Ecosystem Concept n Business

8/11/2019 Ecosystem Concept n Business

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1: INTRODUCTION1

An ecosystem consists of the biological community that occurs in some locale, and the

physical and chemical factors that make up its non-living or abiotic environment. There

are many examples of ecosystems -- a pond, a forest, an estuary, a grassland. Theboundaries are not fixed in any objective way, although sometimes they seem obvious, as

with the shoreline of a small pond. Usually the boundaries of an ecosystem are chosen for

practical reasons having to do with the goals of the particular study.

The study of ecosystems mainly consists of the study of certain processes that link the

living, or biotic, components to the non-living, or abiotic, components. Energy

transformations and biogeochemical cyclingare the main processes that comprise the

field of ecosystem ecology. As we learned earlier, ecology generally is defined as the

interactions of organisms with one another and with the environment in which they occur.

e can study ecology at the level of the individual, the population, the community, and

the ecosystem.

!tudies of individuals are concerned mostly about physiology, reproduction,

development or behavior, and studies of populationsusually focus on the habitat and

resource needs of individual species, their group behaviors, population growth, and what

limits their abundance or causes extinction. !tudies of communities examine how

populations of many species interact with one another, such as predators and their prey, or

competitors that share common needs or resources.

"n ecosystem ecologywe put all of this together and, insofar as we can, we try to

understand how the system operates as a whole. This means that, rather than worrying

mainly about particular species, we try to focus on major functional aspects of the

system. These functional aspects include such things as the amount of energy that isproduced by photosynthesis, how energy or materials flow along the many steps in a food

chain, or what controls the rate of decomposition of materials or the rate at which

nutrients are recycled in the system.

# http$%%www.globalchange.umich.edu%globalchange#%current%lectures%kling%ecosystem%ecosystem.html

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1.1 ECOSYSTEM CONCEPTS2

"n biology%ecology an ecosystem is the collection of organisms in one area that interact

and therefore depend on each other. "t is to be contrasted with the notion that organisms

are in deadly competition with each other for evolutionary survival. The notion of

ecosystem recognises the many ways an organism interacts with and is dependent for its

own survival on various parts of its environment. The concept of ecosystem may be

viewed as a systems gernerali&ation of the food chain and food web, allowing for more

general relationships than consumption. 'or example, plants not only provide food for

animals but also shelter, shade, etc.

The contrast between the idea of survivial through competition and the idea of an

ecosystem has also been transferred to social and economic systems. The term ecosystem

is used when people talk about the environment that a company is part of, when they

think about how it interacts with various suppliers (of e)uipment, of parts, of services, of

knowledge, of financial li)uidity, etc.*, partners in its primary activity, consumers or users

of the products or services it provides, and the underlying structure and behavior of the

technology, markets and social context. The idea of establishing alliances with companies

that might otherwise have been thought of as competitors reflects the notion that

cooperation in an ecosystem is part of how the organisms that comprise it survive.

"n the general usage one can contrast +ecosystem+ to the term +system+ which focuses on

the collective behaviors. The term ecosystem is typically used to describe the internal

dependencies of the larger system especially as they pertain to a particular part. 'or

example, one might say +he%it is part of my ecosystem+ to refer to recogni&ing ones

dependence on the other in the larger context. Thus, ecosystem is almost a substitute for

the term environment, but it emphasi&es the existance of various parts of the

environment, rather than the environment as a single entity. "n ecology, the term also

refers to the system (collective* behaviors of an ecological system (e.g. forest, wetland,

coral reef, etc.* consisting of interdependent biological organisms and their physical

context. The large scale collective behaviors include, for example, the forest lifecycle that

might in some places include destruction by fire and stages of regrowth.

http$%%necsi.org%guide%concepts%ecosystem.html


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2. BUSINESS AND ECOSYSTEMS

ver the past /0 years human activity has altered ecosystems faster and more extensively

than ever before in human history. That is the main finding of the 1illennium 2cosystem

Assessment# (1A*, a four-year, international, scientific appraisal of the condition and

trends in the 2arth3s ecosystems.

The 1A classified ecosystem services, the benefits people and businesses obtain from

ecosystems, into four categories$

4 5rovisioning 6 goods such as food, water and fiber7

4 8egulating 6 biophysical processes controlling natural processes7

4 9ultural 6 providing recreational, aesthetic or spiritual values74 !upporting 6 underlying processes such as soil formation, photosynthesis and nutrient

cycling.

