Burgess COMMENTARY

Peter Burgess

Natural Capital Coalition ... INVITATION TO CONTRIBUTE METHODOLOGIES

On behalf of the NCC, the WBCSD and a broad field of experts are leading the development of the Natural Capital Protocol (NCP), which will provide a framework to enable companies to better measure, value and manage their direct and indirect interactions with natural capital.

The NCP will not create any new methodologies for the measurement and valuation of natural capital, but instead will build on existing approaches. The team has already begun considering a variety of methodologies both proprietary and publically available.

Thank you to all who submitted methodologies before 19 December 2014; this has been hugely beneficial in kicking off the process and we are very grateful. However, if you are still interested in submitting a methodology for consideration, please get in touch with Eva Zabey, WBCSD.

Of course we also greatly welcome your insights and feedback throughout the life of the NCP Project. This will include review periods for NCC members as well as public consultation. Please get in touch with the NCC directly and signup to the newsletter to be informed of next steps.

Developing The Protocol ... Developing the Protocol and Sector Guides

The Challenge

At present there a growing number of fragmented activities underway regarding the valuation of natural capital in business and public sector applications. One of the challenges in scaling uptake in business is the lack of a harmonised approach to enable natural capital valuation to be practically used in applications e.g. internal management, reporting and disclosure.

The Project

The Natural Capital Protocol Project responds to this challenge. The overall vision of the Natural Capital Protocol (NCP) is to transform the way business operates through understanding and incorporating their impacts and dependencies on natural capital. The intent is not to invent new methods, but build on the front runners that already exist e.g. the WBCSD Guide to Corporate Ecosystems Valuation, fill the gaps and enable a period of experimentation in the market via different sectors and geographies. This will enable lessons to be learnt and the current gaps to be better understood. It is anticipated that the resulting framework would be the starting point to inform future standards.

The aim of the NCP is to enable business to assess and better manage their direct & indirect interactions with natural capital, in particular through:

increasing knowledge and awareness to generate & deliver greater consistency

equipping project managers to effectively link and embed the outputs directly into business (operations, accounting, etc.)

stimulating action

The NCP will support companies in their decision-making and can be used for a range of applications, incl. risk management, exploring new revenue streams, improving products and value chain innovation, as well as preparing for future reporting and disclosure.

The Protocol

The NCP will provide clear guidance on how businesses can assess their impacts and dependencies on natural capital, and manage these better. It will take the user through the purpose and value-add of carrying out such an assessment for the company, an inventory of impacts and dependencies to consider as well as guidance on how and where to focus effort so that the exercise is fit for purpose. The NCP will also help business navigate the range of approaches that exist, providing recommended steps to take wherever possible, as well as guidance on data needs. Importantly, it will also include how the results of the NCP will be used and embedded in companies.

The Sector Guides

The specific activities and value chains of business sectors result in specific natural capital priorities. The Sector Guides interpret the NCP for specific sectors contexts, initially focusing on apparel and food & beverage due to the materiality and complexity of their impacts. In particular the sector guides will:

• Inform businesses and other stakeholders on the core impacts and dependencies of each sector

• Raise awareness amongst businesses on how integrating natural capital accounting leads to better decision-making

• Direct businesses and other stakeholders to relevant tools and datasets

Business Engagement

To ensure that the Natural Capital Protocol and the Sector Guides are “fit for purpose” they will be thoroughly tested with companies. Companies are invited to become Business Engagement Partners to develop and pilot test the Protocol and the sector guides. This is an exciting opportunity for business to be at the cutting edge of natural capital measurement, accounting and valuation. Involvement of companies from an early stage will not only ensure the market shapes the Natural Capital Protocol itself but enable business to be involved in testing it as it is developed and also by providing feedback into the process.

Stakeholder Engagement

We are fully aware that natural resources and ecosystem-services have many stakeholders. The Natural Capital Coalition brings together many organisations that reflect this broad group of stakeholders. In the work programme to develop the Natural Capital Protocol we also provide for two public consultation processes. These will take place in the spring (for the NCC membership) and fall of 2015 (general public).

The Team

The Natural Capital Protocol is a product of the Natural Capital Coalition. The Natural Capital Coalition has brought together the world’s leading institutions from business, accountancy, consultancy, financial institutions and NGOs to develop the Natural Capital Protocol, to develop two sector guides on Food and Apparel, and to engage business in the development and testing of the Protocol. These institutions are: Accenture, ACTS, ARCADIS, The B Team, Carbon Disclosure Standards Board, University of Cambridge Institute for Sustainable Leadership, Conservation International, Deloitte, eCountability, eftec, ERM, EY, FAO, GIST Advisory, IERS, Imperial College London, Integrated Sustainability Services, IUCN, Natural Capital Project, The Nature Conservancy, The Sustainable Fashion Academy, PwC, Sustain Value, Synergiz, Trucost, True Price, WBCSD, World Resources Institute and WWF.

Work on the Natural Capital Protocol Project has been made possible with generous funding from the Gordon and Betty Moore Foundation and the Swiss Economic Ministry (SECO) and Dutch Ministry of Foreign Affars to IFC at the World Bank.