Download (PDF, 6.71MB) - TEEB

10.2.2 BETTER LINKS TO MACRO-
ECONOMIC AND SOCIETAL
INDICATORS AND NATIONAL
ACCOUNTS
Most services provided by the natural environment
to human society are not captured by GDP
or other conventional macro-economic indicators
because, as noted above, they are not directly traded
in markets. However, in no way does this lessen the
need to treat them as economic assets, given their
vital contribution to long-term economic performance.
Taking tropical forests as an example, the marketplace
currently ignores a whole series of ecosystem
services they provide (e.g. regulation of local and regional
climate and freshwater flows, carbon storage,
preservation of soil cover, provision of habitat for
plants and animals, downstream flood protection).
Without prices, these services go unmeasured in conventional
accounting procedures such as the universal
System of Standard National Accounts (SNA).
SNA has major limitations when it comes to measuring
natural capital. It recognises depreciation for
man-made capital assets but not the ‘wear and tear’
of ecological assets which is just as real. This gap is
one of the main reasons why natural capital losses
remain largely hidden from policy makers and from
the corrective power of public scrutiny.
This problem has not gone unnoticed. A System of
Economic Environmental Accounting (SEEA) has
been developed, covering land, water, environmental
expenditures and social issues in monetary and physical
terms, and adopted by some countries. However,
an upgrade of the UN SEEA manual (2003) is
urgently needed to catalyse progress on measurement
and incorporate ecosystem services into national
accounts. This should prioritise physical accounts
for forest carbon stocks to reflect the emerging ‘green
carbon’ regime (REDD or REDD-Plus, see 10.3
below) but also support the gradual and full inclusion
of other forms of natural capital and ecosystem services.
A possible way forward would be to develop simplified
natural capital accounts, annually updated to
RESPONDING TO THE VALUE OF NATURE
assess losses and gains in the ecological potential of
ecosystems in terms of physical units and estimate the
economic costs of maintaining or restoring this capital
(e.g. natural capital consumption or formation). These
accounts could then be integrated with conventional national
accounts, using natural capital consumption as a
possible adjustment factor for macro-economic aggregates
such as national income. More detailed ecosystem
accounts, relying on economic valuation of
ecosystem service flows, would obviously be useful
for specific evaluation and policy purposes. However,
their development presents substantial challenges and
full integration with national economic accounts may
therefore be a longer term prospect.
The need to move beyond GDP indicators to measure
sustainability and human well-being is now
increasingly recognised. Ways to achieve this range
from complementing traditional macro-economic
aggregates with adapted indicators to promoting more
fundamental reform of economic and societal progress
reports to embed sustainability principles. Integrating the
contribution of ecosystems to human well-being through
national accounts could form a core element of this
effort.
Concrete progress could be made by developing a
set of indicators based on the concept of inclusive (‘extended’)
wealth, involving regular measurement of
per-capita physical, natural, human and social capital.
This idea is not new, and has been developed notably
in the World Bank’s adjusted net savings index
(Hamilton and Clemens 1999) and in the genuine investment
indicator (Dasgupta 2001). Recent work such as
the report of the Stiglitz-Sen-Fitoussi Commission to
President Sarkozy and ongoing activities under the EU’s
‘Beyond GDP’ initiative (CEC 2009) points in the same
direction.
These new approaches to measurement give rise
to new terms and concepts. A well-known example is
the ‘ecological footprint’. This is sometimes criticised as
reflecting an inherently anti-trade bias as it focuses on
ecological deficits or surpluses at a national level. However,
in a context of increasing global scarcity of natural
assets, it can nevertheless be considered a useful tool
to inform policy-making as well as for education and
public awareness.
TEEB FOR NATIONAL AND INTERNATIONAL POLICY MAKERS - CHAPTER 10: PAGE 11