8 January 2026
Natural capital should be formally recognised as critical national infrastructure to strengthen the UK’s economic resilience, drive sustainable growth, and meet its environmental goals, according to a new policy paper by The Institute of Sustainability and Environmental Professionals (ISEP), supported by professional services firm Jacobs.
The new report Natural capital is critical infrastructure: Putting natural capital at the heart of UK growth and resilience – brings together insight from industry experts across infrastructure, energy, water, highways, rail, and finance. It demonstrates that the loss or degradation of natural capital could significantly impact essential services, economic stability, and national security.
Natural capital refers to the world’s stocks of natural assets – including forests, fisheries, rivers, biodiversity, land and minerals, both the living and non-living. These assets provide essential ecosystem services – the benefits humans derive from nature – such as food, water and climate regulation, which are crucial for the economy and human wellbeing.
Natural capital loss impacts economic resilience, operational costs, and critical resources: :
- Office for National Statistics values UK ecosystem services at £1.8trillion, or 72% of GDP.
- The Green Finance Institute estimates environmental deterioration could lead to a 6-12% GDP loss by the 2030s. (e.g. the 2008 financial crisis reduced GDP by 5%, while Covid-19 cost 11% GDP in 2020.)
- Natural England’s State of Natural Capital Report says environmental degradation threatens industrial productivity and resilience to climate change and economic shocks.
- Investing in nature-based solutions can drive economic growth, create jobs, and generate significant social welfare benefits (for example, £3 for every £1 spent).
While UK policy has evolved from site-specific conservation to strategic nature restoration, and natural capital is recognised as an asset in some policy frameworks such as the UK’s 25 Year Environment Plan (25YEP) and the HM Treasury Green Book, it largely remains voluntary and inconsistently applied across sectors.
To address these challenges and harness nature's economic potential, the report proposes six priority policy actions within national infrastructure and economic planning:
Relevant government bodies should formally recognise natural capital as a critical national infrastructure alongside its essential role in supporting the Critical National Infrastructure (CNI) sectors and the UK Government’s growth agenda.
Create a Strategic Nature Network (SNN) and designate it as a Government Major and Nationally Significant Infrastructure Project, creating opportunities for economic growth and targeted investment in nature recovery.
Recognise the SNN in National Policy Statements and Spatial Development Strategies and promote the uptake of natural capital approaches to deliver a consistent reporting requirement.
Explicitly recognise the economic importance of natural capital in delivering the Environmental Improvement Plan and embed environmental net gain in decision making, including mandating nature-related financial disclosures for CNI sectors and public bodies. This will help the UK Government to deliver its nature restoration targets.
Establish a dedicated Natural Infrastructure Investment Fund for nature restoration projects that connect the SNN, to create early-stage investment that provides private sector confidence and targets nature recovery in the most nationally critical locations.
Develop guidance and training on natural capital and asset management approaches for public bodies and companies across all CNI sectors to enable decision makers to reach balanced and sustainable investment decisions.
This paper makes practical proposals that natural capital built on structures already in place is critical for economic growth, vital to ensuring resilience to climate change and economic shocks and added value to the current nature conservation and restoration system.
ISEP CEO Sarah Mukherjee MBE, said: “There is a crucial relationship between the UK's economic growth agenda and natural capital. Despite growing evidence demonstrating that nature and biodiversity loss pose significant risks to society and the economy, and that investment in nature restoration can generate jobs and economic output, there remains a shortfall in policy integration.
“There are 13 sectors that currently fall under the category of critical national infrastructure, such as food, water, energy, health, transport, and communications, and while not a sector in its own right, natural capital directly underpins the functioning and resilience of each of these existing sectors.
“To futureproof the economy and provide resilience against the increasing impacts of climate change, natural capital should be recognised as critical infrastructure and integrated more effectively into the UK economy and fiscal policies. This will align with the scientific advice, with current forecasts predicting that nature-related risks – unless addressed and properly integrated into decision-making – will negate any of the potential gains in economic growth that the government is striving to deliver.”
Jacobs Senior Vice President Amy Bentley said: “Recognising natural capital as critical national infrastructure is fundamental to strengthening the UK’s economic resilience and achieving long-term growth. Natural capital assets underpin the performance and productivity of every infrastructure sector — from energy and transport to water, food and health — providing essential ecosystem services that support communities and industry alike.
“At Jacobs, we apply natural capital and asset management approaches to quantify and value nature’s role in delivering resilient infrastructure and sustainable economic outcomes. By embedding nature-based solutions and nature-related financial disclosures into policy and investment decisions, we enhance the evidence for public and private investment in nature recovery, while ensuring natural systems are recognised and managed as strategic national assets.”
Jacobs led the research for the paper and facilitated workshops with key business representatives across critical national infrastructure sectors.
Kylie Jones, Carbon & Nature Strategy Manager for SSEN Distribution said: “As an electricity Distribution Network Operator, we rely on natural capital, whether it's for the wooden poles that carry our overhead lines, or the flood protection given to our substations by intact habitats. Recognising that natural capital is critical infrastructure will ensure investment flows into nature restoration, and that the benefits it delivers are fully recognised.”
Neil Strong, Biodiversity Strategy Manager, Network Rail, said: “Incorporating nature-based solutions is a key part of our Greener Railway Strategy. Nature can be an important ally when managing the rail infrastructure. Natural flood management schemes can help to reduce the risk of embankments being washed away during storm events. Similarly, hedgerows provide connected habitat for biodiversity enhancement, they help create an impenetrable barrier to trespassers and they take up carbon – doing all this whilst looking great.”
Stephen Elderkin, Director of Environmental Sustainability, National Highways, said: “The economy is embedded in and dependent on nature. Whether for materials, or ecosystem services such as flood management, carbon storage, air to breathe or food to eat, the health of the natural environment is the critical foundation on which a prosperous society is built. A strategic, resilient national nature network is critical national infrastructure.
“I welcome the ISEPs recommendations for a Strategic Nature Network and encourage all to join Rebuilding Nature in its construction.
“The SNN can help us make sense of all the initiatives and projects that are dispersed across the UK. It helps us communicate and inspire, with a vision for a better future. It shows that access to nature will be coming to your community with all the benefits for health and wellbeing that brings.
“It gives us confidence that we have a coherent plan and that delivering and maintaining it will ensure that the natural environment is sufficiently muscular and resilient, safeguarding the ecosystem services it provides. It can help us prioritise our spend and provides the strategic context within which to make the business case for individual interventions.”
Naomi Conway, UK Director of Nature, Palladium, said: “Palladium welcomes ISEP's policy paper, because recognising nature as critical infrastructure is essential to unlocking private capital at scale. Looking at nature through an infrastructure lens underscores the scale of need and the urgency to invest now. Ultimately this investment would mean that the UK can safeguard essential services, strengthen community health and resilience, and secure a more prosperous future.”
Emma Knight-Strong FISEP, Director, Green Arch Consulting Ltd, said: “Natural capital is not a peripheral concern - it is critical infrastructure for every business. Companies, to varying degrees of materiality, rely on healthy ecosystems for resources, resilience, and long-term viability. Those that embed natural capital into their strategy will not only safeguard their operations but also build the resilience needed to thrive in a rapidly evolving business environment.”
