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Robert Costanza• VC’s Chair in Public Policy
Crawford School of Public Policy
Australian National University
Canberra ACT 0200, Australia
• Editor in Chief, Solutions (www.thesolutionsjournal.org)
The Circular Bioeconomy and
Grand Societal Challenges
Opportunities and Challenges of Sustainable Forest Bioeconomy
13.12.2017 Wanha Satama, Helsinki, Finland
Human influence on the earth system is now so large, that a new geologic epoch (the Anthropocene) has begun. We now live in a “Full World”
Business as usual is not an option
To create a sustainable and desirable Anthropocene, we need to think, act, finance, and govern differently
Vision Tools &Analysis
Implementation
SustainableWellbeing
How the world isHow we would like it to be
PLANETARY BOUNDARIES: THERE ARE FUNDAMENTAL ECOLOGICAL CONSTRAINTS
Rockström, J., et al. 2009. A safe operating space for humanity. Nature 461:472-475
Steffen, W., J. Rockström, and R. Costanza. 2011. How Defining Planetary Boundaries Can Transform Our Approach to Growth. Solutions. Vol 2, No. 3, May 2011
We need a third movie…
We need a third movie and a new vision and narrative…
Society
Environment(the rest of Nature)
Economy
A sustainable and desirableeconomy-in-society-in-the rest of nature.
A Wellbeing Economy
Overlapping Ideas
Wellbeing Economy
Circular BioEconomy
Ecological Economy
Ecological Civilization
Steady State Economy
Doughnut Economy
Regenerative Economy
Lagom Economy
food
energy
water
leisureparticipation
health
community
education
fairness
income
security
identity
freedomecoservices
Elementsof well-being& Quality of
Life
The Sustainable
and Desirable
“doughnut”(after: K. Raworth. 2012. A safe
and just space for humanity: can
we live within the doughnut?
Oxfam International)
Integrated Questions/Goals:
• Ecologically Sustainable Scale
• Socially Fair Distribution
• Economically Efficient Allocation
UN Sustainable Development Goals (SDGs)
TRANSFORMING OUR WORLD:
THE 2030 AGENDA FOR SUSTAINABLE DEVELOPMENT
Eco
log
ical
Eco
no
mic
s
Fra
mew
ork
UN
SD
Gs
Figure 2. The relationship of the 17 UN Sustainable Development Goals (SDGs) to the framework of ecological economics and the
overarching goal of a sustainable, equitable and prosperous system (Costanza et al. 2016. Modelling and measuring sustainable wellbeing in
connection with the UN Sustainable Development Goals. Ecological Economics. 130:350–355.
Overarching Goal:A prosperous, high quality of life that is
equitably shared and sustainable
Natural
Capital/Ecosyste
m Services
Sustainable Scale:
Staying within planetary
boundaries
Social
Capital/Commun
ity
(Surveys)
Fair Distribution:
Protecting capabilities for
flourishing
Net Economic
Contribution
(GPI 2.0)
Efficient Allocation:
Building a living economy
6.Water &
sanitation
for all 13. Urgent
action on
climate
change
15.Conserve
terrestrial
ecosystems
1.End
poverty
for all2.End
hunger
for all
3.Ensure
healthy
lives for
all 4.Ensure
equitable
quality
education
for all
5.Achieve
gender
equality
10. Reduce
inequality
within and
among
countries
14. Conserve
marine
ecosystems
16.Promote
justice and
accountable
institutions 17. Strengthen
global
partnerships
7.Ensure
access to
sustainable
energy 8.Promote
inclusive
economic
prosperity
9.Build resilient
infrastructure
11.Build
resilient
and
sustainable
cities
12.Ensure
sustainable
consumption
patterns
167 Targets, 300+ Indicators
Ecosystem Services: the
benefits humans derive from
functioning ecosystems
Missing: Interaction with other forms of capital
BuiltCapital
Human Capital
Sustainable Human
Well-Being
EcosystemServices
Natural Capital
Social Capital
Inter-action
XFrom: Costanza, R., R. de Groot, P. Sutton, S. van der Ploeg, S. Anderson, I.
Kubiszewski, S. Farber, and R. K. Turner. 2014. Changes in the global value of
ecosystem services. Global Environmental Change 26:152-158.
Natural Capital is everything in the world that
humans do not have to produce or maintain – the
“gifts of nature”.
