In 2021, natural capital will become a prominent investment theme. The reasons are twofold. (1) COVID has made us aware of the importance of nature, highlighting how critical it is for our mental and physical health. Thus, the wellbeing of our planet and our own individual wellbeing are seen as two sides of the same coin – investing in the former yields benefits for the latter. (2) Contrary to what is widely assumed, valuing natural capital and investing accordingly in it (as in the circular bio-economy) generates jobs and growth. One example to prove the point: managing our forests sustainably could generate 30m jobs and create $2.3tr worth of potential business by 2030. No surprise that nature-based investment funds and other opportunities are proliferating!
This whole point about individual wellbeing and the wellbeing of our planet raises a fascinating question about how we measure wellness from an economic and financial standpoint. Today, the Global Wellness Institutes estimates that the wellness economy is worth 4.5 trillion dollars, corresponding to the aggregation of 11 disparate categories (ranging from wellness tourism to healthy eating, nutrition and weight loss) and amounting to roughly 3.3 per cent of global GDP (2018).
What would happen to this figure if we started to include in the measurement of the wellness economy the value of critical assets that are currently un-accounted for? Our current economic system is designed to only value what has a market value. As Mark Carney – the former Governor of the Bank of England – puts it: “Market value is taken to represent intrinsic value, and if a good or activity is not in the market, it is not valued.” This may change as we reconsider the meaning of value. The example above of sustainable forests – equally important for our individual wellbeing (as shirin-yoku / forest bathing illustrates) and the wellbeing of our planet (as carbon sequestration illustrates) shows why this matters and why it will happen.
Therefore, it wouldn’t be far-fetched to add $2.3tr to the size of the wellness economy. The same logic applies to other natural assets like the oceans or the rivers, but also to societal assets like community-building and mutual trust. If we assume, like Mark Carney and many “new economic thinkers” do, that the businesses that will be most profitable in the long-term are those that solve our most intractable problems (like climate change and un-wellness), the size of the wellness economy will expand considerably.