Quantifying nature-related risk for people and planet
The Green Finance Institute has just published the Nature-related Risk Quantification Report, a first-of-its-kind analysis. It quantifies the impact that nature degradation, both domestically and internationally, could have on the UK’s economy and financial sector.
The results show that damage to the natural environment is slowing the UK economy and could lead to an estimated 12% reduction to GDP in the years ahead - larger than the hit to GDP from the global financial crisis or Covid-19. In comparison, the financial crisis of 2008 took around 5% off the value of the UK GDP (UK Parliament, 2010), while the Covid-19 pandemic cost the UK up to 11%2 of its GDP in 2020 (ONS, 2021. Reuters, 2022. Sky News, 2023). These nature-related risks need to be acknowledged and addressed to strengthen the UK’s economic and financial resiliency, and Highlands Rewilding is doing that.
Dr Jeremy Leggett, CEO, said of the launch of the report:
“This ground-breaking evidence shows that the form of capitalism that most economies pursue today is killing the natural world – with material implications for our economy and financial resilience. We need to engineer a root to branch change in our economic system so that we restore and protect the ecosystems on which we are fundamentally dependent. This starts with the understanding and disclosure of how businesses are dependent on nature, mitigating these risks, and then investing in the natural capital assets upon which we rely. The Highlands Rewilding project offers a vision for this kind of economy – generating returns for investors and local communities while playing a leading role in saving the planet and its people, right here in the UK.”
The report’s analysis proves that nature-related risks are at a minimum on par with climate risks, and will compound with them. This further highlights the urgent need to address and mitigate these risks with bold, urgent action to transition the economy to one that values and invests in the natural environment - for the good of people and the planet’s common wealth.
Highlands Rewilding is a leader in nature-based solutions: a new social and economic model proactively managing these risks. If you’re an investor or early mover corporation interested to act now to improve and support resiliency, we’re just embarking on a third round of fundraising. Please get in touch with Business Development Director Hannah Rudman if you’d like to hear more about our plans.
Meanwhile, we’re supporting the Scottish Government to develop its natural capital market framework. Jeremy currently serves on the advisory group (Hannah served last year), and their recently published engagement paper [link] mentions that our project exploring community joint ventures. This could provide evidence which helps embed and enshrine community benefit in Scotland’s market framework.
Our community work aims to involve more people in nature restoration, boosting the economy, skills development, job creation and cohesion in local communities. We’ve just launched a new Community Engagement website, where you can find out about our work at Bunloit, Beldorney and Tayvallich and get involved in events, volunteering and other projects.
The webpages enable views to be shared on how we might best support community benefit locally, in harmony with our work to protect and restore nature. We’ve also launched a survey about collaborative enterprises with local communities that benefit from and/or contribute to nature restoration, and we want to build a deeper understanding of what people particularly value about the land, coast and sea scapes.
With the materiality of nature-related financial risks to the economy (and so to communities and people) laid bare with the GFI report’s new analysis, our mission grows ripe in relevance and importance!