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Rosemary Bissett, NAB - Presentation - UNAA Vic Natural Capital Seminar


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Rosemary Bissett (Head of Sustainability Governance and Risk, Enterprise Risk, National Australia Bank) - Presentation at the United Nations Association of Australia (Victorian Division) Business, Biodiversity and Ecosystem Services: Valuing the Earth's Natural Capital Seminar held in Melbourne, 20 September 2012, in partnership with National Australia Bank.

Building momentum for collective action post-Rio+20, the seminar brought together key players from business, government and civil society to discuss the challenges and opportunities in measuring the true value of nature and enhancing natural capital as a critical economic, ecological and social asset.

An expert panel addressed:
The Natural Capital Declaration and the finance sector
Australian Government perspective on natural capital and sustainability: current priorities, measurement and where Australia can make a difference
Business and biodiversity: valuing natural capital and ecosystem services in practice
The Economics of Ecosystem Services and Biodiversity (TEEB for Business)
The System of Environmental - Economic Accounts (SEEA)
Integrating the valuing and management of environmental assets into business and government decision-making processes
Experiences and opportunities for cross-sector collaboration

Guest speakers:
Rosemary Bissett (Head of Sustainability Governance and Risk, Enterprise Risk, National Australia Bank)
Malcolm Thompson (Deputy Secretary, Australian Government Department of Sustainability, Environment, Water, Population and Communities
Stuart Anstee (Chief Adviser, Biodiversity and Ecosystem Services, Rio Tinto)
Dr Joshua Bishop (Former Chief Economist, IUCN and National Manager, Markets, Sustainability and Business Partnerships, WWF Australia).
Charles Berger (Director of Strategic Ideas, Australian Conservation Foundation)

Rosemary Sainty (Former Head, Secretariat UN Global Compact Network Australia and Adviser, Corporate Engagement, Transparency International Australia)

More information available at:

Published in: Technology, Education
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Rosemary Bissett, NAB - Presentation - UNAA Vic Natural Capital Seminar

