Ecosystem Natural Capital Accounting: A new tool for climate adaptation in Madagascar and the Comoros

Madagascar and the Indian ocean islands are a biodiversity hotspot – a group of islands with incredible species diversity and extremely high rates of endemism.To protect and preserve these species that exists nowhere else in the world and are threatened by climate change, IUCN NL and its partners in Madagascar, Comoros, Mauritius and the Seychelles are guiding ecosystem-based adaptation (EbA) and conservation projects.

In a series of articles, we highlight some of the powerful projects.

Header photo: Landscape of the dry region of western Madagascar © IOGA

Since June 2024, IOGA has been implementing the ’Ecosystem Accounting of Natural Capital for Ecosystem-Based Adaptation project in Madagascar and the Comoros’. The project applies Ecosystem Natural Capital Accounting (ENCA) in the Boeny region of Madagascar and the Grande Comore island in the Comoros. The project runs until December 2026, supporting evidence-based climate adaptation and environmental decision-making.

Key milestones achieved:

Over the past period, IOGA and its partners have reached several important milestones:

• Established and interpreted ecosystem accounts for Boeny and Grande Comore
• Calculated ecological debt, highlighting ecosystem degradation linked to human activities and climate change
• Identified sub-catchments where ecosystem service provision is declining most rapidly
• Determined the most affected ecosystem services, including water- and biomass-related services
• Assessed the perceived monetary value of ecosystem services based on local population surveys

Why ENCA matters

Ecosystems quietly provide, especially for free, essential services to humanity, such as water, soil fertility, logs, air and climate regulation, etc. that support livelihoods and human well-being. Yet these services are rarely visible in usual planning or economic systems.

ENCA makes these invisible benefits measurable and comparable over time. By tracking the potential of ecosystems to deliver services, ENCA enables scientists and policymakers to:

• Assess the sustainability of a protected area or region
• Detect early signs of ecosystem degradation
• Identify priority zones where ecosystem services are declining fastest
• Design ecosystem-based adaptation (EbA) measures to restore lost functions.

ENCA is fully compliant with the UN System of Environmental-Economic Accounting (SEEA 2021). It complements existing global standards and offers a practical, field-tested method that can be adapted to biodiversity-rich regions such as Madagascar and the Comoros.

The results are then being used to inform public policy, protected area management and adaptation planning. ENCA is also being explored as a bridge to corporate accounting approaches, such as the CARE-TDL model, which integrates natural capital into business balance sheets.

How ENCA works

The ENCA approach is based on the following:

• Land-use and land-cover maps at two points in time (the count opening and closing years);
• Household and resource-use surveys among local populations
• Ecological and scientific reference data drawn from established studies.

Rather than assigning monetary values to each individual service, which is often difficult and inconsistent across regions, ENCA evaluates ecological potential, for example, the amount of water stored in vegetation and soils or the availability of biomass. Tracking changes in these potentials over time reveals a territory’s ecological ‘debt’ or gain.

A monetary valuation is possible, but in this case it reflects how local communities value ecosystem services rather than abstract or intrinsic prices. The values are derived from:

•  Surveys of ecosystem users
• Population data by user category
• Spatial analysis of land use.

This approach ensures that the accounting reflects local perceptions, needs and dependencies, making the results more relevant for decision-making at a local level.

Sharing knowledge with the public

To make these concepts more accessible, the team produced a short educational video:

• Ecosystem Natural Capital Accounting. Malagasy version with English translation

The video explains how ecosystems support daily life and how ENCA helps us to understand and improve them.

Looking ahead

As climate pressures intensify, tools like ENCA provide an effective means of linking ecology, economics, and governance. By making nature’s contributions visible and measurable, ENCA enables smarter, fairer and more sustainable decisions for both the present and future.