The natural capital myth


The Making of ‘Natural Capital’

Increasingly, it seems, nature is actually money. The contemporary moment of global crisis in both ecological and economic spheres is also the moment wherein ‘Nature’ is being refashioned as ‘Natural Capital’. Key interlocking elements thus are joining the previously rather separate domains of economics, business and finance, with ecology, environmentalism and conservation. This making of natural capital involves:

  1. discursive shift, through which both conservation practice and understandings of nonhuman natures are reframed in economic and financial terms (amongst which ‘natural capital’ and ‘ecosystem services’ are paramount);
  2. material shift, through which businesses and financiers are turning to environmental and sustainability parameters, both as a new frontier for expansion and investment and to ascertain the material danger to profits of environmental change;
  3. calculative and accounting shift, through which relatively untransformed and restored natures are becoming technically inscribed as numerical signifiers of capital, such that these can be added to and offset against other forms of accounted capital and in economic models more generally;
  4. and an institutional shift, in which networks and alliances are becoming constituted as an interlinked assemblage organised around making the core metaphor of nature as natural capital appear as the materialised reality of accounted for natural capital.

As Mike Hannis asserts1, through these aligned shifts ‘talk about things like cod and rainforests is translated first into talk about natural resources, then into talk about natural capital, and then into talk about the substitutability of different forms of capital’. My intention with this piece is to draw attention to this emergence and consolidation of the new myth of nature as Natural Capital, and to indicate some associated power-effects.


The Natural Capital ‘Coup’

The post-WW2 era has become known for the establishment of cogent social movement critique regarding the detrimental effects on environmental parameters of extractive and industrial production and consumption practices. Linked in part with the treatment of environmental aspects as ‘externalities’ in conventional economic models, a number of international meetings and policy statements – from the UN Stockholm Conference on the Human Environment in 19722, to the World Wide Fund for nature (WWF), International Union for the Conservation of Nature (IUCN) and Food and Agricultural Organisation (FAO) World Conservation Strategy of 1980 – drew attention instead to the limits to economic growth posed by environmental parameters, and thus to the need for a ‘sustainable development’ that embeds economic agendas within environmental means.

In the years since, these proposals for limits to economic practice and production have been re-choreographed so as to place corporate and financial leaders at the forefront of environmental policy and practice, reinventing sustainability as the new frontier for economic growth. This change has become possible not so much by a reskilling of business leaders as ecologists and natural scientists, as by a remaking of nature as «Natural Capital», through which environmental parameters can be known, technically approached and embedded within economics and accountancy spheres of knowledge production.

There are many routes in to understanding the metaphorical conception and literal constitution of nature as capital, but two global moments seem to be of particular importance. The first is the establishment of the World Business Council for Sustainable Development (WBCSD), at the first United Nations (UN) Earth Summit in Rio de Janeiro in 1992. The WBCSD is a CEO-led global network of corporations from Monsanto to Rio Tinto3. This network was initiated by Maurice Strong, as the Secretary General for the 1992 Earth Summit (and previously for the 1972 UN Stockholm Conference on the Human Environment), but originally an entrepreneur in the Alberta oil patch and president of the Power Corporation of Canada. One of the first key assertions of nature as akin to a ‘bank of natural capital’ can be traced to this powerful player in global environmental governance, in the following statement repeated in various speeches in the early to mid-1990s that:

[i]n addressing the challenge of achieving global sustainability, we must apply the basic principles of business. This means running “Earth Incorporated” with a depreciation, amortization and maintenance account.4.

This sentiment has rapidly become almost a truism in environmental governance. It is used, for example, as a marketing hook by private sector organisations such as the US-based Environmental Consultancy Agency and the global investment fund Eko Assets Management5. And it is echoed by government representatives such as Caroline Spelman, who as Environment Minister for the UK’s Conservative coalition government and simultaneously co-owner of a lobbying firm for the food and biotechnology industry, launched DEFRA’s 2011 Natural Environment White Paper The Natural Choice: Securing the Value of Nature,[8] by stating that:

… if we withdraw something from Mother Nature’s Bank, we’ve got to put something back to ensure that the environment has a healthy balance and a secure future.

Indeed, in 2012 the UK established a ‘Natural Capital Committee’ precisely ‘to ensure that Government has a better informed understanding of the value of Natural Capital, and … [to] help it to prioritise actions to support and improve the UK’s natural assets’.

This metaphor of nature as ‘a bank of natural capital’ is presented in rather literal form by the celebrated United Nations (UN) and European Union (EU) project on The Economics of Ecosystems and Biodiversity (TEEB). Led by a career banker from Deutsche Bank and current consultant for GIST (Green Indian States Trust) Advisory Ltd6 – described as ‘a specialist consulting firm which helps governments and corporations discover, measure, value, and manage their impacts on natural and human capital’7 – in 2011 TEEB launched its Bank of Natural Capital website.8. In the iconography of the site, nature’s stocks and flows are depicted such that they accord with the format of a standard online current bank account.

bank of natcap


Twenty years on, a second key moment in the instituting of this ‘nature-as-natural-capital’ discourse occurred with the UN Rio+20 Earth Summit on 20-22 June 2012. Here a ‘Natural Capital Declaration’ was presented as a private sector finance response signed by CEOs of financial institutions and committing the financial sector to take ‘natural capital’ into account in all financial products and services9.

