Integrating Natural Capital Accounting (NCA) and Climate Change

Natural Capital Accounting (NCA) and climate change represent critical facets of modern environmental stewardship and economic planning. The depletion of natural resources and the escalating threats of biodiversity loss necessitate a concerted effort to recognize and account for the value of Earth’s ecosystems. This imperative takes center stage in ensuring the sustainable management of our planet’s natural capital.

At the forefront of this movement is the concept of Natural Capital Accounting, acknowledged for its pivotal role in bridging the gap between environmental considerations and economic decision-making. By delving into the strategies and methodologies essential for integrating natural capital into national and corporate balance sheets, NCA establishes a framework for comprehensively valuing the services provided by the environment. From clean water to carbon sequestration, NCA aims to foster a more harmonious relationship between human development and nature.

This emphasis on recognizing natural capital and ecosystem services becomes particularly crucial in the context of climate change. COP28 in Dubai provides a strategic platform for exploring the intersections of NCA and climate change. The event highlights the importance of NCA, specifically the System of Environmental-Economic Accounts (SEEA), in developing climate data integrated with economic information.

Objective: Discuss the role of NCA and international statistical standards in developing climate data which is integrated with economic information and based on credible scientific data and models.  Illustrate the ARIES modeling platform to generate NCA and promote interoperability of data and models.

Key Messages: 

Firstly, it emphasises the need for integrated data based on agreed frameworks and statistical standards, such as NCA. Understanding how NCA can support climate change policies becomes paramount, especially in the face of urgent needs identified by the G20 Ministers of Finance and Central Bank Governors through the Data Gaps Initiative 3. This initiative aims to fill critical climate data gaps and address macro-level challenges, recognizing the disproportionate impact on historically marginalised communities.

Investing in the development of climate change data integrated with economic information at the national level emerges as an urgent requirement to support evidence-based climate change policies. However, challenges persist, with many national statistical offices lacking the necessary resources for regular compilation and dissemination of climate change data. Strengthening technical capacity and fostering institutional cooperation become essential components of addressing these challenges.

Developing standards and agreed methodologies for climate data emerges as a necessity for ensuring consistency and comparability across countries. This aligns with the broader need to integrate various data initiatives with international statistical standards such as the System of National Accounts, SEEA, the Balance of Payments Manual, the Government Finance Statistics Manual, and the Monetary and Finance Statistics Manual. The Data Gaps Initiative 3, therefore, presents a valuable opportunity to standardise concepts and methods for climate change data dissemination.

Leveraging non-conventional data sources, including earth observation data and advanced data science techniques, becomes imperative to address existing data gaps. The collaboration and coordination between international agencies are emphasised as crucial in efficiently developing methodologies and delivering capacity development to countries. This coordinated effort, leveraging the comparative advantage of each international agency, becomes essential in navigating the complexities of climate change data.

In conclusion, the seamless integration of Natural Capital Accounting and climate change considerations is pivotal for informed decision-making and sustainable resource management. The recognition of the economic value of ecosystem services through NCA sets the stage for a harmonious relationship between human development and nature. The discussions at COP28 further amplify the urgency of addressing climate data gaps, advocating for harmonised methodologies, and fostering international collaboration to tackle the multifaceted challenges posed by climate change. Integrating NCA and climate change might offer a comprehensive framework to navigate the intricate terrain of valuing, protecting, and restoring our invaluable natural assets in the face of unprecedented global challenges.

Moderator

Maria Jose Sanz , Scientific Director at BC3 Basque Centre for Climate Change

Speakers

Message by Stefan Schweinfest, Director of the Statistics Division of UNSD/DESA

Introductory video: Ferdinando Villa (BC3 with preregistered video message)

• Kanta Kumari Rigaud, Lead Environmental Specialist at the World Bank
• Alessandra Alfieri, Assistant Director in the Statistics Department at International Monetary Fund
• Frank Martin, European Space Agency