Is natural capital the answer? Hint: Yes – Here’s what agriculture needs to make it work

Can agriculture really be the solution to biodiversity loss, climate change, and land degradation?

That’s the question that opened a standing-room-only breakout session at evoke^AG. 2025 – where leaders from philanthropy, finance, sustainability and innovation explored what it will take to move ‘natural capital’ from concept to core capability on farm.

Natural capital isn’t just about carbon – it’s a new way to understand value on farm

Farming for the Future (FFtF) is one of -the world’s most comprehensive, farmer-centricresearch initiatives into the role of nature in agricultural performance. Michelle Gortan, CEO of the Macdoch Foundation – the philanthropic foundation that seeded FFtF – said the program provides a strong footing from which to build a sector-wide conversation about natural capital.

Michelle Gortan in action at evoke^AG. 2025.

“FFtF was developed with many stakeholders – producers, advisors, banks, industry bodies, RDCs,” she said. “We were very keen to understand what it is about natural capital that would motiviate them; and what would be the drivers for operationalising it in the business.”

“Resilience (of the farm and of nature), profitability, productivity – these were clear motivations,” added Michelle. “But one of the things we noticed in our consultations was there is very low literacy around the concept of natural capital: how it’s applied, where it’s useful.”

“People could conceive of nature as trees on the farm, or carbon stored in soil. But nature as something you can manage and transact and value as part of your operation is limited.”

To bridge that gap, Macdoch Foundation developed the Natural Capital Primer – a practical science-based online resource to boost understanding of natural capital assets, the services that flow from them, and the value they provide for businesses and society.

Making nature visible in the farm business

Understanding that natural capital matters is one thing. But how do farmers turn that awareness into action – and outcomes?

Michelle said that’s where decision-useful data comes in. “When you integrate production, finance and nature data, you operationalise natural capital in your business and pull on it as another levers to meet your business goals, in the same way you would manage other inputs” she explained.

And in news that surprised delegates, the biggest bang for buck from harnessing natural capital isn’t in side-hustle sales of carbon or biodiversity credits. It’s in core production.

“There is under-optimised productivity and profit that already exists in the farm system. That’s the real opportunity,” said Michelle.

And to prove it, she shared Deloitte’s modelling of FFtF’s research into livestock enterprises across Victoria, WA and NSW, which showed that integrating natural capital into decision-making could lift gross farm margins by 22% – or up to $6.9 billion across the sector.

It’s a compelling case for reinvesting in the natural systems that underpin production, particularly at a time when, as Michelle noted, farm productivity growth has been relatively flat for years.

A systems approach to a systems problem

Sarah Cragg, Head of Asia Pacific at The Earthshot Prize, brought a global innovation lens to the discussion, noting that natural capital is foundational to the world’s most promising climate and nature startups.

“Natural capital is central to everything that we do at Earthshot. It’s central to our mission as a company, but it’s also central to all of the solutions that we work with – from lithium-ion technology coming out of Hong Kong, to a UK business using eDNA to develop nature metrics.”

Charlotte Weston, Sustainability, Clients and Markets Leader at EY, highlighted the need for business to understand their dependence on natural capital, and nature related risks and opportunities.

Charlotte Weston in action at evoke^AG. 2025.

“There’s been a gear shift in recent years,” she said, driven in part by rising scrutiny from investors, insurers and regulators. But also, by the growing practical need to respond to climate and supply chain shocks.

Charlotte said agriculture is uniquely positioned, as one of the few sectors that can not only reduce its footprint, but actively draw down carbon, regenerate ecosystems, and support communities at scale.

“We’ve traditionally had a very segmented approach to engaging with climate and nature, but this is changing.What we’re facing is a systems challenge. And we need a systems approach to the solution.”

And that means supply chain partners, food companies, financiers, insurers and investors all have a role to play, too.

Making data work for farmers

Michelle added this system-wide thinking is missing from the on-farm natural capital piece, too.

“Thinking in an integrated way is what farmers do – they have to. But right now, that integrated information just isn’t available for farm businesses, and natural capital is missing from the equation. Many farmers already collect environmental data, but it exists in siloes, and it’s not in a form where farmers can use it in a decision-useful way.”

FFtF has proven it can be done. Michelle said its future lies in being scaled as  as a capability in agriculture that also protects its public interest mission

“Nature, climate change, food security – these are very big, wicked problems,” she said. “And we need public interest approaches to address the challenges on data. Our aspiration is that the FFtF capability will be open to the world – where tech, farmers, advisors, policymakers can use that information to integrate into all forms of decision-making.”

Beyond the farmgate

After the panel, delegates rolled up their sleeves for roundtable discussions exploring five big questions:– How do we define natural capital? – What incentives or policies are needed? – Where are the innovation gaps? – What are the key challenges? – Who needs to collaborate?

The result was a roadmap of interventions to embed natural capital as a core farm business capability, and one which we can all drive to build a more productive, resilient and profitable future.

To see what delegates think will shift the needle on natural capital, see below.  

And to catch up on the other conversations about sustainability, climate resilience and the role of natural capital in meeting those challenges, click here

evoke^AG. 2025 wish list for shifting the needle on natural capital