Understanding the potential for private sector investment in natural capital – lessons from the Spey catchment, Scotland

There is a growing recognition amongst policy-makers, conservation NGOs and the private sector that funding for land management needs to be increased and diversified to protect and restore biodiversity and natural capital in Scotland. However, effective mechanisms for enabling private investment by companies who do not manage land themselves are poorly understood. A better understanding of business motivations and challenges is required to effectively increase and diversify private investment in natural capital. This study reviewed existing case-studies and interviewed business in the Spey catchment to understand how private sector investments could be increased or diversified.

Valuing Nature Programme Placement holder (anja.helena.liski@gmail.com)

SEPA placement host (nicola.melville@sepa.org.uk)

Edinburgh University supervisor (marc.metzger@ed.ac.uk)

Main findings of the study are:

1. Businesses recognise the importance of natural capital to their business success, but this does not currently translate into significant investment

2. Businesses are interested in diversifying and increasing their investments in the environment, but find it difficult to identify tangible returns on investment

3. There is broad support for increasing coordination of investment through an independent business-led intermediary

4. Two potential business models for coordinated business investment were identified: a levy model and a project-based model

5. Government and public sector support are essential to increase investment

Main findings from this study are:

The Valuing Nature Programme, funded by the Natural Environment Research Council, aims to better understand and represent the complexities of the natural environment in decision making. This report summarises the findings of a short research placement between November 2017 and March 2018 awarded to The University of Edinburgh and hosted by the Scottish Environment Protection Agency with support from the Scottish Forum on Natural Capital.