The 1A also identified six interconnected challenges that are of particular concern for

business as these further affect the integrity of ecosystems and their capacity to provide

services$

4 ater scarcity

4 9limate change

4 :abitat change

4 ;iodiversity loss and invasive species

4 verexploitation of oceans

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agribusiness depends on nature3s pollination, pest control and erosion regulation services7

while tourism builds on cultural services, and the insurance industry benefits from the

natural ha&ard protections that some ecosystems provide. ;ecause of these inter-

relationships, the trends and six challenges identified by the 1A pose significant risks to

companies (as well as to their suppliers, customers and investors* including$

4 perational 6 increased scarcity and cost of raw materials such as freshwater,

disruptions to business operations caused by natural ha&ards, and higher insurance costs

for disasters such as flooding7

4 8egulatory 6 emergence of new government policies such as taxes and moratoria on

extractive activities7

4 8eputational 6 damage to corporate reputation from media and nongovernmental

organi&ation (* campaigns, shareholder resolutions and changing customer

preferences7

4 Access to capital 6 restrictions as the financial community adopts more rigorous

investment and lending policies.

At the same time, these trends and challenges can create new business opportunities

including$

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Assess impacs an! !epen!ence

4 9onduct a systematic review of impacts and dependence on ecosystem services,

covering direct operations and those of suppliers and customers. This may initially focus

on a single business unit, facility or product line, but later could expand7

4 Assess the status of relevant ecosystem services and assess key trends in order to

understand their effects on a particular business7

4 9onsider the following$ hat are the conditions of the services globally and regionally@

hat factors are driving these trends@ ho are other significant users of these services@

hat trade-offs among services are involved@

E"p#$%e an! pu%sue ne& business $pp$%uniies

4 Use the impact%dependency assessment to identify, evaluate and respond to new

business opportunities7

4 Take advantage of opportunities emerging in response to ecosystem changes, including

new technologies, markets, businesses and revenue streams7

4 !upport government policies that align incentives with actions that sustain ecosystem

services.

Re!uce impacs an! sca#e up s$#ui$ns

4 Use the assessment to develop appropriate corporate strategy, policy and operational

responses guided by the hierarchy of avoid, minimi&e, mitigate and offsetB to reduce

impacts. !et targets for improvement, and report on the results7

4 "ntegrate assessment and review systems into existing environmental management

systems7

4 ;uild alliances with research organi&ations, s, industry associations and

governments to improve understanding of ecosystem services, scale up solutions and

share assessment tools and best practices.

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2.1 'ATER SCARCITY

'reshwater scarcity an

accelerating condition for

#- billion people

worldwide, affecting food

production, human health

and economic

development. The most

important sources of

renewable freshwater are

forest and mountain

ecosystems, whichprovide water to twothirds

of the global population.

The availability of water

per person varies

worldwide, but only about

#/C of the world3s population lives with relative water abundance.

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Cha##en(es

orldwide, some #.E million people die annually as a result of inade)uate water,

sanitation and hygiene.

:alf the urban populations in Africa, Asia, Fatin America and the 9aribbean suffer from

diseases associated with inade)uate water and sanitation. ;etween /C and 0C of global

freshwater use exceeds long-term sustainable supply and is met by water transfer or

unsustainable use of groundwater. 1ost water is consumed by agriculture and industry,

with agriculture accounting for more than E0C of total consumption in six out of eight

regions.

'reshwater )uality can be reduced by wastewater from industry, storm water runoff in

urban areas, overuse of fertili&er, and poor sanitation facilities in both urban and rural

areas. 5rojections indicate that between 000 and 0#0, global water use will expand by

#0C.

Imp#icai$ns

1ost corporate operations need reliable sources of water. 1ajor business risks arising

from water scarcity include$

4 :igher water costs due to decreased supply or increased treatment and processing costs7

4 Unpredictable water supply, which could disrupt operations, shut down plants, and

challenge heavily water-dependent industries7

4 >overnment-imposed water restrictions or rationing7

4 5lant closures in areas where costs become prohibitive or operations are no longer

viable7

4 8isk to reputation and brand

image as a result of excessive or

inefficient use.

)$&e*e%+ nume%$us business

$pp$%uniies c$u#! eme%(e+

inc#u!in(:

4 "ncreasing access to drinking

water using market mechanisms

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(e.g., water )uality trading* or new technologies (e.g., wastewater treatment and

desalination*7

4 "mproving efficiency by streamlining processes and implementing closed-loop systems7

4 Gesigning products and processes that are less water-dependent7

4 "mproving image and reputation through active involvement in water management via

partnerships with government, local communities and civil society.

