Magazine article American Forests

Trees on the Balance Sheet: Worried about Your Portfolio? Here's a Hot Investment Tip to Keep You Cool and Increase Your Earnings. (Editorial)

Magazine article American Forests

Trees on the Balance Sheet: Worried about Your Portfolio? Here's a Hot Investment Tip to Keep You Cool and Increase Your Earnings. (Editorial)

Article excerpt

It doesn't take a financial wizard to recognize that the stock market has not been a good bet lately. While we are not traditional investment managers, AMERICAN FORESTS has a hot tip for increasing your earnings. It isn't a blue chip stock or dot com start-up. It's an asset allocation that pays off in multiple dividends: cleaner air and water, lower energy costs, and improved human health and quality of life. I'll give you a hint: it has to do with trees.

Natural capital-the intangible value of healthy ecosystems-is an investment guaranteed to perform high above standard indices and appreciate in value for generations. The concept of natural capital was developed as a way to compare the costs and benefits of natural resource management strategies. In other words, to put the value of natural resources into dollars and cents. But how to show debt and equity ratio on the budget sheet when the benefits don't have dollar values? What is a pound of oxygen worth to an animal?

About five years ago, after a decade and a half of leadership in the urban forest movement, AMERICAN FORESTS developed a way to measure the value of natural resources-especially that of trees- in urban ecosystems. Finally the planting and care of trees, as ecosystem-restoring actions, could be weighed against the value of the benefits those trees provide.

AMERICAN FORESTS has looked at urban ecosystems in several metropolitan areas across the US, and the findings are striking. All areas that were naturally treed have lost about 30 percent of their canopy cover in the last 25 years. We can place dollar values on these missing trees because we can measure the effect of their loss. In a cross-section of 100 of the country's urban and suburban forests (where more than 156 million of us live), trees reduce the need for 264 billion cubic feet of stormwater retention infrastructure (sewers, channels, catchment basins, etc. …

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