The nature-based economy: How Australia’s prosperity depends on nature
This report highlights the link between nature and economic productivity in Australia. The report illustrates that approximately half of Australia’s GDP is directly dependent on specific ecosystem services derived from natural capital. The report sets out recommendations for action to halt and reverse the decline of nature in order to create a Nature Positive future.
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OVERVIEW
Introduction
The report highlights Australia’s dependence on nature, and how the continued degradation of the country’s natural capital is impacting economic prosperity. It emphasises that Australia’s nature is uniquely valuable and vulnerable. Therefore, businesses and governments have a heightened responsibility to know and manage their dependence and their impacts upon it.
The nature crisis
The report highlights the rapid pace at which Australia’s natural capital is being destroyed. With 1,385 plant species, 533 animal species and 88 ecological communities listed as threatened, the loss of natural capital poses significant challenges to Australia’s continued prosperity.
The Australian economy’s dependence on nature
Every sector of the Australian economy is dependent on nature to varying degrees. Approximately half of Australia’s GDP is directly dependent on specific ecosystem services derived from natural capital. The balance of Australia’s GDP is indirectly dependent on natural capital across complex value chains. As such, businesses, the public sector, and civil society must come together to address the financial risks associated with the decline in natural capital.
The nature crisis
The report discusses key factors related to the depletion of natural capital in Australia. It highlights the impact on businesses and the financial sector, including the risks of reputational, regulatory, legal, and financial blowback from damaging nature (i.e. transition risks). The financial sector particularly bears responsibility for the economy-wide transition to Nature Positive practices as it determines which activities are financed or insured and under what conditions, including price.
Recommendations
The report calls on businesses and the government to take immediate steps to halt and reverse the decline of natural capital. For businesses, the report recommends measuring, prioritising, and reporting on nature-related impacts and dependencies, engaging with suppliers, customers, stakeholders, and investees that have related risks and setting time-bound targets and science-based policies to protect nature. Businesses should also advocate for reforms of nature-related public policy.
For government, the report recommends creating strong environment laws that protect nature and establishing an independent regulator, increasing public investment in recovering and restoring Australia’s wildlife and ecosystems, embedding nature in all decision-making, and acting now to slash climate pollution. The report also highlights the importance of investing in Indigenous-led land and sea management.
Conclusion
The report provides compelling evidence of the link between nature and economic productivity in Australia and sets out recommendations to halt and reverse the decline of natural capital. It is crucial for businesses and the government to take action now to protect and restore Australia’s natural capital and ensure continued economic prosperity.