At this event, and amidst an array of interventions resisting a corporate-led Green Economy orientation, powerful networks and institutions further declared and consolidated nature as Natural Capital. In the run-up to the event significant global interventions were publicised for better ‘green accounting’ that incorporates non-produced environmental elements.

The WAVES (Wealth Accounting and Valuation of Ecosystem Services) initiative of the World Bank Group (WBG), for example, is a key element of the WBG’s recently published ‘Environment Strategy’, and is a methodology for incorporating ‘natural capital’ and ecosystem measurements into national ‘wealth accounts’, in part ‘to establish the true value of biodiversity’10 WAVES is set within the context of a substantially energised System of Environmental-Economic Accounting (SEEA), agreed in 2012 by the UN Statistical Commission as an international standard for combining economic and environmental data, including ‘ecosystem services’ and ‘natural capital’, into a single global accounting system11.

The Green Accounting of Indian States Project, funded by Deutsche Bank India, Centurion Bank of Punjab and Green Indian States Trust and co-authored by TEEB’s director, thus affirms that, ‘biodiversity should be treated as an asset and its loss should be adequately represented in the national accounts’, at the same time as functioning as ‘natural capital’ that can represent ‘genuine net additions to the national wealth’12. And in the UK,

[e]conomists have begun preparing to include a value for “natural capital” in Britain’s GDP calculations by 2020, a move that promises to be the greatest change in national accounting practices since their creation 70 years ago13.


A Double-edged Sword?


This banking and capital metaphor is a double-edged sword.

A benign reading is that it will encourage nature care by keeping nature, as ‘natural capital’, in the black rather than the red. As stated by former UNEP official Don de Silva:

much of what we regard as wealth creation has in fact represented a running down of our common capital. Like any other business, Earth Incorporated, simply cannot function for long on that basis. In fact, if we were to present its accounts on a business basis, Earth Incorporated would be, in a very real sense, like the current banking crisis, heading steeply in the process of liquidation: bankruptcy’.14

As noted above, a massive push thus is underway to calculate and account for nature as akin to the assets of a business, or as a bank of natural capital.

There is something strange here, however. This is that in fact it is debt that tends to constitute banked capital assets in the ‘real world’, and that also creates the possibility for businesses to innovate and expand. It is debt that generates seemingly endless ‘value’ through its securitisation and financialisation, and for which careless behaviour and cynical manipulation have recently been rewarded by massive bailouts from public sources.

In other words, the metaphor of nature as ‘a bank of natural capital’ might be rather inappropriate if it is the better relationship with, and wise use and ‘saving’ of, embodied ‘nature health’ that is to be promoted by this thinking. Banks are sustained by and associated with a variety of practices that split actual stored capital so as to create more financial value and thus greater liquidity or flow of money in the system over all. These practices include:

  • fractional reserve lending, in which the total value commanded by a bank is a vast multiplication of the value it actually houses;
  • the splitting of debt into complex tradable packages that turn it into assets on the portfolios of ‘securities’ managers;
  • and the management of unimaginably large virtual funds of money through betting on ultimately unpredictable market probabilities.

These practices surely constitute greatly problematic models for conceptualising and managing the fleshly, relational and unpredictably varying entities, populations and phenomena that constitute ‘real nature’ as opposed to Natural Capital.


Materialising Natural Capital

Accounting for nature in terms of money is also creating innovative and unintuitive possibilities for materialising and leveraging nature as Natural Capital. This is the other edge of the sword. It perhaps provides an indication of why accounting for nature in terms of ‘natural capital’ is becoming popular in the sectors of society that have tended to treat nature health and harm as externalities that have little to do with profits or pay-outs. From payments for ecosystem services (PES) schemes, to REDD+ (Reducing Emissions from Deforestation and Forest Degradation in Developing Countries) initiatives, and to the hedging of various derivatives that bet on predictions of dynamics in nature health and harm, nature’s ever-expanding presence as Natural Capital permits its further incorporation into the sphere of finance capital.

Two new layers of this ‘materialisation’ are in the form of bonds linked with the monetised value of nature, and frequently of forested nature, as natural capital, and as the monetised risk posed to investors by environmental decline.


‘You know what I mean by a bond? Something that binds?’15

The Climate Bonds Initiative states that,

[t]he bond market is the great innovation that distinguishes western capitalism from previous economic systems.16

A bond is a promise to pay its holder an agreed amount by a certain future time and with an agreed rate of interest. From the letters of credit issued in Europe by the Knights Templar in the 12th century, a bond denotes a loan of funds whose repayment is secured by its attachment to something held by the debtor, and valued by the investor.

In Shakespeare’s Merchant of Venice, Shylock secures his bond on a pound of Antonio’s flesh. More usually, bonds are attached to something that is more easily legible in monetary terms. So, a mortgage is secured by a property, a banknote is secured by the currency reserve held by the bank, and a government or sovereign bond is secured by capitalised resources at a government’s disposal.

