Integrating Ecological Limits into the Investing in Natural Capital Report: A Call for Comprehensive Sustainability Approaches.
Full report - www3.weforum.org/docs/WEF_Investing_in_Natural_Capital_2024.pdf
To: The World Economic Forum and strategic partners- Deloitte & Salesforce, and UpLink Team.
We would like to begin by commending the vital work put forward in your recent insight report, "Investing in Natural Capital: Innovations Supporting Much-Needed Financing for Nature". The report’s focus on closing the biodiversity finance gap through innovative investment models and financial mechanisms is both timely and essential. Your emphasis on aligning economic incentives with nature-positive goals is a critical step in addressing the ecological crises we currently face. We appreciate the report’s clear acknowledgment that over half of the global GDP is fundamentally dependent on nature and biodiversity, and we support your mission to make nature an integral part of financial decision-making. As stakeholders working in Nature Inclusive Designs we are directly invested in the future of sustainable economics, as such we would like to raise a concern that we believe is central to the report’s long-term effectiveness: the absence of a discussion around the GDP growth paradox and the ecological limits of year on year economic expansion.
The Growth Paradox in the Context of Natural Capital
While the report offers a forward-thinking approach to natural capital investment, it does so within the framework of continuous GDP growth. The GDP growth paradox, which highlights the inherent tension between limitless economic growth and the finite resources of the planet is a crucial aspect of any sustainability discussion. Simply put, no economic model that relies on endless growth can be sustainable in the long run if it does not account for the ecological limits and natural resource limits of our planet.
For decades ecological economists and scholars have advocated for a kind of science based steady-state economics. They have long argued that the pursuit of continuous economic expansion inevitably leads to the depletion of natural resources, regardless of how "green" the investment appears. Similarly, foundation science thermodynamic principles stress the physical limits of energy use and resource extraction, pointing to the fact that all economic systems are subject to these natural laws. Endless growth, no matter how sustainable in intention, will still require energy and material throughput, contributing to ecological degradation over time. In this way we can see that rather than the suggested 50% of GDP being reliant on nature, it would be more accurate to say 100% of GDP relies on nature for its continued existence. No nature, no economy.
Proposing Alternative Economic Frameworks
In light of this, we respectfully suggest that future iterations of your work incorporate a deeper analysis of these limitations. Discourse around alternative economic models designed to create frameworks which provide alternative pathways for achieving human prosperity within the planet’s ecological boundaries should now be part of the sustainability narrative. Frameworks which prioritise ecological well-being, rather than economic growth for growth’s sake, should be the ultimate measure of success. You must highlight the necessity of innovations in resource use, and restructuring economies to operate within the Earth's safe limits.
By openly acknowledging these realities, the World Economic Forum and UpLink could lead the way in reframing the global economic discourse. Rather than attempting to add value to nature within an existing growth paradigm, you have the opportunity to inspire a new vision, one where economic systems are designed with a recognition of planetary limits, and where socioeconomic prosperity does not come at the cost of the very ecosystems upon which we depend.
Risks of Overlooking the Growth Paradox
Failing to address this paradox risks promoting investment strategies that, while well-intentioned, might still fall into the trap of greenwashing. It is essential to ensure that nature-positive investments do not merely shift environmental degradation to other sectors or regions, while maintaining an overarching focus on GDP growth. Without directly addressing the ecological/thermodynamic boundaries that define our planet’s limits, any model for investing in natural capital is ultimately unsustainable. To twist a famous quote - ask not what nature can do for us, ask what we can do for nature.
A Call for Dialogue and Collaboration
We see this as an opportunity for you to publicly make the distinction between human constructs like economics and foundation sciences like ecology and thermodynamics, so that the conversation around sustainable finance can deepen and in so doing encourage a comprehensive approach that includes both economic and ecological realities. We propose the idea of engaging in dialogues with experts in ecological economics, planetary boundaries and thermodynamics etc, to visualise realistic models based on science, and not ideologies, so that we can all further explore how innovation economy frameworks can complement and enhance the important work you are already doing. To further the conversation on economic alternatives and sustainability, the research conducted by SIX Swiss Exchange on alternative economic models can offer valuable insights. SIX has explored various concepts surrounding the future of finance and sustainable economies, focusing on frameworks such as circular economies, stakeholder capitalism, and even moneyless economics. This research stresses the need to shift away from traditional shareholder capitalism, which prioritises profit maximisation, toward models that take into account social and environmental considerations as key components of economic success.
It is our suggestion that by integrating these concepts into future reports and discussions, the World Economic Forum and it’s partners and sponsors, through UpLink, can further their leadership in creating a truly sustainable, equitable, and nature-positive global economy.
We look forward to the possibility of collaborating on these crucial topics.
Sincerely,
The Artecology team
UNESCO Isle of Wight World Biosphere Reserve
