS add 57 % to “GDP of the Poor” Source: Pavan Sukhdev 22
Ethics of discounting Three hidden stories 1. Declining Growth Paths in the per-capita flow of nature’s services … imply that discount rates should be negative 2. Marginal Utility of $1 to the Rich vs Poor … is too different to merit the same discounting treatment 3. Inter-generational Equity … following ‘market practice’ means valuing nature’s utility to your grandchild at one-seventh of your own ! Cash flow Annual Present 50 years in discount value of the future rate the future Most of the 29 valuation studies cash flow in our meta-study of forest valuations 1,000,000 4% 140,713 use discount rates between 3%-5% 1,000,000 2% 371,328 1,000,000 1% 608,039 1,000,000 0% 1,000,000 Source: Pavan Sukhdev 23
GDP & natural capital loss How they (don’t) fit The assumption of GDP (OECD Scenarios) continued economic GDP, with feedback on 2.8%/year group will be economic losses from Relative to 2000 biodiversity compromised by losses integrated - illustrative eroding our natural capital GDP: 41.4$ trillion (PPP) (10^12) Population 9100 million GDP/capita: 680$ (PPP) Population: 6092 million GDP adjusted for well-being impact of biodiversity loss - illustrative Services that would have been If we measure it there, had biodiversity been halted right – we are most probably going in Ecosystem the wrong direction service level 2000 2050 Source: Patrick ten Brink (IEEP), Leon Braat (Alterra), Mark van Ooorshot (MNP), Matt Rayment (GHK) 24
..some quotes… Simon Kuznets - GDP's creator – already in 1934 said that “The welfare of a nation can scarcely be inferred from a measurement of national income”. & after almost 30 years further thought, added “Distinctions must be kept in mind between quantity and quality of growth, between its costs and return, and between the short and the long term. Goals for more growth should specify more growth of what and for what.” On GDP and natural resources A country could cut down all its forests and deplete its natural resources and this would show only as a positive gain to GDP despite of the loss of capital. Source: Millenium Ecosystem Assessment (MA) 2005 see http://www.millenniumassessment.org 25
Global Loss of Fisheries… …Human Welfare Impact Half of wild marine fisheries are fully exploited, with a further quarter already over- exploited at risk : $ 80-100 billion income from the sector at risk : est. 27 million jobs but most important of all….. We are fishing down the food web At risk : over a billion people rely to ever smaller species… on fish as their main or sole source Perverse Subsidies are a key driver of the loss of animal protein, especially in of fisheries : Need for new policy orientation? developing countries. Source: Ben ten Brink (MNP) presentation at the Workshop: The Economics of the Global Loss of Biological Diversity 5-6 March 2008, Brussels, Belgium. Original source: Pauly (UBC, Canada) 26
Impacts of Phase 1 Engagement into the Process • Formal Engagement by other into the TEEB process - voting with their feet/pockets/time Engagement in TEEB • CBD support TEEB formally • UNEP on board - thematic/expert input, not just secretariat • UK on board to support TEEB Phase II • German government (not just initiators and funders, but also going to do TEEB Germany) • European Parliament Interest • ….. Links of TEEB to others – TEEB is seeking to build links and wider engagement. • UNDP : Latin America… • Ecosystem value work in China…. • Japan – building • USA - building • VROM et al workshop on IPES (February 2009) • CBD workshop on perverse incentives (..maybe May 2009) • EEB Biodiversity seminars! (tip of the iceberg) What potential links are there that you recommend TEEB make? 27
TEEB Phase 2: Ambitions, Process and milestones • Overview • D0 D0 • D1 D1 • D2 D2 • D3 D3 • D4 D4 28
TEEB – Final Reports Sep 2009 - June 2010 Science & Economics Foundations, Policy D0 Costs & Costs of Inaction Policy opportunities for D1 National & International Policy-Makers Decision Support D2 for Local Administrators Business Risks D3 & Opportunities Citizen / Consumer D4 Ownership Source: Pavan Sukhdev 29
The Process for TEEB Phase 2 2008 2009 2010 Nagoya, Japan Inputs from Science and Economics experts through the Call for Evidence, participation in Working Groups, etc CBD COP9 - Bonn, Germany Val‘n Framework, Methodologies, Cost Analyses D0 D0 End-User Outreach TEEB for Policy-Makers D1 D1 D2 TEEB for Administrators D2 D3 D4 TEEB for Business D3 CBD COP10 TEEB for Citizens/Consumers D4 Continuous involvement of End-User Groups Source: adapted from Pavan Sukhdev 30
The Operational Framework of TEEB – Phase II Study Leader Group Advisory Board Scientific Peer Review Group Coordination E1 E2 E3 E4 Group Workshops – Call for Evidence – Synthesis Papers– etc…. TEEB Secretariat D0: Science & Economics D1: D2: D3: D4: - Policy Maker Administrator Business Citizen/consumer Workshops – Call for Evidence – Synthesis Papers– etc…. E5 E6 E7 E8 E9 E10 E11 E12 E13 E14 Source: Pavan Sukhdev 31