Bonds secured on monetised signifiers of environmental health now are flourishing. Climate Bonds and Green Bonds thus ‘frontload’ future funds by encouraging government borrowing from investors secured on the future economic and environmental (especially climate) benefits predicted to flow from these investments.17.

The World Bank Treasury currently issues a variety of bonds secured on climate-related goals, including ‘Cool Bonds’18, ‘Eco Bonds’19 and ‘Green Bonds’20, Green Bonds have been issued by the World Bank Treasury since 2008 to encourage ‘fixed income investors to support World Bank lending for eligible projects that seek to mitigate climate change 21

In the UK ‘environmental bonds’ – ‘including green investment bank bonds, green infrastructure bonds, and woodland creation bonds’ – are being encouraged as a means of linking investment to pledges of environmental improvement by issuers22. These bonds target an emerging class of investors in sustainability, interested in investing in companies whose ‘sustainability performance’ may be linked to financial ratings indices that include environmental proxies23 They permit investor finance and venture capital to be connected now with infrastructural developments considered to enhance future environmental sustainability and to generate financial returns from this.

This innovation of western capitalism is also being brought to bear so as to leverage landscapes of conserved and/or restored nature as the underlying collateral for capital-releasing loans that are bonded with the calculated monetary value of the ‘natural capital’ supported by these landscapes.

In 2011, for example, a ‘high-level workshop’ to consider the development of ‘Forest Bonds’ to finance ‘ecological infrastructure such as tropical forests’, was hosted by the World Wide Fund for Nature (WWF), the Global Canopy Programme and the Climate Bonds Initiative. Their financial partners were global investment banking and securities firm Goldman Sachs and the Swiss private bankers Lombard Odier. The workshop report24 proposes that public-sector funds and incentives such as tax breaks be used ‘to support private-sector investment in forests’ in return for government issued bonds based in part on the monetary value adhering in the ‘natural capital’ of tropical forests,  and against state income from ‘sustainable forest management’.25 It is advised that ‘the investment proposition needs to be large and liquid to attract the largest investors’, and that multilateral donors might ‘play an additional catalytic role by issuing a forest bond themselves and helping to pump-prime the forest bond market’.

unlocking2 adj


Through this ‘EcoSecuritisation’26, forests in effect would be ‘materialised’ as capital so as to ‘leverage additional finance from global capital markets’. This is intended to create an attractive new investment frontier that frontloads the funds needed for forest development. The financial capital that would be realised from this ‘natural capital’ would confer financial resources for a developing country’s economic transition to forest-friendly eco-entrepreneurial activity, rather than destructive land uses such as oil palm, soya and cattle ranching. Issuers of a ‘forest bond’ such as the governments of forest-rich countries of the global south would thereby raise ‘large-scale finance now that will be repaid by existing and anticipated future income’ from the forests thus invested.

But where exactly will the income come from for repaying the bond once it comes to maturity? It is suggested that it will derive from sources such as forest carbon revenue, ecosystem service markets, sustainable timber and agriculture and taxes. Thus, ‘EcoSecuritisation merges existing securitisation techniques with rapidly emerging environmental markets, in order to attract low cost, long term ‘patient capital’ to projects that have potential to generate significant Payments for Ecosystem Services (PES), such as tropical forestry’27. Let’s consider forest carbon revenue and PES as sources of debt repayment in a little more detail.

Forest carbon revenue is a reference to the ‘future streams of payments for expected emissions reductions’ provided by the carbon contained in standing forests under the UN funding programme called REDD+. This programme encourages forests of the global south deemed to be under sustainable forest management and involving the conservation and enhancement of carbon stocks, to become tradable in global markets to the extent that their carbon can be calculated, accounted for and conserved, as well as monetised and monitored. It is based on a widely held assumption that,

[t]here exists a fundamental gap between the value high-income nations place on pristine tracts of land in low-income nations, and the value that the owners of that land place on it, driven in part by the necessities of economic activity.28

As its name suggests, REDD+ is intended to reduce emissions of carbon to the atmosphere caused by reductions in forest cover. At the same time, concern regarding carbon loss from southern tropical forests occurs in a context of unequal distribution in industrial fossil fuel emissions. As such, REDD+ is akin to a giant global offsetting scheme whereby industrial emissions are maintained in part by ensuring enhancement of forests as stored carbon in the south.

Making southern forests ready for REDD+ involves significant monitoring and conservation work by local communities and the giving up of alternative production practices, not to mention the centralised administration and surveillance required to permit registration of the new carbon value of forests. Nonetheless, if all this ‘value’ can become legible as ‘natural capital’, and as recommended by the World Bank Group, it might indeed then ‘serve as collateral to loans to finance the upfront investments in [REDD+] programs’, in effect creating ‘REDD+ bonds’29.

As such, investment in forest bonds might act to fund the creation of REDD+ programmes, such that the future carbon revenues from these programmes ultimately are directed to service the loans offered for their creation. It is hard not to see this as yet another intervention whereby natural resources in southern countries might become bound to outside investors in ways that shifts sovereignty over those resources, as well as increasing the indebtedness of invested countries.

