Better appraisal, measurement, and reporting of natural and social capital provides a company’s stakeholders, including investors, with a better understanding of the factors that materially affect its ability to create value
What is natural capital and is it relevant to you?
Natural capital refers to the elements of nature that directly and indirectly produce value or benefits to people, including ecosystems, species, water, land, and minerals. The everyday resources they provide include energy, food, timber, fisheries and freshwater, as well as services such as air and water filtration, flood protection and plant pollination.
Our approach is to identify and analyse the natural capital that is material and relevant to a business unit or operation; and to integrate the management and reporting of this with other business metrics. The support we provide includes :
- Assessing corporate natural capital usage and determining stewardship criteria
- Understanding the impacts and dependencies relevant to risk profiles, supply chains, and market opportunities
- Natural capital accounting and valuation
- Modelling and support for project specific decision making
- Reporting on performance and business impacts
What natural capital is material and relevant to your operations and supply chain?
Do you own or lease land and natural resources?
Are you responsible for significant resource use and/or emissions to air and water?
Do your products/services provide food, fuel or fibre?
How far does the health of natural capital impact on yields and production costs?
We apply the new Natural Capital Coalition natural capital protocol (draft November, 2015), Natural Capital Committee CNCA approach for corporate natural capital accounting approach (January, 2015), and the World Resources Institute Corporate Ecosystem Services Review (WRI, 2012).
How do you measure and value social capital?
If decision making contains no quantification of externalities such as natural and social capital, companies are exposed to increased risk and potentially making less optimal decisions in terms of long-term growth, productivity and innovation.
Social capital refers to the collective value of all “social networks” (who people know) and the inclinations that arise from these networks to do things for one other (norms of reciprocity). External social capital derives from the social network structures, relationships, and connections between an organisation and its customers, suppliers, partners, investors and NGOs.
What is the value of social capital to your business?
How does this link to supply chains, customers and stakeholder communities? How and what should you measure and monitor? What indicators, outputs, and outcomes can help you improve your performance and generate a net positive impact?
We help organisations:
- Build social capital to improve supply chain transparency, traceability, and collaboration.
- Link social capital to supplier, partner, and community monitoring that identifies actual performance, investments and improvement opportunities.
- Generate valuations of social capital, and the investment and maintenance costs and benefits, so that stakeholders see the potential market value.
- Make decisions that improve performance, stability and capacity for growth in value chains; and improve the business-enabling environment in communities.
- Communicate how the steps being taken to improve social capital translate into increased market valuation, e.g. how investments may strengthen market sentiment and increase the anticipated future worth of the business.