Natural Capital Statements: a case study on SCA, a Swedish paper and pulp company

Companies and investors have an important role to play in preventing further degradation of the natural environment and supporting its improvements. This requires decision-useful, readily available corporate reporting and investment analysis on environmental impacts and dependencies. There are pressures on providing such information, driven by movements within climate change reporting, uptake of the UN Sustainable Development Goals and increasing expectation for more transparency in reporting and analysis. Although sustainability reporting and environmental social and governance (ESG) analysis are evolving, they are not deemed ‘fit for purpose’ to meet all the changes currently on the horizon. eftec developed the Natural Capital Statements to fill this gap. The ‘NatCapStatementsTM’ are a combination of the income statement and balance sheet for natural capital assets, mostly using the data already being collected by companies and analysts. Based on the relatable structure of traditional financial accounts, the NatCapStatementsTM report (i) the impacts of a company on natural capital; (ii) how dependent a company is on natural capital and (iii) whether the company is prepared for future risks and opportunities from the environment. To demonstrate this approach, this article presents an independent assessment of the NatCapStatementsTM of Swedish paper and pulp company SCA.