2.2 C,IMATE C)AN-E

2cosystems and climate are closely interrelated7 local and global climate cycles are

influenced by$

4 2cosystems se)uestering or emitting greenhouse gases (>:>* such as carbon dioxide

(9*, methane (9:?* and nitrous oxide (


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The use of fossil fuels to meet the world3s growing energy needs has contributed to an

increase in >:> concentration in the 2arth3s atmosphere. There is a widespread view

that this increase is leading to climate change, with adverse effects on the environment.

2cosystems and ecosystem change are also major contributors to climate change in terms

of$

4 9 emissions from land use changes, primarily deforestation7

4 9:? emissions from natural processes in wetlands and agriculture (ruminant animals

and rice paddies*7

4 :> emissions. Targeted policies that use fiscal mechanisms

to encourage emissions reductions, such as incentives for low-carbon technologies, are

also likely to play an important role in efforts to stabili&e emissions.

9limate change is one of the direct drivers of ecosystem change that is expected to

become increasingly prominent over the next /0 years. !cientists project that climate

change will affect ecosystem services, economic development and human well-being by

increasing the global mean surface temperature, accelerating losses of biodiversity

worldwide, changing productivity and growing &ones of vegetation, causing sea level

rise, and expanding the prevalence of pests and diseases such as malaria, dengue fever

and cholera.

Imp#icai$ns

;usinesses are affected by climate change, but the distribution of the impacts will vary.

Those businesses that have implemented effective risk management strategies or have

competitively positioned themselves will be more adaptable and could stand to benefit

from climate change. Those that fail to recogni&e the risks and potential opportunities

may suffer decreased operational efficiencies and profit margins.

9orporate responses to climate change should incorporate uncertainty regarding the

nature, extent and location of change.

;usiness risks posed by climate change include$

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4 8educed agricultural yields and insecurity of crucial raw materials, such as water,

caused by higher temperatures and increasingly complex regional variation in weather

patterns7

4 8educed ecosystem resilience generated by the loss of species and their stabili&ing

interactions7

4 Gecreased operational efficiencies, mounting costs, and rising insurance premiums

resulting from the increased occurrence of extreme weather events, such as floods and

tropical storms7

4 "ncreased operating costs due to governmentimposed restrictions on or charges for

>:> emissions.

Business $pp$%uniies p%esene! b c#imae chan(e inc#u!e:

4 "ntroduction of new businesses, products or services that reduce >:> emissions7

4 8educed costs through

energy efficiency

improvements or switching

to low-carbon fuels7

4 2nhanced reputation and

brand through corporate

policies and proactive

action to reduce >:>

emissions (e.g., conducting

a >:> inventory, setting

reduction targets*7

4 2arning a place at the

policy-makers3 table in response to timely and effective company action.

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Bui#! scena%i$s $ p%epa%e /$% chan(e

!kanska has begun to develop its approach to climate change by using scenario modeling.

These models will be applied to new development projects to assess the potential impacts

of climate change on indoor climate and help the company consider architectural designs

accordingly. 'or example redesigning heating, ventilation and air conditioning systems

can significantly lower energy demand, with annual consumption of less than #00 k per

s)uare meter achievable in commercial offices.

2.0 )ABITAT C)AN-E

9hanges in land use have significantly altered the capacity of ecosystems to provide

services. Today, one-)uarter of the 2arth3s land surface is covered by cultivated systems.

:abitat fragmentation is most severe in 2urope and least severe in !outh America. 1any

countries in sub-!aharan Africa suffer from low soil productivity and rely on the

expansion of cultivated areas to meet the demand for food.

Cha##en(es

The economic value of converted land is often far less than that of sustainably managed

natural systems that provide a greater variety and )uantity of services.

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4 Tarnished reputation and image in response to corporate degradation of ecosystems and

corresponding habitat loss, such as in the ;ra&ilian Ama&on7

imposed obligations to restore degraded land and habitats in response to stakeholder

concerns.