生物多样性和生态系统服务的跨政府平台
0
500
1000
1500
2000
2500
3000
3500
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
NumberofArclesPublishedon"EcosystemServices"
Year
NumberofAr clesPublishedon"EcosytemServices"inSCOPUS
Total as of 3/7/2017 = 17,899
有关生态服务的文章
NATURE VOL 387 15 MAY 1997
The value of the world’s
ecosystem services and
natural capitalRobert Costanza, Ralph d’Arge, Rudolf de Groot,
Stephen Farber, Monica Grasso, Bruce Hannon,
Karin Limburg, Shahid Naeem, Robert V. O’Neill,
Jose Paruelo, Robert G. Raskin, Paul Sutton &
Marjan van den Belt*. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For the entire biosphere, the value (most of which is
outside the market) is estimated to be in the range of
US$16–54 trillion per year, with an average of US$33 trillion
per year.
2nd most cited article in the Ecology/Environment area according
to the ISI Web of Science with more than 7500 citations – which
puts it in the top 0.01% of all papers ever published.
Valuing
…we estimated the loss of eco-services(生态服务损失) from 1997 to 2011 due to land use
change(土地使用变化) at $4.3–20.2 trillion/yr.
全球生态系统服务价值改变
Focus on GDP growth
Focus on Well-being
Market ForcesThe market knows best
Inequality not addressed
Fortress WorldEveryone for themselves
Limited Governance
Policy ReformNeed planning and governmentEquity maintained
Great TransitionWe’re all in this togetherGovernance at many levelsStewardship and sharing
CommunityIndividualism
From: Kubiszewski, Costanza, Anderson, and Sutton. (2017). The Future of Ecosystem Services: Global Scenarios and National
Implications. Ecosystem Services. 26:289-301.
Market Forces
Com
mu
nityIn
div
idu
ali
sm
Focus on GDP growth
Focus on Well-being
Fortress World Great Transition(SDG world)
Policy Reform
全球生态服务价值年度总量
From: Kubiszewski, Costanza, Anderson, and Sutton. (2017). The Future of Ecosystem Services: Global
Scenarios and National Implications. Ecosystem Services. 26:289-301.
Market
Forces
Fortress
World
Policy
Reform
Great
Transition
-100 -90 -80 -70 -60 -50 -40 -30 -20 -10 0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 180
Percent Change in 2050 from 2011 Ecosystem Service Values生态服务价值
From: Kubiszewski, Costanza, Anderson, and Sutton. (2017). The Future of Ecosystem Services: Global
Scenarios and National Implications. Ecosystem Services. 26:289-301.
Some mistaken identities concerning
ecosystem services and valuation
• Economics “the Market”
• Valuation Privatization, Commodification, or Trading
• Expressing values in monetary units Market or exchange values
Also, we cannot avoid valuation:decisions about ecosystem are implicit valuations
Use of Valuation Appropriate valuesAppropriate spatial
scalesPrecision Needed
Rising awareness and interest Total values, macro aggregates Regional to global Low
National income and well-being accounts
Total values by sector and macro aggregate
National Medium
Specific policy analysis Changes by policy Multiple depending on policy Medium to high
Urban and regional land use planning
Changes by land use scenario Regional Low to medium
Payment for ecosystem services Changes by actions due payment Multiple depending on system Medium to high
Full cost accounting Total values by business, product, or activity and changes by business, product, or activity
Regional to global, given the scale of international corporations
Medium to high
Common asset trusts Totals to assess capital and changes to assess income and loss
Regional to global Medium
Range of uses for ecosystem services valuation
From: Costanza, R., R. de Groot, P. Sutton, S. van der Ploeg, S. Anderson, I. Kubiszewski, S. Farber, and R. K. Turner. 2014. Changes in the
global value of ecosystem services. Global Environmental Change 26:152-158.
Rival
Non-rival
Non-ExcludableExcludable
Market Goods
and Services(some provisioning
services)
Common Pool
Resources(some provisioning
services)
Congestable
Services(some recreation
services)
Public Goods
and Services(most regulatory and
cultural services)
EcoServices Classified According to Rivalness and Excludability
From: Costanza, R., 2008. Ecosystem Services: Multiple classification systems are needed. Biological
Conservation 141:350-352
Property Rights Regimes are Important
Claim the Sky!www.claimthesky.org
By asserting that we all own the atmosphere as a
common asset, we can begin to use the Public Trust
Doctrine and the legal institutions surrounding property
rights to protect the climate, charge for damages, and
provide rewards to those that improve this shared
resource, by creating an Earth Atmospheric Trust.
We find that the maximum potential
of Natural Climate Solutions is 23.8
petagrams of CO2 equivalent
(PgCO2e) y−1 (95%CI 20.3–37.4)
by 2030
This is ≥30%higher than prior
estimates,
About half of this maximum (11.3
PgCO2e y−1) represents cost-
effective climate mitigation,
assuming the social cost of CO2
pollution is ≥100 USD MgCO2e−1
by 2030.
