Natural capital approaches for the optimal design of policies for nature recovery.

By embedding a spatially explicit ecosystem services modelling tool within a policy simulator we examine the insights that natural capital analysis can bring to the design of policies for nature recovery. Our study is illustrated through a case example of policies incentivising the establishment of new natural habitat in England. We find that a policy mirroring the current practice of offering payments per hectare of habitat creation fails to break even, delivering less value in improved flows of ecosystem services than public money spent and only 26% of that which is theoretically achievable. Using optimization methods, we discover that progressively more efficient outcomes are delivered by policies that optimally price activities (34%), quantities of environmental change (55%) and ecosystem service value flows (81%). Further, we show that additionally attaining targets for unmonetized ecosystem services (in our case, biodiversity) demands trade-offs in delivery of monetized services. For some policy instruments it is not even possible to achieve the targets. Finally, we establish that extending policy instruments to offer payments for unmonetized services delivers target-achieving and value-maximizing policy designs. Our findings reveal that policy design is of first-order importance in determining the efficiency and efficacy of programmes pursuing nature recovery. This article is part of the theme issue 'Bringing nature into decision-making'.

Sustained participation in a Payments for Ecosystem Services program reduces deforestation in a Mexican agricultural frontier.

Payments for Ecosystem Services (PES) provide conditional incentives for forest conservation. PES short-term effects on deforestation are well-documented, but we know less about program effectiveness when participation is sustained over time. Here, we assess the impact of consecutive renewals of PES contracts on deforestation and forest degradation in three municipalities of the Selva Lacandona (Chiapas, Mexico). PES reduced deforestation both after a single 5-year contract and after two consecutive contracts, but the impacts are only detectable in higher deforestation-risk parcels. Enrollment duration increases PES impact in these parcels, which suggests a positive cumulative effect over time. These findings suggest that improved spatial targeting and longer-term enrollment are key enabling factors to improve forest conservation outcomes in agricultural frontiers.

Biodiversity market doublespeak.

The notion that biodiversity markets can raise money desperately needed for biodiversity conservation is gaining momentum. The dire state of biodiversity and the enormous biodiversity repair bill means that every funding option must be explored. However, the risk that trading ill-defined generic biodiversity credits will result in biodiversity loss, not conservation, should be considered. Scarce resources could be diverted to market regulation rather than conservation. Without key elements, biodiversity markets could be perverse, leading to Orwellian "doublespeak"-saying one thing, but resulting in another.

Ongoing declines for the world's amphibians in the face of emerging threats.

Systematic assessments of species extinction risk at regular intervals are necessary for informing conservation action1,2. Ongoing developments in taxonomy, threatening processes and research further underscore the need for reassessment3,4. Here we report the findings of the second Global Amphibian Assessment, evaluating 8,011 species for the International Union for Conservation of Nature Red List of Threatened Species. We find that amphibians are the most threatened vertebrate class (40.7% of species are globally threatened). The updated Red List Index shows that the status of amphibians is deteriorating globally, particularly for salamanders and in the Neotropics. Disease and habitat loss drove 91% of status deteriorations between 1980 and 2004. Ongoing and projected climate change effects are now of increasing concern, driving 39% of status deteriorations since 2004, followed by habitat loss (37%). Although signs of species recoveries incentivize immediate conservation action, scaled-up investment is urgently needed to reverse the current trends.

The impact of green taxes on green innovation of enterprises: a quasi-natural experiment based on the levy of environmental protection taxes.

Green innovation is a strategic choice for Chinese enterprises to achieve in balancing economic performance and environmental benefits. Environmental protection tax (EPT) is the first green tax in China. How to fully leverage the institutional dividends of environmental tax reform to achieve green innovation in enterprises is of great significance for the high-quality development of China's current economy. This study takes the levy of environmental protection taxes as the quasi-natural experiment and uses DID, DDD, PSM-DID and so on to verify the impact of EPT on green innovation. The results show that EPT can improve green innovation through the path of legitimacy pressure and legitimacy management. Notably, the effects are more obvious in enterprises with non-state-owned, low-financing constraints and located in the eastern region. Furthermore, green innovations under the push of environmental protection tax can improve long-term performance, while it has a negative effect on short-term performance. The levy of EPT has the dual dividend effect of economy and environment. Moreover, this study explores the source of the legitimacy pressure and the strategic response of enterprises and provides guidance for government's precise implementation of policies to optimize the role of EPT in green innovation.

The carbon costs of global wood harvests.

After agriculture, wood harvest is the human activity that has most reduced the storage of carbon in vegetation and soils1,2. Although felled wood releases carbon to the atmosphere in various steps, the fact that growing trees absorb carbon has led to different carbon-accounting approaches for wood use, producing widely varying estimates of carbon costs. Many approaches give the impression of low, zero or even negative greenhouse gas emissions from wood harvests because, in different ways, they offset carbon losses from new harvests with carbon sequestration from growth of broad forest areas3,4. Attributing this sequestration to new harvests is inappropriate because this other forest growth would occur regardless of new harvests and typically results from agricultural abandonment, recovery from previous harvests and climate change itself. Nevertheless some papers count gross emissions annually, which assigns no value to the capacity of newly harvested forests to regrow and approach the carbon stocks of unharvested forests. Here we present results of a new model that uses time discounting to estimate the present and future carbon costs of global wood harvests under different scenarios. We find that forest harvests between 2010 and 2050 will probably have annualized carbon costs of 3.5-4.2 Gt CO2e yr-1, which approach common estimates of annual emissions from land-use change due to agricultural expansion. Our study suggests an underappreciated option to address climate change by reducing these costs.

Understanding the nexus between environmental, social, and governance (ESG) and financial performance: evidence from Chinese-listed companies.

