By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She is currently writing a book about textile artisans.
Coral reef ecosystems are especially vulnerable to climate change. During the past fifty years their condition has steadily deteriorated, with global coverage of living coral declining by half (see Global Coral Coverage Down by Half Since the 1950s). As the oceans continue to warm up, scientists say it may be possible to preserve some reefs, but urgent action is needed now for that to happen (see World’s Coral Scientists Warn Action is Needed Now to Save Even a Few Reefs from Climate Change).
Lambert has written at length about initiatives to restore coral reefs and I refer interested readers to his two extensive posts on the topic (See, e.g. New Hope for Coral Restoration with “Electric Reefs”? and Coral Reefs, Climate Change, and Mobilization). In his New Hope post, Lambert expresses skepticism towards reef reconstruction efforts that rely on NGOs, international funding, and very large grants. Hold that thought; I share his healthy skepticism.
So, due in part to climate change but also as a result of other ways we’ve despoiled the oceans, coral reefs are in trouble. In Nobel-winning stock market theory used to help save coral reefs, yesterday’s Guardian reported on the work of Prof Ove Hoegh-Guldberg, a climate scientist at the University of Queensland, who helped lead a the “50 reefs” project to identify and save key coral reefs. These scientists applied modern portfolio theory to identify fifty coral reefs most suited to surviving climate change, and to be used as ‘arks’ to foster coral restoration projects elsewhere. According to Hoegh-Guldberg:
“It’s essentially a strategy to help us make decisions about what to protect, if we are to have corals at the end of the century.”
“It is our best shot at having a long-term future for coral reefs,” he said.
The Guardian elaborated the details of the work undertaken:
Researchers at Australia’s University of Queensland used modern portfolio theory (MPT), a mathematical framework developed by the economist Harry Markowitz in the 1950s to help risk-averse investors maximise returns, to identify the 50 reefs or coral sanctuaries around the world that are most likely to survive the climate crisis and be able to repopulate other reefs, if other threats are absent.
The study recommends targeting investment in conservation projects that have the “strongest potential to succeed” in protecting priority reefs. The gains go beyond positive ecological outcomes and include crucial social, economic, health and nutritional benefits for communities, according to partners, organisations and funders interviewed by Blue Earth Consultants.
The Guardian lauded these efforts, but I’m inherently suspicious of an initiative whose “gains go beyond positive ecological outcomes” to “include crucial social, economic, health and nutritional benefits for communities” – especially as there looks to be a tangle of partners, organisations, funders, and consultants involved. What’s a neo-liberal not to love?
Well, for starters, conservation priorities will be assessed according to an investment framework – whatever that means in the conservation context:
“Modern portfolio theory is a framework that aims to reduce risk while maximising returns,” said Hoegh-Guldberg. “It’s treating conservation sort of as an investment opportunity.”
The strategy, which came out of a meeting of scientists at the Hawaiʻi Institute of Marine Biology in 2017, tapped into the theory to help scientists choose a “balanced” portfolio of coral reefs.
“You’ve got hundreds of these reefs across the planet,” said Hoegh-Guldberg. “Which one do you pick, so that you concentrate your efforts on it?”
Unsurprisingly, I’d wager that the pseudo-investment nature of the scientists’ process would make this project catnip to funders:
Dr Hawthorne Beyer, a fellow at the University of Queensland researching the use of quantitative modelling in managing environmental systems, said: “Talk to people in the business world and they get it immediately. It’s a very logical idea and makes a lot of sense. Ours was the first to apply it on a global scale.”
The project created a global framework for focusing efforts and has garnered a goodly share of foundation funding:
The project identified reefs across the Middle East, northern and eastern Africa, Australia, the Caribbean, Pacific islands, South America, south-east and south Asia. They include parts of the Great Barrier Reef in Australia, the Egyptian and southern Red Sea, and parts of the “coral triangle” around Indonesia, Malaysia, Papua New Guinea and the Philippines. But, based on the criteria for climate and connectivity, the model excluded several ecologically significant areas, such as Hawaii and Central America’s Barrier Reef.
Nearly $93m (£70m) has been invested in the project, funded by Bloomberg Philanthropies’ Vibrant Oceans initiative and others. The report found the 50 reefs-inspired approach had helped at least 26 organisations, and eight funders have now prioritised 60 coral reef ecosystems across more than 40 countries.
Coral reefs cover just 0.2% of the ocean floor but are home to at least a quarter of all marine species and support hundreds of millions of people. Conservation efforts inspired by the study have focused on five threats to coral: fishing; “non-point source pollution”, such as from fertilisers, runoff from roads, or sediment; wastewater pollution; coastal development; and stress to reefs from climatic extremes.
I’m not denying that these factors pose significant threats to coral reefs. Nor am I rejecting the use of investment models per se. Tom Ferguson’s investment theory of political parties is tremendously helpful for examining political questions, as it highlights the logic behind money-driven political systems: follow the money! But that approach doesn’t seem relevant here. Instead:
The scientists divided the world’s coral reefs into “bioclimatic units” (BCU) of 500 sq km (190 sq miles). They used 174 metrics, in five categories, including temperature history and projections, ocean acidification, invasive species, cyclone activity and connectivity to other reefs, for each one. Then, using a process called “scalarisation”, they produced estimates for each BCU. This captured the widest range of possibilities for the future. “We don’t know which metrics are the best metrics at predicting risk,” explained Beyer.
The team then used MPT to quantify threats and identify the reefs offering the best options for conservation, while allowing for the uncertainty over future risks from climate change.
“You don’t want to put all your eggs in one basket, or bet on one measure of risk, when we have massive uncertainty about what the risks will be,” he said.
If the model provides a way to focus conservation efforts, what harm’s been done? According to The Guardian:
Emily Darling, director of coral reef conservation at the Wildlife Conservation Society (WCS), said part of the benefit was having a clear blueprint of where best to focus their efforts.
“One of the biggest benefits of the 50 reef approach has been this compelling message that climate change is the critical threat to coral reefs and this is an approach that can give reefs a fighting chance.”
The WCS has $18m in funding for work in 11 countries, including Fiji, Indonesia, Kenya and Tanzania, on 21 of the 50 reefs, to help communities reduce pressure on the precious ecosystems.
I guess one long-lasting benefit of my MIT undergrad education is some basic facility with numbers and their use as a tool for guiding decision-making. Plus some understanding that just because a bag of tricks is useful for one purpose – and may have indeed won a Nobel prize – doesn’t mean it’s necessarily helpful in another another context. So I wonder what alternative models preceded the 50 reefs project. Such approaches may not have been as attractive to funders tickled by the pseudo-investment framework. But were they inherently inferior for deciding which reefs to save and which to let go?