TEEB Phase 2 D0: Valuation Framework, Methodologies, Cost Analyses - Scientific Challenges D0 • The scientific tome / basis of the wider TEEB work • Solid, referenced analysis on TEEB issues, building on • Phase 1 TEEB work and supporting effort • Existing work across the world • Contributions from across the planet - “big names” & other committed • New work launched within the D0 context • European Commission • Others (Germany, UK, UNDP, etc) • Develop further the TEEB valuation framework / guidelines to facilitate others doing similar work. 32
D0 TEEB Phase 2 D0: Valuation Framework, Methodologies, Cost Analyses - Scientific Challenges • Develop further the TEEB valuation framework, e.g. • further develop the framework of ecosystem services and benefits, • investigate the state of knowledge on ecosystem dynamics, • exploring how to reflect thresholds • Recommend valuation methodology and do TEEB analysis, e.g. • examine further some values not addressed in depth during Phase I (e.g. resilience values of biodiversity, option values such as bio- prospecting, non-use values such as bequest & existence values), • address additional biomes (e.g, oceans, poles) • Evaluation of policy costs • the costs and opportunity costs of conservation policies versus the costs of ‘business-as-usual’ within an existing policy framework (e.g. agriculture, fisheries, infrastructure, climate change, etc) Source: adapted from Pushpam Kumar 33
TEEB for Policy Makers Objectives and Outcomes: D1 • Raise awareness of policy makers across the globe of the importance and urgency of action to address ecosystems degradation and biodiversity loss. • Help improve the understanding of the benefits of ecosystems and biodiversity and the risk and costs of losing these benefits. • Inform about the consequences of international and national policies on biodiversity and ecosystems (i.e. subsidies, trading rules, benefits sharing). • Identification of opportunities for action, such as applying new or reforming existing policy tools; improve the way we measure our societal and economic wellbeing taking account of ecosystem benefits and losses • Support policy action, by providing information and tools to help provide information that can be integrated into decision making. 34
The D1 (Policy Level) TEEB Report: D1 Structuring the issues (The “wireframe”) Ch Title Questions being addressed 1 The Biodiversity Policy Challenge Why is there Urgency for Action to address biodiversity loss? 2 Policy Responses: Actors and instruments Who can take up the biodiversity challenge; what tools can help ? 3 Measuring to Manage our Natural Capital What should we measure to ensure a proper stewardship of our natural capital? 4 Evaluation Tools that (can) Integrate the Value of What tools work, what needs and opportunities are there Biodiversity for their use? 5 Policies to Reward (unrecognised) Benefits of What policy instruments can help and how to make the Ecosystems and Biodiversity markets give the right signals? 6 Aligning Today’s Subsidies to Tomorrow’s Priorities Can we save money and avoid the destruction of biodiversity? 7 Policies to Address the Losses of Biodiversity What instruments and market signals can help ensure that the polluter pays ? 8 Protecting areas, ecosystems, habitats and species Protected areas, and addressing the financing and implementation challenge 9 Using the whole Policy Toolkit to address the challenge What package of instruments and responses do we need to respond to the challenge? Structure and content being developed continuously taking into account insights & suggestions – detailed wireframe on http://ec.europa.eu/environment/nature/biodiversity/economics/pdf/d1.pdf 35
Examples of issues of particular interest Where can TEEB help ? D1 Working suggestions of areas where particular focus in TEEB is valuable - due to value of good practice and/or need for new initiatives or progress: • Integrated policy making – the costs and benefits of losing biodiversity • Payments for Environmental Services (PES) • REDD (Reducing Emissions from Deforestation and Degradation) • Environmental Harmful Subsidy (EHS) reform • Adjusted national income accounting • Ecological footprints • (Criminal) Liability for damages • … • … What areas do you see as particularly important to give due focus to? 36
Deep Links with Poverty Examples Rewarding Unrecognized Benefits Panama Canal : Insurance firms and shipping companies are financing a 25-year project to reforest the water catchment of the canal to restore freshwater flow to its locks… the fear of loss due to closures of the Canal had been making shipping insurance premiums mount. Costa Rican PES : Payments for Environmental Services are virtually a national strategy for forest and biodiversity conservation and sustainable development Guyana : A Private Equity firm recently bought the rights to environmental services from a 370,000 hectare rainforest reserve in Guyana anticipating that its services (water storage, biodiversity maintenance, rainfall regulation, etc) will gain value. Revenues will be shared 80% with the local community. Benefits sharing Source: Pavan Sukhdev 37
