UK's natural capital presents clear business opportunity, report finds

Addressing the UK's deteriorating natural capital could represent a business opportunity for pro-active firms, according to a new report from the University of Cambridge.

Natural capital can be defined as the elements of the natural environment that provide valuable goods and services

Natural capital can be defined as the elements of the natural environment that provide valuable goods and services

The report – Doing Business with Nature – was produced by the University's Institute for Sustainability Leadership (CISL) in partnership with a number of corporate leaders including Asda, Mars and Nestlé.

---Read the full report---

The report argues that by sustainably managing their interactions with the environment, UK businesses can benefit from reduced input costs, decreased supply chain risk, and enhanced brand reputation.

CISL director Polly Courtice said that while many companies have started to implement measures to reduce their impact on natural capital, more needs to be done. She said: "By developing a body of evidence in partnership with a group of companies, we aim to translate the management of natural capital into tangible commercial benefits - highlighting in real terms the financial savings, security of supply, and brand enhancement on offer."

Natural capital-gains

This report comes on the back of a similar study released in January by the independent Natural Capital Committee, which said England's natural environment is in decline and its deterioration is harming the economy.

Natural capital-friendly actions can be as simple as a water reduction initiative – 85% of UK firms have no such plan – or collecting more empirical data on the links between biodiversity and certain commodities.

"We need to turn it around for the corporate world, and make good practice around biodiversity credible," said Asda's director of ethical sourcing Chris Brown. "Business can bring a lot to bear to help fill in data gaps that can then be interpreted into decision making."

Last year, Asda revealed the financial impact that climate change is already having on its operations in the form of the Climate Adaptation Framework study, developed with PwC. The study found that extreme weather events such as the recent UK floods have a direct impact on 95% of fresh produce stocked in Asda stores, with food sourcing, processing and transportation all facing an growing threat from environmental issues. 

Speaking at the report launch, Brown said that failing to address these issues could cost Asda more than £370m. "Only five per cent of our fresh produce supply chain is not at risk from climate change impacts," he said. "For businesses, the events such as droughts and flooding reduce the resilience of supply chains and risk potential losses from commodity price hikes that follow sudden drops in agricultural production."

Natural Capital Infographic

Brad Allen



Click a keyword to see more stories on that topic, view related news, or find more related items.


You need to be logged in to make a comment. Don't have an account? Set one up right now in seconds!

© Faversham House Group Ltd 2015. edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.