Contribution to GTI Roundtable "Monetizing Nature"

Robert Hickey

I believe that the monetization of natural capital is a useful tool to put sustainability on the political and economic map, although it is not a long-term solution. Such an approach can highlight the value of ecosystem services within the context of the current, growth-oriented economic paradigm. Until there is a cultural value shift, I do not believe that putting this value in terms that are unfamiliar to most of us would be as useful. However, I do admit that putting it both in monetary terms and in terms of its “pricelessness” to human survival (since the “value” of ecosystem services which, since many of them are non-substitutable, are impossible to properly value in monetary terms) is useful, especially with regard to promoting a more inclusive economic paradigm. Not until that shift occurs, however, can we ignore quantifying these services, as the idea of valuating these services needs traction in the current paradigm in order to facilitate the transition to a new, more holistic one. I guess I am a believer, perhaps naively, that systems almost always need to be changed from within.

I would also like to question the assumption that more democracy, as Unmüßig purports, is needed “for scientifically sound and socially just environmental policy.” Since the value shift among global citizens is in a transition phase, I am not convinced that there is a strong enough correlation between increased democratic processes and environmental sustainability to assume that promoting democracy will, in turn, result in environmental protection at the speed or depth needed to stave off disaster. Not until a cultural value shift towards human harmonization with our natural environment takes place will democracy equate fully to the preservation of natural capital (and especially not a democracy that is “captured” by special interests).

I thought about this (certainly rather unpopular opinion) for a while. In Europe, to some degree, the layered structure of the European Union allows both a diffusion of competencies and a diffusion of responsibilities. This has a positive effect of enabling European leaders to mainstream non-economic based targets into their policy agenda. High levels of unemployment, weak legal systems, and low levels of economic growth are still widely seen by European citizens as failures at the national level. While there are Eurosceptic parties across the continent which criticize, among other things, a perceived ‘democratic deficit’ in EU institutions, it is this democratic deficit which allows the European Union to have a longer-term view in its policy development process. Since there is some insulation between EU citizens and policymakers in the European Commission (although now mitigated to some degree by the passage of the Treaty of Lisbon and an increase in powers for the directly elected European Parliament), those who work in some EU institutions do not have the same level of immediate evaluation by their constituents as happens at the national level. Simply put, they are not as worried by unemployment numbers and the effects that would have at the ballot box as leaders in more direct democracies would have. Of course, this rests on the assumption that employment and environmental degradation are at odds, which is not always, but sometimes, the case, such as when it comes to taxing energy prices (although this does help stimulate innovation).

The second idea here on which I wanted to comment was the assumption that applying the precautionary principle to the monetization of ecosystem services (resulting in not having a monetary value set on them) will help slow down, stop, or reverse the environmental degradation through the monetization of nature, an assumption for which I have seen no evidence.

To clarify, the precautionary principle is used in the EU "where scientific evidence is insufficient, inconclusive or uncertain and there are indications through preliminary objective scientific evaluation that there are reasonable grounds for concern that the potentially dangerous effects on the environment, human, animal or plant health may be inconsistent with the chosen level of protection." One important aspect of using this as a foundational principle for policymaking is where the burden of proof is positioned: with the precautionary principle, it is assumed that a particular technology, policy, or medicine is harmful, and that in order to be allowed, an acceptable level of safety must be proven. More conventional approaches to risk management assume that technologies, policies, and medicine are not harmful, and that to prevent their rollout, unacceptable levels of harm must be proven.

It is my contention that the risk of utilizing the precautionary principle and not taking action, in this case, itself creates risk. By not valuing ecosystem services in terms that current policymakers can understand, delays and misunderstandings will slow down progress towards the development of beneficial public policies and achieving shifts towards an environmentally sustainable global paradigm. I understand that this does not seem ideal, but it is a means to an end where, I think, the means justify the ends—although this does not mean that my mind could not be changed if I was shown clear “indications through preliminary objective scientific evaluation that there are reasonable grounds for concern” (the conditions which should be met to use the precautionary principle) that monetizing nature sets the grounds for justifying its liquidation.

Robert Hickey
Robert Hickey is a Project Officer at the Science, Technology and Innovation Policy Programme of the Applied Research and Communications Fund, a premier think-and-action tank located in Sofia, Bulgaria.

Cite as Robert Hickey, contribution to GTI Roundtable "Monetizing Nature," Great Transition Initiative (August 2014),

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