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Unlocking investment in the UK's natural environment is essential for a productive and resilient economy

6th November 2017

Today the Aldersgate Group publishes two briefingsKey asks for the 25 Year Environment Plan, which sets out business priorities for the upcoming plan, and Increasing investment in natural capital, which recommends actions by businesses and government to overcome the barriers currently restricting flows of finance towards natural capital projects.
 
Nick Molho, Executive Director of the Aldersgate Group said: “Our economy and society are hugely reliant on the goods and services provided by nature and are also vulnerable to the impacts of a changing climate. Investing in our natural environment will help improve both the productivity and resilience of businesses, supply chains and communities. The forthcoming 25 Year Environment Plan is an opportunity to show cross-government leadership and set clear legally binding targets that help support the growth of innovative natural capital enhancement projects.”
 
Nick Molho added: “Significant investment will be needed from the private sector to improve the state of the UK’s natural environment and meet the goals of the 25 Year Environment Plan. Whilst the natural capital finance market is currently nascent, innovation from business, investors and communities as well as targeted government intervention can work in tandem to develop its maturity by identifying new revenue models.
 
Opportunities include the reform of agricultural subsidy payments to increase focus on sustainable land management following the UK’s exit from the European Union, setting up an innovation fund that provides resources for the private sector to develop new financing models, and creating a Natural Capital Investment Fund that provides seed funding for priority natural capital projects across the country.”

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25 Year Environment Plan key to improve UK’s natural assets and resilience to flooding

2nd November 2016

The Aldersgate Group welcomed the Environment, Food and Rural Affairs Committee's proposals today for a much wider use of measures such as tree planting and improved soil management to help address flood risk[1]. The Group highlighted the importance of developing a 25 Year Environment Plan to improve the state of the UK’s natural environment and the resilience of its infrastructure.

As highlighted in the Aldersgate Group’s recent report Setting the pace: Northern England’s low carbon economy, examples such as the Slowing the Flow project in Pickering, North Yorkshire and the Alkborough Flats project in Lincolnshire show the potential of natural capital solutions for flood management[2].

Nick Molho, Executive Director of the Aldersgate Group said: “Whilst it is understandable that the timetable for the government’s 25 Year Environment Plan has been impacted by the vote to leave the European Union, we would press Defra to publish a framework for the plan as soon as possible. Investing in natural assets can help protect businesses and communities from flooding and increase the resilience of the UK’s infrastructure to the future impacts of climate change.”

Nick Molho added: “As the EFRA Committee has highlighted, post-Brexit we have an opportunity to reconfigure the agricultural subsidy system to one more focused on the provision of positive environmental outcomes. Channelling greater funds towards sustainable land use practices will help support the farming community in delivering environmental enhancements such as improved water catchment management and reductions in greenhouse gas emissions.”


[1] Environment, Food and Rural Affairs Committee (November 2016) Future Flood Prevention

[2] The Slowing the Flow initiative has used a range of land management techniques, including reseeding heather and planting new woodlands to reduce the chance of flooding in the town from 25% to 4% or less in any given year - see: bit.ly/slowtf. The Alkborough Flats project involved the flooding of 440 hectares of intensively farmed agricultural land on the south bank of the Humber Estuary to act as a storage site for floodwater and reduce costal erosion. The project is estimated to deliver total flood risk management benefits of £12.26m over 100 years, in addition to an annual £165,000 of enhanced recreation and tourism, and almost £750,000 per year from wildlife habitat benefits - see: bit.ly/Alkmr and UK National Ecosystem Assessment (2011).

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UK must invest more in its natural assets to support long-term economic growth

17th November 2015

A new report from the Aldersgate Group out today, Investing in our natural assets: how government can support business action, argues that it is in the UK’s economic and social interest to increase investment in its ‘natural capital’ and calls on government policy to do more to support businesses investing to improve the state of the UK’s natural assets. 

Featuring case studies from major projects such as Crossrail and the work of Aldersgate Group members including National Grid, the RSPB, Kingfisher, Willmott Dixon and the Woodland Trust, the report explores how businesses are already assessing their reliance on natural capital and investing to protect it.

