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Putting a price on natural capital

Not many companies have tried to put a value on the environmental services provided by the natural world that they tap to help their business function.

No surprise there, you might say: it is a hard thing to do and creates another form of accountability for business. Yet there are good commercial, social and environmental reasons to embrace these challenges and get stuck in.

Last week’s ecosurety lunchtime debate saw us looking at this question of natural capital – and how and why to put some figures to the value being delivered by the world around us.

One of the best examples of a company assessing the value of the natural capital it uses is the clothing and footwear multinational Puma. Back in 2010 Puma released environmental profit and loss accounts for the first time – and they revealed a great deal.

What did they show? That Puma’s supply chain was found to be responsible for 94% – or €137m – of its total environmental impact, and that over half (57% or €83m) of all its environmental impacts were associated with the production of raw materials (including leather, cotton and rubber) in tier four of Puma’s supply chain.

Since their publication, these insights have profoundly influenced Puma’s sustainability mission because they serve to show just what natural resources the business relies on – and hence its business vulnerabilities and true environmental impacts.

The numbers are easy to challenge, of course, but the analysis has demonstrably opened up a new seam of sustainability insight for the business to act upon. Others would benefit similarly.

PUMA 2012 report

The PUMA Environmental Profit and Loss Account

 


Steve Clark

Non-executive director

Steve established Ecosurety in 2003 in response to the lack of flexibility, innovation and customer-focus in the compliance scheme market. He took inspiration from the mobile phone market, which continues to provide a diverse range of pick-and-mix options for the customer, and built the original business on a commitment to provide flexible, friendly and tailored support for all clients.

He is passionate about bringing the latest business concepts from other markets and industries and applying them to the environmental sector for the benefit of clients.


Written by Steve Clark Published 24/03/2015 Topics Sustainability

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