Business $pp$%uniies /%$m m$%e e//icien use $/ #an! an! habia %es$%ai$n

inc#u!e:

4 Adoption of new technologies, design of new products and processes that improve the

efficiency of land use and boost profitability7

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De*e#$p bes p%acice (ui!e#ines h%$u(h mu#isaeh$#!e% p%$cesses

1ulti-stakeholder processes like the 8oundtable on !ustainable 5alm il, the 8oundtable

on 8esponsible !oy, and the ;etter 9otton "nitiative, each established by the orldwide

'und for


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The main causes $/ cu%%en an! /uu%e bi$!i*e%si #$ss a%e human in!uce! an!

inc#u!e:

4 :abitat change, particularly conversion of natural systems to agriculture7

4 9limate change, which may become the dominant driver in the coming decades7

4 "nvasive species, particularly on islands and in estuaries and freshwater ecosystems7

4 verexploitation, particularly of fish stocks7

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4 5roviding technical advice and consulting services to the wider business community on

biodiversity strategy and management systems7

4 9ommercial supply of habitat restoration and management services, such as carbon

se)uestration in biomass (mainly forestry*, or other forms of compensation for ecosystem

damage (e.g., biodiversity offsets, habitat banking*7

4 2merging markets for

ecosystem services,

particularly regulating and

cultural services

such as watershed management

to deliver clean water, and

private protected areas to

deliver recreational value.

Bui#! $n scieni/ic n$e!(e $ imp%$*e pe%/$%mance

9adbury !chweppes is engaged in an 2arthwatch "nstitute research project in >hana

investigating the feasibility and potential of cocoa production in a biologically diverseenvironment. 9adbury !chweppes employees join the project as volunteer research

assistants and gain a better awareness and understanding of the links between

biodiversity, sustainability and the 9adbury !chweppes supply chain.

2.5 O4ER E6P,OITATION O7 OCEANS

ceans cover more than E0C of the 2arth, playing key roles in climate regulation, the

freshwater cycle, food provisioning and delivering cultural services.

9oastal &ones cover only HC of the 2arth, but the services they provide are responsible

for approximately ?=C of the estimated total value of ecosystem services. ;eing the most

productive part of the ocean, the coastal boundary &ones yield about I0C of marine

fisheries. They also have high levels of pollution.


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Cha##en(es

Gemands on coastal &ones are increasing in terms of shipping, military and security uses,

recreation and fish farming. The overexploitation of oceans presents several challenges$

4 'ish landings averaged H.? million metric tons per year during #II#-000, with a

declining trend largely attributed to over-fishing7 a )uarter of fish stocks are

overexploited or significantly depleted7

4 'ishery declines mean less cheap protein7 more than a billion people rely on fish as

their main or sole source of animal protein7

4 2xpansion of fish and shellfish farming (a)uaculture* has caused loss of vegetation and

biodiversity and deterioration of water )uality7 a)uaculture of carnivorous species such as

salmon and tuna consumes more fish than it produces7

4 Algal blooms and dead &ones (low oxygen conditions* in coastal waters are increasing

in fre)uency and intensity, harming marine resources and human health7

4 !ome =/C of mangrove areas have been lost or converted over the past several

decades7 some 0C of coral reefs have been destroyed, with more than a further 0C

being degraded7

4 "nvasions of non-native species are altering marine and coastal ecosystems, threatening

the supply of ecosystem services.

2stimates based on current rates of diversity loss indicate that there will be no viable fish

or invertebrate species available to fisheries by 0/0.

:owever, the trends in species loss are still reversible hile the demand for fish is

increasing, fish farming may relieve some of the pressure on wild fisheries, but only if it

reduces the pressure on wild fish stocks, and sustainable fish farming practices are

adopted.

1arine tourism is growing, especially the marine wildlife tours sector, which depends on

suitable local conditions, such as productive coral reefs. 'uture forms of ocean

exploitation include fish harvesting, a)uaculture, energy production, bioprospecting,

seabed mining and carbon se)uestration.

Imp#icai$ns

9hanging ocean ecosystems as a result of overexploitation will affect the profitability of

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businesses that rely on products or services provided by the marine environment,

including fishing, oil and gas extraction, and recreation. 8isks to business from continued

overexploitation of oceans include$

4 Gepletion of fish stocks, reducing revenue and triggering new catch regulations7

4 5roperty damage, asset losses and rising insurance rates associated with the loss of

natural coastal protection7

4 Gecreased tourism and lower property

values caused by beach erosion, coastal

dead &ones and coral reef degradation.

