Restoring Natural Capital: Science, Business, and Practice

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How can environmental degradation be stopped? How can it be reversed? And how can the damage already done be repaired? The authors of this volume argue that a two-pronged approach is needed: reducing demand for ecosystem goods and services and better management of them, coupled with an increase in supply through environmental restoration.
Restoring Natural Capital brings together economists and ecologists, theoreticians, practitioners, policy makers, and scientists from the developed and developing worlds to consider the costs and benefits of repairing ecosystem goods and services in natural and socioecological systems. It examines the business and practice of restoring natural capital, and seeks to establish common ground between economists and ecologists with respect to the restoration of degraded ecosystems and landscapes and the still broader task of restoring natural capital. The book focuses on developing strategies that can achieve the best outcomes in the shortest amount of time as it:
• considers conceptual and theoretical issues from both an economic and ecological perspective
• examines specific strategies to foster the restoration of natural capital and offers a synthesis and a vision of the way forward
Nineteen case studies from around the world illustrate challenges and achievements in setting targets, refining approaches to finding and implementing restoration projects, and using restoration of natural capital as an economic opportunity. Throughout, contributors make the case that the restoration of natural capital requires close collaboration among scientists from across disciplines as well as local people, and when successfully executed represents a practical, realistic, and essential tool for achieving lasting sustainable development.

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Editorial Reviews

"The editors contend that 'ecological restoration must be practiced as if people matter' ... Summing Up: Recommended."
Executive Director, Global Footprint Network - Mathis Wackernagel
"In a time when humanity is in ecological overshoot, steady-state economics is no longer sufficient. Moving beyond a state of overshoot, however, requires that we learn how to restore natural capital. Hence I warmly welcome this volume. It provides not only road maps and tools, but also a pragmatic approach: rather than merely lamenting about the state of the biosphere, it shows that we can, and need to, make a difference."
Professor, School of Public Policy, University of Maryland - Herman E. Daly
"Economic logic says we should invest in the limiting factor. In yesterday's empty world that meant investing in human-made capital; in today's full world it means investing in natural capital. Fallowing is the traditional way to invest in natural capital. To discover modern analogs to fallowing, read this important book."
President-elect, International Society for Ecological Economics - Peter H. May
"This book is our first road map beyond the Millennium Ecosystem Assessment. It teaches us how to repair our wounded planet, ensuring that nature's services vital to human and ecosystem survival are restored before we reach critical thresholds. The authors weave a closely intertwined series of arguments and cases to show how economic values can only be maintained if we protect and restore the natural environment."
Ecological Restoration
"The book should be of interest to all those who are concerned with not merely understanding the intellectual challenges of ecological restoration, but also with how to implement it in the field. Ecologists sensing they might need a new set of perspectives and tools to do this will find this an instructive and useful book."
Wildlife Activist
"This book reviews related theoretical issues, case studies from around the world and specific strategies to increase the restoration of natural capital."

"The editors contend that 'ecological restoration must be practiced as if people matter' ... Summing Up: Recommended."

— K.B. Sterling

Ecological Restoration - David Lamb

The book should be of interest to all those who are concerned with not merely understanding the intellectual challenges of ecological restoration, but also with how to implement it in the field. Ecologists sensing they might need a new set of perspectives and tools to do this will find this an instructive and useful book.

Choice - K.B. Sterling

"The editors contend that 'ecological restoration must be practiced as if people matter' ... Summing Up: Recommended."
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Product Details

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Restoring Natural Capital: Science, Business, and Practice

By James Aronson, Suzanne J. Milton, James N. Blignaut


Copyright © 2007 Island Press
All rights reserved.
ISBN: 978-1-59726-779-3


Restoring Natural Capital: Definitions and Rationale


The restoration of natural capital is arguably one of the most radical ideas to emerge in recent years, because it links two imperatives—economics and ecology—whose proponents have been at loggerheads for decades. In economically developed and developing countries alike, however, we have to acknowledge that humans have transformed ecosystems to the extent that the supply of life-essential ecosystem goods and services is seriously threatened (Wackernagel and Rees 1997). This fact is summarized by two conclusions from the Millennium Ecosystem Assessment (MA 2005f):

Over the past 50 years, humans have changed ecosystems more rapidly and extensively than in any comparable period of time in human history, largely to meet rapidly growing demands for food, fresh water, timber, fiber and fuel. This has resulted in a substantial and largely irreversible loss in the diversity of life on Earth.

