A Brief Historical Perspective on Natural Capital — Part I — a guest post series by Nuno Gaspar de Oliveira

This is the first part of a guest post series by Nuno Gas­par de Oliveira who works as.consultant and advi­sor in Esporão, a por­tuguese main wine and olive oil com­pany, in the area of Strate­gic Man­age­ment for sus­tain­abil­ity using ‘Busi­ness Ecosys­tems’ models,

This guest post has pre­vi­ously been pub­lished on LinkedIn. It is the expres­sion of the author’s thoughts and expe­ri­ences and as such is acknowl­edged as a fruit­ful con­tri­bu­tion to the dis­cus­sion on bio­di­ver­sity off­sets. If you want to react or clar­ify your own posi­tion (under­pin or dis­prove), please leave a reply below!

In terms of nowa­days eco­nom­ics way of think­ing, one of the strik­ing fea­tures of mod­ern growth mod­els is their silence about the nat­ural foun­da­tions of eco­nomic pro­duc­tion. Cap­i­tal goods and human labour com­bine to pro­duce com­mod­ity out­put, but no land is required as a site, no mate­ri­als are needed from which to form com­modi­ties, and no energy is required to drive the process of com­mod­ity pro­duc­tion and exchange (e.g., Eng­land, 2000).

But how did this hap­pen? Why is the XXIst cen­tury econ­omy still so detached from its true nat­ural foun­da­tions and so focused on the pure finan­cial out­puts? Were there no warn­ings along the road? Appar­ently, there were aplenty, even since the early times…

Let’s begin with Socrates, the ancient Greek philoso­pher (470 BC-399 BC), who was known for avoid­ing any writ­ten legacy forged by his own hand. The Philoso­pher believed that noth­ing should ever be carved in stone. Oddly enough, he was the son of a stone carver and learned the trade him­self. One of the main points was that knowl­edge was in con­stant trans­for­ma­tion and the seek­ing of the true mean­ing of words and expres­sions should be the endeav­our of the knowl­edge seeker. The words of Socrates were ‘carved’ how­so­ever by his con­tem­po­rary fel­lows, namely Plato, Xenophon and through the plays of Aristo­phanes. The alleged founder of west­ern ratio­nal­ism was not indif­fer­ent to the quest on the deep mean­ing of nature and the vital impor­tance that nature plays in human exis­tence and well­be­ing:

He is rich­est who is con­tent with the least, for con­tent is the wealth of nature.”

The Roman civ­i­liza­tion was one of the influ­ent forces that still sup­port nowa­days polit­i­cal and eco­nomic think­ing. In prac­ti­cal terms, and con­sid­er­ing nat­ural cap­i­tal, they have cre­ated the pub­lic trust doc­trine that traces its roots to the Insti­tutes of Jus­tin­ian in Roman Law, which declared that there are three things com­mon to all peo­ple: air; run­ning water; and the sea and its shores (e.g., Ruhl, 2006). But this prob­lem is far from being some­thing only dis­cussed in ancient Greece, rev­o­lu­tion­ary peri­ods or mod­ern day acad­e­mia and His­tory is full of long lost for­got­ten tales, but some still emerge to our days.

One of the most inter­est­ing phases in the his­tory of west­ern Euro­pean civ­i­liza­tion is the early Islamic period, one of intense philo­soph­i­cal devel­op­ment begin­ning in the early IXth cen­tury and last­ing until the XIIth cen­tury. The period is known as the Islamic Golden Age, and the achieve­ments of this period had a cru­cial influ­ence in the devel­op­ment of mod­ern phi­los­o­phy and sci­ence (e.g., Sharif, 1966). Per­haps due to resource scarcity in most Islamic nations, there was an empha­sis on lim­ited, and some claim also sus­tain­able, use of nat­ural cap­i­tal, i.e. pro­duc­ing land. Muham­madis con­sid­ered a pio­neer of envi­ron­men­tal­ism for his teach­ings on envi­ron­men­tal preser­va­tion (Nomanul Haq, “Islam”). His hadiths on agri­cul­ture and envi­ron­men­tal phi­los­o­phy were com­piled in the “Book of Agri­cul­ture” of the Sahih Bukhari, which included the fol­low­ing saying:

“There is none amongst the believ­ers who plants a tree, or sows a seed, and then a bird, or a per­son, or an ani­mal eats thereof, but it is regarded as hav­ing given a char­i­ta­ble gift [for which there is great recompense].”

