The Natural Step is embarking on a new Sustainability Transition Lab—this Lab aims to improve the way we measure, manage and make decisions about Canada’s natural capital.
What is Natural Capital?
Natural capital refers to our stocks of water, land, air, and renewable and nonrenewable resources such as plant and animal species, forests, and minerals (David Suzuki Foundation). These stocks provide ecosystem services that serve vital, but largely invisible, functions in our communities (e.g. forests absorb carbon, filter and increase air quality and provide stormwater management services).
Canada has an unparalleled abundance of natural capital. Canada is home to 0.5% of the world’s population, but contains 6% of the world’s land mass. We enjoy 60% of the world’s lakes, 9% of the world’s fresh water, 25% of the world’s wetlands, and 10% of the world’s forests (Source).
Natural capital accounting is a way of measuring these assets, how they are used and what goods and services they generate. Without effective natural capital accounting, we cannot fully understand the impacts of our decisions on our environment or our economy.
Why is This Important?
Despite the environmental, economic and social importance of our ecosystems, the lack of robust natural capital market and non-market indicators make it difficult to properly value their worth – and their cost of degradation.
In order to ensure the proper stewardship and conservation of natural capital, business and government leaders need reliable information, tools and frameworks to include natural capital in the decision-making process. New economic indicators and accounting standards are urgently needed, as is the application of these across businesses, governments and communities – the system is in need of a transformation.
Natural capital is not a new idea, but the field is fragmented. Important work is being done across the country on better measurement and management, but initiatives are largely disconnected from each other. As a result, the public is largely unaware of the concept, and even interested stakeholders in business and government are faced with a confusing variety of metrics, definitions, and methodologies for valuing natural capital.
The Path Forward
The Natural Capital Lab is being co-convened by The Natural Step Canada, the Chartered Professional Accountants Canada, TD Bank Group, The Cooperators, Deloitte, Sustainability Prosperity and the Municipal Natural Capital Initiative. It is a platform for collaborative experimentation and innovation among leaders from across Canada who have a stake in ensuring that:
- Market signals and incentives are corrected to account for the central role natural capital in our economy,
- Canadians are engaged and informed on the value and importance of natural capital
- Canadian business and government accounts for natural capital in decision making, and,
- Canada’s economies and communities are positioned for a resilient, sustainable future.
To coordinate, scale and accelerate the measurement and management of Natural Capital across Canada, we are engaging stakeholders from all corners of the country. Participants in the Natural Capital Lab will include: representatives of federal, provincial and municipal governments; the accounting, finance, manufacturing, and resource extraction sectors; non-profits; academia, and economics.
How to Get Involved
Our official website launch kicks off the recruitment period for participants for the Natural Capital Lab. In the coming days, we’ll be launching an FAQ page for more information on the recruitment process and an application form.
If you have any questions, comments or think that we should connect, please get in touch with us at ncruz (at) naturalstep.ca.