  1. 1. Natural CapitalA finance sector perspectiveRosemary BissettHead of Sustainability Governance & Risk20 September 2012
  2. 2. The context Business GDP Suppliers P&L & Customers balance sheet Natural Value Natural Value Real Economic System Real Business System
  3. 3. What are we talking about? Biodiversity Ecosystems Ecosystem Natural Services Value Natures Natural habitats Natural services Economic valuing of ‘living assets’ delivering the derived from the ecosystem services (flora and fauna) adaptability to earth’s natural assets, and natural sustain and extend on which human environment natures systems beings are reliant.•Diversity of plants, •Includes a •Support primary •Recognising the animals, marine life combination of soil, production, nutrient contribution that and other natural air, water, flora and cycling, soil formation Natural Capital has on organisms. fauna, and climate e.g. •Provide feed, fresh economic desert, forest, ocean, water, wood & fibre, sustainability and grassland. fuel accounting for it •Regulate air quality, within traditional climate, flood, disease, business frameworks water purification Natural Capital
  4. 4. The issue Some examples: • Natural habitats and species are declining largely due to human activity. 50% of the natural capital of the planet created over the last 3.8 billion years has been used in the last 50 years. • Cultivated land now covers one quarter of the world’s land – leading to massive loss of natural habitats and associated ecosystem services. • Demand for food to increase 70-80% by 2055. A further 10-20% of grassland and forest will be converted to agriculture by 2050. • 35% of the global food production from plants benefits from pollination - valued from $112 - $200b annually. Wild bee populations are in decline. (See notes for case study of a F&B company response) • 5-20% of freshwater use exceeds long term sustainable supply and 15-35% of natural irrigation is unsustainable. • Unprecedented destruction of coastal habitats is reducing protection against natural hazards such as hurricanes and tsunamis.Figures & information drawn from Millennium Ecosystem Assessment 2004, as published in UNEP FI Biodiversity and Ecosystem Services, A Financial Sector Briefing
  5. 5. The issue Proposed safe operating space for nine interconnected planetary systems Estimate of the current position for each. The boundaries in three likely to already be exceeded and impacting economic growth and human developmentSource: ‘A safe operating space for humanity’ by Johan Rockstrom, Stockholm Resilience Centre, Stockholm University, Stockholm Environment Institute
  6. 6. An example: Haagen Daas
  7. 7. Natural Capital impact and dependencyPerceived levelsof natural capitalimpact anddependenciesvary acrossdifferent sectors
  8. 8. Why is a bank interested?1. TEEB (The Economics of Ecosystems and Biodiversity) and many other studies show the tremendous costs to society, businesses and nations of ecosystem loss.2. Natural capital underpins economic growth – and hence secures growth of businesses that finance sector services through debt, equity and insurance.3. FI’s have considerable indirect ecological footprints through customers and purchasing decisions4. The nature of issue and our globalised economies favors collective action.
  9. 9. Creating a solution:The Natural Capital Declaration• A finance-led initiative to account for and embed natural capital within investment, banking and loan decisions.• Sector-wide initiative – includes banks, asset managers, institutional investors and (re)insurers.• Developed by and for financial institutions over an 18-month worldwide consultation process via 6 regional meetings.• Signed at the CEO level to secure the highest level of commitment highlighting the materiality of healthy natural capital for the industry.• Strives to facilitate, and work towards, developing methodologies and standards to operationalise the commitment in the Declaration.
  10. 10. The Natural Capital DeclarationCentres on four key commitments:1) understanding the impacts and dependencies of natural capital, directly and through customers, by financial institutions that can translate into material risks or opportunities;2) embed/integrate natural capital considerations in financial products and services;3) work towards a global consensus on integrated reporting/disclosure; and4) work towards a global consensus for the integration of natural capital in private sector accounting and decision making.
  11. 11. The NCD partnersNow signed by 39 Financial InstitutionsSupported by 23 organisationConvened by
  12. 12. NCD Signatories* As of June 2012
  13. 13. NCD Supporters* As of June 2012 13
  14. 14. Embedding Natural Value in FI’s Investment Investment Lending Investment (manager) (owner)• Environmental • Investment • Inclusion in • Consider NC in risk and Social risk analysis (R&D) investment policies management analysis underwriting, • Best in class product• Credit policies for development and specific sectors • Exclusion of claims management unacceptable NC impacts • Work with clients and partners to • Proxy voting reduce NC risks Engagement and disclosure Access materiality of NC impacts across lines of products and services
  15. 15. NCD Roadmap 2012 2015 2018 2020 STEPS OUTPUTS OUTPUTS OUTPUTS OUTPUTS 1. Set up governance Assessment frameworkUNDERSTANDING on risks and Best practice case structure and studiesNC DEPENDENCY secretariat opportunities related to finance and NC2. EMBEDDING NC NCD road map Decision criteria for work plan, embedding NC into FI’s Mid term review on IN FINANCIAL schedule and products and services 4 steps output PRODUCTS & SERVICES budget 3. INTEGRATED Agreement on road NC friendly products and Comparable global Comparable global REPORTING map with NCD services standard for NC standard for NC accounting signatories accounting for FI for FI industry Templates for NC industry drafted reporting and disclosure Regulatory framework recommendations mandating NC accounting 4. FINANCIAL Shadow price ACCOUNTING accounting Environment P&L’s for FI’s 4 pilots in FIs 8 pilots in FI’s 30 FI pilots 130 FI pilots (1 per step) (2 per step)
  16. 16. Links to other initiatives ESG issues across TEEB for UN Global CBD industry sectors Business Compact Principles Business for Biodiversity UNEP FI Statement ESG issues across on Sustainable the financial sector Development Banking Investment Insurance ESG issues by Equator Principles Principles for Principles for financial sub-sector (project finance) ESG (various) Responsible Investment Sustainable Insurance ESG (various) ESG (various) Natural capital by financial sub-sector Natural Capital Declaration
  17. 17. What is NAB doing? Making External Connections Risk Embedding in Business Building our Management Operational Change understanding Decisions Taking leadership
  18. 18. Thank you