Source: Griscom et al. PNAS (2017)
In a word, businesses profit by calculating
and paying only a fraction of the costs
involved. Yet only when “the economic and
social costs of using up shared environmental
resources are recognized with transparency
and fully borne by those who incur them, not
by other peoples or future generations”, can
those actions be considered ethical.
Pope Francis, ENCYCLICAL LETTER
LAUDATO SI’ - ON CARE FOR OUR COMMON HOME
“A good ecological environment is the most
universal common good, the most universal
aspect of people’s wellbeing”
“We would rather have clear water and green
mountains than mountains of silver and gold”
President Xi Jinping
Creating an “ecological civilization”
“The modernization that we pursue is one characterized by harmonious coexistence between man and nature. In
addition to creating more material and cultural wealth to meet people’s ever-increasing needs for a better life, we need
also to provide more quality ecological goods to meet people’s ever-growing demands for a beautiful environment.”
“To reform the environmental regulation system. China will establish regulatory agencies to
manage state-owned natural resource assets and monitor natural ecosystems. China will develop
a nature reserves system composed mainly of national parks.”
President Xi Jinping, 19th Party Congress
http://www.thefifthestate.com.au/articles/ken-henry-on-advancing-
australias-natural-capital/82531
“We all know that farmers go through dry and wet times. There
will be drought. But when the drought breaks:
- if you have invested in your built capital – your pumps will be
working,
- if you’ve invested in your human capital, you’ll have staff to
operate your machinery and the know-how to run your
business commercially,
- and if you’ve taken care of your natural capital – managed your
weeds, your water retention and your soil health – you will be
well positioned to take advantage of future commercial
opportunities.
Natural capital is not a footnote in a business
plan, it is a core asset on the balance sheet.
That’s true for an individual business; and it is
true also for the nation.”
Source: Deaton, 2008.
Indicator UnitsIndic
atorsExplanation
Area
coverageTime
Genuine Progress
Indicator (GPI)$ 26
Personal Consumption Expenditures weighted by income distribution, with volunteer and
household work added and environmental and social costs subtracted.
17 countries
+ regions
1950-
present
Genuine Savings $ 5Level of saving after depreciation of produced capital; investments in human capital; depletion
of minerals/energy/forests; and damages from air pollutants are accounted for
140
countries1970-2008
Inclusive Wealth $ 8 Asset wealth including, built, human, and natural resources 20 countries 1990-2008
Australian Unity Well-
Being IndexIndex # 14 Annual survey of various aspects of well-being and quality of life Australia
2001-
present
World Values Survey Index # 100's Periodic (5 so far) survey of a broad range of social, environmental, and economic variables 73 countries 1981-2008
Gallup-Healthways
Well-Being IndexIndex # 39
Annual survey in six domains: live evaluation, physical health, emotional health, healthy
behavior, work environment, and basic assets
50 states in
US
2008-
present
Gross National
HappinessIndex # 33
In-person survey in nine domains: psychological well-being, standard of living, governance,
health, education, community vitality, cultural diversity, time use, ecological diversity Bhutan 2010
Human Development
Index (HDI)Index # 4 Index of GDP/person, spending on health and education, and life expectancy
177
countries
1980-
present
Happy Planet Index Index # 3 HPI = subjective well being * life expectancy / ecological footprint153
countries3 yrs
Canadian Index of
Well-BeingIndex # 80
Includes community vitality, democratic engagement, education, environment, population,
leisure, living standards, and time useCanada
1994-
present
National Well-Being
IndexIndex # 5
proxies for built, human, natural and social capital with weights based on regression with
subjective well-being56 countries 1 yr
OECD Better Life
IndexIndex # 25
Includes housing, income, jobs community education, environment, civic engagement, health,
life satisfaction, saftey, and work-life balance
36 OECD
countries1 yr
Well-Being of Nations Index # 63 63 indicators in 20 domains weighted and ranked180
countries1990-2000
Sustainable Society 150
GPI /capita for the 17 countries for which it has been estimatedFrom: Kubiszewski, Costanza et al. 2013. Beyond GDP: Measuring and Achieving Global Genuine
Progress. Ecological Economics 93:57-68
From: Kubiszewski, Costanza et al. 2013. Beyond
GDP: Measuring and Achieving Global Genuine Progress. Ecological Economics 93:57-68
Economic growth Un-Economic growth
To create a sustainable and desirable
economy-in-society-in-the rest of nature
requires:
Breaking our addiction to the "growth at all costs"
economic paradigm, to fossil fuels, and to over-
consumption
A key step in the therapy is building a shared vision of
a more sustainable and desirable future that focuses
on the wellbeing of all life
Wellbeing
Economy
Alliance
(WE All)At a meeting in Glasgow, Scotland, in Oct.
