Grace Augustine

Skoll Award Recipients Focus on Ecosystem Services Market

Having focused much of my research at Oxford on carbon markets and the development of ecosystem services markets, I was thrilled to see the Skoll Foundation’s recent investments in this area at last night’s ceremony for their 2010 Awards for Social Entrepreneurship. Three of the seven recipients of this year’s awards were from the field of ecosystem services and avoided deforestation. While past recipients have included incredible organization such as the Global Footprint Network, the Marine Stewardship Council, and, a quick count of those who received a Skoll award from 2005-2009 reveals that only 8 of the past 59 awardees (13%) have been environmentally-focused organizations, making this year’s awardees an extraordinary bunch. Last night’s ceremony is a testament to the fact that the social entrepreneurship world has turned a vital corner in its commitment to environmental issues and its realization that the environment is closely tied to so many problems facing those living at the base-of-the-pyramid.

The Skoll Foundation’s prestigious awards recognize and provide financial support ($765,000 each) to people and organizations with a proven track record and very high potential for future large-scale positive change. This year’s three environmentally-focused Skoll award recipients were Forest Trends, Imazon, and Telapak. Not only are they all working on environmental issues, but they are all committed to work on tropical forests and all contribute to the development of the ecosystem services market.

In terms of knowledge and momentum within the emerging ecosystem services market, Forest Trends is at the forefront. The organization’s goal is to understand the market potential of forests and avoided deforestation. It conducts research, partners with corporate and community projects, and is generally steering a movement towards the re-conceptualization of the value of forests. Check out their latest report on Ecosystem Markets. In the development of this market, we will also need players such as Imazon and Telapak. Imazon provides valuable technologies for monitoring deforestation and Telapak organizes community-based sustainable logging cooperatives in Indonesia, a nation that is often cited as the world’s 3rd largest contributor to greenhouse gases due to its rates of deforestation.

While carbon markets have shown that those in the developed world are willing to pay for the service of carbon sequestration from forests, ecosystem services as a whole is based on the idea of going beyond carbon to account for the value that forests provide in other areas, such as purifying our water and providing biodiversity that heals our illnesses and fortifies our agriculture. For more details on the ecosystem services, check out this 2008 NextBillion post from WRI and the very recent Biosphere Economy report on pathways to scale put out by Volans. Forests have numerous values that we have not been willing to pay for, leaving local people only with the option of gaining value through extraction. Markets are not flawless, as demand for resources such as hardwood and palm oil have been responsible for much recent forest destruction, but ecosystem services markets, which account for what were formerly considered social or environmental externalities, can bring vital capital to otherwise desperate communities and governments who have conventionally turned to commercial, smallholder, or even illegal logging for income. Today, creating a market for avoided deforestation and sustainable forestry management is probably one of the fastest-growing movements in the environmental sector.

I’ll be honest. Conservation, in the context of high-tech solutions and the power of man over nature in fields such as biotech, agriculture, energy, and medicine, seems a bit, well, boring. The word “conserve” invokes stagnation, in opposition to the “movement” that drives much of the world of social entrepreneurship. In February, at the launch of the TEEB report, a document that will probably go down in history as one of the most important steps in the development of the ecosystem services market, I had the pleasure of hearing Pavan Sukhdev, Special Advisor to the United Nations Environment Program’s Green Economy Initiative, speak of how difficult it is to sell forests and conservation as an economic and sustainable development tool.

Sukhdev said that he goes to donors, investors, and governments with his pitch for a “carbon capture and storage solution” that will provide sustainable income to local people and result in interest repayment levels beyond most conventional investments. With this opening pitch, his audience is usually begging to know more about his cutting-edge solution. But when he tells them that the innovation he has in mind is forests, he gets at best a laugh and at worst a scowl. There’s no ribbon-cutting ceremony or public relations events surrounding the preservation of century- old trees, and unfortunately, as I heard from both Sukhdev that day and Dr. Peter Gleick of the Pacific Institute yesterday, “People don’t value natural infrastructure like they value physical infrastructure.”

But I think forests have a chance. Social entrepreneurs have taken other seemingly-boring, conventional items, such as sanitation, reading lamps, eye-glasses and lapdesks and re-envisioned them through revolutionary models, making them sexy and exciting to financiers and clients. If APOPO can convince you to pay to adopt a rat, what’s so strange about getting people motivated to pay for the services they receive from forests? In addition, this “conventional” approach to creating livelihoods and fighting climate change will need the sleek, high-tech solutions such as Imazon’s monitoring devices and the complex financial tools of global investment banks such as JP Morgan, who just bought one of the leading carbon market project developers, EcoSecurities.

So maybe Forest Trends was wise in deciding on its name, implying a forestry movement, or as the Oxford English Dictionary defines “to trend” as “to run, stretch, incline, bend.” There is nothing stagnant in that definition. I know that I felt excited to see this vital movement celebrated by the Skoll Foundation in a ceremony that showed the possibility of the intersection of social change and the abatement of climate change.