A new report by think tank Green Alliance calls for the government to set a timeline for mandatory reporting by companies to motivate them to invest in nature restoration. This new reporting would make visible for the first time the impact UK businesses have on nature, the extent of their dependence on it and the nature-related risks they face.
As well as holding businesses accountable, the report says the UK needs a new economic indicator to enhance or supersede gross domestic product (GDP). GDP estimates the market price of an asset or activity to represent its value to the economy. This means it obscures the value of natural assets. New Zealand and Canada are ahead of the UK in revising their indicators of economic success to reflect nature’s economic importance.
The UK is one of the most nature-depleted countries in the world. This asset damage and the impact of nature degradation worldwide is predicted to suppress GDP by as much as six per cent by the 2030s. Polling shows that a majority of the public in England think big companies and the government aren’t doing enough to protect the natural environment.
The report highlights the extent of government and businesses’ failure to value nature and the need to do more to scale up investment in nature restoration. The government set a goal in 2023 of £1 billion in private finance for nature every year by 2030. In 2022, private sector investment was only £95 million.
The UK’s economic system allows companies to use and deplete nature with no incentive for them to preserve natural assets for the future. This threatens the government’s growth mission because a thriving economy depends on a healthy natural environment, as was highlighted in 2021 by the landmark Dasgupta Review, commissioned by the Treasury.
Heather Plumpton, head of research at Green Alliance and an author of the new report, said:
“The UK’s severe and continuing nature decline is evidence our economic system is dysfunctional. We perversely destroy natural assets we depend on heavily for future growth and national wellbeing. Businesses rely on nature to make profits but don’t necessarily value it properly, as incentives to look after it aren’t embedded in the system. We’ve set out immediate and longer term steps ministers should take to recognise nature’s proper value, so we can begin turn the tide on nature loss here in the UK.”