2017, a group of five governments
(Scotland, Sweden, Costa Rica, Slovenia,
and New Zealand) committed to creating
the Wellbeing Economy Alliance.
What is a wellbeing economy?
A wellbeing economy has the fundamental goal of
achieving sustainable wellbeing with dignity and fairness
for humans and the rest of nature. A wellbeing economy
achieves the SDGs. (This is in stark contrast to current economies that
are wedded to a very narrow vision of development—indiscriminate growth
of GDP.)
A wellbeing economy recognizes that the economy is
embedded in society and nature. It must be understood and
managed as an integrated, interdependent system.
To achieve a wellbeing economy, a major transformation of our
world view, society and economy are needed to:
a. Stay within planetary biophysical boundaries – a sustainable size of the
economy within our ecological life support system.
b. Meet all fundamental human needs, including food, shelter, dignity,
respect, education, health, security, voice, and purpose, among others.
c. Create and maintain a fair distribution of resources, income, and wealth –
within and between nations, current and future generations of humans and
other species.
d. Have an efficient allocation of resources, including common natural and
social capital assets, to allow inclusive prosperity, human development and
flourishing. A wellbeing economy recognizes that happiness, meaning, and
thriving depend on far more than material consumption.
e. Create governance systems that are fair, responsive, just and accountable
Current Economic Model Green Economy Model Ecological Economics Model
Primary policy goal More: Economic growth in the conventional
sense, as measured by GDP. The assumption is
that growth will ultimately allow the solution of
all other problems. More is always better.
More but with lower environmental
impact: GDP growth decoupled from
carbon and from other material and
energy impacts.
Better: Focus must shift from merely growth to “development” in the real
sense of improvement in sustainable human well-being, recognizing that
growth has significant negative by-products. More is not always better.
Primary measure of
progress
GDP Still GDP, but recognizing impacts
on natural capital.
Index of Sustainable Economic Welfare (ISEW), Genuine Progress Indicator
(GPI), or other improved measures of real welfare.
Scale/carrying
capacity/role of
environment
Not an issue, since markets are assumed to be
able to overcome any resource limits via new
technology, and substitutes for resources are
always available.
Recognized, but assumed to be
solvable via decoupling.
A primary concern as a determinant of ecological sustainability. Natural
capital and ecosystem services are not infinitely substitutable and real limits
exist.
Distribution/poverty Given lip service, but relegated to “politics”
and a “trickle-down” policy: a rising tide lifts
all boats.
Recognized as important, assumes
greening the economy will reduce
poverty via enhanced agriculture and
employment in green sectors.
A primary concern, since it directly affects quality of life and social capital
and is often exacerbated by growth: a too rapidly rising tide only lifts yachts,
while swamping small boats.
Economic
efficiency/allocation
The primary concern, but generally including
only marketed goods and services (GDP) and
market institutions.
Recognized to include natural capital
and the need to incorporate the value
of natural capital into market
incentives.
A primary concern, but including both market and nonmarket goods and
services, and effects. Emphasis on the need to incorporate the value of
natural and social capital to achieve true allocative efficiency.
Property rights Emphasis on private property and conventional
markets.
Recognition of the need for
instruments beyond the market.
Emphasis on a balance of property rights regimes appropriate to the nature
and scale of the system, and a linking of rights with responsibilities. Includes
larger role for common-property institutions in addition to private and state
property.
Role of government Government intervention to be minimized and
replaced with private and market institutions.
Recognition of the need for
government intervention to
internalize natural capital.
Government plays a central role, including new functions as referee,
facilitator, and broker in a new suite of common-asset institutions.
Principles of
governance
Laissez-faire market capitalism. Recognition of the need for
government.
Lisbon principles of sustainable governance.
Market Forces
Com
mu
nityIn
div
idu
ali
sm
Focus on GDP growth
Focus on Well-being
Fortress World Great Transition(SDG world)
Policy Reform
Scenarios for Australia in 2050: A synthesis and public opinion surveyhttp://www.anuscenarioplanning.com/
Focus on GDP growth
Focus on Well-being
Free EnterpriseThe market knows best
Inequality not addressed
Strong IndividualismEveryone for themselves
Limited Governance
Coordinated ActionNeed planning and governmentEquity maintained
Community WellbeingWe’re all in this togetherGovernance at many levelsStewardship and sharing
CommunityIndividuals
Costanza, R., I. Kubiszewski, S. Cork, P. Atkins, A. Bean, A. Diamond, N. Grigg, E. Korb, J. Logg-Scarvell, R. Navis, and K. Patrick, Journal of Future Studies 19: 49-76 (2015)
www.anuscenarioplanning.com
Preferences for the four scenarios among Australians (n= 2,083)
Papers mentioned in this presentation can be downloaded from:
www.robertcostanza.comThank You
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