HOW A NATURE-BASED ECONOMY WILL BENEFIT AUSTRALIA

By Michael Davis, Senior Specialist, Carbon Markets and Nature Capital

We live in a time of unprecedented prosperity, with advances in technology, medicine and infrastructure providing more comfort and security than ever before. However, this prosperity has come at a significant cost. Our economy, built around extracting resources as quickly as possible, is putting immense strain on the planet.

Today, we’re living beyond the planet’s capacity to regenerate. We’ve exceeded the limits in six out of nine key planetary boundaries scientists use to track our impact. We’re using resources faster than nature can replenish them, putting us at risk of collapsing the very systems we rely on. While our current economic system is efficient at creating wealth in the short-term, it’s not resilient. By pushing beyond Earth’s limits, we’re creating risks that threaten our prosperity— not just for future generations but also for us today.

A Regenerative Economy: A Shift in Focus

It’s clear we need to redesign our economic system. We need to move from a system of solely extraction to one that regenerates. A regenerative economy isn’t just about minimising harm—it’s about actively restoring the environment, rebuilding communities and strengthening the economy in ways that benefit everyone. Our economic system today is built around taking from nature without giving back. It treats the Earth’s resources as if they’re endless, when we know they’re not. Nature is valued at close to zero, and the environmental damage caused by this approach is staggering. Globally, it's estimated that US$7 trillion a year flows into nature-negative industries—those that harm the environment. Our economy depends on nature in countless ways: from bees pollinating our crops to forests regulating rainfall, nature is essential for food production, building materials and even the water that cools the data centres we rely on so that you can read this blog post. Our survival is directly tied to clean air, fresh water, and a stable climate. But our current system fails to recognise this reality.

The Australian Context: A Disconnected Reality

In Australia, the situation is particularly alarming. Recent estimates put Commonwealth Government spending at $26 billion annually on activities that harm nature, including land clearing, fossil fuel subsidies and mining. This is 50 times more than the $500 million spent on protecting and restoring nature. These figures highlight how out of balance our priorities are. We’re investing far more in destructive practices than the ecosystems we depend on. Can this really be the best value for money, especially when environmental destruction will destabilise the economy in the long run?

A Path Toward Regeneration

To move toward a regenerative and nature-positive economy, there are key actions we can take:

1. Understanding the risks

We need a deeper understanding of how much our economy depends on healthy ecosystems. By recognising this, we can make smarter decisions that protect our future. Companies (and investors) can do this by assessing how their decisions impact and are impacted by nature. They can use this information to identify opportunities to reduce impact and invest in nature. The Taskforce for Nature-related Financial Disclosures (TNFD) is helping businesses track risks. Governments should make nature-related disclosures mandatory for all companies, as long-term success depends on how well companies manage nature risk.

2. Levelling the playing field

The government must remove subsidies that encourage environmental harm. Australia spends far more on activities that destroy nature than on its protection. This isn’t a sustainable use of public funds, especially when the risks of environmental degradation are so high.

3. Transition planning

Start planning today. The government must work with key industries to develop and implement a transition plan to move from extractive to regenerative-based practices in a way that is fast and just.

4. Incentivising regeneration

The government must provide more incentives toward approaches supporting nature restoration, including nature-positive carbon credits.

5. Vote and shop for change

Citizen consumers should vote for politicians committed to a nature-positive economic future and use their purchasing power to encourage more regenerative businesses.

A Call for Change

Our goal is to build an economy that regenerates rather than exploits. An economy that restores the environment, rebuilds communities and ensures future generations can prosper. To achieve this, we need a transition plan that brings together governments, businesses and communities to develop policies that are fast and just. We understand that this change won’t happen overnight. But if we continue to extract from the planet without considering the long-term consequences, we risk undermining the very system that has brought us prosperity. By adopting a regenerative mindset, we can protect nature and create a more resilient, equitable and sustainable economy. This is not just an option—it’s a necessity. If we want to continue enjoying the benefits Earth provides, we must work together to shift toward a regenerative economic future. You can help by joining our calls for our political leaders to Choose Nature and build an economy that works for people and nature.