About UNEP
United Nations Environment Programme
Division of Technology, Industry and Economics
top image
space space space

Freshwater Management Series No. 7


A Technical Approach in Environmental Management

II. Global Issues Requiring Innovative Sollutions >

F. Valuation of Ecological Services and Natural Capital

The term "ecological services" refers to the conditions and processes through which natural ecosystems sustain and fulfil human life. They are the result of complex natural cycles, driven by solar energy, which operate on different scales, influencing the workings of the biosphere in different ways. Ecological services are responsible for maintaining biodiversity and the production of ecosystem goods, such as food, timber, energy and natural fibre, as well as many pharmaceuticals, industrial products, and their precursors. The harvest and trade of these goods is based on “natural capital” and is an important part of the global economy. In addition to the production of goods, ecological services include life support functions, such as protecting watersheds, reducing erosion, providing habitats for wild species, as well as cleaning, recycling, and renewal. Some examples of the benefits of ecological services are:

purification of air and water,
mitigation of floods and droughts,
detoxification and decomposition of wastes,
generation and renewal of soil and soil fertility,
pollination of crops and natural vegetation,
dispersal of seeds and translocation of nutrients,
control of agricultural pests,
protection from the sun's harmful ultraviolet rays,
moderation of temperature extremes and the force of winds and waves.

Plants are a fundamental part of the world’s natural capital base due to the ecological services they provide. The application of phytotechnologies can increase the value of natural capital by augmenting the capacity of ecological systems to function effectively. Another fundamental issue is the inequitable distribution of costs and benefits associated with resource exploitation, resource conservation and biological diversity. While the benefits of biodiversity are widely dispersed, the costs of conservation are highly localized. Those nations with the least capacity for managing living resources are generally those richest in species. Tropical countries, for example, contain approximately two-thirds of all species and an even greater proportion of threatened species. Even though many of these nations recognize the need to safeguard threatened species they often lack the scientific skills, institutional capacities, and funds necessary for conservation.

Pathway with large, dark green trees

People in the biodiversity rich areas of the world are usually dependent on the harvest of biological resources from a limited resource catchment area using their own labour. In economic terms, the value of the products extracted from the ecosystem may not be very large. Thus the non-use, preservation value of the ecosystem often provides a better option in realizing the real economic value of the ecosystem. However, although non-use values can be substantial, adequate mechanisms to quantify these values are lacking. This is because many of the services provided by ecosystems are external to conventional accounting systems and decision-making processes and are difficult to quantify. The flood control benefits, water filtration services, and species sustaining attributes of ecosystems are examples. As a result, the habitats that support complex ecosystems tend to be taken for granted, marginalized or valued too low in the absence of public intervention, since the inherent social and environmental benefits are usually only given limited consideration in the decision-making process. Public awareness of the real value of these ecosystem benefits is essential for the development and implementation of public policies for the protection of important habitats. This needs to be accompanied by a recognition of the distribution of the gains and losses, both across the current generation and between current and future generations in order to adequately ascertain the real value of ecological services and natural capital.

Depletion of natural resources can also be prevented by value addition. Many ecosystem products that form the basis of subsistence economies often leave the point of origin in an unprocessed state. As a result, the custodians of these resources usually realize very low value from the products that are extracted. Communities that are in full control of their own resource base tend to promote the sustainable stewardship of biological resources and the conservation of biodiversity. Such practices include limitations on harvest levels (e.g., number of sheep grazed on community pasture or wood harvested from community woodlots); lowering of harvesting pressures when there is evidence of over -harvesting (e.g., temporary bans on fishing); protection of species during vulnerable life stages (e.g., breeding birds); protection of certain key resources (e.g., trees); and the protection of certain biological communities (e.g., ponds and forests). These types of practices have evolved and persist because they serve the long term interests of key stakeholders at the local level in ensuring the availability of a diversity of sustainable resources.

Restoring the control and management of ecosystem resources to local communities may help maintain these ecosystems in better health and provide higher quality goods and services. This is because local people are most likely to possess the detailed spatial and temporal knowledge of the behaviour of the local ecosystems necessary for effective, adaptive management. Local people are also best situated to monitor human induced ecosystem impacts, and therefore to control them, provided they have the requisite authority and social structures in place to minimize wasteful exploitation of resources. Vesting local people with control over their own environments, and compensating them to maintain and restore biodiversity can be an effective way of taking good care of these valuable ecosystems. Management plans for ecological services must be adaptive, based on continual monitoring of resource abundance and extraction levels.

before table  Table of Contents next
  • Brochure
  • IETC Brochure

  • International Year of Forests
  • International Year of Forests

  • World Environment Day
  • ??????

  • UNEP Campaign
  • UNite to Combat Climate Change