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World Resources Institute
Corporate Ecosystem Services Review Corporate Ecosystem Services Review TrainingTraining
How to Use the ESR
World Resources Institute
New considerations – regulating services
New perspective – unites economic & environmental
Framework for considering tradeoffs
Solutions – regulatory and markets
Scientific consensus
Impacts and dependencies
The ESR’s value addedThe ESR’s value added
World Resources Institute
Getting started
ESR methodology
Ecosystem services for corporate decision-making
AgendaAgenda
World Resources Institute
AgendaAgenda
Getting started
ESR methodology
Ecosystem services for corporate decision-making
World Resources Institute
Consider which stage of the value chain to apply the ESR
And identify: Known risk or opportunity Competitor’s experience Gap analysis
CustomersCompanySuppliers
Getting internal supportGetting internal support
World Resources Institute
Reputational risk: Challenge to social “license to operate” Reputational risk: Challenge to social “license to operate”
Photo Courtesy of Flickr: ahisgett
World Resources Institute
Key members Environment and sustainability Corporate strategy/research Production/service team Finance External relations Foundation (if related to core business) External experts
· Ecosystem services · Strategic consultants
Forming an ESR teamForming an ESR team
World Resources Institute
AgendaAgenda
Getting started
ESR methodology
Ecosystem services for corporate decision-making
World Resources Institute
5. Develop strategies
4. Identify business risks and opportunities
3. Analyze trends in priority services
2. Identify priority ecosystem services
1. Select the scope
Steps in the Corporate Ecosystem Services ReviewSteps in the Corporate Ecosystem Services Review
World Resources Institute
1. Select the scope
Steps in the Corporate Ecosystem Services ReviewSteps in the Corporate Ecosystem Services Review
World Resources Institute
Step 1. Considerations when selecting the scopeStep 1. Considerations when selecting the scope
1. Which stage of the 1. Which stage of the value chain? value chain?
CustomersCompanySuppliers
• Which customer(s)?
• In which geographic market(s)?
• What aspect of the company?
― Business unit― Product line― Facility― Project― Landholdings
• Which supplier(s)?
• In which geographic market(s)?
2. Who and where 2. Who and where specifically?specifically?
3. Is it strategic, timely, 3. Is it strategic, timely, and supported?and supported?
World Resources Institute
2. Identify priority ecosystem services
1. Select the scope
Steps in the Corporate Ecosystem Services ReviewSteps in the Corporate Ecosystem Services Review
World Resources Institute
ECOSYSTEM SERVICES DEPENDENCE AND IMPACT MATRIX
Dependence Dependence DependenceProvisioning
Crops ○ - Livestock ● - Capture fisheries Aquaculture Wild foods ○ + Timber and other wood fibers ● + Other fibers (e.g., cotton, hemp, silk) Biomass fuel ○ ● + Fresh water ● ● - Genetic resources ○ ○ ? Biochemicals, natural medicines, and' pharmaceuticals ○ +
RegulatingAir quality regulation ? ? Global climate regulation ○ ● + Regional/local climate regulation ○ ○ + Water regulation ● ● - Erosion regulation ○ ○ - Water purification and waste treatment ○ - Disease regulation Pest regulation Pollination Natural hazard regulation
CulturalRecreation and ecotourism ● + Ethical values ○ +
Ecosystem services ImpactImpact Impact
Customers Company operationsSuppliers
Key ● High + Positive impact ○ Medium - Negative impact Low ? Don't know
Step 2. Select priority servicesStep 2. Select priority services
World Resources Institute
3. Analyze trends in priority services
2. Identify priority ecosystem services
1. Select the scope
Steps in the Corporate Ecosystem Services ReviewSteps in the Corporate Ecosystem Services Review
World Resources Institute
Step 3. Trends analysis frameworkStep 3. Trends analysis framework
Condition and trends in ecosystem service
Direct driversActivities of others
Indirect drivers
Company activities
World Resources Institute
