Mainstreaming Natural Capital Valuation

By Purvaja Modak, Akshay Mathur, and K N Vaidyanathan


There is a critical need to reconfigure the international financial architecture to meet sustainable goals. For making informed decisions on allocating resources for sustainable business and economic development, it will be essential to value the cost of natural capital. This practice is difficult since assigning a monetary value for quantifying natural inputs such as water, air, trees is context-specific and requires data. Natural capital valuations can further help in calculating the true cost of capital and thus differentiate sustainable projects from unsustainable ones. The G20 should encourage the development and adoption of processes, instruments and regulations needed for valuing natural capital.