Natural capital and ecosystem services valuation: Assisting policy making

At the global scale, socio-economic and environmental systems are now in a process of co-evolution. Socio-economic systems rely on the continued health of environmental systems which provide the basis for human wealth and wellbeing. Nature, through its stock of natural capital assets, provides a flow of tangible and intangible benefits, known as ecosystem services that improve human wellbeing and contribute to economic development. Since many of the ecosystem goods and services are not traded in any markets, information and knowledge about their values are expressed in many different ways culturally through society. So, nature’s value is a multidimensional concept and not restricted to just monetary expression. Assigning more priority to nature conservation and management in our decision making at the individual project assessment to national/international rule making scales is socially desirable and an urgent requirement. This chapter outlines the different valuation methods and techniques, including monetary, non-monetary and hybrid approaches, that might support better decision making and examines future prospects for valuation research. In particular, the chapter discusses the role of these methods in policy making and their contribution towards efforts to incorporate the value of natural capital asset stocks and ecosystem services flows into a system of national accounts.