Natural capital refers to the world's stocks of natural assets which include geology, soil, air, water and all living things. They provide valuable ecosystem services like food production, water purification, recreation and cultural services. Assigning economic value to natural capital helps incorporate environmental costs and benefits into decision making. For example, a study in Costa Rica found native forest habitats near coffee farms supported more pollinating bees, increasing coffee yields by 15-50% and farmer income by $60,000. This example shows how valuing natural capital can inform land use and conservation policies to promote sustainability.

1. Natural Capital
Michal Crawford-Zimring
Minneapolis College of Art and Design
2012 course 12SD

2. Overview
Clearly humanity benefits from nature, and whether we know it or not, our survival as a
human species depends on the success of the ecosystems that provide us with benefits
and flow of services.
This slide presentation provides an introduction to the concept of Natural Capital and
how the idea of assigning economic value to natural capital helps us prosper in a way
that is sustainable not only for us and the generations to come, but is also essential for
the survival of planet earth.

3. What is Natural Capital?
Natural capital comes from the general
notion of capital -- which is “a stock that
provides a flow of valuable goods or
services into the future.”
The stock of natural resources that we
experience as goods and services come
from the ecosystems.
Natural capital links the benefits from
ecosystem services with the ecological,
economic and sociocultural values that
provide us (humans) with health, security
and prosperity.

4. Understanding Ecosystem Services
The concept of ecosystem services helps us understand and describe how the environment provides us
a multitude of benefits. These collection of benefits are known as “services’.
Ecosystems are interrelated communities that are linked through cycles of energy and
nutrient flows. They are dynamic systems that are subject to disturbances and stress, but
they are resilient and can bloom with diversity and evolutionary success.
air
oxygen
energy from sun ECOSYSTEM
habitat
plant/animal
water biodiversity
nutrients
nutrients

5. Global
CATEGORIES OF ECOSYSTEM SERVICES GNP
18
Ecosystem Trillion
$US
Services
PROVISIONING
33 Trillion
$US
These services are usually described as ecosystem goods and represent the tangible benefits that are
derived from ecosystems. These are services that are easier to see and have a market value.
Wood, fiber, forests, grazing lands, agricultural products, food, honey production, biochemical or Ecosystem Valuation
pharmaceutical, genetic resources, fur and animal skins. Estimates Trillion $US (1997)
REGULATORY
Service Value
They are more difficult to quantify because they seem less tangible and are usually clasified as public goods. Soil 17.1
These services represent the ecosystem processes that are needed for human health and infrastructure.
Recreation 3.0
Water regulation, fire regulation, climate mitigation, disease and pest control for crops and livestock
pollination services and water purification Nutrient cycling 2.3
Water purification 2.3
and regulation
SUPPORTING Climate regulation 1.8
These services help the other services to work. They can also be called ecosystem processes. 1.4
Habitat
Habitat protection and management, fish habitat, soil productivity, coastal and wetland zone management,
photosynthesis, water cycling, nutrient cycling, primary production, native pollination, pest resistance Flood and storm 0.8
protection
Genetic resources 0.8
CULTURAL Atmosphere gas 0.7
This category includes environmental and natural resources that are intangible but of value to people, their balance
families and cultures. 0.4
Pollination
national parks, recreation, fishing, special sites, educational and ecotourism, heritage values for land and
species, spiritual and religious values All others 1.6
TOTAL 33.3

6. Natural Capital Valuation Framework
Natural Capital
NATURAL CAPITAL
Valuation Approach
Human activities
public/private Ecosystem Services
The natural capital
valuation approach
LINKS value from Economic, ecological
natural capital with socio/cultural values
dollar amounts.
$
Adapted from NRC 2005

7. Natural Capital and Sustainability
We have a challenging task and a common goal.
We must find new guidelines and principles If protection of natural capital
based on the belief that sustaining ecosystems and pricing of environmental
and natural capital are of the utmost importance. resources is neglected, if
economic and societal development
We have lived for far too long not knowing the continue on a path of exploitive
importance of natural capital - it has been over- growth and resource depletion,
looked and invisible. natural capital will decline.
We need to find ways to incorporate
the economic costs and benefits
of natural capital into a sustainable
financial system.
Then we need to restructure the
financial sector so that we learn
to live off the interest of natural
capital, not its principle.

