As delivered by Dr. Naoko Ishii - CEO & Chair of the Global Environment Facility at the 1st GLOBE Natural Capital Summit
Excellences, colleagues and friends: I'm really honoured to be here and have this opportunity to talk to you.
Very recently, more than 300 global leading scientists came to the consensus that maintaining life support systems in the 21st century will represent a crucial challenge for humanity. They stated that the earth may be rapidly approaching a tipping point, and that we are damaging our ecological life support systems beyond their capacity. Human quality of life will suffer from substantial degradation by the year 2050 if we continue on our current path. That kind of scientific recognition of the current status of the global environment is actually, luckily, catching the imagination of leaders like you.
Last night Barry Gardiner reminded us that we are gathered here to help launch a process to restore and sustain the ability of the earth to support human communities into the future. Science is finally making its way to policy and political actions. The Global Environment Facility, which I'm representing today, is here to serve this goal, the goal of ensuring that our life support systems are maintained in a way that ensures sustainable development.
The GEF has provided significant financial resources in the past 22 years. We were, in fact, created 22 years ago to serve the Rio Conventions. The resources GEF provided has amounted to $11 billion and mobilised an additional $57 billion in co-finance through 2,300 projects over 150 countries. So, we have been making some good efforts to serve those noble goals. However, when we are facing rapid degradation of global environment, and knowing that there are important mega-trends facing us: the growing population from 7 billion to 9 billion, combined with 3 billion people joining the middle class, and most of them likely to live in cities. – So, with a growing population, a wealthier middle class, and expanding urbanisation it is really easy to see that the state of our ecosystem is getting worse and worse. Many scientists, as Pavan Sukhdev already mentioned, believe that we are indeed approaching the tipping point beyond the safe planetary boundaries where we really cannot exclude any kind of major change.
It is clear to me that we are entering into the very special development stage of human beings where our interaction with earth's ecosystem is outpacing its carrying capacity. So, how can we halt that kind of situation? It's clear that business as usual will not do; we need a new model of doing business, a new model of living in this earth. In order to address that fundamental question, Pavan's study becomes crucial. This gathering by GLOBE itself and the discussion about Natural Capital taking place here, are fundamental to efforts to address this important topic.
Well, this is all very easy to say but very difficult to actually implement into action. Pavan put it very eloquently: The fundamental issue is that natural capital doesn't really have a price. We use it as if there is no limit. One is therefore compelled to use it until reality kicks in and hurts us. What we really need to do is to think of how we can recognize and value natural capital and how we can integrate those values into the day-to-day decision-making by policy makers as well as by the private sector – consumers, producers, and investors. So, how we can create the right set of incentives? The purpose of this entire summit is to understand natural capital and how to integrate it into national accounting and decision-making systems. This is really the way to go, but we know it will require a lot of effort and work.
Just taking this opportunity, I'd like to present three examples, in addition to this long-term effort, of the kind of models that are available today based on GEF's experience. The first one is putting prices, not necessarily on the entire natural capital, but to some part of the transaction. Pavan already mentioned PES – the "payment for the ecosystem services" scheme. We have been supporting a lot of watershed PES approaches with great success in Costa Rica and in many Latin American countries. The concept is now being tried by some of the African countries, knowing that there may be a discrepancy with the natural capital, but still knowing that it is a very practical to connect the protector of natural capital with the actual user of natural capital. To us, this is a very practical way forward, but it still requires the support of legislators like yourselves because the regulatory frameworks is what will make these models be adopted or not.
The second example, also mentioned by previous speakers, concerns how to bring the natural capital value into the policy and also the budgeting process. Mainstreaming the effort through the sectorial policy, the budget process and the development process – and GLOBE has been supporting the forestry legislation for Mexico – the kind of legislation to create a right policy environment is substantial, is really critical. And as Pavan mentioned, we need to bring in the private sector, but we also need to create the right operating framework, the right operating environment for them. And this is actually the role of legislators. Without that, the private sector will continue to do business as usual because that's the way they operate. So it's your role to provide and to incentivize, to integrate, the value of natural capital, or to penalize them for not doing so. That kind of role is only played by you. So I just want to emphasise the kind of important role you are playing.
The third example, and my last example, where I think the immediate or near-term benefit is produced, is how to break silos. We tend to operate within environmental silos. Observing my own institution, we have a tendency to only work in a narrowly focused silo, and I see the same kind of silo within the government. Normally, environmental ministries don't necessarily talk to other ministries, while the issue of nexus of water and energy requires integrating various sectorial ministries. How can we actually break that type of sectorial silo? This is actually one of the three recommendations included in the slides.
We need your leadership to break these sectorial silos, and when you break sectorial silos you also need to bring the private sector and civil society in on that. In addition, many ecosystems, biodiversity, climate change, oceans – don't respect national boundaries. We are really talking about global public goods. We need your effort to break country silos and to build the various cooperative frameworks, so that neighbouring countries can really join. Another example I wanted to mention is green procurement. This is something which you could also readily do because you could really send the right signal to the market using the purchasing power of the public sector.
So going forward we really need your leadership to upscale and mainstream the work public institutions like the GEF are doing. We are still very much a drop in the ocean despite our past effort of supporting 2,300 projects and investing more than $11bn. We really need to find a way to upscale and mainstream those efforts and we need your support to transform our drop in the ocean into a perfect storm of transformational change to address the global environmental challenge. The GEF is also entering into its next fundraising cycle this year, and in order for us to continue to provide services to the Earth, I also need your support to our process.
When I ran for this position, our campaign strategy was that we wanted to be the champion of the global environmental commons. But in order for us to meet that objective, particularly because nature doesn't have a price, we really need the help of legislators' to create the right environmental operating framework. Without that, our efforts will remain very small. So please create the right operating framework and let's join hand-in-hand because we are all in the same boat.