BSI, in its role as the UK National Standards Body, publishes guidance for preparing natural capital accounts.
The new British Standard, named BS 8632: Natural Capital Accounting for Organisations – Specification, provides organizations with a deeper understanding of how their operations impact and depend on natural capital assets like geology, soil, water, air and living organisms, to underpin decision making.
The standard presents terminology, principles, steps, and outputs for creating a natural capital account to enable a transparent and repeatable practice. This includes the minimum requirements for defining the boundary of an account, material impacts and dependencies, and documenting the data and process used. Creating robust information can help an organization:
- identify its impacts and dependencies on natural capital assets, and associated risks and opportunities;
- communicate information and implications within the organization and with external stakeholders;
- make more informed business strategies and operational decisions by integrating natural capital accounts with assessment of other capitals; and
- monitor and evaluate the impacts and effectiveness of internal decisions and changes due to external factors.
David Fatscher, Head of Environment, Social and Governance Standards at BSI said: “We are proud to have led the development of the first guidance standard for preparing natural capital accounts. By combining financial, environmental and socioeconomic information, natural capital accounting can reveal the value of nature to organizations and society, and importantly, the value of organizations’ impacts on nature. The purpose is to enable better integration of natural capital considerations into financial and other business analysis.”
The standard has been developed by a committee1 that is made-up of experts in the fields of environmental economics, forestry, natural and social capitals and environmental science. The standard is intended to be used by those who will be preparing the accounts. These could be environmental and sustainability professionals, accountants, environmental economists, and others working in collaboration.