Watch AEI founder, Steve Apfelbaum’s keynote video presentation at the 2022 Stewardship Network Conference or read an edited (by John Steven Bianucci) transcript below.
The drivers of our investment conservation and restoration are changing right before our eyes.
In the U.S. early in the 1800’s, we had a mutually shared responsibility for natural resources and the land. Often, even privately owned land was managed as a commons with sharing of the responsibility for managing the natural resource on the land. From wood production for construction timbers and firewood to meat hunting, shared and participatory responsibility crossed property boundaries, and the community or village at large worked together.
The old town square commons, where shared livestock grazing occurred, or the national forests where grazing allotments reflect a long history without the responsibility for ecosystem condition and health, stand as lost opportunities for the assumption of responsibility for conservation and restoration. Where wild rice harvesting by Native Americans remains as a good example of a responsibility Commons, firewood collection allotments in the national forests provide a waste wood clean up service after logging operations have often clear-cut forest stands, and this represents an appeasement that serves a double function, namely, providing wood while appearing to provide a conservation service and outcomes from our national forests.
As the human populations spread and increased the world over, landscapes and their natural resources, including fish and wildlife, diminished. And private uses, such as the grazing of privately owned sheep or cattle herds, began to diminish the open sharing and shared responsibility for the health of the natural resources. Responsibility previously grounded in community values was replaced by individual motivations, business and commercial interests. A market demand for the natural resources was motivated by private gain, which accelerated as commercialization created organizations to serve the growing consumer demand. Corporations - rather than landowner and neighbor cooperation - focused on delivering products, values and goods or services increased demand and competition. The result is a product differentiation bloom in the marketplace that has increasingly challenged products to get noticed and attain SKU space on shelves, such as in food stores and other markets.
Differentiation of the same products resulted in different ways to harvest and exploit natural resources. Usually, to drive costs down to gain more market share through pricing meant to appease consumers demands. During this process, conservation and restoration, responsibility for natural resource’s conditions, and the future of the resources were forgotten. Serious natural resources degradation resulted with many of the now understood and amplified problems of our times: declining fish stocks, degraded and declining grasslands, forests, water resources, biodiversity decline, antibiotic resistance, climate health, and ultimately our very own health and well-being as a species. It is no coincidence that increasing zoonotic diseases, autoimmune diseases, human malnutrition, and pandemics have manifested.
The recognition of the declining condition of all members of the land community, including our own health, triggered the regulatory period in our evolutionary legacy and approach to conservation and restoration. The Endangered Species Act, Clean Air Act, and Clean Water Act, including the no net loss of wetlands standard, the River and Harbors Act, and the Bald and Golden Eagle Protection Act, have all focused on the protection of waterways, various timber and forest management acts enacted at the state levels, and of course federal and state fish and wildlife laws that govern the harvesting of species—trapping, hunting, and harvesting in nearly all ways—have been put in place as a construct, as a surrogate for the super-consciousness, to govern and regulate the use of natural resources when few in our society know enough or pay attention to the condition of these resources.
Yet, everyone still depends on their availability.
In essence, the laws and regulations attempt to provide the resource commons in which we participated with tangible understanding and with dirt under our fingernails. The regulatory phase kicked in as government regulations were designed not only to meter out access through permit allowances, but also to harvest or destroy resources with some level of equitability (at least among the politically connected and organized members or those with enough financial wealth to purchase access). Now, how is it today?
Responsibility to perfunctory, politically palatable permit allowances dictates exploitive and consumptive use of natural resources. Individual responsibility has been left behind. Without individual responsibility as the foundation of our civilizations’ approach to management and use of natural resources, it has become predictably inevitable that natural resources will largely continue to decline.
Two reactions by civilization, especially by the wealthier nations and regions of the USA, have focused on countering these declines. One reaction has been the movement to restore natural resources. Protection was the initial means contemplated and acted upon. For decades, starting in the early 1900’s with the foundations in national parks as wildlife refuges, restoration of wildlife such as bison, eagles, deer, among many other species occurred. For decades, restoration was focused on regrowing fish stocks and wildlife, especially those that had declined.