TEEB D1 Organisation and Process D1 Core Group Advisors & Authors / Contributors & Peer Reviewers Co-ordinate process + develop Direct contributions: advice on content + contributions of “wireframe” + substantial ideas, insights, recommendations and material (text, content contributions + data, maps, case examples, quotes, messages, photos) responsible for overall output & + Peer Review “make it happen” Call for Evidence D1 “wireframe” – The “contents of D1” On-line http://ec.europa.eu/environment/nature/call_evidence.htm Oct to Jan 08 for D1 Thematic Workshops January to May 09 Focused on policy makers. Expectation: 150-200 pages D1 Report June 09 Peer Review Sept’ 09 38
TEEB Phase 2 D2: TEEB for Local Administration D2 Still being developed Aim: support awareness of the implications/trade-offs in local decisions & • Provide tools and information to local administrations to help them in their practical work – permit decisions, inspection, enforcement, court cases, setting local taxes/charges/fines (if and where possible) etc Topics to be addressed: • Tools to help local authorities with permit decisions (eg land conversion requests) – eg clarify ecosystem services that should not be ignored, – seek to provide some indicative values for potential use / benchmark, – provide examples to demonstrate precedent. • Help provide information to local authorities to help with conflict resolution over protected areas. • Information to support local courts – Eg to support implementation of liability cases / criminal law for environmental damage What areas do you see as particularly important to give due focus to? 39
TEEB Phase 2 D3 D3: TEEB for Businesses Topics to be addressed: • Tools to help business managers identify biodiversity risks and liabilities – Value of biodiversity ecosystem services as an input to their processes, dependence and need to safeguard the inputs. – Potential liabilities – damages, costs (fees/charges). • The concept of “no net loss” or “net positive impact” on biodiversity and implications for business accounting systems • New biodiversity business opportunities, including bio-friendly segments within established sectors, e.g. eco-agriculture, eco-tourism, certified forestry, as well as new sectors, e.g. biocarbon, biodiversity banking • How to make business assets / capacities / skills more relevant to conservation through public-private partnerships • Mainstreaming ecosystem indicators and values in corporate management and annual reporting systems • The role of environmental regulation and market structures in pricing ecosystem assets and liabilities • How business can help build a green economy and green jobs Source: adapted from Joshua Bishop 40
D4 TEEB Phase 2 D4: TEEB for Citizens/Consumers Still being developed – balance of citizen focus and consumer focus open Re Consumers, need for: • Information on impact of consumer choices on biodiversity / ecosystems – eg the food we eat, clothes we buy, cars we drive (& the fuel), house we live in (and heat), and holidays we take.. • Tools to help consumers measure their impacts so as to respond to a need for responsibility. – Eg food miles or footprints or rucksacks? – Benefits of organic for health and for the environment • Examples of policies to help consumers - from different countries Re Citizens & peoples, arguably need for: • Rights, ethics and responsibility (and potential roles – eg spot the impact eg IAS) • Realities for forest peoples • GDP of the poor • Ethics – who reaps the ecosystem services (eg biofuels-food tension) What do you see as particularly important to give due focus to? 41
TEEB and NGOs 1. Opportunity to get your messages across – for policy makers (D1), administration (D2), for business (D3) and for individuals (D4) 2. There is no “TEEB for NGOs”, as NGOs have something to say for the 4 end user groups. Opportunity for engagement in Ds (contributors, advisors, core group) 3. From NGOs, TEEB needs messages, insights, data, case examples, photos, maps and quotes – we need global representation. Help with practice in Latin America, Africa, and Asia most welcome – examples and names of experts who know. 4. NGOs invaluable in getting the communication “buzz” in the public/press + issues into the policy corridors. 42
TEEB and Communication – how to get the messages across The challenge – not just identifying the message, but getting it across and being taken seriously – into agendas, into action. TEEB: 5 deliverables, including 4 specific end user focused products Pavan Sukhdev (and others): wide range of high level presentations Big numbers and the press National/local numbers and country relevance Wide Engagement and involvement of into the process Clarifying links between high level issues - climate change, financial losses Case examples, interesting facts, quotes, lessons/insights + spotting the needs and opportunities. What do you see as initiatives that TEEB should focus on ? 43
