In a world with finite natural resources, the prevalence of economic models which
exclude environmental impacts signals a non-sustainable business context. A
paradigm shift is required to ensure that sustainable economic growth is achieved
without further environmental degradation. The research investigated the organisations'
thinking surrounding aspects of natural capital, which include their interpretation,
reporting and the range of valuation methods being utilised. In addition perspectives
on deemed barriers and enablers to achieve natural capital accounting in South Africa
have been explored with the intent to reduce potential market failures or opportunity
costs incurred by society.
Through semi-structured interviews with 15 experts, nine Johannesburg Stock
Exchange (JSE) listed organisations across four industries, namely mining, banking,
food retail and brewing, the study qualitatively explored the level of sophistication of
natural capital accounting in South Africa and presents an enablement model for
natural capital accounting.
The results indicate that the influence of conventional economic paradigms, coupled
with lack of knowledge flows and institutional voids has marginalised natural capital,
creating an unquantified social cost. While institutional voids exist, there remains an
opportunity for business and stakeholders to align and manage natural capital more
pragmatically and create truly sustainable businesses.