Building resilience using a Natural Capital approach

Hands holding soil

While the uncertainty around Brexit continues, businesses are starting to prepare as best as they can to improve their resilience. This newsletter looks at the best and most profitable ways in which farm and other land-based businesses can utilise their core assets and strengths, focusing on long term sustainable production, enhancing natural capital, securing future public and private payments, and developing excellent relations with stakeholders.

1. Ensuring long term sustainable production. Land managers are developing ways to reduce inputs and therefore costs, while making their soils more resilient. The following article ‘Practical alternatives to farm intensification’ provides some illustrations of this for the livestock sector, view here.

2. Enhancing natural capital. Taking a natural capital approach means developing a deeper understanding of the natural assets related to your business and enterprises. For example, Crown Estate Scotland worked with Cumulus Consultants and AECOM to trial the Natural Capital Protocol; we focused on some key natural capital questions including:

  • What is the extent and the condition of the estate/farm’s natural capital assets?
  • What is their capability to deliver ecosystem services?
  • What are the dependencies and impacts on ecosystem services for different enterprises? What are the inter-relationships, conflicts or synergies between these enterprises?
  • What are the risks and opportunities for the business and how can these best be addressed?

For more information, see also our case study Trial of the Natural Capital Protocol for land-based businesses.

Natural capital assessments help us look at the value of natural capital assets in a different way. Valuation means more than just monetisation. It refers to the process of estimating the relative importance, worth, or usefulness of natural capital to people. Valuation can be qualitative, quantitative or monetary or a combination of these.

3. Securing future public and private payments linked to natural capital. In the future, environmental markets (combined with regulation) will drive environmental improvements. Defra’s new ELM system, view here, will replace BPS and agri-environment schemes. ELMs will be underpinned by a natural capital approach and will create a market for environmental goods where the government is the buyer and the land manager is the seller. This will be complemented by private environmental markets. For example, Entrade is an online reverse auction system that is already being used for reducing nutrients in the water supply and for taking flood mitigation measures.

4. Develop excellent relations with supply chain partners, local communities and government agencies.

  • Supply chain: a natural capital approach goes beyond the boundaries of your business and considers the wider supply chain upstream (what are your suppliers’ dependencies and impacts on natural capital?) and downstream (what positive and negative impacts do your enterprises have on your customers and communities?).
  • Local communities / NGOs: do you have a clear understanding of the local priorities in your area in terms of food production, water quality, flood prevention, biodiversity, and recreation? Understanding these priorities will help you be a player in the environmental market place.
  • Government agencies: meeting regulations is obviously important and going beyond compliance can be a good way of anticipating future regulations, giving your business a competitive advantage.

If you would like to know more about applying a natural capital approach to your business, please get in touch.

Cumulus Consultants is delighted to be contributing to the development of the natural capital approach nationally and internationally. For example, Paul Silcock, Managing Director, recently:

  • Presented our work on natural capital for Crown Estate Scotland at a Natural Capital Initiative event in Edinburgh
  • Facilitated a Cambridge Institution of Sustainability Leadership workshop for international leaders in sustainability called ‘Embedding Natural Capital’.
  • Explored financing opportunities for managing natural capital on rural land, with colleagues from AECOM, at the Natural Capital Investment Conference 2019.