MDIA ... LAND ... a component of natural capital

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MDIA ... LAND ... a component of natural capital

  1. 1. MULTI DIMENSION IMPACT ACCOUNTING File: MDIA-p3-04-31-LAND-150613.odp Peter Burgess (c) All rights reserved MDIA LAND A COMPONENT OF NATURAL CAPITAL
  2. 2. EXPLANATION This slideset is A WORK-IN-PROGRESS. It will be upgraded periodically. It is part of a series of more than 50 slidesets. Navigation to all of these is available here: FEEDBACK is welcome. Please email to Peter Burgess … peterbnyc@gmail.com … with a catchy phrase in the subject line so that it gets attention, and please identify the specific slideset(s) involved. This explanation is version v150801. The most current text is available at: MULTI DIMENSION IMPACT ACCOUNTING http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=txt00010199 http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=N1-Slidesets-p3
  3. 3. MULTI DIMENSION IMPACT ACCOUNTING Sun BOP Sun Financial Capital Human Capital Man Built Capital Natural Capital Sun SunSun Financial Capital Human Capital Man Built Capital Natural Capital Sun Nature (life) Land Water Air pollution Ecoservices GHG emissions About Land Land Land is a limiting factor with many competing uses. Natural processes and ecosystem services require land and so do man built structures and systems EOP
  4. 4. LAND has been central to the idea of wealth and power for ever. MULTI DIMENSION IMPACT ACCOUNTING
  5. 5. Law about LAND has been crafted to make statutory ownership more important than any system of traditional ownership. MULTI DIMENSION IMPACT ACCOUNTING
  6. 6. The money value of land is based on the money profit earning potential of the land. MULTI DIMENSION IMPACT ACCOUNTING
  7. 7. This value ignores the important ecosystem services provided by natural land use. No metrics … no value! MULTI DIMENSION IMPACT ACCOUNTING
  8. 8. Tropical rain forests have little money value as is, but provide incredibly important ecosystem services. ● Carbon sequestration ● Habitat (biodiversity fauna and flora) MULTI DIMENSION IMPACT ACCOUNTING
  9. 9. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun TROPICAL RAIN FOREST
  10. 10. To make money, degrade the rain forest and ... ● Clearcut for mining; or ● Clearcut for palm oil plantations; or ● Exploit for old growth logging MULTI DIMENSION IMPACT ACCOUNTING
  11. 11. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun MINING (in Peru)
  12. 12. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun CLEAR CUTTING FOR PALM OIL
  13. 13. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun CLEAR CUTTING FOR PALM OIL
  14. 14. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun OLD GROWTH LOGGING
  15. 15. Mangrove and wetlands are essential to the good health and survival of everything in the fish and animal kingdoms. MULTI DIMENSION IMPACT ACCOUNTING
  16. 16. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE MANGROVE
  17. 17. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE WETLANDS
  18. 18. In a money based world, land fill for urban trash is a preferred use for (money valueless) wetlands … MULTI DIMENSION IMPACT ACCOUNTING
  19. 19. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE Meadowlands wetlands being used for landfill
  20. 20. Or warehouses … MULTI DIMENSION IMPACT ACCOUNTING
  21. 21. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Capital Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Capital Natural Capital Sun LAND USE Meadowlands wetlands being used for warehouses
  22. 22. Or a sports arena … MULTI DIMENSION IMPACT ACCOUNTING
  23. 23. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Capital Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Capital Natural Capital Sun LAND USE Meadowlands wetlands being used for sports arena
  24. 24. Or a shopping mall … MULTI DIMENSION IMPACT ACCOUNTING
  25. 25. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Capital Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Capital Natural Capital Sun LAND USE Meadowlands wetlands being used for shopping mall
  26. 26. … and of course urban housing like this is an efficient land use. Certainly in terms of money but also likely in terms of people. MULTI DIMENSION IMPACT ACCOUNTING
  27. 27. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE URBAN HIGHRISE
  28. 28. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE SUBURBAN HOUSING
  29. 29. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE SUBURBAN TRACT DEVELOPMENT
  30. 30. … but maybe not for single family McMansions … MULTI DIMENSION IMPACT ACCOUNTING
  31. 31. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE MCMANSIONS
  32. 32. The money value of mountains is low … the ecosystem service value is low … maybe it is only the recreational dimension that gives them any value at all! MULTI DIMENSION IMPACT ACCOUNTING
  33. 33. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE MOUNTAINS
