Ecosystems and Food Systems: Valuing the Connection

Mr. Pavan SukhdevCEO, GIST Advisory

Author, ‘Corporation 2020’UNEP Goodwill Ambassador

“True Cost of Food”Sustainable Food Trust

London, 6th December 2013

10.04.23 2Source: Gundimeda and Sukhdev, TEEB for National & International Policy

Indonesia India Brazil

99 million 352 million 20 millionEcosystem service- dependent poor people :

Ecosystem services

Ecosystem services consumed by the poor as a % of “GDP of the poor” :

Ecosystem services as a % of classical GDP :

TEEB (2010) on Ecosystems & Rural Poverty…

QUESTION: So why is this NOT happening?

• Green farming practices have increased yields, especially on small farms, between 79 % (Pretty et al, 2006) and 180 % (FAO, 2009).

• 10 % increase in farm yields => 7 % reduction in poverty in Africa & => 5 % poverty reduction in Asia (UNEP, 2011)

• Approximately 2.6 billion people rely on agricultural production systems for their livelihood (FAO, 2009)

• Of 525 million small farms world wide, 404 million are less than two hectares (Nagayets, 2005)

•Small farms cultivate 60 % of arable land (Herren et al. 2010)

UNEP – GREEN ECONOMY INITIATIVE

The importance of Small Farm yields ….

…. for solving hunger, poverty, & employment

QUESTION: So why is this NOT happening?

Private Profits, Public LossesShrimp farms in South Thailand

MangrovesShrimp Farm

private profits

less subsidies

Net of public costs of restoration after 5 yrs

private profits

10,000

US$/ha in 1996

private profits

5,000

$584$1,220

$9,632

$584

-$9,318

$12,392

After adding public benefits

from mangroves

Source: Data from Barbier et al (2007)

All values in NPV over 9 yrs (1996-2004) at 10% discount rate

$584 Forest prods.$987 Fisheries

$10,821Storm protection

• Negative externalities of top 3,000 companies estimated at US$2.15 trillion per annum

Source: Trucost for UNPRI, 2010.

Private Profits, Public LossesGlobal Assessment of Environmental Externalities

Source: Trucost for UNPRI, 2010.

Top 3,000 Listed Companies

Negative Corporate Externalities …..

Water Abstraction

Greenhouse Gases

Greenhouse Gases

Natural Resources

Natural Resources

Natural Resources

….. Are Pushing Planetary Boundaries

Four Micro-Policy Reforms for “Corporation 2020” to become the new “DNA” of Business:-

Source: Why Corporation 2020?, Island Press, 2012

Resource Taxation (Finance Ministries) Replacing Corporation Tax (on Profits) with Resource Taxes

(on Resource Use & Extraction)

Accountable Advertising (Advertising Associations) Two Principles, Four Strategies, & Industry-wise Standards to

make marketing/ advertising responsible & accountable

Leverage Limits (Central Banks)Six reforms to govern & limit financial leverage at the point of

credit extension, not just intermediation

Disclosing Externalities (Accountancy Regulators) Measuring & disclosing all major corporate externalities (+ve

& -ve) using sectoral standards & guidelines

Source:

Corporation 2020’s“Theory of Change”

TEEB for Biz Coalition: Valuing Externalities For Business Sectors / Regions

“TEEB for Agriculture & Food” Background & Rationale

• Role of biodiversity and ecosystem services in agriculture– Nutrient cycling, Soil fertility, Genetic diversity– Pollination, water purification, soil retention

• Dependencies on Nature: well-being, livelihoods, food security, health, development (“GDP of the poor”)

• Impacts on Nature: intensification, expansion, subsidies• Context: Different scales & types of food systems & land use

Website: http://www.teebweb.org/agriculture-and-food/ Email: teeb@unep.org; dustin.miller@unep.org

For Key Research Questions:-

•Global meta-analysis

•Policy-relevance

•Open architecture

•Ecosystem functions: Substance flow analysis

•Costs and benefits: measure, model and map

“TEEB for Agriculture & Food” Research Scope & Approach

Website: http://www.teebweb.org/agriculture-and-food/ Email: teeb@unep.org; dustin.miller@unep.org

• Conceptual framework for evaluating dependencies &

impacts across different scales and systems

• Set of methods and tools for valuation

• Literature review and synthesis

• Range of policy recommendations

• Examples of Success: national and local decision-making

frameworks & processes

Website: http://www.teebweb.org/agriculture-and-food/ Email: teeb@unep.org; dustin.miller@unep.org

“TEEB for Agriculture & Food” Expected Outputs

Thank You !www.teebweb.org

www.gistadvisory.comwww.corp2020.com

Pavan Sukhdev

Founder-CEO, GIST AdvisoryAuthor, Corporation 2020,

& UNEP Goodwill Ambassador