Policy context and user expectations Laure Ledoux European Commission, DG ENV, Biodiversity Unit Developing an EU Ecosystem Accounting System – focus on ecosystem asset and ecosystem service accounts, EEA, 1-2 October 2015

7EAP The integration of the economic value of ecosystem services into accounting and reporting systems at EU and national level by 2020 will result in better management of the EU’s natural capital' Work to develop a system of environmental accounts, including physical and monetary accounts for natural capital and ecosystem services, will need to be stepped up. This supports the outcome of Rio+20, which recognises the need for broader measures of progress to measure well-being and sustainability to complement gross domestic product. ACTION: Developing and applying alternative indicators that complement and go beyond GDP to monitor how sustainable our progress is and continuing work to integrate economic indicators with environmental and social indicators, including natural capital accounting. 2

Council conclusions on greening the European semester and the Europe 2020 Strategy – mid-term review Underlines the need for further “greening” the European Semester and the Europe 2020 Strategy by: […] f) Calling on the Commission to step up work in close cooperation with Member States,on developing a system of valuation of natural resources, and of biodiversity and the ecosystem services it provides – EU natural capital – in line with 7th EAP guidance, with a view to developing indicators, including for monitoring economic progress, and contribute to the development of environmental accounts.

EU 2020 Biodiversity Strategy and MAES Are Europe’s ecosystems in good shape to continue delivering essential ecosystem services? Can we value the flow of ecosystem services from ecosystems to society? Which drivers of change increase or decrease the delivery of ecosystem services? We need to map and assess ecosystems and their services

MAES overall conceptual framework First output of the MAES working group Sets a conceptual framework for mapping and assessment linking human well-being to bio diversity Makes proposals for a typology of ecosystems and ecosystem services EU input to IPBES conceptual model and UN Natural Capital Accounting work Importantly, MAES recognises the multiple roles of biodiversity in underpinning the supply of ecosystem services, e.g.: Ecological processes: Biodiversity enhances the efficiency of ecological processes. Functional traits: Diversity in body size of pollinator species results in different flight distances to reach crops. Biophysical structures: Forest diversity creates more microhabitats for insects. State: River and lake fish diversity is used to assess ecological status. Biotic interactions: Wasps and beetles prey on pest species that harm crops. Species richness: People like bird and game watching, or enjoy indentifying different species of butterflies. Genetic diversity: Wild crop and livestock relatives increase resilence against environmental change.

EU 2020 Biodiversity Strategy: Target 2 Action 5: Improve knowledge of ecosystems and their services in the EU Member States, with the assistance of the Commission, will map and assess the state of ecosystems and their services in their national territory by 2014, assess the economic value of such services, and promote the integration of these values into accounting and reporting systems at EU and national level by 2020.

MAES and NCA: timing and sequence Mapping & Assessing Valuing Accounting 2011 2014 2020 2011 2014 2020 Mapping & Assessing Valuing Accounting

MAES reference frame linking ecosystem condition to ecosystem services

MAES high level conference and other developments MAES high level conference –highlighted political importance of NCA, whilst recognising methodological challenges. Relevance much beyond biodiversity policy. Importance of maintaining link between biophysical assessment and biophysical and monetary accounts Need both aggregated accounts and spatially disaggregated accounts – main added value of accounts Need explicit link between ‘cross-cutting’ accounts e.g. Carbon, Land and Water, and ecosystem condition accounts, following MAES categorisation

Ecosystem accounts Forests Marine Grassland Etc. Simplified accounts Water Carbon Land Species diversity Nutrients

Key policy issues We need to: measure changes in our natural capital stock and what impacts it has on our economy and society. assess the extent and condition of ecosystems that is needed so that they can carry on delivering essential services to our economy and society

What do we need natural capital accounts for? Develop meaningful Macro-indicators, both physical and monetary: EU 2020 and greening the European Semester Implementation of 2030 sustainable development agenda in the EU Better take into account how different sectors benefit from and impact on natural capital Better manage ecosystems by taking account a wider range of values, and assessing synergies and trade-offs amongst ecosystem services The private sector – ensure consistency with national accounts International dimension; WAVES and UN-SEEA

Thank you for your attention For more details on Biodiversity Strategy and related actions: http://ec.europa.eu/environment/nature/index_en.htm Ecosystem Assessment Platfom: http://biodiversity.europa.eu/ecosystem-assessments WAVES:  http://www.wavespartnership.org/waves/   13