Natural capital includes all the renewable and
non-renewable resources in our biosphere, including clean air and water, fertile soils and sediments, biodiversity, and finite mineral and fossil resources.
what is natural capital?
The current approach and pace in the utilisation of these resources leads to their depletion, threatening the stability and sustainability of the economic, social and environmental systems.
In recognition of this, regulatory, consumer and
market forces are pushing our economy to transition
to a sustainable circular economy which harnesses and preserves nature.
>$44trn
Nature is both overexploited
and under-utilised
At least USD 44 trillion worth (51%) of GDP
is moderately or highly dependent on nature.
Although it is irreplaceable, the value of nature and its economic potential are still quantifiable: bees pollinate crops worth up to USD 577 billion per year but bees don’t send invoices and so the economic value of this vital resource is taken for granted.
1. World Economic Forum, 2020.
2. United Nations Development Programme, 2017.
51%
But bees don’t send invoices…
Bees pollinate crops worth up to
$577bn
per year
Our impact has pushed us past
the point of stability
(that’s over half the
weight of Mount Everest)
of resources per year
We extract
92bn tonnes
3. Circle Economy, 2020.
Populations of species declined by an average of 68% between 1970 and 2016, with losses as high as 94% in the worst-affected areas .
Species population decline since 1970
Worldwide average
Worst-affected areas
Ecosystem services at risk
As a result, out of 18
key ecosystem services surveyed, 14 are suffering from a long-term decline. Among others, this includes declines in pollination, the abundance of fish stocks, new soil formation, the maintenance of genetic diversity, freshwater quality, and natural hazard protection .
4. WWF, 2020.
5. IPBES, 2019.
68%
94%
To preserve economic growth,
we must put nature at the heart
our economy
Harnessing the power of nature means shifting more of our economy into the bio-based economy, which benefits from self-regenerative and sustainable features of nature.
Whilst preserving nature means shifting towards greater circularity in our production and consumption model as well as eliminating waste in our industrial activities. Such transformation shifts the economy toward more efficient and circular model.
Source: LOIM. For illustrative purposes only.
Timber, for instance, can substitute as much as 20% of steel and concrete in construction in the EU .
6. Maximum ambition assumptions for a net zero transition within the EU as per (ClimateWorks/CTI, 2018).
20%
Preserving
nature
Harnessing
nature
Resource efficiency
Circular bio-economy
Outcome-oriented economy
Zero waste
What is the
Investment Opportunity?
Harnessing and preserving nature are the two key pillars for investing in natural capital. We see the ‘winners’ of the future as c.500 small-mid cap companies globally involved in four themes:
The circular bio-economy unlocked by new technologies
Leaner forms of production through resources efficiency
An outcome-oriented approach
to consumption
The move towards a zero waste world
How do you access
this opportunity?
Find out more here
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