The changes that have been made to ecosystems have contributed to substantial net gains in human well-being and economic development, but these gains have been achieved at growing costs in the form of the degradation of many ecosystem services, increased risks of nonlinear changes, and the exacerbation of poverty for some groups of people. These problems, unless addressed, will substantially diminish the benefits that future generations obtain from ecosystems.

We argue that natural capital has become a limiting factor for human well-being and economic sustainability (Costanza and Daly 1992; Daly and Farley 2004; Aronson, Clewell, et al. 2006; Farley and Daly 2006; Dresp 2006) and advocate that the restoration of natural capital is the most direct and effective remedy for redressing the debilitating socioeconomic and political effects of its scarcity. Conservation, and reducing waste are indispensable, but likewise the investment in the restoration of natural capital that augments the pool of natural capital stock and hence stimulates the supply (or flow) of ecosystem goods and services (Repetto 1993; Cairns 1993; Jansson et al. 1994; Clewell 2000). The restoration of natural capital includes ecological restoration, but it goes further. The restoration of natural capital also considers the socioeconomic interface between humans and the natural environment. By functioning within this interface, the restoration of natural capital builds bridges between economists and ecologists and thereby offers new alternatives for ecologically viable economic development. It also offers new hope for bridging the worrisome gaps between scientists and nonscientists and between developed and underdeveloped countries.

Definitions of Terms and Concepts

Here we define a number of key terms pertinent to the concepts of restoration and natural capital, and explain how this focus complements related approaches to ecosystem repair and raises awareness of the need to make development ecologically, socially, and economically sustainable.

Natural Capital

Generally, development and the improvement of life quality are not possible without a growing asset, or capital, base. The concept c apital, however, is not homogenous since one can distinguish between five principal forms of capital (Rees 1995; MA 2005f):

• Financial capital (money or its substitutes)

• Manufactured capital (buildings, roads, and other human-produced, fixed assets)

• Human capital (individual or collective efforts and intellectual skills)

• Social capital (institutions, relationships, social networks, and shared cultural beliefs and traditions that promote mutual trust)

• Natural capital, an economic metaphor for the stock of physical and biological natural resources that consist of renewable natural capital (living species and ecosystems); nonrenewable natural capital (subsoil assets, e.g., petroleum, coal, diamonds); replenishable natural capital (e.g., the atmosphere, potable water, fertile soils); and cultivated natural capital (e.g., crops and forest plantations)

Some clarification is required to distinguish between renewable, replenishable, and cultivated natural capital. Renewable natural capital is the composition and structure (stocks) of natural, self organizing ecological systems that, through their functioning, yield a flow (or natural income) of goods and services. These flows are essential to life in general and are extremely useful to humans and all other species. Replenishable natural capital consists of stocks of nonliving resources that are continually recycled through their interaction with living resources over long periods (such as the interaction between surface mineral components and living organisms that produces fertile, stable soil). The condition of renewable natural capital stocks obviously influences the quality, quantity, and renewal rate of these essential, replenishable, natural capital stocks, and vice versa.

Cultivated natural capital arises at the dynamic interface of human, social, and natural capital. This interface produces agroecological systems and amenity plantings that may be more or less self-sustaining, depending on their design and management. Cultivated capital forms a continuum between renewable natural capital and manufactured capital and may be closer to one or the other, depending on the degree of transformation of the landscape, the genetic material, and the subsidies (e.g., energy, water, nutrients, seeding, weeding, pest control) required for maintaining the system. It is often forgotten that, in all cases, both cultivated resources and manufactured capital are derived from renewable, replenishable, and nonrenewable natural capital. This transformation of natural to human-made capital is "mining" the stock of renewable, replenishable, and nonrenewable natural capital, thereby reducing it for future use, unless it is restored where it has been used up or degraded.

