Recognition of the interrelationships between the global loss of nature and collapse of rural communities is essential. Compartmentalising or ignoring the diversity of stakeholder perspectives, policy objectives, and the complexity of nature has not worked. We must improve all natural and human capital to address the growing problems. Progressing environmental and development policies in isolation diminishes policy effectiveness, polarises communities by engendering dislocation, fear and conflict, and leads to ineffectual or deleterious natural and rural systems management. Conservation and rural policy can be recast to a new rural-urban dynamic: progressing from food and fibre production with little regard for externalities to one of food, fibre and sustainable natural and rural systems. We propose a conceptual framework based on the interdependence of humans and nature that recognises multiple forms of capital, and their role in environmental management and community development. Specifically, the 'forms of capital' framework directs attention to the transformational properties of different forms of capital and to the deterministic socioeconomic and political drivers of change. Integrating system governance and stewardship, in conjunction with coordinated, self-adapting processes of research, planning, monitoring and system evaluation, offers a means of improving sustainable management of the complex inter-relationships between people and nature.