Farm-scale Natural Capital Accounting

Valuing Natural Capital on your farm

The La Trobe University Farm-scale Natural Capital Accounting research project addresses a critical gap in promoting sustainable farm practices.

In collaboration with 50 Australian farmers, from 2020 – 2023, the Natural Capital Accounting project integrated farm management operational data with farm-scale environmental and biodiversity data to generate 50 farm-scale natural capital accounts.

The accounts provide farmers with verifiable information about the natural capital assets on their farm (e.g., soil, vegetation, biodiversity) and the ecosystem services that flow from these assets (e.g., pasture, shelter, pest control). Farmers can use the accounts to improve their management of natural capital and farm performance.

Natural capital accounts also empower producers to leverage their sustainability credentials for commercial benefits.

This project is funded through the Australian Government’s Smart Farming Partnership Program with co-investment from La Trobe University and the Odonata Foundation.

Project Outcomes

The results of the project include:

1. A methodology for measuring and communicating farm-scale natural capital for farmers and their stakeholders. It is the first of its kind in Australia.

2. A user-friendly digital platform that presents data points and ecosystem layers of information.

3. A pathway for farmers to set and achieve their financial, environmental, and social goals and to help communicate their environmental performance to their stakeholders.

Farm-scale Natural Capital Fact Sheets

Download factsheets about:

What is Natural Capital?

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Natural capital includes all elements of the natural environment. On a farm, this includes:

  • soil and soil biology (microbes, fungi, invertebrates)
  • water (ground and surface water)
  • grasses, forbs and sedges (native and introduced) that make up pastures and understory
  • crops and livestock
  • shrubs and trees (remnants, re-planted and agroforestry)
  • native animals

Why is Natural Capital important?

Natural capital is the foundation of all farming systems - soil and water support crops and pastures, plants provide food and shelter for livestock and regulate the micro-climate for crops, and native animals (e.g., insects, reptiles, birds) provide services such as pollination, pest control and waste decomposition.

What is Natural Capital Accounting?

Natural capital accounting is a tool that enables farmers to record and manage the natural capital on their farms, both in physical and monetary terms. Like financial accounting, natural capital accounts are guided by an agreed set of standards, and are quantifiable, verifiable and repeatable.

Natural capital accounting puts a value on nature on farms. This value can be tracked over time to demonstrate the value of nature to investors, buyers and consumers of agricultural products (i.e., everyone).

What's Next?

  1. Automate production and processing of accounts by leveraging Artificial Intelligence and Machine Learning to incorporate ‘big data’ and improved modelling of remote sensed data.
  1. Drive commercialization (links to global and national initiatives, creating demand and recognition of NCA as fit-for-purpose approach).
  1. Enhanced modelling of ecosystem services and biodiversity as a function of natural capital, including monetary evaluation.
  1. Social research and adoption – overcoming barriers and driving behaviour change.
  1. Confirm standards and accreditation (including audit) – leading to a ‘natural capital assured’ branding.

Team Members

Jim Radford

Fred Rainsford

Alex Maisey

Grace Sutton

Jen Wood

John Morgan

Annette Cavanagh (PhD candidate)

Berenice Della Porta (PhD candidate)

Andrew Bennett

Heloise Gibb

Ryan Phillips

Project Partners

Project Launch Media Event

There would be no farm without its foundation of soil, water, birds and trees – it’s known as natural capital - and now, La Trobe University researchers and partners have developed a tool that enables farmers and industry to unlock the value of this resource and use it to their advantage.