Protecting biodiversity in forests managed primarily for wood production is often associated with lower calculated profits. But the picture changes when the financial benefits of biodiversity are included. This emerges from a global systematic review led by Wageningen University & Research.
Forests provide timber as well as many other ecosystem services. An important question is how measures to conserve biodiversity affect the profitability of forest operations focusing on wood production. Researchers from Wageningen University & Research and the University of Freiburg therefore reviewed studies worldwide that compared forest management with biodiversity conservation measures against business-as-usual management without those measures.
Of 5,305 publications initially identified, 53 studies met the review criteria. Together, they contained 814 scenarios involving measures such as harvesting trees later, retaining habitat trees and deadwood, and increasing tree species diversity. In 41 of the 53 studies, the average financial effect of biodiversity measures was negative compared with business as usual; in twelve it was positive. Across all studies, calculated profitability was about 5% lower on average.
Biodiversity benefits change the picture
An important difference emerges, however, when studies account not only for costs, but also for the financial benefits associated with biodiversity. These may include, for instance, the potential insurance value of more diverse forest under climate change, lower operational costs due to less intense management measures, higher timber qualities, or additional income options through payments for ecosystem services.
In scenarios where such benefits were included, calculated profitability was almost 20% higher on average than under business as usual. In scenarios where no financial benefits were attributed to biodiversity, it was more than 20% lower. This is a striking outcome of the study.
Much depends on assumptions about the future
The profitability of biodiversity measures further depends on the conservation measure, forest type and assumptions about factors such as timber prices, climate change and future disturbances. The first author Lorenz Schimetka notes: "Increasing biodiversity can help to mitigate the effects of climate change in forests - what we call the "insurance value" of biodiversity facing an uncertain future. Yet, quantifying the benefits of conservation in monetary terms is challenging, and hence was not done in many studies. This however leads to a systematic negative bias towards the profitability of biodiversity measures in respective studies."
What assumption we make is hence decisive. This is particularly important in forestry, where investments and management decisions can have consequences for decades or even centuries while future conditions remain uncertain. Climate change, for example, may strongly alter the risk of drought, storm damage, fire or pests. Such effects were only rarely incorporated into the financial models reviewed.
More than a financial calculation
The research team finally stresses that profitability is only one factor in forest management decisions. "Forests are a treasure serving so many societal needs. They have own intrinsic value as complex ecosystems populated by trees that can be centuries old, and many rare other species", the research team's leader Prof Georg Winkel notes. "While our review indicates that there may be important synergies between environmental and economic perspectives on forest management, such management needs to be based on wider considerations than profitability only."
The study was conducted within the European Horizon Europe project TRANSFORMIT by researchers from the Forest and Nature Conservation Policy Group at Wageningen University & Research and the University of Freiburg.