Ecological Restoration and Restoration of Natural Capital

The Society for Ecological Restoration International's Primer on Ecological Restoration (SER 2002) defines ecological restoration as "the process of assisting the recovery of an ecosystem that has been degraded, damaged, or destroyed," but it is a much broader concept. The goal of ecological restoration, according to the SER Primer, is a resilient ecosystem that is self sustaining with respect to structure, species composition, and function, while integrated into a larger landscape and congenial to "low impact" human activities. Ecological restoration "is intended to repair ecosystems with respect to their health, integrity, and self-sustainability" (SER 2002). An associated discipline is ecological engineering, which involves restoring and creating (thus, engineering) sustainable ecosystems "that have value to both humans and nature" (Mitsch and Jørgensen 2004). Lewis (2005) cogently adds that ecological engineers attempt to address both the restoration of damaged ecosystems and the creation of new sustainable systems "in a cost effective way."

The restoration of natural capital is any activity that integrates investment in and replenishment of natural capital stocks to improve the flows of ecosystem goods and services, while enhancing all aspects of human well-being. In common with ecological restoration, natural capital restoration is intended to improve the health, integrity, and self-sustainability of ecosystems for all living organisms. However, natural capital restoration focuses on defining and maximizing the value and effort of ecological restoration for the benefit of humans, thereby mainstreaming it into daily thought and action and promoting ecosystem health and integrity. Natural capital restoration activities may include but are not limited to (1) the restoration and rehabilitation of terrestrial and aquatic ecosystems; (2) ecologically sound improvements to arable lands and other lands that are managed for useful purposes; (3) improvements in the ecologically sustainable utilization of biological resources; and (4) the establishment or enhancement of socioeconomic activities and behavior that incorporate knowledge, awareness, conservation, and management of natural capital into daily activities.

Those motivated by a biotic rationale for restoration, as explained by Clewell and Aronson (2006), and whose concern lies with the perpetuation of biodiversity, may raise a concern here. They may argue that natural capital restoration's human-centered focus will obscure an essential insight of the restoration and conservation movements—that ecosystems and all the processes and species they contain are worth restoring and preserving "for their own sake," regardless of their economic (or other) value to humans. This is true (see chapter 2); however, in order to mainstream ecological restoration into the economy (chapter 34), it is also necessary to show how humans will benefit directly from it and how the interaction between economic and ecological systems could be improved through the restoration of natural capital.

Rehabilitation and Reallocation

In figure 1.1, rehabilitation is aligned with restoration in that both generally take an "original" (preanthropogenic era, sensu Crutzen and Stoermer 2000) or historic, culturally acceptable ecosystem or landscape as a reference for the orientation of interventions to halt degradation and initiate more sustainable ecosystem trajectories. By contrast, reallocation is a term that describes what happens when part of a landscape, in any condition is assigned a new use not necessarily bearing any relationship to the structure or functioning of the preexisting ecosystems. Whereas, traditionally, restoration seeks a complete or near-complete return to a preexisting state (although this is being challenged as a result of the consequences of global climate change), by reassembling the species inventory, stresses, and disturbances, as far as possible, rehabilitation focuses on repairing ecosystem functions, in particular raising ecosystem productivity and services for the benefit of humans.

Where the spatial scale of damage is small and the surrounding environment is healthy in terms of species composition and function, amelioration of conditions in the damaged patch, together with ecological processes such as seed dispersal and natural recolonization by plants and animals can lead to full recovery of resilient, species-rich ecosystems that provide a range of services valued by humans (chapter 21)-including aesthetic, cultural, and what we may call "spiritual" services. However, in heavily modified ecosystems, which have crossed one or more thresholds of irreversibility (May 1977; Westoby et al. 1989; Aronson et al. 1993; Milton et al. 1994; Whisenant 1999; Hobbs and Harris 2001; Walker et al. 2002), restoration of the preexisting species inventory may no longer be feasible. In such cases, only rehabilitation and reallocation are likely to remain as viable, cost-effective alternatives, and any actions to reverse environmental damage should be determined by socioeconomic decision making that takes into account the spatial scale of the degradation, the present and future value of the resource to humans, and the condition and composition of the surrounding ecosystem.

