Natural Assets
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Natural assets are assets of the natural environment. These
consist of biological assets (produced and wild), land and water areas with
their ecosystem, subsoil assets, and air.
In the sense of business environment, natural assets are
items, thing, or entity that has potential or actual value to an organization. It
is a financial term given to the ecosystem that defines them as productive
units of ecosystem service. Natural assets can be monetized directly or
indirectly like traditional assets.
For example:
Natural Assets monetization factors in social or urban
forestry:
- Tree Health
- Carbon sequestration
- Age and size
- Aesthetic
- Stormwater attenuation
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How can
natural assets be converted into financial assets?
To convert natural assets into financial capital. IEG has
developed an accounting framework to measure ecological performance. Natural
Assets produce an estimated $125 trillion annually in global ecosystem
services, such as carbon sequestration, biodiversity, and clean water.
The factor in this valuation system can also be used to
determine the level of service a thing provides. Determining the level of
service your organization ensures
1. Value of assets role
2. Allocation of assets
3. Budgeting for resources
4. Assets management
Natural Asset Companies are a new asset class of sustainable
enterprises that hold the rights to ecosystem services, allowing investors to
directly invest in land preservation and transformation.
References:
https://stats.oecd.org/