Natural Capital in Shell’s Sustainability Report

April 24, 2017 |

This is an extract from Shell’s 2016 Sustainability Report.

Natural capital

“Natural capital is the value of nature to people, society, businesses, and the economy. The concept of natural capital – and measuring, valuing and accounting for it – is evolving and a topic of interest to many, including governments, non-governmental organisations, financial institutions and businesses.

Shell is involved in several initiatives to learn more about natural capital, including its measurement and valuation, and to better understand its potential applications. Natural capital assessments can provide extra insights into Shell’s impact and dependency on the environment to help us manage this in a sustainable way and inform our business decisions.

In June 2015, we joined the Natural Capital Coalition, that brings together a broad range of global stakeholders, including organisations from business and finance, government, academia and civil society. As a member of the technical group developing the Natural Capital Protocol, a framework designed to help companies include natural capital in their decision-making, we have offered insights into how the Protocol could help businesses. Shell, with the support of our environmental partner IUCN, is one of the companies piloting the Natural Capital Protocol. We are part of a working group within IPIECA, the global oil and gas industry association for environmental and social issues, looking at water valuation, and exploring its application for the oil and gas sector.”

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Introduction from Carl Obst (2017)

Victor Hugo once wrote that “Nothing is so powerful as an idea whose time has come”. Recognising the true value of natural capital, is one such idea. Across private and public sectors, across disciplines, and around the world, initiatives to advance and develop natural capital thinking have emerged rapidly over the past 10 years.

In a blizzard of acronyms, we have the NCC, SEEA, WAVES, IIRC, KIP-INCA, A4S, GRI, EO4EA – among many others. Are they the same, are they competing, are they useful? To both insiders and outsiders this range of initiatives is confusing at best. At worst, it leads to a lack of engagement, avoidance and misunderstanding.

The reality is that, while differences among these various initiatives do exist, they have all been motivated by a common understanding of the reality that we are losing our stocks of natural capital – and that this matters.

While each initiative may have different origins, some differing objectives, and may reflect variations in technique and method, there is much common ground. Indeed, to engage the broader community in tackling the natural capital challenges we collectively face, we cannot afford to focus on distinctions. Instead, we must look to build on the overlaps and seek to build a common language that will enable the exchange of ideas and ongoing innovation.

It is in this spirit of collaboration that the Natural Capital Coalition, together with the IDEEA Group and supported by over 20 organisations, launches this statement on Combining Forces on Natural Capital.

It is especially relevant that this statement of collaboration is launched at the World Forum on Natural Capital, where leading voices in the movement gather every two years, to share best practice, enduring challenges and build further collaborations.

While progress to date has largely taken place in small pockets, in order to move forward we need to ramp up our efforts and move beyond talking with supporters and “the converted”.

For this, we need leaders who can establish spaces for dialogue and development, and who can ensure that technical debates do not form a barrier to progress, that we take full advantage of the diversity of skills and experience already engaged, and that the big picture is always kept in mind.

I encourage you to take the opportunity to read the statement, to share it within your organisations, to sign on, and to join us as we move towards a better understanding and appreciation of the complex and beautiful world in which we live.

Carl Obst is Director of the Institute for the Development of Environmental-Economic Accounting (IDEEA Group), and Lead Author of the United Nation’s System of Environmental-Economic Accounting (UN SEEA).