Ecological restoration, rehabilitation, and reallocation can all contribute to the restoration of natural capital and be pursued simultaneously in different landscape units. Throughout this book, the term restoration (and hence, natural capital restoration) is often used so as to include rehabilitation, whereas reclamation is not employed because of prior connotations (Aronson et al. 1993; SER 2002).

Rationale for Restoring Natural Capital

We now present some basic principles, following Clewell and Aronson (2006), that collectively provide a rationale for the restoration, sustainable use, and enhanced protection of natural capital. They serve as a template that the editors and authors will use for the evaluation of the case studies, regional overviews, and other contributions in this volume.

Principle 1. In setting targets for the restoration of natural capital, our premise is that people of all cultures depend on the products and services derived from natural ecosystems to provide much of their sustenance and well-being (Daily 1997; Balmford et al. 2002). It follows that an improvement in the quantity or quality of natural ecosystems increases human well-being, while degradation causes the converse. We assert that self-sufficient, self-organizing natural ecosystems are appropriate restoration targets because, despite the deficiencies in our understanding of natural ecosystem functioning (Balmford et al. 2005), it would appear that they provide most ecosystem services (e.g., water purification, flood control) and some goods (e.g., natural pasture, marine fish) more cleanly, efficiently, and inexpensively than human-designed systems, such as "improved" pasture or aquaculture (Costanza et al. 1997; Balmford and Bond 2005). In the context of semicultural or cultural landscapes, and human-designed ecosystems (see, for example, chapter 16), the broader term of restoring natural capital is more readily applicable than ecological restoration, per se.

Principle 2. It has been remarked that anthropogenic global changes, including climate change, have profound implications for ecological restoration and biological conservation (Harris et al. 2006; Thomas et al. 2004), and the overlapping field of ecological engineering (Mitsch and Jørgensen 2004; Kangas 2004) that deals with the design and creation of ecosystems, as well as their restoration. However, we argue that the only durable way to increase ecosystem services is by restoring the functions (MacMahon 1987; Luken 1990; Falk 2006) and processes of self-sustaining ecosystems. Such systems will adapt to climate change and evolve as well or better than "designer ecosystems." Furthermore, restoring natural ecosystems on a large scale may actually help mitigate the effects of climate change (Clewell and Aronson 2006). Finally, climate change scenarios in no way alter the obvious benefits of restoring natural capital.

Principle 3. Costs of restoration of natural capital increase as a function of the spatial extent, duration, and intensity of environmental damage, and with the complexity of the target ecosystem or socioecological system (George et al. 1992; Aronson et al. 1993; Milton et al. 1994). This cost increase reflects the increasing number of interventions required to achieve restoration as damage initially depletes the plants and animals (for example, overfishing, deforestation), and then destroys the physical habitat (for example, through pollution, soil erosion, hydrological or climatic changes), not to mention the preexisting ties and links between people and the landscapes in which they lived and worked. Like ecological benefits, social and economic benefits from investments in restoring natural capital will generally take longer to be realized where not only ecological injuries but also adverse socioeconomic changes have been more profound and long lasting.

Principle 4. Natural capital and manufactured capital are complementary. Increasingly, the limiting factor for economic development is natural capital, and not manufactured capital, as it used to be.

Principle 5. Extinct species can never be recovered nor lost complexity fully understood or restored. Therefore, it is better to conserve or use resources sustainably than to restore, and better to invest in restoring natural capital during the earlier stages of resource degradation and loss of sustainability in managed systems than to postpone restoration activities.


