What Is The Conservation Economy?
Think: market-based approaches that enable the protection and restoration of habitat and biodiversity.
In a nutshell, the conservation economy operates where nature and biodiversity intersect with livelihoods and finance – and where these elements are sustainable and mutually reinforcing.
But don’t worry if you haven’t heard of it before – or at least not in so many words. While the concepts inherent in the conservation economy are widely practiced around the world, the term is not yet commonly used.
This is surprising, when you think about it, given how many “economies” have surfaced in recent years. The trend kicked off with naming the informal economy (the term used to describe economic activity operating outside of government regulation and taxation). Since then, we’ve seen lots more start to circulate, including the green economy, the blue economy, the impact economy, the cultural economy and even the humane economy.
“The term ‘economy’ refers to the system surrounding the production and consumption of goods and services, as well as the supply of money.”
Labelling something an “economy” may seem unnecessary at best or pretentious at worst, but the term is useful in capturing the unique set of economic drivers that create commercial momentum and market opportunities in a particular sector. If “economy” refers to the system surrounding the production and consumption of goods and services, as well as the supply of money, then it is a good descriptor to help define niche markets, including around conservation.
History of the term
First coined by Ecotrust Canada in the early 2000s as a way to frame their work in the coastal temperate rainforests of the Pacific Northwest, the term was originally broad and all-encompassing. Based around equity (social capital), ecology (natural capital) and economy (economic capital), Ecotrust Canada’s pattern map of the conservation economy presented 57 building blocks as a framework for an “ecologically restorative, socially just and reliably prosperous society”. While Ecotrust’s framework is entirely purposeful in what it seeks to encapsulate, it becomes almost meaningless as it excludes very little.
The Wilderness Society (TWS) in Australia also played with the term in the mid-2000s. The organisation presented the concept of building a conservation economy in Cape York as part of its ‘Wild Country’ campaign in 2005. However, the campaign was associated with the controversial Wild Rivers legislation in Queensland, which many Indigenous leaders were strongly against and which was later repealed in 2014 under the Newman government. Despite this, TWS’s conceptual work around supporting environmentally sensitive industries was positive and is still relevant today.
The conservation economy in practice
At Ethical Republic, we use the term “conservation economy” to refer to a handful of market-based approaches that enable the protection and restoration of habitat, biodiversity, natural capital and ecosystems services in ways that involve and benefit Indigenous people and local communities.
“The conservation economy is about using market-based approaches to enable the protection and restoration of habitat, biodiversity, natural capital and ecosystems services in ways that involve and benefit Indigenous people and local communities.”
For us, it includes opportunities for people to create sustainable livelihoods that can co-exist alongside, and complement, protected areas and other biodiversity-rich environments. It also includes ways of harnessing private and public capital to finance the expansion and improved management of protected areas and to invest in nature-based businesses and other investments with a conservation impact.
A simple model
We propose a simple model of the conservation economy, which includes the following three areas of practice:
1. Nature-based businesses – also known as conservation enterprises, nature-based businesses are all about local communities and Indigenous people creating profit-based opportunities that generate economic, social and cultural benefits in ways that help meet conservation outcomes. This may include sustainable use of natural resources for commercial or subsistence purposes. E.g. agroforestry, ecotourism + recreation, arts + cultural products, conservation management, bush tucker harvesting enterprises and many more.
2. Payments for ecosystems services – The ecosystems services provided by nature are many and varied, ranging from fertile soils, to carbon sequestration, to fresh water, clean air, flood protection, cultural values and pollination. Payments for ecosystems services (PES) are arrangements where beneficiaries of such services provide incentives to encourage the maintenance of ecosystems and natural capital. An example is water funds that encourage farmers in watershed areas to implement agricultural practices that protect water quality. Carbon markets that use land sector methods are another example that provide payments for activities that sequester carbon or avoid emissions.
3. Conservation finance - Conservation finance is the practice of raising, applying and managing capital (both public and private) to support land, water, biodiversity and resource conservation. It includes impact investment where capital is applied to enterprises or initiatives that deliver environmental and social returns alongside economic returns.
Sustainable Livelihoods and Protected Areas
In the 2016 Protected Planet Report, UNEP and IUCN report that more than 1.1 billion people globally depend on protected areas for a significant percentage of their livelihoods. Further, protected areas are fundamental for achieving many of the Sustainable Development Goals, especially SDG 14 (Life under Water) and SDG 15 (Life on Land).
Private sector approaches are one of the most important driving forces behind economic development, poverty reduction and improved quality of life. However, it is counterproductive if those opportunities degrade resources and further threaten biodiversity. They must be sustainable and, especially in regional and remote places, compatible with protected areas.
A recent independent study (the Waldron Report) notes that protecting at least 30% of the world’s land and ocean would provide greater benefits than the status quo, both in terms of financial outcomes and non-monetary measures like ecosystem services. In fact, it indicates that the financial and economic benefits of 30% protection exceed the costs by a factor of at least 5:1.
The same report has modelled economic growth in the nature sector (ecotourism in protected areas, outdoor recreation and related conservation enterprises) to be 4-6% - many times faster than the 1% growth expected in competing sectors (agriculture, fisheries and forestry).
We believe that if people can derive direct economic benefits from nature conservation (along with all the other social, cultural and environmental benefits), then they are more likely to support protected areas and conservation initiatives and are less likely to engage in behaviour that threatens biodiversity or degrades natural capital. That’s our ‘why’.