TEEB and Communication – how to get the messages across Eg: how to get companies to use values for “green D3 accounting”? Underline the material benefits of ecosystem services to their operations (ie dependency on ecosystem inputs?) + underline the risks / liabilities of loss of inputs, or damage to ecosystems D0 D1 D2 D3 D4 + clarify economic opportunities and competitiveness advantages. +underline the long term context – the financial crisis gives a new hope for moving away from short-termism?. “No one would look just at a firm’s revenues to assess how well it was doing. Far more relevant is the balance sheet, which shows assets and liability. That is also true for a country.” Joseph Stiglitz, 2005 in Foreign Affairs, see http://www.foreignaffairs.org/.html 44
TEEB and Communication – how to get the messages across Eg: how to get countries to use values for “green accounting”? Underline the importance of ecosystem services to the economy and societies wellbeing/development. Demonstrate the benefits of using a more complete evidence base Demonstrate the linkage of TEEB issues to others they recognise intuitively or already commit to addressing (natural hazards, food dependency, climate change, migration, development etc) A country could cut down all its forests and deplete its natural resources and this would show only as a positive gain to GDP despite of the loss of capital. Source: Millenium Ecosystem Assessment (MA) 2005 see http://www.millenniumassessment.org 45
TEEB and the Financial Crisis parallels and differences 1. 1. The loss of natural capital is losing us more money than the stock The loss of natural capital is losing us more money than the stock market collapse market collapse 2. Ecological losses have been leading to human disasters (starvation, 2. not risk of ends meet (…suicides by Indian farmers), migrations) but The makingnatural capital loss is hardly factored in – has been off the not taken as seriously as banking losses decision makers’ radar…. 3. The risk of natural capital loss - to the economy to societies - is hardly 3. factored down natural capital is like running down out Running in – has been off the decision makers’ radar….savings – and when our savings run out, the situation is fragile, explosive, implosive 4. Running down natural capital is like running down out savings – and when our savings run out, the situation is fragile, explosive, implosive 4. Short termism rules the decision (eg discount rate, quarterly 5. The insurance market term again not in our economic losses objectives) - the longwill not be able to cope with the compass. 6. Short termism rules the decision (eg discount rate, quarterly 5. The market signals have often encouraged loss of natural capital – a objectives) - the long term again not in our economic compass. loss in the faith in markets… need to fix the compass 7. The market signals have often encouraged loss of natural capital – a loss in the faith in markets… need to fix the compass 46
Rescues committed to and rescues still to be committed to… International Financial Crisis and Global Ecological Crisis Rescue Action (Source: BBC, Oct 2008) Approximately 60% (15 out of 24) of the ecosystem services evaluated in this assessment are being degraded or used unsustainably-MA,2005 According to various estimates, these conservation areas produce some $4-5 trillion of utility per year from various ecosystem services Any Rescue Action/ Plan for Ecological Crisis? Source: Pavan Sukhdev 47
Summary • Loss of biodiversity and ecosystem services cannot continue into the future without undermining wellbeing and welfare of societies, economies and individuals. • Sustainable progress needs a reorientation of market signals and a revision of policies in light of a greater appreciation of the role / importance of ecosystems and biodiversity to societies. • TEEB is a response to the need and Phase 1 has launched the issues • TEEB Phase 2 has a lot to do - to clarify the messages, ensure ownership and visibility of the messages and that they are heard and responded to. Contribute to a Green New Deal • This requires engagement by all end-users and NGOs have an important contribution to make. • Without rising to the challenge we are creating a basis for a crisis much beyond the current financial turned economic turned social crisis. 48
Thank you! - Further information…. http://ec.europa.eu/environment/nature/biodiversity/economics/index_en.htm or google „TEEB Europa“ TEEB website will be up soon For contributions • Call-for-Evidence http://ec.europa.eu/environment/nature/call_evidence.htm • Other contributions/engagement – please contact TEEB core teams/coordinators • DO: Pushpam Kumar; D1: Patrick ten Brink; D3: Joshua Bishop Wider TEEB Contact (and also cc generally): TEEB Scientific Coordination via firstname.lastname@example.org TEEB is currently funded by the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety and the EU Commission, Directorate General for the Environment, with additional contributions from other partners. 49
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