The reference to ecosystem service markets implies a similar mobilising of capital from other aspects of conserved nature in southern countries, through the receipt of payments for the maintenance of these increasingly valued and monetised ‘services’. Thus, World Bank loan funding is being directed to support countries such as the Republic of Congo to become providers of monetised and marketable ‘environmental services to the emerging global markets’30. As well as through forest carbon credits under a REDD+ mechanism (as described above), this would include the monetised value of conservation products such as biodiversity offsets.31.

Demand for purchase of these conservation products comes in part from ecological pressure exerted by extractive industry and plantation forestry, which in the Congo case are also supported by the World Bank32. Somewhat tautologically then, the logic of these funding models is to create new sources of repayments to investors through funding strategies that necessitate the creation of these very sources of repayments. This is in two ways:

  1. by enhancing the scarcity of healthy ecosystems through funding development and extractive activity, in such a way as to stimulate a mirroring need for ecosystem service and offsetting markets;
  2. and by funding the natural capital accounting frames and techniques that are creating the monetary values for new nature categories such as ‘ecosystem services’ and REDD+ credits that themselves might be mobilised as both the security and as sources of repayment for these loans.

World Bank economists have also considered the design of bond structures attractive to private investors in association with funding the conservation of specific charismatic species.

‘Tiger Bonds’ have been proposed, for example, to frontload future funds for subsequent repayment through the capitalisation of nature assets associated with tiger territories33. These assets might include future forest carbon revenues from the REDD+ mechanism as it plays out in such territories (as above), or created through ‘[e]stablishing biodiversity as collateral for lending’34.

In the private sector, the US consultancy firm Advanced Conservation Strategies proposes the creation of ‘environmental performance bonds’ as insurance-based contracts based on ‘the health of an endangered species’ relative to the activities of a company or economic sector.35. They suggest that such a contract would provide immediately available funds for ‘endangered species mitigation’ if a company ‘does not perform environmentally’; that it would simplify environmental compliance by companies; and, through fixed payments to reward environmental performance, would provide financial incentives to companies for environmental stewardship. This proposal attempts to enhance corporate responsibility for negative environmental changes by transforming measures and indicators of these changes into numerical scores that can be incorporated into financial performance models. It is an approach that seems to turn the risk of species loss and decline into insurable events, but that perhaps pays little heed to the embeddedness of organisms, populations and species within ecosystemic relationships, or to unpredictably dynamic contexts of environmental change.

These proposals for binding nature as natural capital with financial domains, constitute some new ways in which conserved nature is conversely becoming ‘unbound’36 from localities and other(ed) culturenature value practices, through its calculation as natural capital and the ensuing possibilities for its release as leveraged and circulating financial assets. The associated mantra is that all ‘stakeholders’, including forest-dwelling peoples of the tropics, should benefit appropriately.

At the same time, proposals for bonds based on ‘natural capital’ generate concerns regarding the possible transfer of monetised nature values to private investment capital portfolios. In particular, clarification is needed regarding what happens to the natural capital collateral in cases of default. Proposals such as forest and REDD+ bonds, for example, are based on an underlying assumption of a secure future income stream arising from payments for the carbon stored in forests of the global south. Nevertheless, a broader context of crisis in carbon markets such as the European Union’s Emissions Trading Scheme (EU ETS) and the recent dramatic fall in the price of tradable carbon37, suggest that this assumption may be untenable, generating questions regarding possible enclosure of leveraged ‘natural capital’ by lenders in such circumstances.

It is not alarmist to suggest such possibilities. We have only to remember the way that the recent subprime mortgage crisis, wherein lenders fell over themselves to advance loans onto books without adequate assurance of repayment strategies, facilitated the massive foreclosure of the capital ‘securing’ such loans when repayments were not forthcoming. The documents cited here for Forest Bonds, for example, are opaque on this point, asserting, that ‘[i]f for any reason … earmarked cash flows did not arise, the issuer would draw on other [unspecified] financial resources to meet its obligations’38.

These contexts invokes the possibility of a further transfer of government, i.e. public, resources to lenders. Indeed, given current tendencies for governments to subsidise a price-floor for carbon so as to maintain carbon markets39. as well as to bail out lenders in instances of bad debt, such proposals might give rise in time to more ways in which public resources are directed to sustain private investment portfolios.


Materialising Environmental Risk

The above illustrates some possible ways in which nature might be leveraged financially as ‘natural capital’. An additional thread in current financial ‘materialisation’ of environmental factors is a  growing concern with the ways in which environmental risk might pose danger and opportunity for financial investments. The Biodiversity for Banks (B4B) programme initiated by the Equator Principles Association, WWF and BBOP, for example, assists financial institutions to overcome the challenges of incorporating risks associated with biodiversity and ecosystem services into their lending decisions40.

Environment, Social and Governance (ESG) performance of financial investments increasingly is materialised through scoring and indexing methodologies for ESG indicators, accompanied by a desire to reduce risk to investors caused by negative performance in ESG indicators for associated investment contexts41.