Ne& business $pp$%uniies %e#ae! $

he susainab#e use $/ ma%ine p%$!ucs

an! se%*ices inc#u!e:

4 2nhanced business image and

reputation through the use of eco-labels

or certification programs, such as the

1arine !tewardship 9ouncil (1!9*7

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Assess supp#ie%s $ %e!uce impac

al-1art has set a goal to purchase all of its wild-caught fresh and fro&en fish for the


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established processes for navigating a wide range of differences in stakeholder views and

values across a range of issues, including values associated with natural resources.

ithin the past couple of years, however, key stakeholders and opinion leaders have

expanded their focus to include consideration of new, often harder to measure issues,

such as ecosystem services. The reason is simple. "t is increasingly clear that many of

these current corporate environmental performance measures fail to capture impacts on

broader ecological dynamics.

'or companies, this emerging expansion of corporate environmental performance

expectations could be significant. 9ompanies may face accountability, not only for

pollution prevention, but also for impacts (positive or negative* to ecological structure

and function in the areas where they operate or source. !uch an evolving mandate could

either be advanced via regulation or, more opa)uely, become expected practice by

investors, insurers, activists, employees or neighboring communities. !uch an expanded

focus would translate into a company needing to understand its dependencies and impacts

(both positive and negative* on the flow of ecosystem service.

There are growing sets of drivers for businesses to restore the function of ecological

systems, some of which are listed below.

1. Ne& &as /$% businesses $:

K 9reate value

K 9onsider risk mitigation

K Gifferentiate among competitors

K 8eali&e new revenue streams through ecosystem services protection

K Access capital and new markets

K !ave on costs

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K The sources and collective methodologies underpinning any preloaded datasets

K The estimated financial and human resources for )uality outputs

K Any third-party assurances for the tool3s methodology

K hat users can do to reduce the level of uncertainty of the tool3s results

b. ;e flexible enough to incorporate both expert and community input, especially as it

relates to relative values for specific ecosystem services.

c. ffer a do-it-yourself B approach that allows corporate decision makers to leverage

preexisting environmental data collection and decision-making processes and protocols.

OUTPUTS a. 9haracteri&e the level of uncertainty for any given output, based upon the

)uality of the data as well as the scientific consensus around dynamics in the ecosystem

of interest.

5robabilistic models are most easily understood among corporate audiences.

b. ffer functionality for identifying cumulative impacts and reinforcing drivers from all

activities in a given region and flagging potential ecological tipping points.

c. here feasible, include a sensitivity analysis to demonstrate the system-wide

conse)uences of possible activities.

d. ffer results at varying geographic scales to enable flexibility across corporate and

project planning.

e. "f reporting valuation results, provide them in relative, nonmonetary units, not absolute

financial e)uivalents, and include a range of stakeholder values, accounting for differing

economic and cultural circumstances.

f. Alongside results, provide anecdotal cases from past benefits accruing to companies

that protected a similar ecosystem service.

g. here feasible, provide an overlay of markets and%or transactions in the region of

interest, including real-time pricing.

COST a. 1inimi&e resource demands for basic tool use to make initial adoption more

likely.

b. 9onsider offering tiered levels of access and%or complexity of results.

5. Mach Se#ece! T$$#s $ E"isin( Decisi$nMain( P$ins: 5rospective users will

need to clarify the interface pointsB between tools and relevant business decision-

making points, including the following$

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K P%$!uc an! p%$cess !esi(n !ecisi$ns+ including optimi&ation along the extended

value chain

K 7aci#i !esi(n an! sie #$cai$n !ecisi$ns+ related to project investments and project

stage reviews

K Inn$*ai$n $pp$%uni a%eas+ including strategic 8JG initiatives and highest value

efforts

K C$%p$%ae pe%/$%mance a%(es+ including local and regional targets%metrics

K Se&a%!ship an! c$mmunicai$n s%ae(ies+ such as corporate social responsibility

(9!8*

K T%a!e$//s assessmens+ such as net environmental benefit evaluations

K Susainabi#i s%ae( ;usi/icai$ns and building the business case for

sustainability%9!8

8. Deci!e $n Ba#ance $/ In)$use 4e%sus Ous$u%ce! '$%: 9orporate practitioners

have pointed to the fact that major companies tend to trust models built in-house or at

least with their own datasets.

As such, prospective tool users will need to strike a balance between drawing on the deep

expertise of external tool developers while maximi&ing in-house modeling capacity and

know-how.


