Frontier Economics has collaborated with one of the UK’s leading wildlife charities to guide them on the best ways to measure the monetary value of biodiversity.
A team of Frontier economists worked on a pro bono basis to develop a valuation toolkit for The Wildlife Trusts, which promotes the role of nature in solving local and global problems.
This new toolkit will help The Wildlife Trusts to place an economic value more easily on their conservation activities and advocate for biodiversity to be incorporated into economic decision-making at the highest level.
Boosting the economy and our wellbeing
The Frontier team started by setting out a framework for identifying how biodiversity generates value based on the concept of ‘ecosystem services’: free services delivered by nature which contribute to our economy and wellbeing. When nature is healthier and more resilient, provision of these services is boosted, to everyone’s benefit.
We then assessed the existing methods in the UK of valuing biodiversity, looking at their strengths and weaknesses. We found that the most common approach – carrying out consumer ‘willingness to pay’ studies – understates the value of biodiversity by failing to consider the wider economic value it generates.
Our assessment identified two key resources for The Wildlife Trusts' valuation activities, which we accompanied with guidance about the utility and application for each. Natural England’s Biodiversity Metric Tool and the associated DEFRA biodiversity credit price, developed for the government’s Biodiversity Net Gain policy, provides one helpful way of valuing biodiversity based on the cost of replacing primary habitat and the money required by the government to permit its destruction. Additionally, DEFRA's Enabling a Natural Capital Approach offers high-level valuations of the biodiversity provided by various natural habitats often based on consumer survey methodologies, which will be useful for reporting the overall impact of The Wildlife Trusts.
The main strength of this approach is its comprehensive nature – it’s likely to capture more of the sources of value derived from biodiversity.
"Better conversations with policy makers and businesses"
Kathryn Brown, Director of Climate Change and Evidence, believes the assessment carried out by Frontier will be crucial to the work of The Wildlife Trusts: “I’m hugely grateful to the team at Frontier for their insights in how we can better include economic valuation of the benefits of biodiversity in our work. Their toolkit has been designed with pragmatism in mind, so that it can be easily applied to a wide range of different projects. This will help us to have better conversations with policy makers and businesses about the value of the work we do on recovering nature and delivering nature-based solutions”.
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