The UK’s ‘natural capital’ includes the natural resources that provide goods and services essential to the functioning of our society and economy, such as the availability of clean water, food, timber, recreational green spaces and the regulation of flood risk and other climate change impacts.

The report argues that with the state of the UK’s natural environment rapidly declining, the UK urgently needs to prioritise the state of its natural assets in order to support the future resilience and productivity of its economy. The report refers for example to the current degradation of soil, estimated to cost £1.2bn a year in England and Wales alone, which is undermining the vital economic and social functions that soil plays in supporting food production and storing water and carbon. Environmental damage feeds directly into costs for government, business, supply chains and households.

Nick Molho, Executive Director of the Aldersgate Group, said: “Not properly valuing natural capital poses economic risks for the UK but natural capital projects can also provide excellent investment opportunities, by ensuring that the key natural resources our economy and society depend on will remain available in the long term. By putting more focus on improving the state of our natural capital in policy making and investment decisions, government and businesses can manage risks more effectively and will reap the benefits in terms of long-term growth and competitiveness.”

In this report, the Aldersgate Group sets out how action by government can help deliver natural capital improvements through:

Better measurement –improving understanding of our reliance on natural resources will help its value be better reflected in policy and corporate decision making and support economic growth over the long term. The Office of National Statistics should in particular continue its work to incorporate tools to measure the state of the UK’s natural capital into the national accounts.

Improved integration of different policy areas – improving the state of the UK’s natural capital could deliver benefits and cost savings for a range of policy areas beyond just the environment and requires much greater levels of co-operation across several government departments including the Department of Health, the Department for Communities and Local Government and the Department for Environment, Food and Rural Affairs.

Evidence such as the NHS Forest Initiative suggests for example that the availability of green spaces for recreational purposes can improve health, accelerate patient recovery and cut costs for the NHS. The government has also previously estimated that coastal wetlands provide valuable services in the region of £1.5bn a year in terms of helping managing the impacts of storms and floods.

The recent co-operation between the RSPB and Crossrail have provided a valuable example in this area: more than three million tonnes of earth tunnelled from beneath London’s streets has been used to help transform Wallasea Island into a huge wetland, which will provide economic benefits in terms of reduced flood risk and flood defence expenditure, increased tourism and significant carbon storage.

Helping build a supportive structure for investment in natural capital projects – long-term investments in natural capital improvements and new market opportunities can be supported by targeted government action.For instance,the reform of existing subsidy schemes in areas such as agriculture could help channel greater funds towards projects aimed at improving the state of the UK’s natural assets. Helping set up markets for ecosystem services, of which some examples already exist in the water and farming sectors, could also result in greater private sector investment in natural capital improvement projects. 

Ensuring robust institutions can help deliver natural capital improvements over the long term – the work of institutions such as the Natural Capital Committee has been fundamental in driving forward understanding in this area. Confirmation of its future remit and an ambitious 25-year plan for biodiversity will help safeguard the UK’s natural capital strategy and steer policies towards delivering better environmental outcomes in the long term.

The report will be launched at an event in Parliament today, hosted by Peter Aldous MP, member of the Environmental Audit Select Committee.


Accounting and investment strategy must protect and enhance UK natural capital

27th January 2015

The Aldersgate Group has welcomed the Natural Capital Committee’s third and final State of Natural Capital report, being published today. The report sets out the roadmap for development of a 25 year strategy to protect and improve the UK environment including priority areas for investment.

Aldersgate Group Chair, Peter Young, said: “The Natural Capital Committee's reports are invaluable in illuminating the parlous state of the UK's natural capital and the opportunities that can be derived from better accounting for its value and loss.

“Conventional accounting systems help measure and safeguard the capital base upon which a business relies. It is only logical that these principles be applied to measure and safeguard the natural environment. The Aldersgate Group membership includes businesses willing to embrace corporate accounting for natural capital to contribute to the restoration of some of our most important natural assets, upon which we all have some dependency.

