Ecosystems Services – what are they and why are they so important?

Ecosystems Services – what are they and why are they so important?

By Arend Hoogervorst

Ecosystem Services?

Ecosystem services are services provided by natural capital (“Nature” or “the environment”- see Explanations below) that support life on earth and are essential to the quality of human life and the functioning of the world’s economies. For example, forests help purify air and water, reduce soil erosion, regulate climate and recycle nutrients.

Ecosystem services are the benefits provided by ecosystems that contribute to making human life both possible and worth living. Examples of ecosystem services include products such as food and water, regulation of floods, soil erosion and disease outbreaks, and non-material benefits such as recreational and spiritual benefits in natural areas. The term ‘services’ is usually used to encompass the tangible and intangible benefits that humans obtain from ecosystems, which are sometimes separated into ‘goods’ and ‘services’.

The use of the term “natural capital” is developed from “capital” used in economics and human financial systems. It is a means of drawing human and environmental systems closer together and to encourage more integration in thinking and practice. Some have said that ecosystem services thinking is a means of placing a monetary value on “the environment”, although the mechanisms are currently imperfect and incomplete.



In terms of “Nature”, an ecosystem is a biological community of interacting organisms and their physical environment; for example, “the marine ecosystem of the northern Gulf had suffered irreparable damage”. In broader, “non-natural” terms, an ecosystem is a complex network or interconnected system; for example, “Silicon Valley’s entrepreneurial ecosystem”.

Ecosystem services

Ecosystem services are the conditions and processes through which natural ecosystems, and the species that make them up, sustain and fulfill human life. They maintain biodiversity and the production of ecosystem goods.

Natural capital

Natural capital can be defined as the world’s stocks of natural assets or environmental resources which include geology, soil, air, water and all living things. It is from this natural capital that humans derive a wide range of services, often called ecosystem services, which make human life possible.

Built capital

Built Capital is defined as any pre-existing or planned formation that is constructed or retrofitted to suit community needs. (In other words, it is any human-made environment.)

Human capital

Human capital is the stock of knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform labour so as to produce economic value.

Social capital

Social capital broadly refers to those factors of effectively functioning social groups that include such things as interpersonal relationships, a shared sense of identity, a shared understanding, shared norms, shared values, trust, cooperation, and reciprocity.


Sustainability means that a process or state can be maintained at a certain level for as long as is wanted.

Sustainable development

Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

The concept of ecosystem services considers the usefulness of nature for human society. The economic importance of nature was described and analysed in the 18th century, but the term, ecosystem services, was only introduced in 1981 through the work of ecologists such as Paul Erlich and HE Daly. In the latter part of the 20th Century, the observation of significant and extended damage to ecosystems caused by human impacts began to highlight the ‘real’ role of ecosystem services, resulting in more study and focus.

Be aware that ecosystems have different functioning levels (See figure 1) and for the sake of clear explanation, this article focuses on high level discussion. The figure demonstrates the different functioning levels that occur in typical ecosystems.

Figure 1: levels of organisation in an ecosystem

Source: eSchooltoday

Ecosystem Capital

Figure 2 (developed by Costanza et. al.) below illustrates the interrelationships between the different types of capital in the environment. Built Capital represents the built environment (human and non-human), Human Capital represents the knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform labour and Social capital represents the factors of effectively functioning social groups that include such things as interpersonal relationships, a shared sense of identity, a shared understanding, shared norms, shared values, trust, cooperation, and reciprocity, all of which are contained within Natural Capital. The interaction of some or all of these different forms of capital contributes towards the goal of sustainable human well-being and is enhanced by ecosystem services.

Figure 2 – Interrelationships between different types of Natural Capital

Ecosystem Services Classification  

Ecosystem services have been classified in various ways, including:

  • ‘Functional groupings’, such as regulation (controls e.g. climate), carrier (e.g. pollination and seed transport), habitat, production (e.g. food), and information services
  • ‘Organisational groupings’, such as services associated with certain species that regulate external inputs into a system, and those related to the organisation of biological entities
  • ‘Descriptive groupings’, such as renewable resource goods, non-renewable resource goods, physical structure services, biotic services, biogeochemical services, information services, and social and cultural services.

Functional Grouping

The most widely adopted classification is the ‘functional grouping’ where ecosystem services are divided into four categories.  Some overlap occurs between categories but the four main groupings include:

  • Provisioning services which are the products that are obtained from ecosystems, such as: genetic resources, food, water, fuel, bio-chemicals, fibre, natural medicines, pharmaceuticals, and building materials.
  • Regulating services which are the benefits obtained from the regulation of ecosystem processes. These include: climate regulation, water regulation and purification, air quality maintenance, erosion control, waste treatment, regulation of human diseases, biological control, pollination, and protection from extreme weather and climatic events.
  • Cultural services which are nonphysical benefits that humans obtain from ecosystems through spiritual enrichment, cognitive development, reflection, recreation, and aesthetic experiences.  These services are connected to human behaviour and values, as well as institutions and patterns of political, social and economic organisation.  Cultural services include: cultural diversity, spiritual and religious values, knowledge systems, educational values, inspiration, aesthetic values, social relations, sense of place, cultural heritage values, and tourism.