Before discussing how to balance and decide on environmental, social, and corporate governance (ESG) and traditional revenue enhancement projects, it is crucial to clarify the relationship between corporate financial performance (CFP) and ESG. However, little attention has been paid to the nexus of ESG and CFP. This paper attempts firstly to investigate the bidirectional causality of ESG and CFP, followed by the micro-foundations, and finally, the moderating effect of intrinsic factors. A GMM-PVAR method was used to examine the research hypotheses, which can effectively deal with endogenous problems that have been ignored by traditional literature. The findings of this research demonstrate that CFP promoted ESG growth, but ESG did not boost CFP. This asymmetric causality was because CFP had a supportive effect on the environment and society pillars, while the social pillar cannot promote CFP, and the environment pillar negatively affects CFP. The relationship between ESG and CFP was moderated by total quality management, environmental sensitivity, and the pay gap. Furtherly, a panel threshold model was constructed to access the threshold effects of ESG on CFP, showing an inverted U-shape. Based on these findings, the theoretical implications, managerial prescriptions, and limitations are also discussed.

The evolution and determinants of Chinese inter-provincial green development efficiency: an MCSE-DEA-Tobit-based perspective.

Continuous and rapid economic development has brought about excessive resource consumption and environmental pollution. Therefore, it is particularly essential to coordinate economic, resource, and environmental factors to achieve sustainable development. This paper develops a new data envelopment analysis (DEA) method that can be used for multi-level complex system evaluation (MCSE-DEA) to reveal the inter-provincial green development efficiency (GDE) in China from 2010 to 2018. Moreover, the Tobit model is applied to explore the influencing factors of GDE. We found that (i) the MCSE-DEA model tends to have lower efficiency scores than the traditional P-DEA (panel data envelopment analysis) model, and the top three provinces are Shanghai, Tianjin, and Fujian; (ii) the efficiency shows an increasing trend during the whole study period. The southeast region and the Middle Yangtze River region have the highest efficiency values, reaching 1.09, while the northwest region ranks last with an average efficiency value of 0.66. Shanghai performs the best, while Ningxia performs the worst, with efficiency values of 1.43 and 0.58, respectively; (iii) the provinces with lower efficiency values mainly come from economically underdeveloped remote regions, which can be attributed to issues of water consumption (WC) and energy consumption (EC). Moreover, there are much room for improvement in solid waste emissions (SW) and soot and industrial dust emissions (SD); (iv) the environmental investment, R&D investment, and economic development level can significantly improve GDE, while industrial structure, urbanization level, and energy consumption have inhibiting effects.

Hope-hype of green innovation, corporate governance index, and impact on firm financial performance: a comparative study of Southeast Asian countries.

The current production and conception have impacted the environmental hazards. Green innovation (GI) is the ideal solution for sustainable production, consumption, and ecological conservation. The objective of the study is to compare comprehensive green innovation (green product, process, service, and organization) impact on firm financial performance in Malaysia and Indonesia, along with the first study to measure the moderation role of the corporate governance index. This study has addressed the gap by developing the green innovation and corporate governance index. Collected panel data from the top 188 publicly listed firms for 3 years and analyzed it using the general least square method. The empirical evidence demonstrates that the green innovation practice is better in Malaysia, and the outcome also shows that the significance level is higher in Indonesia. This study also provides empirical evidence that board composition has a positive moderation relationship betwixt GI and business performance in Malaysia but is insignificant in Indonesia. This comparative study provides new insights to the policymakers and practitioners of both countries to monitor and manage green innovation practices.

Quantifying an influence of green credit on digital technology innovation: financial perspective of a China's case study.

This paper examines the impact of green credit (GC) on digital technology innovation based on Chinese enterprises using panel data from 1990 to 2016. The study collected panel data from the 40 Chinese firms listed on the Beijing and Wuhan stock markets. Manufacturing companies were selected because they mainly contribute to green credit from pre- and post-policy periods. First, in the "two high and one surplus" sectors, the application of China's Green Credit 2012 could significantly increase total factor digital technology innovation by 1.21%. Results show a considerable drop in the variable values of digital technology innovation, 61.3%; green credit policy, 10.45%; leverage, 21.0%; and green innovation, 85.4%. The results of the absolute value of standard error after matching is much lower than 20.0%, demonstrating that the variable features of the two sets of samples are similar. In conclusion, GC's impact on the FDI of capital was asymmetrical, reflecting various impacts on businesses with various types of property rights and sizes.

Hydrology-mediated ecological function of a large wetland threatened by an invasive predator.

Invasive species are one of the greatest threats to ecosystems, disrupting ecosystem function and leading to the collapse and extinction of native species. While populations of native fishes in the Everglades are tied to the system's natural hydrological dynamics, Asian Swamp Eels (Monopterus albus/javanensis) are drought-resistant fish first reported from Florida in 1997 and the Everglades in 2007. Using a 26-year dataset that included a 13-year baseline period prior to swamp eel arrival in Taylor Slough, we assessed population changes of common small fishes and decapods that are important prey for larger vertebrate predators. After invasion, populations of two crayfishes collapsed by >95 %, two fishes declined by >80 %, two fishes had intermediate declines of 44-66 %, and three species remained unchanged. Species most strongly reduced were those dependent on predator-free habitats at the onset of the wet season, indicating drought-resistant swamp eels have introduced novel predator effects and disrupted the hydrology-mediated production of aquatic animals that are prey for many larger predators. Ongoing Everglades restoration is designed to restore hydrological conditions that support production of crayfishes and fishes, and nesting wading birds reliant on them. Water management may have facilitated the invasion of swamp eels. Our results suggest that the continued spread of swamp eels may result in adverse consequences for Everglades trophic dynamics and potentially diminish benefits expected from the $20B+ restoration.