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In 2005, the Millennium Ecosystem Assessment (MA, 2005) provided the first comprehensive report on global ecosystems, the dependence of human societies on the services provided, current state, and likely future trajectory. The MA identified the failure to value ecosystem services as a major contributing cause. The 2001 environment strategy did not explicitly address environmental valuation, although the focus on poverty and environment implies a need for valuing natural resources and environmental services. In consultations on the 2010 environment strategy, a wide range of stakeholders stressed the importance of mainstreaming environmental services. To better direct limited resources for environmental valuation and training, a closer look is needed to identify the conditions under which valuation has had an impact on: policy and project design, policy dialogue in client countries, environmental investments, and strengthening the capacity of national institutions. This report presents a review of environmental valuation in World Bank operational and analytical work, identifying what has been done, and the impacts environmental valuation has had. The report identifies the conditions under which valuation is most likely to influence decision-makers, and finally, the implications for the 2010 environment strategy. The report is organized as follows: section one gives context; section two gives introduction; section three gives approach to learning from past experience; section four focuses on coverage of ecosystem services; section five presents prioritizing environmental valuation; section six deals with why environmental valuation not done; and section seven gives recommendations.

Valuation of Ecosystem Services in World Bank Group Work