the biosphere economy scaling up market solutions to ecosystem challenges wec/volkswagen roundtable,...
TRANSCRIPT
The Biosphere EconomyScaling up Market Solutions to Ecosystem Challenges
WEC/Volkswagen Roundtable, May 20-21, 2010
Alejandro LitovskyDirector, Pathways to Scale, Volans
The Amazon pumps 8 trillion litres of water a year into the atmosphere
Seeing differently: Eco-Utilities
Biodiversity’s role in sustaining Nature’s services
Source: The Value Web
An inflection point: Planetary overshoot
‘Vision 2050’World Business Council for Sustainable Development
• CEOs of 29 global companies
• A future where markets adequately price the ecological costs of doing business.
• We are becoming more acutely aware of our dependence on natural systems.
• Companies include Alcoa, Boeing, Syngenta, Sony, E.ON, Proctor&Gamble, Duke Energy, Toyota, Infosys and Volkswagen.
• An Economy aligned with naturalcapital
• Role of market pioneers and their pathways to scale
• A collaborative agenda 2010-2020
The Biosphere Economywww.biosphereeconomy.com
New DashboardsPlanetary Boundaries
Source: Stockholm Resilience Centre
New Dashboards 2Ecological Footprint
Source: Global Footprint Network
The Biosphere Economy: 4 Trends
• 1998 Yangtze floods: $20 billion in losses, 250 million people affected. Chinese government forbids land degradation in upper basin.
1. Business Leadership:From Externalities to Corporate Valuation
• “It is only a question of time until a financial analyst, looking at the valuation of companies begins to consider (knowingly or not) the ecological factors that threaten their business.”
Chris Knight PriceWaterhouseCoopers LLP
• 35 financial institutions with $3.5 trillion in assets back the disclosure request of the Forest Footprint Disclosure Project. 200 companies exposed to forest-risk commodities (e.g. leather, palm oil, beef)
2. Operations and Supply Chains:Ecological Footprint and Shareholders
• “You can’t expect companies to run a series of parallel systems for water, carbon, forests, etc.”
Richard Burrett, Earth Capital Partners
• Shareholders backing disclosure requests.• Funds incorporating ecological footprint metrics.• Carbon markets $11 billion in 2005 > $170 billion in 2010 > $3.1
trillion in 2020.• Other markets: Biodiversity offsets, water services, ‘forest carbon’.
3. Markets and Finance:Markets for Ecosystems Services
• “Investors are switching to this agenda as they are beginning to understand the genuine long-term benefits and liabilities associated with capital allocation decisions.”
Jason Scott, EKO Asset Management Partners
4. Nature-Driven Innovation:Biomimicry
Source: The Biomimicry Institute
Scaling up the Biosphere EconomyWorking with innovators
• Business Leadership: What’s the company’s story about natural capital and leadership in a Biosphere Economy?
• Operations and Supply chains: What does the zero footprint vision look like? convergence of metrics and mgt systems?
• Investment: How to factor in natural capital into new portfolio and long-term risk models?
• Nature-driven innovation: What would radical innovation in business models, design and products look like?
See: www.biosphereeconomy.com
‘Pathways to Scale’ Model