An example of how these linkages are being systematised for national and international environmental parameters has been published recently as E-RISC: Environmental Risk Integration in Sovereign Credit Analysis, by the UN Environment Programme’s Finance Initiative (UNEP-FI), the Global Footprint Network and collaborating financial institutions. This text seeks to clarify the material risk of environmental parameters to current investment portfolios that incorporate government bonds, in a context in which outstanding sovereign debt in 2010 was in the order of US $ 41 trillion42.

‘Risk’ here is the danger to investment portfolios posed by commodity price volatility, climate change, and reductions in a country’s natural resource productivity or ‘biocapacity’ due to environmental degradation. All these risks may adversely affect a country’s investibility by amplifying risk to investors.

While protecting the interests of financiers, however, this approach does little to recognise the ecological debt linked currently and historically to financial investment practices more broadly. These practices include:

  1. speculative financial practices elsewhere in the financial system that are driving up commodity prices, encouraging land-grabs in the global south for the production of primary commodities, and thus enhancing both inequity and environmental transformation43;
  2. investments in algorithmic and hardware technologies that permit ever-faster trading practices, thereby cranking up the energy within the financial system and increasing the likelihood of bubbles and crashes44;
  3. and the historical infrastructure and large-scale investments that have created ‘peripheral’ economies as intrinsically more vulnerable to current price fluctuations and environmental change dynamics, and thus more risky in terms of sovereign bond investment45.

The accounting technology and institutional apparatus for materialising the environmental risk associated with investment in sovereign bonds thus might be seen again as affording protection to financiers at the possible expense of indebted countries. It is an assemblage of discourses, institutions and technologies that protects financiers from both the negative ecological transformations associated with their own historical lending practices, as well as from the possibility of declining sovereign credit ratings that may be associated with these same lending practices.


The Natural Capital Myth

The examples above trace some ways in which beyond-human nature is being productively conceived and normalised as Natural Capital. Making nature visible as ‘natural capital’ binds nature with economic concepts and structures, through conceptually unbinding it from ecological and different  social-ecological relationships and conceptions of value.

As Kathryn Yusoff describes,

this new political scene of ecosystem service economies represents a new ontology of biotic subjects – be they plant, animal, microbe or fungi – in which their value as entities is inscribed into capitalist modes of production as the defining characteristic of their life’s work.46

The process is raising economic rents for land areas through new prices for the ‘ecosystem services’ provided by accounted for standing stocks of nature as ‘natural capital’. Through enhancing the impetus towards ‘green grabbing’47 – whereby sources of ‘green’ value are appropriated, privatised and speculated on – these new prices may extend an historical trajectory whereby land, and today the newly ‘valued’ natural capital entities associated with land areas, becomes more valuable than the people on it.48 Indeed, in many contexts where REDD+ and payments for ecosystem services are being stimulated, local people are working hard to both ensure that forest value remains embedded within communities, and to resist the cooptation of local nature values that outside investments can represent.49

To follow philosopher Mary Midgley in The Myths We Live By, this new economising myth of nature as Natural Capital is rapidly becoming a hegemonic nexus of powerful symbols for interpreting, knowing and thus for making the world in which we live50. The metaphorical concept of Natural Capital is being discursively and technically constructed using the expert languages of economics and science in such a way that engenders authority and the appearance of truth, despite the basis of these assertions in conjecture, metaphor, myth and fantasy.

Exercising the language of Natural Capital, and the growing imaginative pattern of nature as Natural Capital with which this is associated, in turn has its own influence in the world. It is a potent mechanism for amplifying nature’s distance and docility, thus supporting its further inclusion and incorporation within the binary discursive technologies of capital accounting. Through these processes, nature’s innate exuberance can be further ‘calculated, organized, technically thought’ and ‘invested with power relations’, such that ‘it’ might more deeply enter ‘a machinery of power that explores it, breaks it down and rearranges it’ to productively bend and release its immanent forces towards economic utility51.

As the examples above indicate, we are seeing the manifestations of this impetus now, in the construction of the vast global Natural Capital Accounting Machine that is creating ‘Earth Incorporated’ as a liquid but deadened world of abstracted and calculated entities. Paul Feyerabend calls this simplifying tendency towards abstraction ‘the conquest of abundance’52. Through this ‘conquest’, the magnificent and emplaced abundance that surrounds and confuses us is reduced, creating a ‘drab world… obedient only to scientific dicta and economic imperatives’53.

Apparently authoritative propositions such as ‘the annual value of “ecosystem services” globally is between $16-54 trillion’54, or ‘sustainability-related global business opportunities in natural resources may be in the order of US$2-6 trillion per annum by 2050’55 thus ‘have the attraction of seeming to make life simpler because they are simple in themselves’56. They manifest as a regressive, adulterated expert language that demeans both the academic disciplines with which they are aligned, and the ‘richness of Being’ of life’s nature57. They are dangerously reductive and speculative, even as they are animated by the magic of scientific language and assumed expertise58.

Nonetheless, given a Newtonian and mechanistic tendency ‘to use a single force to account for many different effects’59, such universalising discursive tendencies – of which the natural capital myth is one – create the hermeneutic conditions within which institutional decisions and policies are made that further assert such myths as self-evident.