Spaceship Earth

It is important to recognise that humans are integral elements of global ecosystems and that dynamic interactions take place between them and other parts of ecosystems. The ever changing human condition drives ecosystem change directly and indirectly, thereby bringing about changes in human well-being. Concurrently, economic, cultural and social factors, independent from ecosystems, influence the human condition, and natural forces shape ecosystems.

Ecosystem services influence human well-being, which is assumed to possess multiple constituents, including: basic materials to support a good quality of life, such as secure and adequate livelihoods, ample food, shelter, clothing, and access to goods; health, including well-being, a healthy physical environment, such as clean air and water; good social relations, which includes social cohesion, mutual respect, the means to assist others and provide for children; security, including secure access to resources, personal safety, and protection against natural and human induced disasters; and freedom of choice and action, which are the opportunities that enable individuals to achieve what they value doing and being.

The earth is not an “infinite resource” and it is important to recognise that polluting or damaging our “Spaceship” or not respecting its needs and limitations could have significant impacts upon its ability to sustain our lives in the future. As the earth’s human population continues to grow exponentially, future problems affecting the survival of human beings can be expected as various ecosystems services begin to break down, fail and become less sustainable.

Ecosystem Disservices

Ecosystem management, in some cases, may lead to possible ecosystem disservices.  Examples of disservices can include: increased prevalence of allergens; promoting invasive species; hosting pathogens or pests; inhibiting human mobility or safety; bringing about cultural and psychological effects that negatively impact human well-being; or increasing the necessity for using natural resources (i.e. water) or chemicals (i.e. pesticides and fertilisers).

Supporting Services

Supporting services are those which are necessary for the production of all other ecosystem services.  They differ from other services as their impacts on humans are indirect, or occur over a long time period.  Some services, such as erosion control, can be categorised as a supporting and regulating service (depending on the time scale and immediacy of their impact on humans).  Examples of supporting services include: production of atmospheric oxygen (through photosynthesis), primary production, soil formation and retention, nutrient cycling, water cycling and provisioning of habitat.

Direct and Indirect Services

Some ecosystem services involve the direct provision of material and non-material goods to people and depend on the presence of particular species of plants and animals, for example, food, timber, and medicines. Other ecosystem services arise directly or indirectly from the functioning of ecosystem processes. For example, the service of formation of soils and soil fertility that sustains crop and livestock production depends on the ecosystem processes of decomposition and nutrient cycling by soil micro-organisms.

Stricter Focus

Some scientists have advocated a stricter definition of ecosystem services as only the components of nature that are directly enjoyed, consumed, or used in order to maintain or enhance human well-being. Such an approach can be useful when it comes to ecosystem service accounting and economic valuation. This is because some ecosystem services (e.g. food provision) can be quantified in units that are easily comprehensible by policy makers and the general public. Other services, for example, those that support and regulate the production levels of crops and other harvested goods, are more difficult to quantify. If a definition based on accounting is applied too strictly there is a risk that ecosystem service assessment could be biased toward services that are easily quantifiable, but with inadequate consideration of the most critical ones for human well-being.

Debate and Publications

The concept of ecosystem services has prompted an increasing number of academic publications, international research projects, and policy studies. It is a subject of intense debate in the global scientific community, from the natural to social science domains. It is also used, developed, and customised in policy debates and considered, if in a still somewhat sceptical and apprehensive way, in the “practice” domain—by nature management agencies, farmers, foresters, and the corporate world. This process of bridging evident gaps between ecology and economics, and between nature conservation and economic development, has also been noted in the political arena, including in the United Nations and the European Union.

Areas of Discussion

The concept appears in four major discussions:

  • Academic: the ecological versus the economic dimensions of the goods and services that flow from ecosystems to the human economy; the challenge of integrating concepts and models across this paradigmatic divide;
  • Social: the risks versus benefits of bringing the utilitarian argument into political debates about nature conservation (Are ecosystem services good or bad for biodiversity and vice versa?);
  • Policy and planning: how to value the benefits from natural capital and ecosystem services (Will this improve decision-making on topics ranging from poverty alleviation via subsidies to farmers to planning of grey with green infrastructure to combining economic growth with nature conservation?); and
  • Practice: Can revenue come from smart management and sustainable use of ecosystems? Are there markets to be discovered and can businesses be created? How do taxes figure in an ecosystem-based economy? The outcomes of these discussions will both help to shape policy and planning of economies at global, national, and regional scales and contribute to the long-term survival and well-being of humanity.

Final Thoughts

“Ecosystems services” is a concept which may help to bridge the gap between the traditional economists (“Air soil and water are “free” goods which must be freely accessible to all.”) and multi-disciplinary decision makers (“There’s no such thing as a “free” lunch.”). After 20 years, the concept is still being hotly debated at many levels. It has perhaps resulted in the beginnings of consensus that there is need for a new economic paradigm which puts “Nature” at its core. It certainly is beginning to walk hand-in-hand with the “People, Planet and Prosperity” themes that emerged from the World Summit on Sustainable Development (WSSD) held in Johannesburg in 2002 and the subsequent UN Sustainable Development goals. There is no doubt that current economic systems and thinking needs to be changed to cope with the 21st century issues that need to be faced.


This article is designed to provide basic explanations and stimulate thought rather than going into excessive detail. Other authors have written tomes on ecosystem or nature services and there are many academic articles of different viewpoints on this subject. For the sake of brevity, this author has applied his view on certain elements of the topic for which he takes full responsibility.


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