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These growing efforts around environmental markets, 52! and other policy changes to

include ecosystem services imply that companies will need to understand their

dependencies and impacts on ecosystem services. "n response, over the past few years,

academics, nongovernmental organi&ations (s* and public sector research entities

have been )uietly developing tools to enable key decision makers N in public, private

and nonprofit sectors N to integrate ecosystem service concepts into planning as well as

daily operations. The growing number of initiatives can make it challenging to sort out

which tools are applicable at which decision-making juncture, which rely on robust

analytical methods and high )uality data, and which may be used in concert with other

decision-making tools.

A. Mu#iEc$ssem Se%*ice Assessmen T$$#s

There is now a set of emergent tools for conducting multiple ecosystem service-focused

assessments, including$

K A8"2! (A8tificial "ntelligence for 2cosystem !ervices* by the University of Lermont3s

2coinformatics 9ollaboratoryB (at the >und "nstitute for 2cological 2conomics*,

9onservation "nternational, 2arth 2conomics, and experts at ageningen University

K 2!8 (2cosystem !ervices 8eview* by the orld 8esources "nstitute (8"*, the

1eridian "nstitute, and the orld ;usiness 9ouncil for !ustainable Gevelopment

(;9!G*

K "nL2!T ("ntegrated Laluation of 2cosystem !ervices and Tradeoffs* by The


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being considered, which include elements of ecosystem services. These other relevant

assessment approaches, which are in various stages of development, include$

K ;;5 (;usiness and ;iodiversity ffsets 5rogram* Toolkit by 'orest Trends,

9onservation "nternational and the ildlife 9onservation !ociety

K ";AT ("ntegrated ;iodiversity Assessment Tool* by 9onservation "nternational,

;irdFife "nternational and the U< 2nvironment 5rogramme3s orld 9onservation

1onitoring 9entre

7i(u%e 2: O*e%*ie& $/ Ec$ssem Se%*ice Assessmen T$$#s

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C. Saus $/ T$$# De*e#$pmen

ithin the set of tools considered on the preceding page, none are yet fully mature with a

robust track record of applications. 8ather, the tools sit along a spectrum from betaB to

prereleaseB to in development.B 1ost of the tool developers will have made public at

least a draft form by the end of 00H.

0.0 NA4I-ATIN- T)E TOO,S 9,ANDSCAPE

A. Simi#a%iies

A range of crosscutting characteristics emerged in this tool review, including$

1. Inen 6 All of the tools profiled on the preceding pages seek to enable improved

decision making through inclusion of ecosystem services considerations.

2. C$mm$n Ta%(e Au!ience6 All of the tools are intended to influence policymakers,

with A8"2!, "nL2!T and 1"12! explicitly focused on this target audience. 2!8,


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0. N$menc#au%e6 1ost of the tools use the 1illennium 2cosystem Assessment set of

ecosystem services and definitions. "nL2!T has narrowed the list to those services it

deems as proxiesB for others in an effort to make the set of services more manageable.

3. Te%%es%ia# 7$cus6


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Gespite some areas of resonance across tools, there are a number of key distinctions$

1. Use% Ine%/aces6 which span from computer models through workbook-likeB 2xcel

spreadsheets.

2. Tpes $/ Resu#s 6 ranging from a list of priority ecosystems to consider through

spatially-explicit maps showing changes under different land management scenarios

0. Daa Deman!s6 from high to low, spanning from do-it-yourself to detailed preloaded

databases.

3. Ec$#$(ica# Deai# 6 from high-level, coarse-grain assessments to fine-grain, map-

based assessments

5. 4a#uai$n Emphasis 6 which can be further parsed in terms of value within an

existing environmental market (such as within the 2uropean Union 2missions Trading

!cheme* or value within a broader societal context that draws upon ecological economics

theory%concepts. "n order to explore further the distinctions outlined on the preceding

page, we offer the following illustrative maps that characteri&e each tool, relative to its

peers, across the five distinguishing criteria. f the tools profiled here, four offer a

computer model interface that provides spatially explicit maps as outputs. 'oundational

to these tools are preloaded databases built from best-in-classB publicly available

information. The other three tools offer sets of )uestions or a workbook that brings

analytical structure to one3s planning.

Those advocating for a shift toward ecosystem services-based management have often

called for an emphasis on valuation, or the ability to place financial value on a given

service, and possibly even a suite of services known as a bundle.B :owever, distinct

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differences are apparent between 2uropean policy dialogues that emphasi&e valuation and

U.!. dialogues that skirt the issue or take a risk mitigation angle.

f the tools assessed here, three have strong focus on valuation as part of their offerings

(given


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;ased upon the status of each tool as of mid-00H, ;!83s corporate working group

participants offered the following perspectives on the relative strengths and weaknesses

of each tool for the business world.