“To support this work, government must create an appropriate new institution to oversee and report on progress.”

Nick Molho, Executive Director of the Aldersgate Group, said: “To support the investment priority areas set out in the Natural Capital Committee’s third report, a Natural Capital Investment Strategy is vital to set out the future direction of travel. The Green Investment Bank is well placed to engage in this area, ensuring the UK exploits the Natural Capital Financing Facility to grow investments in natural capital.

“Under-investment in natural capital and the resulting cumulative deficit threatens our long term resilience and well being.”

See our coverage in businessGreen and Click Green.

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Government must do more to realise growth opportunities of natural capital

5th September 2014

The Aldersgate Group welcomes the wide acceptance of the work of the business-led Ecosystems Markets Task Force (EMTF) set out in the Government’s response published on 5th September. But while the Government has favoured the vast majority of the recommendations, the actions described could fall well short of delivering the contribution to growth and business opportunity that ambitious implementation of the EMTF's carefully crafted suggestions would make.

Peter Young, Chairman of the Aldersgate Group and a member of the EMTF said: “The business opportunities highlighted by the EMTF will not be realised if Government is not prepared to make them tangible and secure for investment in new nature based markets. For example, it is vital that the current consultation on biodiversity offsetting does not result in a voluntary scheme which, the published Impact Assessment shows, will deliver absolutely nothing for growth. It would be a massive missed opportunity which has been estimated to be worth £450 million over the next decade. I am pleased that there will be the opportunity to scrutinise progress on all 22 recommendations next spring.”

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We need a repayment plan for nature

3rd September 2014

The Chairman of the Aldersgate Group, Peter Young, has said we need a repayment plan to address the natural capital debt. Delivering the closing remarks at RSPB's Conference for Nature alongside other keynote speeches from Sir David Attenborough and the Rt Hon Nick Clegg, Deputy Prime Minister, he said that the debt to nature was far worse than the financial debt.  

Peter Young said: "If the Greek debt crisis looked bad our natural capital debt is even more grave. The plant will become truly bankrupt if we don't start reducing it soon. We need a credible repayment plan to start restoring nature now."

"The next government must act for nature. New legislation to halt destruction and start recovery, a clear long term remit for the Natural Capital Committee Mk II, and consistent linkage between the health of the individual, the economy and nature in policy making would do it for me. It is time to halt the selfish complacency of procrastination which politicians have shown in dealing with our urgent environmental problems."

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AG Chairman to lead new Defra review panel

9th April 2014

Defra has announced that Aldersgate Group Chairman, Peter Young, will preside over a review panel to help shape England’s environmental legislation as part of their Smarter Environmental Regulation Review (SERR). Joining his review panel is AG member Northern Ireland Environment Agency’s Terry A’Hearn.

Defra has found that the current framework “evolved in a piecemeal way” and being “fragmented, overlapping, inconsistent and complex”. They are building on the first phase of SERR to consider the scope to reform environmental legislation. The panel aims to propose a new long-term direction and framework for environmental legislation as well as actions for the next 5-10 years. They are set to report to Ministers in late 2014.

To read the terms of reference for Phase 2 of SERR, click here

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Paterson calls for business to show leadership on natural capital

26th March 2014

Speaking at an Aldersgate Group event, Rt Hon Owen Paterson MP, Secretary of State for Environment, Food and Rural Affairs, argued that "our long-term prosperity and wellbeing relies on recognising the real value of nature." 

The Secretary of State noted that momentum is building in the natural capital movement and argued that the Government had made "solid progress" delivering on the recommendations of the the Ecosystem Markets Task Force (EMTF).  

Sir Ian Cheshire, Group Chief Executive of Kingfisher and EMTF Chair, also speaking at the event, argued: “we have to go further and faster…The Government’s heart is in the right place. The challenge now is to push through in some of the areas where the politics is perceived to be difficult.” 

