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## The Economics of Ecosystems and Biodiversity (TEEB)

At COP10, the final report of “TEEB: The Economics of Ecosystems and Biodiversity,” which is referred to as the biodiversity version of the Stern Review, was released (Figure1: Overview of TEEB). TEEB is an initiative of study supported mainly by the UNEP based on the “Potsdam Initiative” that was adopted at the 2007 G8 Environment Ministers Meeting, conducting analysis and assessment of the effects of deterioration of biodiversity and ecosystem services on international society and economy from an economic perspective. Here we will introduce TEEB’s main outcomes and recommendations.

## (1) Quantification of Biodiversity and Ecosystem Services

Until recently the value of biodiversity and ecosystem services has rarely been recognized, and there are an aspect that they have been rapidly lost due to exploitation and development. Therefore, with the objective of quantifying the effects of loss of biodiversity on our daily lives and the value that we gain by the conservation, attempts to assess the economic value of ecosystem services are being made around the world (Table1: Examples of Assessing the Monetary Value of Ecosystem Services).

TEEB not only brings about awareness of such value. It is said that it also works toward economic rationality and makes preservation of biodiversity and sustainable use possible, by reflecting the value in the decision-making and actions of government decision-makers, businesses, and consumers. For example, New York City authorities made decisions, to pay remuneration to landowners in the Catskill mountains to improve farm management techniques and prevent run-off of waste and nutrients into nearby watercourses in order to secure purified water. The cost of this choice was between USD 1 billion and 1.5 billion, while avoiding the projected cost of a new water filtration plant at USD 6 billion, plus USD 300 million to USD 500 million in estimated annual operation costs (Figure 2: Comparison of Costs Required for Securing Purified Water in New York City). However, it must be noted that such methods

## Figure 1 Overview of the Economics of Ecosystems and Biodiversity (TEEB)

## TEEB: The Economics of Ecosystems and Biodiversity

○An initiative to draw attention to the economic value of biodiversity on a global scale, highlight the cost of biodiversity loss caused by economic and social losses, and provide information to facilitate policymakers local and regional agencies, businesses and citizens for their decision-making.

At the 2007 G8 Environment Ministers Meeting the importance of economic assessment of global-scale loss of biodiversity was pointed out, and research then began, carried out mainly by Deutsche Bank. An interim report was made at COP9 in 2008, and a final report was released at COP10 in 2010.

Organizations and countries that played a central role:

D0 (Theory)

D1 (For policymakers)

D2 (For Local and Regional Policy)

D3 (For Business)

United Nations Environment Programme (UNEP), European Union (EU), the UK, Germany

D4 (For Citizens)

## Recommendations

①It is important to economically clarify the value of ecosystems and biodiversity.

The value of ecosystems and biodiversity is not reflected in a wide variety of decision-making, and that is leading to loss.

②It is necessary to change to a method in which it is possible to economically and socially reflect the value of ecosystems and biodiversity in policy formation and a wide variety of decision-making

Examples of specific methods

○Candidates for policy framework for managing natural resources

(payment for ecosystem services, promotion of procuring products that pay attention to biodiversity.)

○Reform of subsidies that have a negative impact on conservation of biodiversity, etc

○Introduction of regulations and tax systems to conserve biodiversity, etc

○Management of protected areas

○Prediction of risks and business chances in business activities related to ecosystems and biodiversity, and activities by the businesses based on those predictions

○Building an information system related to ecosystems and biodiversity, setting targets, and measuring, assessing, and reporting