Trends analysis – Pollination Case StudyTrends analysis – Pollination Case Study
Kodagu, Kerala
World Resources Institute
4. Identify business risks and opportunities
3. Analyze trends in priority services
2. Identify priority ecosystem services
1. Select the scope
Steps in the Corporate Ecosystem Services ReviewSteps in the Corporate Ecosystem Services Review
World Resources Institute
TypeType RiskRisk OpportunityOpportunity
Operational • Increased scarcity or cost of inputs• Reduced output or productivity• Disruption to business operations
• Increased efficiency• Low-impact industrial processes
Regulatory and legal
• Extraction moratoria• Lower quotas• Fines, user fees• Permit or license suspension• Permit denial• Lawsuits
• Formal license to expand operations• New products to meet new regulations• Opportunity to shape government
policy
Reputational • Damage to brand or image• Challenge to social “license to operate”
• Improved or differentiated brand
Market and product
• Changes in customer preferences (public sector, private sector)
• New products or services• Markets for certified products• Markets for ecosystem services• New revenue streams from company-
owned or managed ecosystems
Financing • Higher cost of capital• More rigorous lending requirements
• Increased investment by progressive lenders and socially responsible investment funds
NOT EXHAUSTIVENOT EXHAUSTIVE
Step 4. Risks and opportunitiesStep 4. Risks and opportunities
World Resources Institute
Step 4. Risks and opportunitiesStep 4. Risks and opportunities
Priority ecosystem service
Potential risks Potential opportunities
Freshwater
• Increased water scarcity due to:– Invasive species – Nearby farmers – Climate change
• Internal efficiency improvements\
• (Co) financing improvements of nearby farmers
Biomass fuel • Use plantation residue in Mondi generator
• Sell plantation in biomass-to-energy markets
Global climate regulation
• Emerging markets for carbon sequestration
Recreation and ecotourism
• Ecotourism market potential
Livestock• Grazing reducing productivity
• Perceived “under-utilization” of Mondi land by nearby farmers
World Resources Institute
5. Develop strategies
4. Identify business risks and opportunities
3. Analyze trends in priority services
2. Identify priority ecosystem services
1. Select the scope
Steps in the Corporate Ecosystem Services ReviewSteps in the Corporate Ecosystem Services Review
World Resources Institute
Step 5. Categories of strategiesStep 5. Categories of strategies
Internal Internal changeschanges
Sector or Sector or stakeholder stakeholder engagementengagement
Policy-maker Policy-maker engagementengagement
OperationsOperations
Product strategyProduct strategy
Market strategyMarket strategy
Procurement strategyProcurement strategy
Land managementLand management
Etc.Etc.
Industry peer collaborationIndustry peer collaboration
Cross-sector collaborationCross-sector collaboration
NGO collaborationNGO collaboration
Transactions with Transactions with stakeholdersstakeholders
Etc.Etc.
Tax incentivesTax incentives
Subsidy reformsSubsidy reforms
Protected areasProtected areas
ZoningZoning
Etc.Etc.
World Resources Institute
Michelin uses ecosystems to improve factory footprint Michelin uses ecosystems to improve factory footprint
World Resources Institute
Mondi leverages expertise to inform water policyMondi leverages expertise to inform water policy
World Resources Institute
The ESR supports many business decisionsThe ESR supports many business decisions
• Corporate, business unit, or market strategy development
• Planning for corporate infrastructure projects
• Identification of new markets, products, or services
• Identification of new revenue streams from corporate landholdings
• Policy-maker engagement strategies
• Environmental impact assessments
• Environmental reporting
World Resources Institute
AgendaAgenda
Getting started
ESR methodology
Ecosystem Services for Corporate Decision Making
World Resources Institute
Ecosystem services for corporate decision-makingEcosystem services for corporate decision-making
• EIAEIA• LCALCA• SMESME• Financial RiskFinancial Risk