7i(u%e


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0.3 CONC,USIONS AND RECOMMENDED PAT)'AYS 7OR'ARD

At present the value of these tools is to enable a structured conversation around whether

were asking all the questions that need to be asked and whether we are missing anything

we should be thinking about.

6 2nvironmental !ervices, Tools and 1arkets 9orporate orking >roup member, 00H

There remains a considerable amount of work to advance both the business case for, and

business adoption of, ecosystem services tools. "n order to avoid duplication of effort N

or proliferation and dilution of impact N we have attempted to stimulate more

coordination between tool developers. !ince we launched these efforts, the following

progress has been made$

K All seven tool development teams now know of one another3s tools and their

capabilities

K "nL2!T3s partner organi&ations have$

6 Approached Arc>"! for delivery of "nL2!T software

6 :ired a team to design their commerciali&ation strategy and conduct a market-si&ing

exercise of potential business users

K A8"2! and 2!83s developers have discussed the complementary nature of their tools

and are considering collaboration

K 1"12!, A8"2! and ";AT developers have explored their respective business models

for selfsustained financing and user membership

K All seven tool development teams and working group companies have agreed to host asecond three-day workshop in early 00I to address the proposed pathways forward (see

figure below*

K The tool developers have tentatively committed to joint development of a navigational

device for prospective users (below*

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7i(u%e =. P$ssib#e Ta"$n$m /$% P%$p$se! Na*i(ai$na# De*ice $ T$$#s

Through our discussion across business, nonprofit, academic and public sector

organi&ations, we discovered the following sets of needs for immediate consideration$

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7i(u%e >. I!eni/ie! Nee!s $ A!*ance T$$# De*e#$pmen an! Upae

"t is our hope that this synthesis paper will be a first step in moving toward greater clarity

on the details related to each of the emerging ecosystem service-related tools as well as

how to most effectively use the tools within the business setting.

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3. CASE STUDIES

PROMOTION O7 RENE'AB,E ENER-Y IN INDIAN INDUSTRIES

verall, about D# percent of "ndia3s greenhouse gas emissions come from energy

generation, and this amount is expected to grow along with future demand. The solution

to emissions reductions in the power sector must come from a planned transition to a

low-carbon economy through an emphasis on renewable power generation.

8enewable sources of energy currently constitute only H percent of total installed

capacity nationwide, and percent in terms of energy operation. :owever, "ndia is

bestowed with abundant renewable energy sources, with a total estimated potential of

#,000 1 of grid-interactive power (without considering solar energy potential*. This

translates into an investment potential of 8s D#0,000 9rores (U!G #=/ billion*, in

addition to the current annual turnover of H to #0 Thousand 9rore 8upees in the

renewable energy sector. "n spite of the huge opportunities for growth in the renewable

energy sector in "ndia, it is still lacking large scale commerciali&ation. To cataly&e more

corporate investments and enhance penetration of renewable energy systems for

industrial and commercial applications, 9""->odrej >;9 has formed a 9ouncil on

8enewable 2nergy to facilitate more private sector participation in tapping the huge

potential in the 82 sector in "ndia. The 9ouncil addresses policy issues at the !tate and

9entral level, supports technology transfer, and facilitates innovative financing

mechanisms

by bringing all stakeholders together. Today "ndia is in a position to play a major role in

large-scale commerciali&ation of renewable energy technologies, and can offer

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has succeeded in transforming the village in the past years by installing a village power

plant run by a biomass gasifier. 'uelled by rice husk and dhaincha, a weed commonly

grown in "ndia to restore nitrogen to depleted soils, the power plant runs agro-processing

machines, irrigation pumps, and a battery charging station. "t doesn3t take much 6 just /

kilowatts 6 to power these village industries on clean, renewable, local energy.

'OR,D C,ASS ENER-Y E77ICIENCY IN T)E CEMENT

INDUSTRY

"ndia is the second-largest cement producer in the world, with an installed capacity of #DD

million tonnes. "ndia3s projected >G5 growth rate of H percent, coupled with a booming

construction industry, has spurred the cement sector to start gearing up for the high

demand.

As the cement industry grows, attention must be paid to the associated environmental

impact.The cement industry is highly energy-intensive, the cost of energy within some plants

reaching as high as // percent of manufacturing costs. ;ecause it powers its clinker

production with carbon-intensive coal fuel, the global cement industry is responsible for

contributing about ? percent of global 9oemissions.

