Developing and piloting a UK natural capital stress test

This report sets out the results of a study that developed and piloted a new Natural Capital Stress Test (NCST) for the UK, to help the Government to track emerging environmental risk ‘hot spots’ in the economy, pinpointing which business sectors are most at risk, in order to help identify the need for and to prioritise policy responses.

The study findings show that the loss or degradation of natural capital could lead to significant impacts on the national economy by 2050 if actions are not undertaken to curb or adapt to the potential changes. These impacts could be particularly significant for the most at-risk sectors, such as the food and beverages sector.

Degradation of the natural environment, both in the UK and overseas, is already posing mounting risks to our economy and businesses (e.g. due to flooding, soil erosion, and air pollution). These findings underline the importance of developing a better understanding of, and carefully managing, these risks in order to safeguard the UK’s future economic resilience and prosperity.