Skip to main content

Thank you for visiting nature.com. You are using a browser version with limited support for CSS. To obtain the best experience, we recommend you use a more up to date browser (or turn off compatibility mode in Internet Explorer). In the meantime, to ensure continued support, we are displaying the site without styles and JavaScript.

Natural capital accounting and climate change

Nature Climate Change volume 4, pages 520–522 (2014)Cite this article

Subjects

Governments and businesses are beginning to account for natural capital, but must collaborate to promote sustainability, combat climate change and improve decision-making.

Globally, government and corporate accounts are missing more than US$40 trillion. It's a lot of money — nearly half the gross world product in 2012, 1.6 times the combined assets of the world's ten biggest banks and more than 300 times the cost of the Apollo Space Program. It's also a conservative estimate — a lower bound — of the value of natural capital in 20051. The UK Natural Capital Committee defines natural capital as the “elements of nature that directly or indirectly produce value to people, including ecosystems, species, freshwater, land, minerals, the air and oceans, as well as natural processes and functions”2. The World Bank's estimate includes only some of these elements from just 100 countries, and cannot be interpreted as the cost of losing all of Earth's ecosystems. However, it does demonstrate that the value of natural capital, largely excluded from both GDP and corporate accounting practices, is too large to leave off the balance sheet. Natural capital accounts (NCAs) contain vital information regarding our economic dependence and impact on the natural world. Economic valuation conveys this in an easily understood metric that can be readily integrated in real-world decision-making. As such, the public and private sectors should collaborate to develop NCAs to improve decision-making and economic resilience.

This is a preview of subscription content

Access options

Rent or Buy article

Get time limited or full article access on ReadCube.

from$8.99

Rent or Buy

All prices are NET prices.

References

  1. 1

    The Changing Wealth of Nations (World Bank, 2011).

  2. 2

    NCC The State of Natural Capital. (Department for Environment Food and Rural Affairs, 2014).

  3. 3

    Energy and Carbon — Managing the Risks (ExxonMobil, 2014).

  4. 4

    Crooks, E. Exxon warns global warming targets 'unlikely' to be met. Financial Times (31 March 2014).

    Google Scholar 

  5. 5

    World Development Indicators (The World Bank, 2012).

  6. 6

    System of Environmental-Economic Accounting: Central Framework (United Nations, 2012).

  7. 7

    UNU-IHDP & UNEP Inclusive Wealth Report 2012: Measuring progress toward sustainability (Cambridge Univ. Press, 2012).

  8. 8

    Atkinson, G., Agarwala, M. & Muñoz, P. in Inclusive Wealth Report 2012 Measuring progress toward sustainability (eds Dasgupta, P., Duraiappah, A. & Muñoz, P.) 87–117 (Cambridge Univ. Press, 2012).

    Google Scholar 

  9. 9

    Bellassen, V. & Luyssaert, S. Nature 506, 153–155 (2014).

    Article  Google Scholar 

  10. 10

    Luyssaert, S. et al. Nature 455, 213–215 (2008).

    CAS  Article  Google Scholar 

  11. 11

    Gatti, L. et al. Nature 506, 76–80 (2014).

    CAS  Article  Google Scholar 

  12. 12

    Ziv, G., Baran, E., Nam, S., Rodríguez-Iturbe, I. & Levin, S. A. Proc. Natl Acad. Sci. USA 109, 5609–5614 (2012).

    CAS  Article  Google Scholar 

  13. 13

    Kubiszewski, I., Costanza, R., Paquet, P. & Halimi, S. Reg. Environ. Change 13, 3–15 (2013).

    Article  Google Scholar 

  14. 14

    Matthews, N. Water Alternatives 5, 392–411 (2012).

    Google Scholar 

  15. 15

    The Natural Choice: securing the value of nature (HM Government, 2011).

  16. 16

    UK-NEA The UK National Ecosystem Assessment (UNEP-WCMC, 2011).

  17. 17

    Lange, G.-M. in Handbook of Sustainable Development (eds Atkinson, G., Dietz, S., Neumayer, E. & Agarwala, M.) Ch. 21 (Edward Elgar, 2014).

    Google Scholar 

Download references

Acknowledgements

We are grateful to colleagues at the Natural Capital Initiative (NCI; www.naturalcapitalinitiative.org.uk) and participants in the NCI sessions at the 2013 World Forum on Natural Capital in Edinburgh, Scotland. M.A. and C.B. acknowledge NCI funding. M.A. acknowledges funding from ESRC SEER Grant (Funder Ref: RES-060-25-0063).

Author information

Affiliations

  1. The Grantham Research Institute on Climate Change and the Environment, London School of Economics, Houghton Street, London, WC2A 2AE, UK

    Matthew Agarwala & Giles Atkinson

  2. CSERGE, School of Environmental Sciences, University of East Anglia, Norwich, NR4 7TJ, UK

    Matthew Agarwala

  3. Trucost Plc., 22 Chancery Lane, London, WC2A 1LS, UK

    Christopher Baldock

  4. Barry Gardiner is a Member of UK Parliament for Brent North and the UK Shadow Environment Minister

    Barry Gardiner

Authors
  1. Matthew Agarwala
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Giles Atkinson
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Christopher Baldock
    View author publications

    You can also search for this author in PubMed Google Scholar

  4. Barry Gardiner
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Matthew Agarwala.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Agarwala, M., Atkinson, G., Baldock, C. et al. Natural capital accounting and climate change. Nature Clim Change 4, 520–522 (2014). https://doi.org/10.1038/nclimate2257

Download citation

Further reading

Search

Advanced search

Quick links

Nature Briefing

Sign up for the Nature Briefing newsletter — what matters in science, free to your inbox daily.

Get the most important science stories of the day, free in your inbox. Sign up for Nature Briefing