Biodiversity, Ecosystem Services and Natural Capital: Terms Matter

Rarely a day goes by without  a new publication highlighting the importance of biodiversity, ecosystems and natural capital to businesses, policymakers and the like being released.  This proliferation of information about these related concepts has also been accompanied with a proliferation of different ways in which these terms are being used.

For these concepts to be incorporated into policy-making and business decision-making these terms must be pinned down into precise concepts which can then be

measured, monitored and reported.  When these terms are used imprecisely or interchangeably it becomes more difficult to agree upon and construct the robust and useful indicators needed by governments and business.

Some of the confusion in how people refer to these terms has been a result of the quite recent introduction and popularisation of the term ‘natural capital’ into these discourses. To many it would seem that this term represents merely a rebranding of ‘ecosystem services’ or ‘biodiversity’ for the purpose of making these concepts sound more relevant to business; however, there is actually a quite simple and clear distinction between how the terms ‘ecosystem services’ and ‘natural capital’ should be used.

Ecosystem services are the flows of benefits which people gain from natural ecosystems, and natural capital is the stock of natural ecosystems from which these benefits flow. So, a forest is a component of natural capital, while climate regulation or timber might be the ecosystem service it provides. Healthy soil is a component of natural capital, while food or energy production might be the ecosystem service it provides.  Natural capital is the stock of resources which generate ecosystem services.  The crucial link between natural capital and ecosystem services is that when some classes of ecosystem services are appropriated by humanity at an unsustainable rate, the stocks of natural capital which provide them may be depleted.

Ecosystem services are an often confused area.  For example, Scottish agricultural research centre the James Hutton Institute  make the following assertion: “’Ecosystem services’ include waste disposal, resilience to climate change, water supply, biodiversity conservation and soil quality, for example.” In a document entitled Safeguarding Natural Capital it seems somewhat perverse to describe ‘waste disposal’ as a service natural ecosystems provide to humanity; presumably the intention is to refer to the bioremediation of pollutants.  And is biodiversity conservation an ecosystem service?  Do natural ecosystems supply us with beneficial flows of ‘biodiversity conservation’?  Biodiversity conservation is an activity carried out by humans with the intent of preserving stocks of biodiversity – in a sense a service we provide to ecosystems, and so if anything it is the opposite of an ‘ecosystem service’.

Another development with terminology in recent years has been the amalgamation of “biodiversity” and “ecosystem services” into one concept: “BES”, an acronym referring to ‘biodiversity and ecosystem services”.  BES is a term used primarily in reports aimed at businesses; here is a variant of the common refrain (from an ACCA report):  “Loss of BES exposes the corporate sector to a range of new risks and opportunities that can affect profit, asset values and cash flow.”

References to BES are problematic because flows of ecosystem services and stocks of biodiversity interact in very complex ways, often in a contrary nature: flows of ecosystem services humans are appropriating from natural ecosystems are responsible for losses of biodiversity and natural capital – it is the unsustainable appropriation of ecosystem services such as waste bioremediation, or food, fibre and energy which is depleting stocks of biodiversity.  As such, amalgamating the terms biodiversity and ecosystem services together in one acronym as if the relationship is always symbiotic makes little sense.

Terms matter in this field because it is with these terms that businesses, governments, and NGOs are attempting to build the frameworks needed to maintain natural capital stocks, ensure sustainable flows of ecosystem services, and conserve biodiversity – so the greater clarity with which these terms are used and understood the better.