The "ndian cement industry has become a forerunner in energy-efficient cement

manufacturing, with some of its plants operating at among the lowest specific energy

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4 The development of an ecosystem marketplaceB that is widely accepted and

encompasses both ecosystem investments and payment for ecosystem services is crucial

in adopting a response of suitable scale7

4


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ANNE6URE

'BCSD

The orld ;usiness 9ouncil for !ustainable Gevelopment (;9!G* brings together

some #H0 international companies in a shared commitment to sustainable development

through economic growth, ecological balance and social progress. ur members are

drawn from more than =0 countries and 0 major industrial sectors. e also benefit from

a global network of /0Q national and regional business councils and partner

organi&ations. ur mission is to provide business leadership as a catalyst for change

toward sustainable development, and to support the business license to operate, innovate

and grow in a world increasingly shaped by sustainable development issues.

ur objectives include$

;usiness Feadership 6 to be a leading business advocate on sustainable development7

5olicy Gevelopment 6 to help develop policies that create framework conditions for the

business contribution to sustainable development7

The ;usiness 9ase 6 to develop and promote the business case for sustainable

development7

;est 5ractice 6 to demonstrate the business contribution to sustainable development and

share best practices among members7

>lobal utreach 6 to contribute to a sustainable future for developing nations and nations

in transition. www.wbcsd.org

EART)'ATC) INSTITUTE

2arthwatch "nstitute is an international environmental organi&ation whose mission is to

engage people worldwide in scientific field research and education to promote the

understanding and action necessary for a sustainable environment. !ince #IE#

2arthwatch has been bringing together individual volunteers and scientists on field

research projects as a means of providing essential funding and a dedicated labor force

for international scientists. 2arthwatch believe that by involving the general public in

science, they gain the knowledge, skills and motivation needed to take responsibility for

the environment. 2arthwatch currently supports over #=0 environmental research projects

?/


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in /0 countries. !ince #IE# the worldwide organi&ation has recruited over H0,000

volunteers in support of ,H00 field research projects in ##H countries. These volunteers

have contributed over #0 million hours to essential field work. 2arthwatch "nstitute

(2urope*3s 9orporate 2nvironmental 8esponsibility >roup (928>* is a platform for

enhancing good practice among the business sector. 928> members benefit from

networking and shared learning with other companies committed to good environmental

practice, stakeholder dialogue through report%policy feedback services and disseminating

good practice through presentations at 2arthwatch seminars. www.earthwatch.org

IUCN T)E 'OR,D CONSER4ATION UNION

'ounded in #I?H, The orld 9onservation Union brings together states, government

agencies and a diverse range of non-governmental organi&ations in a uni)ue world

partnership$ over #000 members in all, spread across some #?0 countries.

As a Union, "U9< seeks to influence, encourage and assist societies throughout the

world to conserve the integrity and diversity of nature and to ensure that any use of

natural resources is e)uitable and ecologically sustainable.

A central !ecretariat coordinates the "U9< 5rogramme and serves the Union

membership, representing their views on the world stage and providing them with the

strategies, services, scientific knowledge and technical support they need to achieve theirgoals. Through its six 9ommissions, "U9< draws together over #0,000 expert volunteers

in project teams and action groups, focusing in particular on species and biodiversity

conservation and the management of habitats and natural resources. The Union has

helped many countries to prepare


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'OR,D RESOURCES INSTITUTE

The orld 8esources "nstitute (8"* goes beyond research to create practical ways to

protect the 2arth and improve people3s lives. "ts mission is to move human society to live

in ways that protect 2arth3s environment and its capacity to provide for the needs and

aspirations of current and future generations.

'or more than 0 years, 8" has demonstrated its commitment to helping find solutions

to these enormous global environmental challenges. 8"3s work is concentrated on

making progress toward four goals$

:ealthy 2cosystems 6 8everse rapid degradation of ecosystems and assure their capacity

to provide humans with needed goods and services.

!table 9limate 6 5rotect the global climate system from further harm due to emissions of

greenhouse gases and help humanity and the natural world adapt to unavoidable climate

change.

!ustainable 2nterprise 6 :arness markets and enterprise to expand economic opportunity

and protect the environment.

Access to 2nvironmental "nformation and Gecisions 6 >uarantee public access to

information and decisions regarding natural resources and the environment.

www.wri.org and www.earthtrends.wri.org

Documents

Ecosystem Concept n Business