IUCN, the International Union for Conservation of Nature

Every year we lose two to four trillion dollars of natural capital.

The monetary value of nature – especially the goods and services it provides us such as water, food, medicine, fuel or building materials – is enormous. Various estimates have put this value at many times the total of the world’s gross domestic product. But although nature occupies a central place in our lives, we very often take it for granted, rarely taking into account its value or the cost of the ongoing biodiversity crisis. As a result, we have been consuming natural resources at an alarming rate, contributing enormously to the degradation of ecosystems and to the loss of biodiversity.

But putting a price on Nature is by no means easy. Its value is rarely taken into account in economic and tax policy, financial systems and markets. The Economics of Ecosystems and Biodiversity (TEEB) study aims to facilitate this, drawing attention to the global economic benefits of biodiversity and highlighting the growing costs of its loss.

GLOSSARY

Biodiversity: the variability among living organisms from all sources including terrestrial, marine and other aquatic ecosystems, and the ecological complexes of which they are part. Biodiversity includes diversity within species, between species, and of ecosystems.  An ecosystem: a community of plants, animals and smaller organisms that live, feed, reproduce and interact in the same area or environment. An ecosystem service: a service people obtain from the environment. Ecosystem services are the transformation of natural assets (soil, plants and animals, air and water) into things that we value. They can be viewed as provisioning such as food and water; regulating, for example, flood and disease control; cultural such as spiritual, recreational, and cultural benefits; or supporting like nutrient cycling that maintain the conditions for life on Earth. Ecosystem ‘goods’ include food, medicinal plants, construction materials, tourism and recreation, and wild genes for domestic plants and animals.

 

What is TEEB?

The Economics of Ecosystems and Biodiversity (TEEB) study is an international initiative which brings together science, economics and policy. It was inspired by the publication of the Millennium Ecosystem Assessment in 2005 and the Review of the Economics of Climate Change by Nicholas Stern in 2006. It aims to analyze and asses the economic, societal and human value of biodiversity, promoting a better understanding of the true economic value of ecosystem services and offering practical economic tools that take proper account of this value. By highlighting the costs and benefits of biodiversity and ecosystems, the study offers solutions to rebuild traditional market mechanisms and shows how to improve them.

The study was launched in 2007 by Germany and the European Commission. It is led by Pavan Sukhdev, chairman of Deutsche Bank’s ‘Global Markets Centre’ in Mumbai, Founder-Director of the ‘Green Accounting for Indian States Project’, and Co-Chair of IUCN’s Commission on Environmental, Economic and Social Policy.

The TEEB study aims to:

Integrate ecological and economic knowledge to evaluating ecosystem services. Examine the economic costs of biodiversity decline and the costs and benefits of actions to reduce these losses. Develop "toolkits" for policy makers at international, regional and local levels to foster sustainable development and improve conservation of ecosystems and biodiversity. Enable easy access to leading information and tools for improved biodiversity practice for the business community – from the perspective of managing risks, addressing opportunities, and measuring impacts. Raise public awareness of the individual’s impact on biodiversity and ecosystems, as well as identifying areas where individual action can make a positive difference.

 

How does it work?

The study is being conducted in two phases. Preliminary findings from the first phase, presented in May 2008, clearly demonstrated the huge significance of ecosystems and biodiversity. They also showed that the size of economic losses is enormous, and so is their impact on human welfare. The study made it clear that biodiversity must become the responsibility of everyone with the power and resources to act.

A second phase of TEEB is currently underway, using the latest theory and methods for valuing biodiversity and ecosystem services. It focuses on policies that stem biodiversity loss and encourage conservation and helps rural communities and local governments better manage their resources. It also aims to develop novel ways of communicating the economics of ecosystems and biodiversity to the widest possible audience around the world. An important part of the study addresses business and is led by IUCN’s Chief economist Dr Joshua Bishop. This focus on business tools for biodiversity risk assessment and management, identifying business opportunities linked to the conservation and sustainable use of biological resources, and promoting new tools for measuring the impacts of business on biodiversity.

The project is overseen by a high-level Advisory Board, including IUCN Director General, Julia Marton-Lefèvre.