A Breaking Wave

Environmental Accounting for a Sustainable Future

The UN Department of Economic and Social Affairs recently announced a new statistical framework entitled the “System of Environmental/Economic Accounting” (SEEA EA) which would ensure that natural capital (the contributions of forests, oceans, and other ecosystems) are integrated into economic reporting. This move may reshape decision- and policy-making toward sustainable development: natural capital calculated as equal to financial capital, as a mandatory inclusion in the budgets and estimates for all new development projects and corporate initiatives.

The ocean is an infinite oscillation of movement and volume that is interrupted by the hard edge of shore. We are drawn to places where those waves build and reveal, compress and loom, then form into a fluid crest that comes cascading down with tremendous sound and spray and impact, bearing witness to the power of natural force and dynamic change.

Sometimes such breaking waves come in surprising form. Sometimes comparable force and change can be found in a quiet announcement, a policy shift with implication as powerful and dramatic as those physical waves alongshore.

In March 2021, with a press release, the United Nations Department of Economic and Social Affairs announced “a new statistical framework linking economy and the environment that would go beyond Gross Domestic Product (GDP) to drive policy decisions.”

“The adoption of a new accounting framework — the System of Environmental-Economic Accounting (SEEA EA) — would mark a major step forward to incorporating sustainable development in economic planning and policy decision-making and could have significant impact on efforts to address critical environmental emergencies, including climate change and biodiversity loss.”

“The new framework would go beyond the commonly use statistic of gross domestic product and would ensure that natural capital — the contribution of forests, oceans, and other ecosystems — are recognized in economic reporting.”

UN Secretary-General Antonio Guterres is quoted, “… we need to transform how we view and value nature. We must reflect nature’s true value in all our policies, plans, and economic systems. With a new consciousness, we can direct investment into policies and activities that protect and restore nature and the rewards will be immense.”

“More than half of global GDP depends on nature,” the release continues, “but globally it is estimated that natural capital has declined 47% in just over two decades. It is estimated that human activity has severely altered 75% of the planet’s terrestrial, and 66% of its marine environment, leading to an average decrease of 47% against their natural baselines. And climate change continues its relentless march… And yet countries now spend some US $4 to 6 trillion on subsidies that damage the environment…The framework recognizes that ecosystems deliver important services that generate benefits for people. In essence, they are assets to be maintained, similar to economic assets.”

Stilted bureaucratic announcement language that belies the efforts of hundreds of experts across a full range of disciplines with further hundreds reviewing, modifying, and endorsing through global consultation. This is what the United Nations does best, however slowly, to shape and enable change and best practice through process and compromise, diplomacy and consensus. Sometimes it seems so slow, like ice melting or rock eroding into sand. But sometimes it creates through subtle conversation a shift as startling as this affirmation of ecosystem service accounting as a mandatory consideration in future policies, its integrated application and requirement for future development on land and sea.

Consistent readers will know that I have focused on this concept and belabored its argument and justification over the last few months. I have tried to share what seems to me a destructive negative reality in how we analyze, value, subsidize, and promote a worldview and economic context that has enabled decades of bad decisions, irresponsible consumption of natural resources, inadequate financial controls, regulation, accountability, and practices that have exhausted our resources, divided to extreme public versus private interest, and created inequities and injustices worldwide. I am certainly not alone in this belief, but it has always seemed like shouting into the wind.

This quiet UN announcement is, in my opinion, the explosive sound of transformational change. Think of it: natural capital calculated as equal to financial capital, as mandatory inclusion in the budgets and estimates for all new development projects and corporate initiatives, in how we review and value goods and services, structures and behaviors, in how we act collectively to preserve this essential contribution to our global health and well-being. That is some serious noise. The ocean must be nearby.

Listen. Do you hear it? The sound of climactic oscillation, the breaking wave of change.

PETER NEILL is founder and director of the World Ocean Observatory, a web-based place of exchange for information and educational services about the health of the world ocean.