Forests, clean air, clean water—priceless, right? Too bad in the global economy, priceless actually means worthless. That’s why a recent MacArthur grant is supporting a group that puts a market value on nature.
There’s a recent episode of the podcast "Radiolab" that talks about a team of scientists in 1997 who calculated the value of the earth’s ecosystems and got $142 trillion dollars. This is the kind of exercise that makes many environmentalists cringe. It feels like a dangerous game to talk about ecosystems as if they are a commodity. After all, shouldn’t it be protected as something with inherent, unequivocal worth?
The people at international nonprofit Forest Trends think about it differently. When you’re working within the structures of capitalism, something must have a dollar value, or else it has zero value. And for years, the economic benefit of the environment was excluded from the equation, meaning, for example, that forests were worth more dead than alive. Calculate the value of keeping nature intact, and you've got something to negotiate with.
The MacArthur Foundation has been chipping in to support Forest Trends, which was founded in 1998 by the funder’s former program director Michael Jenkins. It’s given about $3 million to the group previously, and just made a $1 million grant as part of its Award for Creative and Effective Institutions. While a million is on the high end for the group, it's also received funding from big names like Packard, Moore, and Rockefeller.
Forest Trends promotes the concept of payments for “ecosystem services,” which means if you own a forest, there’s a shared value in that forest that’s greater than if it were torn down for agriculture, and you can put a market price on that.
“They had this thought that one way to save forests might not be just to put up fences around them and create protected areas, but actually to create markets for the sustainably harvested products and services of a forest," Matt Arnold, Global Head of Sustainable Finance at JPMorgan Chase, said in a release on the grant.
One big opportunity is valuing forests based on their massive carbon capture, as trees are low-hanging fruit for reducing greenhouse gases. An example of this is working with indigenous people to measure the carbon capture of forests they own, and then creating a mechanism for them to receive payment as carbon credit, instead of selling for development.
The group has also worked with governments in the United States, China, Peru, and Ghana, for example. Forest Trends has been operating for 15 years now, and the concept of market-based conservation has become a pretty common one.
For those uneasy with the idea (like many enviros, I too get a little on guard whenever I see the words “market,” “corporate,” and “environment” in the same sentence), there is another way to think of this that is really compelling: Groups like Forest Trends act as a sort of universal translator for parties with a stake in natural resources.
Indigenous communities, governments of all shapes and sizes, developers, banks, energy companies—these people don’t speak the same language at all (sometimes literally). Except for money, that is. Everyone speaks money.