Here we have indicated that the restoration of natural capital includes ecological restoration, but it also considers the socioeconomic interface between humans and the natural environment, including managed systems such as food, fodder, tree fiber, and fish farms, and the awareness of the importance of natural capital in the daily lives of people. The recognition of the real possibility of restoring natural capital helps build bridges between economists and ecologists who can then develop a set of information and hypotheses to help develop new and sustainable economic pathways while also repairing some of the ecological and socioeconomic damage done in the past. As has been indicated, restoration and rehabilitation are not the only ways of developing these pathways. Conservation and revised management of resources and anthropogenic systems, as well as the reduction in consumer demand, among other things, are also vitally important. In the following chapters, various authors including, among others, economists and ecologists from various countries consider the theoretical, commercial, financial, and practical implications of restoring natural capital. The goal is a consilience of ecologists and economists offering practical strategies for redressing the debilitating socioeconomic and political effects of declining natural, social, and cultural capital worldwide. This poses an immense ethical challenge, as well as new conceptual approaches and revised strategy planning. In chapter 2, therefore, we reflect on the restoration of natural capital from an ethical vantage point before returning to economic, ecological, and political considerations.


Excerpted from Restoring Natural Capital: Science, Business, and Practice by James Aronson, Suzanne J. Milton, James N. Blignaut. Copyright © 2007 Island Press. Excerpted by permission of ISLAND PRESS.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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Table of Contents

Foreword \ Peter Raven
Preface \ James Aronson, Suzanne J. Milton and James N. Blignaut
PART I. Restoring Natural Capital: The Conceptual Landscape
Introduction \ James N. Blignaut, James Aronson, and Suzanne J. Milton
Chapter 1. Restoring Natural Capital: Definition and Rationale \ James Aronson, Suzanne J. Milton and James N. Blignaut
Chapter 2. Restoring Natural Capital: A Reflection on Ethics \ James N. Blignaut, James Aronson, Paddy Woodworth, Sean Archer, Narayan Desai, and Andre F. Clewell
Chapter 3. Restoring Natural Capital: An Ecological Economics Assessment \ Joshua Farley and Erica J. Brown Gaddis
Chapter 4. Restoring Natural Capital: A Mainstream Economic Perspective \ Eugenio Figueroa
Chapter 5. Assessing and Restoring Natural Capital Across Scales: Lessons from the Millennium Ecosystem Assessment \ Richard Norgaard, Phoebe Barnard, and Patrick Lavelle
Chapter 6. Assessing the Loss in Natural Capital: A Biodiversity Intactness Index \ Reinette Biggs and Robert J. Scholes
PART II. Restoring Natural Capital: Experiences and Lessons
Introduction \ Suzanne J. Milton, James Aronson, and James N. Blignaut
Chapter 7. Setting Appropriate Restoration Targets for Changed Ecosystems in the Semiarid Karoo, South Africa \ W. Richard J. Dean and Chris J. Roche
Chapter 8. Targeting Sustainable Options for Restoring Natural Capital in Madagascar \ Louise Holloway
Chapter 9. Landscape Function as a Target for Restoring Natural Capital in Semiarid Australia \ David Tongway and John Ludwig
Chapter 10. Genetic Integrity as a Target for Natural Capital Restoration:Weighing the Costs and Benefits \ Cathy Waters, Andrew G. Young, and Jim Crosthwaite

