FUTURE ECONOMY
LMD’s panel discussion on World Environment Day – moderated by Ruwandi Perera – focussed on nature-based solutions that can enable Sri Lanka’s economy to prosper with purpose
The programme featured the CEO and founder of Good Life X – Randhula de Silva; the Co-Founder and Director of the Centre for a Smart Future (CSF) – Anushka Wijesinghe; Senior Advisor to Biodiversity Sri Lanka, President of the Institute of Environmental Professionals Sri Lanka (IEPSL), former Country Representative of IUCN Sri Lanka and former Head of the Regional Business and Biodiversity programme of IUCN Asia – Shiranee Yasaratne; and the founder of RETRACE Hospitality – Chalana Perera.
We reproduce edited excerpts of this panel discussion…
Ruwandi Perera (RP): What is the definition of nature-based solutions in a Sri Lankan context?
Shiranee Yasaratne (SY): Nature-based solutions come from and are inspired by nature. This has come into focus more recently and Sri Lanka has living examples of them.
For example, going back to the Asian tsunami, wherever we had mangrove systems along the coastal belt, villagers and communities were reasonably safe from the waves. This was because the mangroves acted as a barrier. Coral reefs do the same.
Another example is reforestation. When you reforest, the trees sequester carbon.
These are the examples we have here in Sri Lanka, and should be replicated and taken forward in a systematic and sustainable manner.
Chalana Perera (CP): Nature-based solutions are all around us and they’re a large part of the global economy. Although the Sri Lankan economy has been built from nature, it’s been done so in an extractive manner.
When we talk about nature-based solutions today, we refer to those taken from and given back to nature. It means regenerating natural resources that we’ve been exploiting.
So in a modern sense, nature-based solutions are influencing or inspiring design. Look at biomimicry design or biophilic design where a lot of R&D across industries and sectors has been based on extracting from nature.
In the case of tourism, our product is our biodiversity. So if we’re concerned about harnessing our biodiversity effectively, we have to regenerate our ecosystems to ensure we attract the high value tourism we’re aiming for.
Every sector in the country is linked to nature-based solutions because they are powered by human capital. We’re a result of what we eat and how we spend our free time, and all of that is linked to biodiversity.
RP: Anushka, why do we need to invest in nature-based solutions?
Anushka Wijesinghe (AW): Economists, and those in charge of economic growth and development, have done a poor job of thinking about the role of nature in the economy.
The metric that we often talked about growth is GDP. It’s one of the most outdated measures of economic growth and prosperity because you can add to GDP by degrading the environment.
You pay the price by having plastic bottles in the ocean. The more you add, it adds to GDP.
We have a fundamental problem with how we value nature, how that value is captured, and the means used to consider and measure economic growth.
It’s well-established that we need to consider nature and natural capital to be key components of our economy. We have the more fundamental challenge of putting nature and perhaps nature-based solutions at the heart of how we grow the economy, how we think about economic growth, our conception of development and what our priorities are.
Currently, all countries – including developing nations – are doing it right to varying degrees. In some countries – particularly Scandinavian countries – they’ve gotten a lot better at truly integrating nature into the economy. They not only see built capital as a growth driver but also natural capital.
There are countries in the Global South such as Costa Rica that are standard examples.
In many instances, this is being driven by young people and folks with new ideas are being allowed to come to the fore. That’s the challenge in Sri Lanka. Our development paradigm tends to be dominated by traditional thinking and older people. But fortunately, that’s changing.
RP: Randhula, how can we take nature-based solutions to a new level especially when catering to global markets?
Randhula de Silva (RS): We need to change our perspective of how we see ourselves – and what we see when we look inwards.
What do we see in Sri Lanka when we look inward and talk about our natural resources that are in abundance… and what do they mean?
For some, it can simply mean that our resources are commodities that can be exported. This has been the case for many years and we need to change that perspective.
Even though Sri Lanka has been blessed with abundant resources and in spite of the continuous extraction, nature keeps replenishing our rich and fertile ecosystems. However, we can’t keep going like this.
We must course correct how we work with our nature-based resources and how we convert them to build solutions, and share them with the world. So we need to regenerate and replenish what we have because soon, consumers will reject every extractive
practice.
During some recent work at the Lost Ingredients Lab, a young tech-based entrepreneur asked why we were working on jackfruit and gotukola. The value of what we have in Sri Lanka and what it means to the world needs to be viewed and understood locally first, through a regenerative lens.