The second reaction was the recognition of purchasing power to change corporate behavior and that of land managers involved in the product supply chains of the world. Agricultural commodity production, timber production, wildlife products, then meat and food products have become the focus of consumer demand changes in the marketplace. This recognition by consumers and corporations that continued to differentiate products and compete on price point sensitive commodities, have resulted in a recognition that voting with one’s consumption and purchasing choices is more powerful and acts faster to build conservation and “sustainability” thinking and behavior into the product supply chains. Consumers thus added another level to the evolution of conservation and more enlightened natural resource management.
This has continued to evolve as the finance and investment community, at the insistence of boards, and certifiers of the quality and the ethical responsibility of the investments has required even further and deeper differentiation of products through marketing and marketplace competition. This process has in recent years resulted in a new formalized approach to display and assume responsibility through the sustainability programs of corporations, landowners, and governmental agencies through ESG program plans. That is, their Environmental, Societal or Social, and Governance programs. Which now provide sustainability metrics that are being imposed on industry by consumers and even perhaps most importantly by the financial community. Industry really took notice and sat forward when Wall Street investments required responsible ESG plans.
Sustainability planning is now behind the money supporting growth and development. And through differentiation, is driving completely new responsibility where finance is requesting responsibility with regard to corporate accountability and sustainability. Corporations are stepping up now and doing exciting conservation and restoration projects as part of ESG programs.
The evolutionary process and philosophical underpinnings of doing business now is motivating a more broadly responsible way to again consider natural resources of the land as critical to our future. Responsibility around climate change, increasing flooding and droughts, an insecure food supply and future, and antibiotic resistance in disease causing organisms are contributing and converging factors that are changing the fundamental way we've thought as a society and globally about conservation and land restoration. ESG thinking, if not just another fad, appears to be driving markets, regulatory decisions and corporate sustainability commitments toward more holistic thinking. In the late 60’s 70’s 80’s and 90’s, to be part of this regulatory permit driven process - where counterparties were granted responsibility through permits to achieve certain outcomes and then to see the legally registered businesses using markets and market differentiation as a change in their program - began to signal that big changes were underway.
Where regulatory requirements and market drivers have failed to gain widespread responsibility, and only have achieved perfunctory success, ESG programs motivated by access of corporate America to finance, seems to have the potential to hammer responsibility back into the future of board decisions and product development sensitivity with respect to natural resources, environment and human health.
Most intriguing now is that the ultimate evolutionary shift may be moving ESG, regulatory and marketplace motivations to a real focus on creating ecosystem solutions. Thus, conservation and ecosystem restoration solutions have become en vogue, in demand, and the right way to think and do.
Since the 1970’s rights that have been granted to natural resources yet as pieces of the natural world: trees and forests have rights, wetlands, rivers, waterways, water supplies and air quality has a legal right or rights. And, now the legal and financial systems are driving deeper, richer commitments than ever possible by regulatory systems, with a focus on whole systems including regenerative agricultural and food systems, biodiversity of all species, all races and equal human access to healthy ecosystems.
The realization that an ecosystem approach under ESG programs and as the basis for development design, forestry management, and nearly all else is often far less expensive than the perfunctory regulatory or market driven approach is helping this shift.
Simultaneous to this ESG adoption has been the broadly allocated culpability for impacts that are occurring in water quality, food quality, and food insecurity. A lot of responsibility, a tangible and widespread culpability - broadly shared amongst corporate policy and your governmental agencies - has everybody trying to figure out how to become more sustainable in a shared relationship with our world's ecosystem.
