Thursday

Investing in Nature: Green Profits from Ecosystem Management

There’s one key concept that will allow your organization, your region, your constituency or your brand to really prosper in the next five and the next fifty years. It’s as simple as the weather and the water you drink. It’s investing in nature, and putting the living world on your map of economic growth.


Water systems, habitat for life of all kinds, even the climate itself have all been profoundly affected, and we are coming to find out that these things are not luxury items or amenities but in fact essential ingredients in our economy.


Environmental issues, not long ago seen by business as a burdensome cost are now core competitive issues. No matter what sector of the economy you work in, intractable large-scale trends in the wobbling natural world like severe and unpredictable rain and storms are affecting your costs, your customers, the way you produce your products or deliver your services, and your profits. Whether you make steel or ice cream, beverages or chemicals, clothing or electricity... whether your company picks up the trash or makes cell phones, produces movies or provides lawn care: nature is now critical to your bottom-line.


Awareness of this is growing across corporations, government at all levels, and the increasingly important environmental groups. As a partner in a private equity fund and a sustainability consultant I am continually asked in one way or another: Can we still afford to embrace the Western ideal of continuous growth and development? Do we just have to start making do with less, cutting costs, downsizing, and most of all, worrying? Is there really any way we can prosper and feel OK about it?


We are all now facing the same question: How can we continue to grow without damaging our life support systems – the ecosystems of the earth.


Business needs to know how investment of capital can help to preserve the systems that we need to draw upon and make competitive returns, in order to keep producing products and services, building factories, homes and schools. Government needs to know how to make rules that balance the value of natural infrastructure with the value of the built infrastructure. And advocates need a clear vision of what they are fighting for, not just what they are fighting against.


Since 1960, the US population has doubled from 150 to 300 million and is predicted to reach the 400 million mark by 2040. The world population is growing even faster: from 3 billion in 1960 to 6.7 billion people today, and heading towards 9 billion in the next 30 years. All these people need are going to need what nature supplies in near impossible quantities: not just products like food and fiber and lumber, but clean water, stable weather and a resilient world of animals and plants.


It’s not just the fact that there are so many of us, it’s the amount we produce and consume that’s putting the strain on natural systems. In 1960, the world Gross Domestic Product was about $7 trillion; today it is over $60 trillion. The CO2 in the atmosphere is a result of the energy we’ve used to create this incredible growth; it has been between 180 – 280 parts per million for all of human history. Today it is at 385 and increasing by about 2 parts per million each year. That may not sound like a lot, but we’re already feeling the effects, and the longer we stay over the 350 limit, the greater our risk of passing the ‘point of no return’ where change feeds on itself in ways that can’t be stopped.


We can no longer talk about setting incremental goals or revamping five year plans based on past performance. Leaders in business, in government, or in the nonprofit sector will not be able to react quickly enough to destabilizing events like aquifers running dry, extinction of species, or rising sea levels.


There are hundreds of books that describe the problems we face in exquisite detail. But most have remarkably little to say about what we should actually do. If you can make it through The Last Hours of Ancient Sunlight by Thom Hartmann, which has gotten tons of press and inspired Leonardo DiCaprio’s movie, Global Warming, you’ll find this prescription: “From that connection, that grounded place in the sacred here and now, you touch the power of life and transform yourself and thus those around you. They transform others and eventually every other living being on the planet.” His solution is to believe in new age gobbledygook.


Another, The Long Emergency by James Kunstler predicts an ongoing slow-motion catastrophe, and in the end has America looking like a nation of onion farmers guarding their dried out patches with handmade weapons.


And these aren’t the only ones. Some of the most intelligent and well-intentioned observers demand that we reduce the world population, eliminate poverty, stop using oil and coal, and so on, while it’s obvious that none of these things are going to happen in time to save us.


What Are We For?


Ecosystem services are the key to an affordable approach to sustainability. We're going to have to show that we can make ‘business as usual’ into a force for protecting and restoring our natural systems. To describe a way to move beyond donations and wildlife campaigns and everybody’s good intentions and put nature where it needs to be: squarely on the bottom line.


By now it is clear that success for our economy and success for our ecology are inextricably linked. We can’t talk just about supply and demand of and for commodities and consumer goods. We have to talk about supply and demand of and for the natural systems that underlie the economy, and on which we all depend.


It’s also clear that because of the conventional way we have valued nature, we’re going to be facing new forms of scarcity. It’s like we’re moving through a tunnel with narrowing walls. What we need is a new approach that lets us see the light at the end of that tunnel. We need to have a pragmatic and hopeful concept the future and how to get there. Our population is going to grow, and so is our economy, and we must balance natural systems with this growth if we’re going to remain a strong and independent nation.


Ecosystem services now provide a strategic approach for business, policy and advocacy. Unlike many 'environmental' issues, they provide more than another gloomy list of the problems you’re already aware of. It’s a concept of a new vision of wealth that includes the natural world. It’s about national security in an interdependent world. It’s about the path to a sustainable future. And it describes a practical and exciting way of getting there that will be useful to farmers and CEOs, regulators and scientists, investors and activists... all of us.