Impacts can lead to changes in the state of natural capital, thereby affecting its capacity to provide benefits to multiple stakeholders. Natural capital impacts can create significant risks for organisations, for example when society responds to such impacts by imposing consequences, such as regulation, fines, or loss of access to markets. Measuring and managing natural capital impacts can support risk management, as well as identification of associated opportunities, e.g. from improved environmental stewardship.
When should I use the Impacts section?
Users of the Impacts section may access these metrics and methods to determine a consistent approach to measuring the causes (‘impact drivers’) or effects (‘state’ of affected natural capital assets) of their organisation’s impacts on nature.
Users of this section may include (but are not limited to) actors interested in measuring their own direct impacts on nature, or indirect impacts associated with their value chain (e.g. customers or suppliers).
Impact metrics
Ideally, impact metrics would track the state of the affected natural capital assets, but often, it may only be practicable to measure the organisation’s actions that produce the impact (e.g. the quantity of emissions of a pollutant). These are known as impact drivers.
Impact metrics in the NCMC have been classified into six broad thematic areas according to a typology published by the Natural Capital Finance Alliance and the United Nations Environment Programme. These thematic areas are: Water, Weather and climate, Land and soil, Biodiversity and ecosystems, Energy, and Air.
The level of risk associated with an impact can be communicated by comparing an impact metric with a target threshold, defined as the level above which the consequences of the impact are considered to pose an unacceptable risk. For example, this might be the level of emissions of a pollutant, beyond which the organisation considers that it is likely to suffer loss of access to key markets. Target thresholds need to be determined by users, taking into account the organisational and environmental context in which the impact occurs.