To follow philosopher Michel Foucault, then, we can learn much of the likely ‘power-effects’ of the Natural Capital Myth, by considering the ideology within which the discourse of natural capital is located, the institutional assemblage within which it is being promoted and operationalised, and the technologies of power that are putting this discourse to work60.

It is no coincidence, for example, that ‘Natural Capital’ is the dominant myth of nonhuman nature at this apparently apocalyptic moment of the Anthropocene and the hegemony of global neoliberal ideology. ‘Natural Capital’ reconstitutes the environmental transformations associated with the Anthropocene as a massive opportunity for the invigoration of capitalist socio-ecological relations, precisely through simplifying nature such that it is both legible, and leverage-able, as capital. Through the application of accounting technologies to socio-environmental relations, and as the examples above indicate, nature becomes more able than ever to be put to work for capitalism. But this is occurring through massive denial and concealment: of the monstrously exuberant and transgressive immanent tendencies and unpredictable dynamics of living entities and complexes; of other(ed) nature myths, knowledges and values; of the repetitive systemic violences and exclusions with which the privileged liquidity of capital is associated; and of the pathological inequities that at times it seems as though the entire eco-socius is constrained to serve61. In particular, the coercive calculative synthesis of nature as ‘natural capital’ extends an expert approach to nature as ‘the object of a technology and knowledge of rectification, reinsertion and correction’62, as opposed to a community of vibrant subjectivities, desiring life too.

The Natural Capital Myth is colonising our imaginations – telling us who we are or might be as human beings in relationship with the more-than-human natures who also dwell on earth. It is offering a convergence between ecology and economy, but one that creates a docile ‘eco-functional nature’63 that can be instrumentalised as a capital-bearing and fissionable asset within a dominant accounting and calculative praxis.

As a myth that is fast becoming hegemonic, it increasingly is part of ‘the matrix of thought, the background that shapes our mental habitats’, and that might act to distort our thinking with possibly detrimental effects.64. This is why it needs both attention and juxtaposition with other world-making myths: perhaps those that tend towards more poetic and democratic celebration of nature’s immanent embodied aspects, in contrast to the transcendental disembedding abstractions favoured by the Natural Capital Myth Machine.


This essay was first published as an invited article for the Public Political Ecology Blog run from the University of Arizona’s College of Social and Behavioral Sciences – thank you to political ecologist Tracey Osborne for the original invitation to contribute to the blog.



Connected peer reviewed publications

Sullivan, S. 2018 Bonding nature(s)? Funds, financiers and values at the impact investing edge in environmental conservation, in Bracking, S., Fredriksen, A., Sullivan, S. and Woodhouse, P. (eds.) Valuing Development, Environment and Conservation: Creating Values that Matter. London: Routledge Explorations in Development Studies.

Sullivan, S. 2018 Making nature investable: from legibility to leverageability in fabricating ‘nature’ as ‘natural capital’. Science and Technology Studies 31(3): 47-76.

Sullivan, S. and Hannis, M. 2017 ‘Mathematics maybe, but not money‘: on balance sheets, numbers and nature in ecological accounting. Accounting, Auditing and Accountability Journal 30(7): 1459-1480, special issue on ‘Ecological accounts: making non-human worlds (in)visible during moments of socio-ecological transformation’, edited by Markus J. Milne, Shona L. Russell and Colin Dey.

Sullivan, S. 2017 Natural capital, fairytales and ideology. Invited Review Essay, Development and Change 48(2): 397-423.

Sullivan, S. 2014 The natural capital myth; or will accounting save the world? Preliminary thoughts on nature, finance and values. LCSV Working Paper 3.

Sullivan, S. 2013 Banking nature? The spectacular financialisation of environmental conservation. Antipode 45(1): 198-217.

Sullivan, S. 2013 After the green rush? Biodiversity offsets, uranium power and the ‘calculus of casualties’ in greening growth. Human Geography. 6(1): 80-101.


