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Nature stock exchange

BBC Earth has launched a pilot model for an Earth Index that aims to demonstrate the financial contribution that nature makes to the global economy. Created by BBC Earth and Tony Juniper, UNEP-WCMC was commissioned to provide a scoping study that identified the research and methodologies that have attempted to place an economic value on nature.

For the launch, BBC Earth published the Earth Index in the financial sections of the Wall Street Times, The Times, Singapore Business Times, and the Economic Times. Designed to put nature at the heart of the economic conversation, the Earth Index highlights that the value of some ecosystem services, such as the food, employment and economic development benefits that fish provide, could exceed the annual revenues of some of the world’s most successful companies.

The Earth Index focusses on the value of specific ecosystem services, such as the improved water storage capacity, enhanced water purity, and flood risk reduction that North American beavers provide through their activities. One study of beavers in the Escalante Basin in Utah calculated that the population of 6,500 beavers had a value of $796 million per year. However, this example also highlights the difficulty in unpicking the bundled benefits that a species or an ecosystem provides to people.

Viewed through this economic lens, the benefits of nature are obtained through the flow of a range of ecosystem services that are generated by a stock of natural capital. Natural capital stocks include both biotic and abiotic elements of the natural environment e.g. plants and animals, and the water and minerals which they use and interact with. When combined with other inputs, such as human, social and man-made capital, the flow of ecosystem services - generated by the natural capital stock - results in benefits to people, such as food, clean water, natural hazard protection, and medicines.

The scoping study carried out by UNEP-WCMC for BBC Earth revealed that, while there are studies that have attempted to place a monetary value of the goods and services provided by ecosystems, studies tend to focus on assets that have global benefits. The study also found a lack of consistency between the different methods that have been used to valuate nature and noted that services which have cultural, sacred or religious values cannot be quantified in monetary terms.

To accompany the Earth Index, BBC Earth has created an interactive feature, ‘Cost the earth’ that challenges people to guess the value of global companies such as Starbucks compared to natural assets such as otters. To play the game and find out more about nature’s stock exchange visit: www.bbc.com/earth.

North American Beaver

North America Beaver (Castor canadensis). Photographer: dw_ross, cc-by-2.0 via Wikimedia Commons

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