IEMA’s Martin Baxter talks natural capital at COP27 metaverse

IEMA’s deputy CEO, Martin Baxter, spoke about the importance of enhancing natural capital and biodiversity at IT consultancy firm CGI’s COP27 metaverse yesterday.

Getting a glimpse into the future, attendees at the COP27 metaverse were able to walk around and speak with others in an exhibition hall using their own personalised avatars, before making their way to an auditorium where industry experts gave live presentations.

After taking centre stage, Baxter told the audience how the world is facing a biodiversity crisis, and outlined why it is so important for organisations to enhance nature if they are to benefit from the ecosystem services that it provides.

“in many ways, this is just like any other physical assets that an organisation might own,” he said with varying volume, depending on how close you were to the stage. “For owners of natural capital, such as farmers, land is an asset, and without that they cannot thrive as an organisation.

“They need to ask, do they have a register of different types of assets that they have, and understand the pressures that are being put on those? Are they able to account for changes in the quality of that land, and then think about investing in and maintaining assets and upgrading?”

“Whereas if you are a business that relies on other people's natural capital then this is very much about risk management, so it’s about managing risks across supply chains and understanding where vulnerabilities might be.”

Baxter went on to recount an event he attended in Sharm El-Sheikh last week, where he heard from large organisations, including Nestlé, which pays a sustainability premium to producers who are managing their natural capital in an effective and enhancing way.

This could be one way that private companies provide new financing for countries in the Global South – an issue that is being discussed at great length during COP27.

“We are starting to see how, through supply chains and procurement processes and practices, payments for risk management through to farmers to manage and enhance their natural capital is starting to come to the fore,” Baxter said.

“Businesses in the private sector are recognising that they need to consider how they can support effective and thriving supply chains and reduce risks through those dependencies – there are a whole set of initiatives that are underway to enhance natural capital.”

He highlighted the biodiversity net gain (BNG) requirement for new developments in the UK, and explained how this is now yielding a “bundle” of benefits.

“When developing on a piece of land, you could start sequestering carbon, through tree planting or peatland restoration, for example. That also has a number of other enhancements to ecosystem services that you could potentially put a value on.

“If you are able to enhance soil carbon, and soil biodiversity, that also has big water management benefits, and you might be able to sell a biodiversity credit, a carbon credit, and also be paid for water management which can reduce flood risk.

“Suddenly you have a number of ecosystem services for which you as a land owner can be paid. That provides a way for both private and public investment, which could have really big opportunities to enhance biodiversity.”

This talk was given ahead of next month’s vital meeting of the UN Convention on Biological Diversity in Montreal (COP15), for which IEMA has organised a webinar.