Chapter 11. Restoring and Maintaining Natural Capital in the Pacific Northwest, USA \ Andrew Carey
Chapter 12. Restoring and Maintaining Natural Capital Reconnects People to Their Natural Heritage: Tiritiri Matangi Island, New Zealand \ John Craig and Éva-Terézia Vesely
Chapter 13. Restoring Forage Grass to Support the Pastoral Economy of Arid Patagonia \ Martin R. Aguiar and Marcela E. Román
Chapter 14. A Community Approach to Restore Natural Capital: The Wildwood Project \ Scotland William McGhee
Chapter 15. An Adaptive Comanagement Approach to Restoring Natural Capital in Communal Areas of South Africa \ Christo Fabricius and Georgina Cundill
Chapter 16. Participatory Use of Traditional Ecological Knowledge for Restoring Natural Capital in Agroecosystems of Rural India \ P. S. Ramakrishnan
Chapter 17. Overcoming Obstacles to Restoring Natural Capital: Large-scale Restoration on the Sacramento River \ Suzanne M. Langridge, Mark Buckley, and Karen D. Holl
Chapter 18. An Approach to Quantify the Economic Value of Restoring Natural Capital: A Case from South Africa \ James N. Blignaut and Christina E. Loxton
Economic Opportunities: Case Studies
Chapter 19. Capturing the Economic Benefits from Restoring Natural Capital in Transformed Tropical Forests \ Kirsten Schuyt, Stephanie Mansourian, Gabriella Roscher, and Gerard Rambeloarisoa
Chapter 20. Restoring Natural Forests to Make Medicinal Bark Harvesting Sustainable in South Africa \ Coert J. Geldenhuys
Chapter 21. Assessing Costs, Benefits, and Feasibility of Restoring Natural Capital in Subtropical Thicket in South Africa \ Anthony J. Mills, Jane K. Turpie, Richard M. Cowling, Christo Marais, Graham I. H. Kerley, Richard G. Lechmere-Oertel, Ayanda M. Sigwela, and Mike Powell
Chapter 22. Costs and Benefits of Restoring Natural Capital Following Alien Plant Invasions in Fynbos Ecosystems in South Africa \ Patricia M. Holmes, David M. Richardson, and Christo Marais
Chapter 23. Return of Natural, Social, and Financial Capital to the Hole Left by Mining \ J. Deon van Eeden, Roy A. Lubke, and Pippa Haarhoff
Chapter 24. Protecting and Restoring Natural Capital in New York City's Watersheds to Safeguard Water \ Christopher Elliman and Nathan Berry
Chapter 25. Making the Restoration of Natural Capital Profitable on Private Land: Koa Forestry on Hawaii Island \ Liba Pejchar, Joshua H. Goldstein, and Gretchen C. Daily

PART III. Restoring Natural Capital: Tactics and Strategies

Introduction \ James Aronson, Suzanne J. Milton and James N. Blignaut

Chapter 26. Valuing Natural Capital and the Costs and Benefits of Restoration \ William E. Rees, Joshua Farley, Éva-Terézia Vesely, and Rudolf de Groot
Chapter 27. A Decision Analysis Framework for Proposal Evaluation of Natural Capital Restoration \ Mike D. Young, Stefan Hajkowicz, Erica J. Brown Gaddis, and Rudolf de Groot
Local and Landscape Levels
Chapter 28. Overcoming Physical and Biological Obstacles to Restoring Natural Capital \ Karen D. Holl, Liba Pejchar, and Steve G. Whisenant
Chapter 29. Overcoming Socioeconomic Obstacles to Restoring Natural Capital \ Christo Marais, Paddy Woodworth, Martin de Wit, John Craig, Karen D. Holl, and Jennifer Gouza
Global Level
Chapter 30. Overcoming Obstacles at a Global Scale to Restore Natural Capital \ Robert J. Scholes, Reinette Biggs, Erica J. Brown Gaddis, and Karen D. Holl
Chapter 31. Managing Our Global Footprint Through the Restoration of Natural Capital at a Global Scale \ Joshua Farley, Erica J. Brown Gaddis, William E. Rees, and Katrina Van Dis
Policies and Institutions
Chapter 32. Making Restoration Work: Financial Mechanisms \ Rudolf de Groot, Martin de Wit, Erica J. Brown Gaddis, Carolyn Kousky, William McGhee, and Mike D. Young
Chapter 33. Making Restoration Work: Nonmonetary Mechanisms \ William McGhee, John Craig, Rudolf de Groot, James S. Miller, and Keith Bowers
PART IV. Synthesis
Chapter 34. Mainstreaming the Restoration of Natural Capital: A Conceptual and Operational Framework \ Richard M. Cowling, Shirley M. Pierce, and Ayanda M. Sigwela
Chapter 35. Restoring Natural Capital Toward a Better Future \ Suzanne J. Milton, James Aronson, and James N. Blignaut
Editors and Contributors

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