Accounting for nature was not previously on the agenda for most of his clients, explains Peter Harker, a partner at Saffery. But the market is changing: “Most of our service lines are traditional ones, such as audit and tax compliance, but we are also building out new lines like climate and nature-related reporting and environmental, social and governance maturity assessments. 

“This is an exciting growth sector,” he adds. “We are helping our clients do positive things for both their organisations and the environment, as we expand Saffery’s nature-related service proposition.” 

Setting the strategic direction

Saffery, which acts for clients who own more than three million acres of land in the UK, features in a case study in the recent Global Accounting Alliance publication, Why nature matters to accountants: a guide to building resilience and value through nature-positive action. When asked if Saffery helps to set the strategic direction for financial decisions for land-owner clients as a partner, Harker responds with an emphatic: “Yes. We are continuing to build out the proposition and enhance our team within the firm across all disciplines, to advise landowners on new natural capital opportunities,” he says. 

Simultaneously, he is working to promote education about nature within the firm so everyone is on the same page. “It is a multi-disciplinary venture for the firm,” he says. “For example, we are integrating audit and assurance with nature. We are advising on how to account for new income streams such as carbon credits and biodiversity units, and we are going back to first principles to understand transactions (in this area), how to account for them and how they should be taxed.”

It is all about identifying gaps and plugging them with expertise to show strong strategic leadership in the sector, and to support those landowners who wish to make the transition to alternative forms of land management where nature is valued as an asset class.

“Landowners, like any other sector, also need to understand their capital base,” Harker says, “and also have requirements to access additional capital. When it comes to natural capital opportunities there is a need to understand the potential returns from this, so they can assess how best to access finance and deploy capital.”

Understanding the client too

Landowners come in all guises. From family farms to huge commercial enterprises, they are all custodians of nature. But landowning is modernising and Harker is seeing quite a shift in land use. Institutional funds are acquiring land for its natural capital value – income streams can be diverse and include planting trees for carbon sequestration, peatland restoration, managing flooding and developing ecotourism.

Harker sees a role for the firm in sharing knowledge about the value of natural assets (and how to build a commercial proposition around them) with owners of traditional family-owned farms and estates, these being a large part of the firm’s traditional client base. “For many years, natural capital was not on the agenda for most landowners,” he says. “Now it is high on the agenda for most meetings; this is especially the case given the shifting subsidy landscape.”

Harker has also seen public sector landowners become even more alert to the natural capital narrative, and adds: “They have an obligation to act in the public interest – and what could be more in the public interest than managing land, its species and ecosystems in a way that benefits everyone?”