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Biodiversity offsetting report welcomed

12th November 2013

The Environmental Audit Committee has published its report into biodiversity offsetting in England (click here). Drawing on multiple submissions of oral and written evidence, including from the Aldersgate Group (click here to read), the report is cautiously in favour of biodiversity offsetting providing the correct measures and safeguards are implemented. The Committee insists that biodiversity offsetting must not be allowed to give developers a "carte blanche to concrete".

Ian Dickie, Director of the Aldersgate Group and author of the Group's submission, said: "Biodiversity offsetting can be an appropriate tool to help tackle conservation objectives, providing it ensures existing levels of protection and is mandatory. We would warn that understanding of biodiversity offsetting is currently at a low level, which makes it vital that the Government does not rush this process and takes due time to design an effective system."

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High quality biodiversity offsets appropriate for conservation

3rd November 2013

The Aldersgate Group has responded to the Department of Environment, Food and Rural Affairs (Defra)'s consultation on biodiversity offsetting.

The Group's response finds that the most important goal for this area is biodiversity protection and enhancement, which makes offsetting an appropriate tool to help with wildlife conservation objectives in England, providing it is structured appropriately. The framework must ensure no dilution of existing protection and that the system is robust and mandatory. 

The Aldersgate Group has also co-signed a letter to the Chancellor of the Exchequer, calling for offsetting to be mandatory. This letter can be viewed here.


Government must do more to realise growth opportunities of natural capital

5th September 2013

The Aldersgate Group welcomes the wide acceptance of the work of the business-led Ecosystems Markets Task Force (EMTF) set out in the Government’s response published on 5th September. But while the Government has favoured the vast majority of the recommendations, the actions described could fall well short of delivering the contribution to growth and business opportunity that ambitious implementation of the EMTF's carefully crafted suggestions would make.

Peter Young, Chairman of the Aldersgate Group and a member of the EMTF said: “The business opportunities highlighted by the EMTF will not be realised if Government is not prepared to make them tangible and secure for investment in new nature based markets. For example, it is vital that the current consultation on biodiversity offsetting does not result in a voluntary scheme which, the published Impact Assessment shows, will deliver absolutely nothing for growth. It would be a massive missed opportunity which has been estimated to be worth £450 million over the next decade. I am pleased that there will be the opportunity to scrutinise progress on all 22 recommendations next spring.”

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AG welcomes report on ecosystem services

6th March 2013

The Ecosystem Markets Task Force (EMTF) has published its Final Report, making the business case for why nature matters. It finds that business is often unaware of its true reliance on nature and a new way of looking at nature will create innovation and mitigate risk. It recommends interventions which would help create new markets, enhance opportunities for growth and also benefit the environment.

Peter Young, Chairman of the Aldersgate Group and a member of the Task Force said: "The report demonstrates the significant benefits that can be achieved for business and the natural environment through integrated thinking. The Aldersgate Group agrees that safeguarding the quality of our natural environment, will benefit our economic performance."

In November 2011 the Aldersgate Group published its report, Pricing the Priceless, which found that incorporating the value of nature into decision-making will be vital to safeguard long-term economic growth.


Business calls for valuing nature correctly

6th November 2012

The Ecosystem Markets Task Force, which brings together industry leaders and experts from a wide range of business sectors, has published its Interim Report, detailing its emerging thinking on why nature should matter to business and the potential opportunities for business from valuing nature correctly.

Peter Young, Chairman of the Aldersgate Group and a member of the Task Force, said: "The Task Force is doing ground breaking work underpinned by some excellent research. This Interim Report sheds a light on why our failure to value the natural environment is impoverishing business, the environment and society as a whole.

"I hope that Government will respond to this business-led initiative to give the structures and certainties for new markets to be developed, to build a leadership position for the UK. Making nature an integral part of business thinking is the only way to go."

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Nature must be valued in decision making

14th September 2012

To open the Friends of the Earth's Conference on "Seeing Things Differently", Andrew Raingold, Executive Director of the Aldersgate Group, argued that a priority for change must be the development of economic and accountancy frameworks which reflect full environmental costs and benefits.