This will help nature-based resources and solutions derived from them to be holistic, and be useful to both local communities and global consumers.
Many young people are coming back to Sri Lanka; and several who are in Sri Lanka have fresh perspectives, and they’re helping to shift the narrative.
RP: Shiranee, in terms of high value tourism, how can we offer something great at a reasonable price without enduring negative repercussions?
SY: Sri Lanka has huge tourism potential where nature is concerned but we haven’t taken that very seriously. When we visit other countries, we see how they use their natural resources to their advantage.
Fortunately, some of our higher end tourism chains have realised this. I’ve been working with a biodiversity private sector oriented platform and the tourism industry works very closely with us.
The concept is nature-based, and these chains try to market Sri Lanka’s culture, beauty and society together in a package. That’s the kind of thing that we should be looking at.
SMEs are part of the value chain. Our larger chains have realised the selling potential of ethical tourism and we should focus on SMEs. They need to be brought on board and allowed to learn from the many examples that are available.
Meanwhile, the Sri Lankan government is also serious about the policies being established. For example, we have the National Biodiversity Strategy and Action Plan, which aims to enhance the island’s biodiversity.
When we say that we’re a biodiversity hotspot, it means that our biodiversity is reducing drastically. So we need to bring it back to the glory days using the policy documentation and action plan that’s been developed.
One of our nationally determined contributions (NDC) under the Paris Agreement looks to increase the island’s forest cover to 32 percent. Therefore, we need to convert the policies into action and encourage all stakeholders to act accordingly.
It’s not only the state that has such a responsibility; all Sri Lankans must be responsible and work towards achieving these NDCs.
RP: How are we faring in terms of our climate targets?
SY: Many private sector organisations are trying to achieve net zero status. Since this is an important goal for them, they are implementing a host of actions to become more energy efficient. But not many are looking at activities that are unrelated to their work such as sequestering carbon or restoring forests.
Renewable energy is extremely important in today’s context and many businesses are trying to minimise their use of fuel-based energy.
I’m observing a positive trend. But Sri Lanka is vulnerable to the impacts of climate change and this is evident even in changing monsoon patterns. We must be ready with mitigation activities and solutions.
This is where nature-based solutions can play a role because they will help communities build resilience against the impacts of climate change.
RP: Anushka, do you share this optimism?
AW: We have to be optimistic because otherwise, we won’t achieve anything.
We can’t separate climate targets from a country’s larger development goals and the ambitions of people for prosperity. That’s why it’s necessary to build a nexus between nature, society, business and government.
If we don’t do that, we’ll continue to have a compartmentalised approach to mitigating the impacts of climate change.
The environment underpins everything we do – including how we grow the economy and climate ambitions such as renewables, reforestation and so on. There are examples where reforestation or replanting around rainforest borders has been undertaken with communities so that projects are sustainable as opposed to simply dropping plants in a disorganised manner.
Meanwhile, other organisations have not involved neighbouring communities, and implemented mangrove projects by simply planting new plants and hoping for the best.
There’s also talk about electrical vehicles (EVs) and going electric in our transport system. These well-intentioned plans are designed to completely electrify our three-wheeler fleet… but without understanding where the power is going to come from. We’ll still have to use electricity.
Climate ambitions should tie up with social realities and development goals.
While I do share the optimism, I worry that we’ll continue to think in silos and not understand how climate ambitious projects link with one another. We shouldn’t imagine that we can implement various projects such as electric mobility, reforestation or ecotourism in isolation.
So while we move forward, it is necessary to integrate all our projects and ambitions with the overall development of the country.
RP: So what are your views on climate ambitions? And how can we break the cycle of ad hoc project implementation?
RS: It’s important when we go micro at an organisational level to not simply look at restoration, conservation or meeting net zero targets as ticking boxes because they appear impressive to stakeholders and consumers.
But if you can transform the way you work as an organisation, it will improve the wellbeing of your community and the environment since your business is a part of a larger ecosystem. This process doesn’t refer to charitable efforts but rather, working for profit while taking nature into account as yet another stakeholder.
It’s a shift in perspectives and companies need to internalise these issues without viewing them as external things that need a solution. Otherwise, you end up working alone and not treating the solutions as part of a holistic process in a connected system.