The evolutionary process from the Commons of yesteryear to regulatory, marketplace, and more recently ESG programs that are finding ecosystem solutions most favorable and rewarding, also enhances public relations. Overall, real mutual benefits result from the restoration of natural resources and land. This sounds like a very interesting return to responsibility where it works best, on the shoulders of the landowners and the landowning corporations, and away from the armchair regulatory play callers or somewhat trendy and dynamic marketplace shifts.
We have learned that some regulatory programs have worked well. Take, for example, the compliance with sulfur dioxide emissions from the industrial emission quotas. They have worked well for internal compliance and also for most hunting and fishing regulations.
The new challenges to the regulatory and compliance founded programs include conflicts with knowledge about the best way to solve some of the original problems when now the regulatory program itself presents challenges to getting things done correctly. Another challenge is uncertainty when trying to apply a black and white regulatory program to the climate and meteorological changes, such as storm intensification and drought, now being experienced. This is completely changing the ability of any applicant or permittee to ensure results. Couple all this with predictable food insecurity, and increasing human health risks such as COVID, and water availability and security risks. Something more dynamic, adaptive and complex than a permitting and regulatory process is clearly needed in the future.
Now, the application of measurement-based performance outcomes instead of behavior-based outcomes is another fundamental change underway. For example, Farm Bill best management practices are rarely measured once installed. Further, failing best management plans will not meet the Clean Water Act in the future. Performance-based programs and requirements are very much part of this evolution to ESG and to ecosystem solutions. When the most fundamental of businesses and civilizations needs are at risk, the regulatory programs will not suffice to meet consumer performance requirements such as for reliable consumer supply chain delivery of food, water, and costs of goods. Normal externalized costs of the way business has been done around extracted and grown resources is changing with the shift to ESG and ecosystem-based solutions.
Ecosystem solutions are quickly becoming the centerpiece of human enterprise. Regenerative agriculture, conservation developments, land developments with a significant element of native landscaping, pollinator habitat, and alternative stormwater management programs that use nature as the solution, rather than storm sewer pipes and detention ponds, are more adaptive, resilient and low cost. Simple examples, like no longer flushing precious stormwater down sewers make so much sense when the country is experiencing drought and at the same time farmers are seeking to invest in more and more irrigation infrastructure. Or, the example of creating reserves rather than small isolated high maintenance parks. A system where the reserves are contiguous, continuous and coherent can be the center feature of a community. When trails are included along with a durable commitment to conservation, restoration and integrated conservation developments, this approach is creating stronger, more durable communities and economies.
Clearly, communities such as Prairie Crossing (Grayslake, Illinois), and the Liberty Prairie Reserve were well ahead of their time. Other projects, taking the Ecosystem approach include the Milwaukee Metropolitan Sewerage District’s “Green Seams” program to protect and restore flood prone land as opposed to investing billions of dollars in hard engineering infrastructure such as pipes and detection ponds. Toronto’s Don River is yet another example, where restoring a river channel and river mouth on Lake Ontario, and a restored associated floodplain, is serving to reduce existing flooding and serve as the central organizing feature of revitalization for a deteriorated industrial waterfront and Port lands.
The future is dependent on participatory engagement at all levels. Engineers provided the early solutions for us having clean drinking waters and less flood prone communities. Now, the solutions require the participation of landowners. Yet, not in a disorganized, scatter shot way driven by regulatory and farm incentive programs. Instead, driven by coherent, contiguous landscape-scale deployments of ecosystem solutions.
The ecosystem framework is the only way to address the looming problems of today, and tomorrow. This will necessitate the involvement of professionals and volunteers, corporations stepping up with their coordinated ESG programs, and regulatory and market programs re-aligning to contribute to and achieve multiple benefits rather than the often-myopic regulatory program outcomes, with every invested dollar. The benefits we now need to focus and achieve will be incumbent on each and every one participating.
This is a return to the commons, a more complex commons and approach that are significantly simplified by working toward ecosystem solutions. Whether in urban or rural areas, wild or developed landscaping, this is the only strategy that can be scaled rapidly and cost effectively with every dollar invested, addressing the myriad challenges we face.