8. How are we going
to do that???

9. Let’s start with a story about coffee.
Did you have a cup of coffee this morning?
Maybe you made it yourself at home, maybe you grabbed
a cup of your favorite fair trade brand from your barista
and dropped something in the tip jar.
But did you thank the bees?

10. Coffee is grown in many regions
of the world that are rich in
biodiversity from the tropical
Coffee is the SECOND most valuably traded commodity rain forest ecosystems.
on the world market, just behind petroleum.
Agricultural production of coffee
depends partially on natural ecosystem
services such as pollination from
bees.

11. But there is a conflict!
Bees provide pollination
services for coffee plants
to grow, and the bees need
the biodiversity of their
tropical forest habitat
to survive.
Farmers think they can grow
more coffee if they cut down
the forest to have more
Many coffee growers are land.
small farmers who are
just scraping by. They
work hard and need money.

12. Bees and Natural Capital
Recently there have been
Crop pollination by bees
declines in bee populations
and other animals is an
and scientists are pretty
essential ecosystem sure that there are a
service that increases number of causes --
crop yields both in quantity PESTICIDES
and quality. LOSS OF HABITAT
GLOBAL WARMING
It has been estimated PARASITES
that the global value of STRESS
pollination serivces is
close to $200 billion.
Native habitats such as the forests that
surround coffee farms are rich in biodiversity
and can support large numbers of bees
as long as their habitat is maintained.

13. So some scientists from the Natural Capital Project went down to
Costa Rica to set up a study project focused on native bee pollination
services and their proximity to a native forest habitat.
When the habitat was close to the coffee farms, the bees would
visit more often and their pollination increased coffee yields
15~50% above normal yields.
For the farmers it amounted to a $60,000 increase
in income for that year.
This gave the Costa Rican Environmental incentive to pay land-
owners to conserve forest lands in proximity to coffee growing areas.
This is an example that illustrates the potentially valuable kinds of benefits and
economic incentives that can be incorporated into land use and conservation
designs. This is a way to value the present and invest in future sustainability.

14. Natural capital is still poorly understood, so organizations such as The Natural Capital Project are important for scientists,
conservationists and government decision makers provide this important link. But there is a huge gap in understanding among
the general population. My design proposal is to create an app. The focus audience will be high school and college students
and the general public. It’s called What’s In Mother Nature’s Wallet?
What’s In Mother Nature’s Wallet
This will result in huge problems
Read about Ecosystem not only for the environment, but
Find Facts
Services for natural life support ecosystems.
There will be increased market
prices, food shortages and decreased
quality of life.
Money does grow
on Trees
We must find ways to grow our
economies and$ takeforests
What is the value of responsibilty
for the accounting of natural
T to a forester
alk What is the $ value of pollination
capital.
T to a Beekeeper
alk
Find out how What is the $ value of a wetland
to earn points T to an ecologist/wetland
alk
and prizes

15. Thank you.
Sources:
http://www.fao.org/docrep/ARTICLE/WFC/XII/0779-A4.HTM
http://www.greenbiz.com/blog/2012/06/22/how-businesses-are-banking-natural-capital
http://www.eoearth.org/article/Natural_capital
http://www.iisd.org/natres/agriculture/capital.asp
http://www.nrdc.org/wildlife/animals/files/bees.pdf
http://regionalworkbench.org/USP2/week1.htm
http://www.globalexchange.org/fairtrade/coffee/faq
http://www.ecosystemvaluation.org/benefits.htm
http://www.esa.org/education/edupdfs/ecosystemservices.pdf
http://www.naturalcapitalproject.org
http://en.wikipedia.org/wiki/Ecosystem_services
Ricketts, T.H., Daily, G.C., Ehrlich, P.R., and C. D. Michener, (2004) Economic value
of tropical forest to coffee production (www.pnas.org/cgi/doi/10.1073/pnas.0405147101
http://www.internationalpollinatorsinitiative.org/uploads/POLL%20VALUE%20NATIONAL%20MANUAL.pdf
http://www.google.com/imgres?start=294&hl=en&client=safari&sa=X&tbo=d&rls=en&biw=1275&bih=556&tbm=isch&tbnid=Y2pJiOFYvNl2YM:&imgrefurl=http://4chandata.org