SPCS Series｜Biodiversity & Economy Vol.3 The Future of Natural Capital Investment and Valuation Metrics

Among the various environmental issues we face, global warming is often at the forefront, with an increasing trend to prevent it by promoting decarbonisation and reducing greenhouse gas emissions. However, biodiversity loss is one of the most serious issues as mapped out by the Planetary Boundaries (68% of all organisms have gone extinct since the 1970s, and more than 100 species continue to disappear every day) (*1). The reality is that it is difficult to set numerical targets and connect biodiversity conservation to economic activity. 

The international community is taking more practical steps towards achieving targets, such as the establishment of the Task Force on Nature-related Financial Disclosures (TNFD *2) and the 30×30 Initiative (*3), while the concept of natural capital is spreading and the impact investment market is expanding in business circles.

SPCS believes that by avoiding design that unilaterally controls nature, we will be gifted with a larger creative margin that also increases the necessity of a multispecies society. We anticipate a growing trend of biodiversity-linked economic activity being evaluated worldwide. In this context, the “Biodiversity & Economy” talk series seeks to explore how multispecies design links to economic activity and how they can or are being evaluated. 

*1: The Planetary Boundaries concept was first proposed in 2009 by a group of Earth system and environmental scientists led by Johan Rockström, an environmentalist at the Stockholm Resilience Centre and Will Steffen from the Australian National University. The framework describes the limits to human activity impact on the Earth system, beyond which, the environment may not be able to self-regulate anymore. Reports have mapped that the limit values for biodiversity loss have already been exceeded.

*2: A market-led, science-based and government-backed initiative providing organisations with the tools to act on evolving nature-related issues. The initiative is supported by national governments, businesses and financial institutions worldwide.

*3: A target pledged at the 2021 G7 Summit to conserve at least 30% of the country’s land area as natural environmental areas by 2030. In Japan, the Ministry of the Environment is taking the lead in implementing specific measures.

• Vol.1　Imagining a Multispecies Capitalistic Society (Held on 7/4)
• Vol.2　Building a Symbiotic Circular Economy (Held on 7/27)
• Vol.3　The Future of Natural Capital Investment and Valuation Metrics
• Vol.4　Data Visualization and Proposed Value

Our guests for Vol.3 are Singapore-based impact investor Patti Chu and SMFG Senior Sustainability Expert Kenji Shima. Chu is co-founder of Mana Impact, an impact investment and consulting company, and Head of Impact Investment at Silver Strand Capital, which invests in projects around the world focused on the theme of biodiversity. Shima has long been involved in environmental and social risk assessment for project finance and is currently responsible for research and analysis of sustainability-related regulations and trends at SMFG. He introduces methods and ideas from various places financial institutions can adopt to work towards Nature Positivity.

In Vol.3, we connect with Chu and Shima online to hear their opinions on ESG investments, impact investments and the future of natural capital investments and possible valuation metrics. (The online segment will be archived digitally for broadcast at a later date). This will be followed by an offline summary session with Shima. Building on Chu’s practical experience, we discuss with Shima what kind of value Japan can bring to the world in this area.  

When we aim for positive social impact through projects related to biodiversity and natural capital, what kind of metrics should we focus on? By learning about the trends of investors and financial institutions at home and abroad, we can obtain guidelines and hints on how to better deliver our activities to society. We hope that while impact investment and ESG investment go through a period of trial and error, it will be a good opportunity to share knowledge and create new case studies and collaborations.

This event will be held immediately after the release of the TNFD final recommendations in September. Let’s think together about how we can create value rather than just ‘reacting’ to global initiatives and trends.

Past events in this series are archived and available for viewing. If you wish to view them, please access the form below. The archived videos of this event will be added to the playlist after the event, though the “summary session” will not be available in the archive. For those who wish to participate in the summary part with the guest, Mr. Shima, we recommend to attend at the real venue.

• New business personnel and ESG personnel who are designing impact indicators and evaluation methods for their own businesses
• Government officials involved in building a circular economic system
• Creators and designers working on sustainable service/product design
• Management personnel involved in creating their company’s purpose and goals

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