Ecosystem Services and human wellbeing

Every day, we benefit from the services that nature provides: clean water, breathable air, fertile soils, landscapes that improve our well-being. But what happens when these services are degraded or disappear? Understanding how ecosystem services work is crucial for those involved in land management and seeking to protect natural capital effectively and sustainably. In this article, we explore the meaning of ecosystem services, their main categories, the benefits they provide, and the tools available to enhance their value, including from an economic perspective.

Ecosystem services: definition and meaning

“Ecosystem services” refers to all the benefits that natural ecosystems provide to humans, either directly or indirectly. The most widely recognized definition comes from the Millennium Ecosystem Assessment (MEA, 2005), which describes them as “the multiple benefits provided by ecosystems to humankind.” These benefits stem from the interactions between nature, the economy, and society, and are essential for the survival of living species and for maintaining so-called natural capital. According to this definition, use includes direct physical consumption, passive enjoyment, and indirect reception of services. Moreover, ecosystem services encompass all forms of interaction between ecosystems and people, including both local and remote interactions.

Categories of ecosystem services

Although still widely used, the Millennium Ecosystem Assessment (MEA) classification that identifies four categories of ecosystem services is now considered partially outdated. More recent frameworks, such as those proposed by the TEEB project and the Common International Classification of Ecosystem Services (CICES) developed by the European Environment Agency, reorganize ecosystem services into three main categories:

• Provisioning services: deliver benefits through resources extracted or harvested from ecosystems, such as food, timber, water, or genetic resources.
• Regulation and maintenance services: derive from the ability of ecosystems to regulate biological processes and influence climate, water, and nutrient cycles, maintaining favorable environmental conditions for life and society.
• Cultural services: refer to intangible experiences and benefits, such as psychological well-being, spiritual or aesthetic inspiration, and values linked to identity and relationships with the land.

Research in this area is still evolving and there is no universally accepted classification, but these categories provide a more updated and coherent framework aligned with current approaches to managing natural capital.

Examples of ecosystem services

• Forests: carbon storage, rainfall regulation, biodiversity protection
• Wetlands: water purification, flood mitigation
• Soil: nutrient cycling, support for agricultural production
• Urban green spaces: climate cooling, psychological well-being, increased property value

Learn how biodiversity protection also means ensuring the continued provision of these services.

The benefits of ecosystem services

Ecosystem services are essential to life on Earth: they support it and directly influence key components of human well-being, including security, health, strong social relations, and freedom of choice and action.

Forests, in particular, play a fundamental role for the environment, people, and the economy. According to the FAO’s State of the World’s Forests 2022, they host more than 80% of terrestrial animal, plant, and fungal species. Specifically, they provide habitat to 80% of amphibian species, 75% of bird species, and 68% of mammal species.

The benefits humans derive from forests are countless: tens of millions of rural families in tropical countries obtain income, food, and shelter from forests, which also contribute to the development of local and national economies. In addition to mitigating the effects of climate change by acting as carbon sinks, forests play a key role in protecting water resources and the terrestrial hydrological cycle. Forest watersheds provide about 75% of accessible freshwater resources, regulate the flow of surface and groundwater, and help reduce risks related to landslides, floods, and droughts, while also improving water quality for communities and ecosystems.

Loss of ecosystem services: a real threat

To ensure these services endure over time, ecosystems must remain healthy. However, in recent years, human pressure has had massive impacts, altering ecosystem structure, functions, and their capacity to deliver services. These pressures are influenced by political choices, technological developments, and consumer behavior.

The MEA (2005) report revealed that in the past 50 years, humans have altered ecosystems more rapidly and extensively than in any other period of human history. About 60% of the ecosystem services assessed are still in decline or being used unsustainably. While this has generally improved human well-being and spurred economic development—meeting the growing global demand for food, water, and energy—it has also weakened ecosystems’ ability to continue providing those same services. This has exacerbated poverty in some population sectors and deepened existing social and economic divides.

Quantifying the economic value

Many ecosystem services lack a market price and are often overlooked in economic and policy decisions. Nevertheless, robust methods exist to estimate their value and integrate nature into decision-making processes. Etifor supports natural area managers in the economic valuation of ecosystem services, fostering more conscious and sustainable management.

Payments for Ecosystem Services: how they work

Among the most effective innovative tools to finance the conservation of natural areas are Payments for Ecosystem Services (PES). These are voluntary agreements where beneficiaries of services pay those who maintain them, such as forest owners or protected area managers. PES are a strategic lever to make natural capital management more sustainable and financially viable.

Etifor projects on ecosystem services

Etifor has supported numerous regions in enhancing their ecosystem services, helping make natural resource management more effective and sustainable:

• Magnifica Comunità di Fiemme: developed an innovative system to measure and reward environmental services provided by forests, promoting participatory and multifunctional forest management.
• CIAD Nature Reserve: strengthened local governance, activated sustainable financial tools, and promoted the social and environmental benefits of the reserve by engaging public actors and local communities.
• Intercede: applied economic valuation tools to ecosystem services across various Italian protected areas, supporting managers in improving planning and accessing funding mechanisms.
• The value of the irrigation network in Veneto: quantified the environmental and socio-economic benefits of the region’s irrigation network, demonstrating the multifunctional value of this green-blue infrastructure.
• City of Turin: supported the municipality in defining a system of indicators to monitor urban ecosystem services and integrate nature into city planning and regeneration policies.

How Etifor supports natural area managers

Using scientific tools and tailored approaches, Etifor helps public and private entities recognize, measure, and enhance ecosystem services. From strategic consulting to participatory process facilitation, we support area managers in strengthening the ecological and economic resilience of their territories. Learn more about our work on ecosystem services.