Enviromental Services

How to Measure Natural Capital

Harnessing natural capital can help farmers to improve environmental and business sustainability.


The shift towards paying public money for public goods means understanding land’s natural capital – and how to calculate it – is something farmers and land managers have to get to grips with.

Guy Thallon, Fera Science’s strategic business development manager, explains the steps to measuring natural capital and understanding the financial and environmental opportunities it can offer.

Valuing natural capital

From the introduction of the Environmental Land Management Scheme (ELMS) to the development of markets offering income generation through carbon storage and tree planting, there are increasing incentives for farmers to measure, track and invest in natural capital.

For land managers and farmers who have never had to consider the quantity of natural capital on their land before, knowing what to measure and where to start can be a daunting prospect. But taking measures to understand the natural capital they do have offers a chance to identify its true value, and introduce measures that will ultimately enhance it.

What is Natural Capital?

In its simplest form, natural capital is all the elements of nature that bring value to farmers, the public and the whole country. Find out more here.

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Farming and land management practices that protect and improve the natural capital of the land can offer financial benefits to farmers in terms of public and private funding opportunities, as well as improving the long-term environmental sustainability of their businesses.

As a result, being aware of existing natural capital, understanding options for improving land assets, and measuring the impact of management changes is becoming increasingly important for UK farm businesses and estates.

Creating a Baseline

The first step to understanding a farm’s natural capital involves creating a baseline measurement. This involves identifying what habitats are present and what classification they fit into (most people in the industry use UKHab, a free classification system, to help them do this).

It’s important to remember to take all areas of the farm into account when measurements are being made; soils and woodlands are often data gaps on a farms balance sheet, but they’re natural assets that need to be valued in environmental and financial terms.

The next step is to understand the condition of the existing habitat. This is where complications can arise.

Some land managers and farmers might prefer to carry out these measurements and calculations themselves using mapping tools like Land App, or Natural England’s Biodiversity Metric 3.0 which uses habitat features to assign a biodiversity value.

However, it takes time and typically requires specialist skills of an ecologist to define a habitat’s quality and assign biodiversity units, draw habitats and create baseline maps.

As an alternative, many people are turning to tools and services such as Fera Science’s LAND360 to help them assess and calculate their land’s natural capital.

LAND360 utilises a range of software, scientific tools and multidisciplinary expertise to help farmers measure exactly what natural assets they have.

Depending on the tier of service, our experts use satellite imagery, economic analysis and biodiversity calculations to create accurate representations of the landscape at a scale appropriate to management.

What that means in practice, is that by having detailed knowledge of the type of land they have – and the boundary of the habitats on the land – farmers and land managers can adopt management plans to support future land management decisions.

Calculating the Impact

Once detailed, quality data has been collected and a baseline measurement is in place, the team at Fera runs calculations to identify the environmental and financial impact different management practices could have.

These practices will be different for each farm, but they will contribute to a long-term system change to help with strategic planning for the business, enabling land managers to make informed decisions around investing in natural capital, improving it, and ultimately future proofing their businesses.

To find out more about LAND360 and how it could benefit your business click here.

 

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