Working in silos is happening at both the micro and national levels. The way to change this situation is by transforming how an organisation operates – after understanding why it exists.
SY: The UN Sustainable Development Goals (SDGs) play a very important role in this process because they integrate the gamut of sustainability needed for Sri Lanka to become a sustainable nation.
Where biodiversity or the environment is concerned, our life on land, beneath the water and climate action require people and nations to work in partnership.
This is why we’re trying to encourage companies to report on SDGs because Sri Lanka as a nation is reporting its progress in achieving them.
It’s only when businesses realise that they also contribute to the national conservation agenda that they’ll understand the depth and value of their contributions. So ad hoc projects like planting trees in a mangrove or forest do not contribute significantly to the national contribution unless they’re part of a larger whole.
CP: Regardless of the sector or industry an organisation belongs to, it’s about recognising that nature is at the core of all businesses. When that happens, there will no longer be a need for a sustainability department.
We have the brains, know-how, talent and passion; it’s the recognition that’s missing. World Environment Day should not be one day of the year but every single day.
RP: Randhula, are there any stakeholders who need to play a bigger role in the effort to protect the environment?
RS: Our generation and those to come will have to take up the challenge of protecting the environment. Millennials and Gen Z are conscious about the need for sustainability, and unwilling to let the status quo of extraction from nature continue.
It’s tough for millennials because they’re caught in the transition without having been born into it. I decided to remain in Sri Lanka and work towards enabling this process by engaging with both old and new players.
Everyone must be involved; no one can be left behind. It’s about transitioning to a new green economy that we can all embrace soon. And it’s becoming evident that the old era is over and a new dawn is breaking.
For the birth of a new era, there needs to be a change of perspective in the economic, financial, ecological and business spheres, and those who can grasp that transition are the younger generation.
They are not necessarily sitting in boardrooms. But they’re already on the field and ground, and working with communities, and rolling up their sleeves and doing the work. Now these new ideas, fresh perspectives and boundless energy must enter the boardrooms and places where policy is made so that the necessary conversations can begin to take place.
It’s only then that the shift will begin to gather momentum and society will be able to witness the transition.
Corporates have a huge role to play in Sri Lanka and many of the changes that we have seen in the past were led by the private sector, which includes both large organisations and SMEs. These enterprises are trying to make that shift happen and the government is introducing policies that create an enabling environment.
SY: Most of the landmass in Sri Lanka belongs to the state. And if the private sector wanted to do something in areas protected by legislation, it was difficult to obtain permission because corporates were viewed with a great deal of suspicion.
But today, the trend is changing and the younger generation working in those offices understands that it is necessary to view environmental protection through a holistic lens. The government has very little resources to do anything constructive and environmental restoration requires financing by the private sector.
AW: Like the other panellists, I am a firm believer that private sector entrepreneurs, however small or large, have the capacity to make innovative changes happen. But we have to be mindful of the fundamental role that the state plays and shouldn’t allow it to abdicate its responsibility nor overstep it.
We need to re-prioritise and realign the role of the state in all this and do the same with the Central Bank of Sri Lanka since it is the regulator that ensures financial stability.
A main source of instability is environmental instability. We may have well-regulated financial systems and effective policies, but we’re going to have immense climate and environmental instability… and the result will be social unrest.
Sri Lanka has some excellent pieces of legislation and regulations on environmental protection, and they have been around for decades – far longer than in many other countries.
RP: Anushka, how will instruments such as green bonds be game changers?
AW: Green and sustainable finance is going to be a huge part of our financial landscape over the next few years.
At an institutional level, some banks are attracting finance from greener sources. The government is considering a green bond framework at a sovereign instrument level, and we have global capital and plenty of offers of new capital that’s looking to deploy in countries like ours – for conservation efforts and so on.
In Sri Lanka, we have an abundance of potential projects that are ready to tap into this capital but the intermediation is still a little weak. Furthermore, we have the private sector and institutions that are still coming out of the CSR mindset.
Organisations need to understand that green finance isn’t simply about reforestation or conservation. It has to be at the core of the business. These monies must be used in sectors such as agriculture or tourism, which embody regenerative practices.
Meanwhile, Sri Lanka needs to tell its story to the world, and explain what kind of projects exist and the types of investments that are required. Banks must play a key role in securing green financing for use in the conservation and restoration effort.
We still don’t place enough value on projects that adopt regenerative practices.