  34. 34. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE MOUNTAINS
  35. 35. Deserts are also low in both money value and ecosystem service value … MULTI DIMENSION IMPACT ACCOUNTING
  36. 36. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE DESERTS
  37. 37. … unless, of course, there are oil resources under the sand … MULTI DIMENSION IMPACT ACCOUNTING
  38. 38. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Capital Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Capital Natural Capital Sun LAND USE Meadowlands wetlands being used for shopping mall
  39. 39. Savanna … a mix of trees and grasses … is not an optimum for money profit use of land … MULTI DIMENSION IMPACT ACCOUNTING
  40. 40. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE SAVANNA
  41. 41. Prairie is much better … monoculture with heavy use of fertilizer, pesticides, herbicides and highly mechanized and energy intensive ... MULTI DIMENSION IMPACT ACCOUNTING
  42. 42. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE PRAIRIE
  43. 43. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE PRAIRIE
  44. 44. A parking lot has money value associated with convenience and economic use. … but a parking lot degrades natural storm water control. MULTI DIMENSION IMPACT ACCOUNTING
  45. 45. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE PARKING LOTS
  46. 46. A shopping mall and parking lots have money value associated with business use. The development degrades natural storm water control. MULTI DIMENSION IMPACT ACCOUNTING
  47. 47. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE SHOPPING MALLS
  48. 48. … and much the same applies for airports … MULTI DIMENSION IMPACT ACCOUNTING
  49. 49. MULTI DIMENSION IMPACT ACCOUNTING SunSun BOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Structures & Systems Natural Capital Sun LAND USE AIRPORTS
  50. 50. The money value of land is determined by the profit flows that can be derived from using the land for money profit activities. MULTI DIMENSION IMPACT ACCOUNTING
  51. 51. The environmental value of land is determined by the ecosystem services that are provided by the land. MULTI DIMENSION IMPACT ACCOUNTING
  52. 52. MULTI DIMENSION IMPACT ACCOUNTING Sun LAND USE Sustainable agriculture Water purification Intensive monoculture Coastal mangrove Urban infrastructure Roads, Parking Lots There is a limited amount of land and there are multiple possible uses. Land is a factor in improving human capital, producing goods and services, and locating MBC. Money value is a metric for this. Land is also a factor in providing very critical ecosystem services. A metric for this is needed, reflecting the ecosystem service potential. Money Value Suburban sprawl Housing Tropical forest Habitat Industrial operations Sun BOP Financial Capital Human Capital Man Built Capital Natural Capital Sun SunSun EOP Financial Capital Human Capital Man Built Capital Natural Capital Sun Medium Zero Medium Zero High Medium High High Zero Zero High Medium Medium Low High Zero Zero Zero Zero High High Zero Wetlands Zero High Natural Value
  53. 53. Uses that make the most money have the lowest ecosystem service value … Uses that have the highest ecosystem service value have the lowest money value … MULTI DIMENSION IMPACT ACCOUNTING
  54. 54. The cost of the use of land appears in the financial accounts ... It may be on the balance sheet as an asset owned by the entity, or … It may be in the P&L as a rental or lease payment. MULTI DIMENSION IMPACT ACCOUNTING
  55. 55. The money value of the land at any moment in time may well be different from the amounts in the financial accounts because this value changes depending on market perceptions. MULTI DIMENSION IMPACT ACCOUNTING
  56. 56. The impact value of the land at any moment in time has a different behavior. The impact value is the difference between the ACTUAL land use and a STANDARD land use. MULTI DIMENSION IMPACT ACCOUNTING
  57. 57. REMINDER This slideset is A WORK-IN-PROGRESS. It will be upgraded periodically. It is part of a series of more than 50 slidesets. Navigation to all of these is available here: FEEDBACK is welcome. Please email to Peter Burgess … peterbnyc@gmail.com … with a catchy phrase in the subject line so that it gets attention, and please identify the specific slideset(s) involved. This explanation is version v150801. The most current text is available at: MULTI DIMENSION IMPACT ACCOUNTING http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=txt00010199 http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=N1-Slidesets-p3
  58. 58. THANK YOU Some links and contact information: Peter Burgess … peterbnyc@gmail.com Peter Burgess LinkedIn profile https://www.linkedin.com/in/peterburgess1 Link to TrueValueMetrics.org website http://www.truevaluemetrics.org/ Link to navigation to other slides in this series: MULTI DIMENSION IMPACT ACCOUNTING http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=N1-Slidesets-p3

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