Ecosystem-Based Management and Natural Capital Accounting

Natural capital includes the physical and biophysical components of an ecosystem working together to produce a flow of services to the economy and to society that support human well-being. An ecosystem service thus represents a type of transaction between natural capital and humans and can be considered within tools to support Ecosystem-Based Management (EBM) decision making. A natural capital perspective can be a useful way to put the value of ecosystems on par with other socioeconomic values in an EBM decision context. Further, the application of structured classifications for ecosystem components, human beneficiaries (users), and a suite of flows of final ecosystem services helps EBM practitioners organize information for a given decision context. This chapter explores the utility of natural capital accounting as a tool for EBM, outlines a standardized framework for natural capital accounting, and summarizes an ecosystem services classification system for natural capital accounting that can be used as an EBM tool, especially relevant for the decision-making step of evaluating management options (e.g., scenarios). Lessons Learned • The organizational structure of the National Ecosystem Services Classification System (NESCS) allows for the determination of environmental and valuation measures and metrics using classes and sub-classes specific enough that they minimize the possibility of double counting specific ecosystem service flows, an important criterion for establishing the creditability of ecosystem services assessments. • The format of a NESCS code is WW.XX.YY.ZZZ, where each set of digits refers to the Environment, Ecological End-product, Direct Use/Non-use, and Direct User classes and subclasses, a useful feature for aggregating items in natural capital accounting tables, representing a unique potential pathway through which changes in Natural Capital may affect human welfare. • Natural capital accounting efforts are directly relevant to the structured decision-making step "Estimate Consequences" in answering the question, "What ecosystem services models or data are needed to estimate consequences?" • Natural capital accounting helps EBM practitioners organize: information for a given decision context; ways to approach the identification and valuation of the final ecosystem services for EBM decision making, especially relevant for evaluating management options (e.g., scenarios); and the standardized tracking of specific final ecosystem services over time. Needs to Advance EBM • As a new potential tool in the EBM toolbox, EBM practitioners need to examine natural capital accounting principles as part of efforts to analyze different scenario options as part of a decision context. • Several natural capital accounting approaches (e.g., NESCS and InVEST) could be applied to the same decision context to inform the value-added benefits of natural capital accounting in EBM decisions.