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  11. WAVES 2012Moving Beyond GDP: How to Factor Natural Capital into Economic Decision-Making. Washington: The World Bank, p. 10; European Commission, Food and Agriculture Organisation, International Monetary Fund, Organisation for Economic Cooperation and Development, United Nations and World Bank 2012 System of Environmental-Economic Accounting: Central Framework. Formerly at, last accessed 7 March 2013; UN 2012 The System of Environmental-Economic Accounts (SEEA): measurement framework in support of sustainable development and green economy policy. Briefing Paper formerly at
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  15. Pullman, P. 1997 The Subtle Knife. London: Scholastic UK Ltd., p. 187. Parts of this section have been published in Sullivan, S. 2012 Financialisation, Biodiversity Conservation and Equity: Some Currents and Concerns. Environment and Development Series 16, Penang Malaysia: Third World Network.
  16. Climate Bonds Initiative 2010 Climate Bonds can fund the rapid transition to a low-carboneconomy.
  17. Climate Bonds Initiative 2009 Financing a Rapid, Global, Transition to a Low-Carbon Economy. Draft Paper for Discussion, pp. 2, 4, formerly at, Last accessed 7 March 2013; Kerste, M., Weda, J. and Rosenboom, N. 2010 Innovations in Financing Environmental and Social Sustainability: Literature Overview. Amsterdam: Duisenberg School of Finance and Holland Financial Centre, formerly at, Last accessed 7 March 2013.
  18. The first bond linked in part with future market prices in Certified Emissions Reductions (CERs) ‘and the actual versus estimated delivery of CERs that will be generated by a hydropower plant located in the Guizhou Province in China’ – The World Bank 2008 Daiwa Securities Group offers the first CER-Linked Uridashi Bond Created in Collaboration with the World Bank, formerly at formerly at
  19. Designed with Netherlands banking conglomerate ABN AMRO, ‘Eco Bonds’ were issued in 2007 and are coupons that are ‘linked to an equity index, the ABN AMRO Eco Price Return Index, comprised of companies that produce alternative forms of energy, engage in water and waste management, or are involved in the production of catalysts used to reduce pollution’, see World Bank Group 2008 World Bank issues Eco 3Plus note through Fortis Retail Bank, formerly at
  20. Designed with Skandinaviska Enskilda Banken, ‘the top bank for large corporate clients and financial institutions for the entire Nordic region’ (, as accessed 7 March 2013
  21. including through avoided deforestation, cf. REDD+] or help affected people adapt to it’ (World Bank Treasury 2012 Green Bond Fact Sheet. Formerly at, p. 1; also The World Bank Treasury 2012 Green Bond Fourth Annual Investor Update.
  22. Ecosystemmarkets Task Force 2013 Realising Nature’s Value: The Final Report of the Ecosystem Market’s Task Force.
  23. As described by fund manager Matthew Kiernan, former Director of the World Business Council for Sustainable Development, in Investing in a Sustainable World: Why Green Is the New Colour of Money on Wall Street (2009, New York: Amacom). Kiernan is founder of Inflection Point Capital Management (IPCM), which compiles and manages a proprietorial database to provide information on companies’ sustainability performance to investors (formerly at
  24. Cranford, M., Henderson, I.R., Mitchell, A.W., Kidney, S. and Kanak, D.P. 2011 Unlocking Forest Bonds: A High-Level Workshop on Innovative Finance for Tropical Forests. WWF Forest and Climate Initiative, Global Canopy Programme and Climate Bonds Initiative, formely at, p. 5. Also see Cranford, M., Parker, C. and Trivedi, M. 2011 Understanding Forest Bonds: A Guide to Raising Up-front Finance for Tropical Forests. Oxford: Global Canopy Programme, formerly at
  25. As suggested in Forum for the Future and EnviroMarket Ltd 2007 Forest-Backed Bonds Proof of Concept Study. Report for the International Finance Corporation and the UK Dept. for International Development, p. 4.
  26. As suggested in Forum for the Future and EnviroMarket Ltd 2007 Forest-Backed Bonds Proof of Concept Study. Report for the International Finance Corporation and the UK Dept. for International Development, p. 4.
  27. As suggested in Forum for the Future and EnviroMarket Ltd 2007 Forest-Backed Bonds Proof of Concept Study. Report for the International Finance Corporation and the UK Dept. for International Development, p. 9.
  28. See Advanced Conservation Strategies 2011 Using Debt Investment to Link Livelihood Improvement and Incentives for Environmental Stewardship. Online. formerly at accessed 7 March 2013, also see Mandel, J.T., Donlan, J.C., Wilcox, C., Cudney-Bueno, R., Pascoe, S. and Tulchin, D. 2009 Debt investment as a tool for value transfer in biodiversity conservation. Conservation Letters.
  29. World Bank Group 2012 Modalities and procedures for financing results-based actions on REDD+. Submission to the UNFCCC secretariat, pp. 1-2. Also see submissions by the UNFCCC Ad Hoc Working Group on Long-term Cooperative Action ‘on modalities and procedures for financing results-based actions’, for the 15th Session in Bonn 15-24 May 2012.
  30. World Bank 2011 Congo, Republic of – Forestry and Economic Diversification Project, AB6677, p. 3.