Also dur­ing the lower Mid­dle Ages, between the VII­Ith and IXth cen­turies,Charle­magne, one of the most dis­cussed polit­i­cal leader of all times, debated with the prob­lem of pro­vid­ing a price to nat­ural cap­i­tal. Charle­magne pro­moted one of the first attempts for cre­at­ing a com­mon agri­cul­tural mar­ket based on nat­ural cap­i­tal within Europe, inspired by his aware­ness of how restric­tions derived from land use man­age­ment would pro­mote or hin­der new devel­op­ments affect­ing eco­nomic and social con­di­tions. Although schol­ars are divided on the import of his actions, the evi­dence sug­gests that he was con­cerned with improv­ing the orga­ni­za­tion and tech­niques of forestry and agri­cul­tural pro­duc­tion, estab­lish­ing a mon­e­tary sys­tem bet­ter attuned to actual exchange oper­a­tions and cor­re­spond­ing to the actual value of the trans­ac­tion (adapted form Bulfinch, 2004).

A few cen­turies later, one of the most iconic kings of Por­tu­gal, Dinis (1279–1325), based his vision of improv­ing the econ­omy and reduc­ing the power of the nobil­ity and the church by encour­ag­ing forestry plan­ta­tion and the fuller devel­op­ment of the country’s agri­cul­tural resources. He also showed great con­cern for ship­build­ing and for the exten­sion and pro­tec­tion of com­merce. This was the launch for a nat­ural cap­i­tal based strat­egy for sus­tain­abil­ity, and also a main eco­nomic dri­ver for the Por­tuguese expan­sion era known as ‘The Discoveries’

But at the begin­ning of the late Mid­dle Ages, dur­ing the Medieval Period, One of the major prob­lems con­cern­ing nat­ural cap­i­tal is the rights of prop­erty and pri­vate appro­pri­a­tion of pub­lic goods and ser­vices. Whether in the case of land or intel­lec­tual prop­erty, the trans­for­ma­tion from a right-to-benefit into out­right own­er­ship was a grad­ual one. Land own­er­ship (and indeed all forms of own­er­ship) says more about our per­cep­tion of the world than about the nature of the thing owned (e.g., Eisen­stein, 2007).

The tran­si­tion from the early days when own­er­ship of land was as unthink­able as own­er­ship of the sky, sun, and moon, to the present day when nearly every square foot of the earth is sub­ject to own­er­ship of one sort or another, is really just the story of our chang­ing view of our­selves in rela­tion to the uni­verse (idem). The end­ing of serf­dom in late medieval Europe is a case in point. Before feu­dal­ism gave way to a money econ­omy and the com­mons migrated into pri­vate hands, land was gen­er­ally not a fun­gi­ble asset. Lewis Hyde (2009) wrote that:

Whereas before a man could fish in any stream and hunt in any for­est, now he found there were indi­vid­u­als who claimed to be the own­ers of these com­mons. The basis of land tenure had shifted. The medieval serf had been almost the oppo­site of a prop­erty owner: the land had owned him. He could not move freely from place to place, and yet he had inalien­able rights to the piece of land to which he was attached. Now men claimed to own the land and offered it rent it out at a fee. While a serf could not be removed from his land, a ten­ant could be evicted not only through fail­ure to pay the rent but merely at the whim of the landlord.

The intro­duc­tion of the notion of pri­vate prop­erty was lat­ter addressed by Rousseau in his dilemma around mankind’s inabil­ity to deal with the respon­si­bil­ity of man­ag­ing both its and nature’s inter­ests. The Franco-Swiss philoso­pher, a major fig­ure of the Enlight­en­ment period and whose ideas influ­enced the French Rev­o­lu­tion wrote in mas­ter­piece ‘A Dis­ser­ta­tion on the Ori­gin and Foun­da­tion of the Inequal­ity of Mankind’ (1754):

The first man who, hav­ing enclosed a piece of ground, bethought him­self of say­ing This is mine, and found peo­ple sim­ple enough to believe him, was the real founder of civil soci­ety. […] Beware of lis­ten­ing to this imposter; you are undone if you once for­get that the fruits of the earth belong to us all, and the earth itself to nobody.

To be continued…

Ref­er­ences (so far)

Bulfinch, T. (2004). Bulfinch’s Mythol­ogy: The Age of Chivalry and the Leg­ends of Charle­magne. Digireads. com Publishing.

Eisen­stein, C. (2007). The Ascent of Human­ity. Panenthea Press.

Eng­land, R. W. (2000). Nat­ural cap­i­tal and the the­ory of eco­nomic growth. Eco­log­i­cal Eco­nom­ics, 34(3), 425–431. doi:10.1016/S0921-8009(00)00187–7

Hyde, L. (2009). The gift: Cre­ativ­ity and the artist in the mod­ern world. Ran­dom House LLC.

Ruhl, J. B. (2006). Back­ground Prin­ci­ples of Nat­ural Cap­i­tal and Ecosys­tems Services-Did Lucas Open Pandora’s Box, The. J. Land Use & Envtl. L., 22, 525.

Sharif, M. M. (Ed.). (1966). A his­tory of Mus­lim Phi­los­o­phy (Vol. 2). O. Harrassowitz.

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