He said that "currently, much of the world's land, forests, waters, air and ecosystems are being liquidated for short-term growth imperatives that will lead to massive costs later on. They appear on the balance sheet as zero and are often not accounted for in decision making."

Andrew was joined on the panel by authors Polly Higgins (Eradicating Ecocide) and James Marriott (Platform).

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Natural capital must be integrated into decision making

17th July 2012

Responding to the publication of the EFRA committee's report on the Natural Environment White Paper, Ian Dickie, Aldersgate Group Director, said:

"The Committee is right to call for natural capital to be better integrated into Government decision-making, as highlighted in the Aldersgate Group's "Pricing the Priceless" report last year. The Committee calls on the Prime Minister and Deputy Prime Minister to lead a programme of action, but it should also demand leadership from the Treasury, which influences the way so many resources are used in the economy, in implementing that programme."


Guardian podcast: what can Rio+20 achieve?

7th June 2012

Andrew Raingold, Executive Director from the Aldersgate Group, contributed to a Guardian podcast on what tangible measures the Rio+20 conference can hope to produce. He cites the huge transformation in business attitudes and opportunities since the last Rio Earth Summit twenty years ago and the need for robust regulatory frameworks to stimulate green growth and a resource revolution.

To listen to the podcast, click here.

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Businesses vote for food security to be priority for Rio+20

18th May 2012

A sustainable, healthy and affordable diet should be the number one priority for Governments at Rio+20 according to a business summit specially convened by the Aldersgate Group.

The Rio+20 Business Summit, hosted by PwC, and attended by over 170 business, policy makers and NGO's, debated the practical outcomes the business world needs to see from the forthcoming Rio+20 international negotiations on the state of the planet.

Paul Kelly, ASDA Head of Corporate Sustainability, made the case for food security, calling for action now, in particular to reduce supply chain waste, rather than sustainable intensificaiton of agriculture alone. Mr Kelly said: "There is no greater political imperative than food security. The stark truth is that if the world's Governments don't make food security their number one priority, than creating a green economy will be for nothing"

Caroline Spelman, Secretary of State for the Environment, said: "The Aldersgate Group summit showed the significant support we have from the business community for a green economy and clear outcomes from Rio+20."

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Aldersgate Group supports Natural Capital Declaration

22nd March 2012

In the run up to the Rio+20 Earth Summit, the Aldersgate Group (AG) has supported the Natural Capital Declaration. This is a finance-led initiative to account and embed natural capital within investment, banking and loan decisions, consistent with the recommendations in our Pricing the Priceless report.

For more information, click here

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Can we put a price on nature?

26th January 2012

AG Director Ian Dickie, was a keynote speaker at the first Earth Debate, organised by the Natural History Museum in the run up to the RIO+20 Earth Summit. The event was a wide-ranging debate which highlighted the importance of understanding the value of nature, and to put this into a language that decision makers understand.

Ian argued that ecosystem services can link to familiar business terms through concepts such as natural capital, which demonstrate that "environmental assets have a value for humans and business both now and in the future." He said that valuing such services in monetary terms can help "inform the decision-making process and sustain economic value from the environment into the future".

To watch the debate, click here.

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Protecting biodiversity vital for future economic success

28th November 2011

A new report by the Aldersgate Group (AG), launched at the the Global Business of Biodiversity Symposium today, finds that protecting biodiversity and introducing new frameworks to incorporate the value of nature into decision making will be vital to safeguard long-term economic growth. It points to research that conservatively estimates that the failure to address biodiversity loss will lead to cumulative losses that will be equivalent to around 7% of global consumption by 2050 and recommends by the end of this Parliament, the Chancellor should present a draft natural capital budget alongside the fiscal budget.

Peter Young, AG Chairman and member of the Government’s Ecosystem Markets Taskforce, said: "The protection of biodiversity must be a priority as we seek to build a stronger, more resilient economy. Preserving and replenishing services provided by nature will provide business opportunities now and huge economic benefits in the future.”

To read coverage in Guardian Sustainable Business, click here.


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