  31. On which see the Business and Biodiversity Offsets Programme, formerly at, national biodiversity offsetting policies, such as those by DEFRA in the UK, as well as commentary and critique, for example, Hannis, M. and Sullivan, S. 2012 Offsetting Nature? Habitat Banking and Biodiversity Offsets in the English Land Use Planning System. Dorset: Green House; Sullivan, S. 2013 After the green rush? Biodiversity offsets, uranium power and the ‘calculus of casualties’ in greening growth. Human Geography. 6(1): 80-101.
  32. At the time of writing the World Wide Fund for Nature thus is researching opportunities for biodiversity offsets to offset mining investments and impacts within the Republic of Congo, formerly at accessed 7 March 2013.
  33. Kiess, J. 2009 Innovative Sustainable Finance for the Global Tiger Initiative. The World Bank. Formerly at (a domain name which now offers information on online gambling – 30 January 2020), but see Not to be confused with Treasury Investors Growth Receipts (TIGR), also known as ‘Tiger Bonds’, which are ‘a type of zero-coupon bond originally issued by the US Treasury’ and ‘do not pay interest over time, but instead are sold at a severe discount and, once mature, pay out at the full market price they had when issued’.
  34. Kiess, J. 2009 Innovative Sustainable Finance for the Global Tiger Initiative. The World Bank, p. 24
  35. Formerly at 7 March 2013
  36. cf. Brockington, D., Duffy, R. and Igoe, J. 2008 Nature Unbound: Conservation, Capitalism and the Future of Protected Areas. London: Earthscan.
  37. See, for example, Carrington, D. 2013 EU carbon price crashes to record lowThe Guardian 24 January 2013
  38. Cranford, M., Henderson, I.R., Mitchell, A.W., Kidney, S. and Kanak, D.P. 2011 Unlocking Forest Bonds: A High-Level Workshop on Innovative Finance for Tropical Forests. WWF Forest and Climate Initiative, Global Canopy Programme and Climate Bonds Initiative, p. 14.
  39. See, for example, HM Revenue and Customs 2012 Carbon price floor. Formerly at accessed 12 March 2013.
  40. Formerly at accessed 13 March 2013, see accessed 30 Januray 2020.
  41. as detailed in Dempsey, J. 2012 Biodiversity loss as material risk: Tracking the changing meanings and materialities of biodiversity conservation. Geoforum
  42. UNEP-FI and Global Footprint Network 2012 E-RISC: A New Angle on Sovereign Credit Risk, p. 3.
  43. See, for example, discussion in Berne Declaration (ed.) 2011 Commodities: Switzerland’s Most Dangerous Business. Zurich: Berne Declaration,  formerly at
  44. Mandelbrot, B. and Hudson, R.L. 2008 The (Mis)behaviour of Markets: A Fractal View of Risk, Ruin and Reward. London: Profile Books Ltd.
  45. UNEP-FI and Global Footprint Network 2012 E-RISC: A New Angle on Sovereign Credit Risk. To provide an indication of the extent of this vulnerability in less developed economies, Christian Aid suggested in 2006 that 182 million people in sub-Saharan Africa alone could die of disease directly attributable to climate change by the end of the [21st] century, see Christian Aid 2006 The Climate of Poverty: Facts Fears and Hope.
  46. Yusoff, K. 2011 The valuation of nature – The Natural Choice White Paper, commentary. Radical Philosophy 170: 2-7.
  47. Fairhead, J., Leach, M. and Scoones, I. 2012 Green grabbing: a new appropriation of nature? Journal of Peasant Studies 39(2): 237–261.
  48. See, for example, Fairlie, S. 2009 A short history of enclosureThe Land 7: 16-31.
  49. For examples, see and
  50. Midgley, M. 2004 The Myths We Live By. London: Routledge.
  51. Foucault, M. 1991[1975] Discipline and Punish: The Birth of the Prison, trans. Sheridan, A. London: Penguin, pp. 24–26, 138, 170; discussed further in Sullivan, S. 2013 Banking nature? The spectacular financialisation of environmental conservation. Antipode45(1): 198-217. Also see Federici, S. 2004 Caliban and the Witch: Women, the Body and Primitive Accumulation in Medieval Europe. New York: Autonomedia.
  52. Feyerabend, P. 1999 Conquest of Abundance: A Tale of Abstraction Versus the Richness of Being. Chicago: University of Chicago Press. I am grateful to Kathryn Papp for drawing my attention to this text.
  53. Borrini-Feyerabend, G. 1999 Preface and acknowledgements, pp.ix-xiii in Feyerabend, P.Conquest of Abundance: A Tale of Abstraction Versus the Richness of Being. Chicago: University of Chicago Press, p. x.
  54. Costanza, R., d’Arge, R., de Groot, S., Farber, M., Grasso, B., Hannon, K., Limburg, S., Naeem, R., O’Neill, J., Paruelo, R., Raskin, R., Sutton, P. and van den Belt, M. 1997 The value of the world’s ecosystem services and natural capital. Nature 387: 253-260.
  55. WBCSD 2011 Guide to Corporate Ecosystem Evaluation, p. 4, formerly at, last accessed 7 March 2013.
  56. Midgley, M. 2004 The Myths We Live By. London: Routledge, p. xiii.
  57. cf. Foucault, M. 2003(1974/75) Abnormal. Lectures at the Collège de France, 1974-1975, trans. by G. Burchell. New York: Picador, p. 39, 41.
  58. Midgley, M. 2004 The Myths We Live By. London: Routledge, p. xiii.
  59. Midgley, M. 2004 The Myths We Live By. London: Routledge, p. xiii.
  60. Foucault, M. 2003(1974/75) Abnormal. Lectures at the Collège de France, 1974-1975, trans. by G. Burchell. New York: Picador, p. 14.
  61. On which see the statistics compiled by the Transnational Institutes State of Power 2013.
  62. Foucault, M. 2003(1974/75) Abnormal. Lectures at the Collège de France, 1974-1975, trans. by G. Burchell. New York: Picador, p. 21.
  63. Igoe, J. 2010. The spectacle of nature and the global economy of appearances: anthropological engagements with the images of transnational conservation. Critique of Anthropology 30(4): 375-397.
  64. Midgley, M. 2004 The Myths We Live By. London: Routledge, p. 5.


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