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«EUI Working Papers RSCAS 2012/23 ROBERT SCHUMAN CENTRE FOR ADVANCED STUDIES Global Governance Programme-18 MULTILEVEL GOVERNANCE OF INTERDEPENDENT ...»

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International incentive mechanisms for conservation of biodiversity and ecosystem services activities, such as guidelines for sustainable use (Secretariat of the Convention on Biological Diversity, 2004a), impact assessment (Secretariat of the Convention on Biological Diversity, 2004b, 2006), or prevention of damage caused by alien invasive species (IUCN and Invasive Species Specialist Group, 2000).

Biodiversity considerations have also been incorporated in benchmarks by the financial institutions.

Out of these, notably the IFC performance standards (2012) 31 and Equator principles (‘Equator Principles’, 2006) 32 spell out specific content that applies to biodiversity. On the legal nature, the origin, and significance, of the IFC Performance standards, and the Equator Principles as a case study, as rules filling the vacuum at the international level about what represents acceptable social and environmental behaviour, see Affolder (2006). The Global Reporting Initiative (GRI) acts in a similar way as the benchmarks of financial institutions. By mimicking financial reporting practices, which are rooted in the principle of transparency, it provides a framework for sustainability reporting. The GRI determines principles and indicators for sustainability reporting by corporations, in other words, it defines how and what should be reported. Based on this, participating corporations are invited to disclose their environmental, social, and governance performance. The requirements for biodiversity reporting are built on qualitative and quantitative indicators which highlight direct and indirect impact on biodiversity (Global Reporting Initiative, 2000). 33 Common to these documents is that they enter into areas managed by the private sector, and provide a framework, or benchmark, for its conduct. They are perhaps the key instruments of corporate accountability. These standards function as an incentive for companies that wish to be associated with good corporate social practices. The compliance with these benchmarks increases the likelihood of an improved reputation. For the aim of corporate internalisation of biodiversity's goals, there is a certain benefit in delivering biodiversity in the package of already accepted obligations, and yet have it spelled out as a responsibility separate from pollution control, which is likely to exist already in corporate practices.

The idea of codes is that companies would use them in designing their activities, for example at the stage of environmental and social impact assessment. Although many codes address the private sector directly, some of them also address it through the states, asking the governments to enact appropriate legislation and make the private sector aware of these developments. While the codes mentioned here are drafted in a multi-stakeholder process, rather than by the industry alone, the most common type of questions which can be raised about the codes remain the same. They relate to a sufficient specificity Relevant to the biodiversity considerations are the following IFC Performance Standards: One: Assessment and Management Environmental and Social Risks and Impacts; Six (“Biodiversity Conservation and Sustainable Management of living Natural Resources”); and Seven (“Indigenous Peoples) and Eight: Cultural Heritage”).

The Exhibit II, titled “Illustrative list of potential social and environmental issues to be addressed in the Social and Environmental Assessment documentation,” promotes that: “In the context of the business of the project, the Assessment documentation will address, where applicable, the following issues: protection and conservation of biodiversity, including endangered species and sensitive ecosystems in modified, natural and critical habitats, and identification of legally protected areas”.

Biodiversity is one of nine aspects in the environmental dimension of sustainability reporting. The two core principles relate to: (a) “location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas;” and (b) “Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas.” The optional principles relate to (a) “habitats protected or restored” (measuring the prevention and redress of negative impacts on natural habitats resulting from the organization’s activities); (b) “strategies, current actions, and future plans for managing impacts on biodiversity” (performance against internal programmes); and (c) “number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk.” Biodiversity value is acknowledged also in other indicators, for example in the optional indicator on discharges of water and runoff, or in spillover.

–  –  –

and rigour of rules which would ensure a high level of protection; to inclusiveness and legitimacy of the drafting process; and to institutions and mechanisms that enable verification of compliance.

Environmental management systems A particular type of corporate practices is the environmental management systems (EMS). EMS are systems “of management policies, procedures, structures and practices that enables an organization to anticipate, identify and manage the environmental impacts of its activities” (Wood, 2002, p.134). EMS and EMS standards, such as the ISO 14000 series or EU EMAS, are tools of corporate governance in the field of environment, which are increasingly popular, and - while voluntary - are increasingly habitual in organisations. These standards have come to include particular provisions on biodiversity.





An example is the revised EU EMAS, which came into effect in January 2011 (Council Regulation (EC) 1221/2009). For the first time, it defines basic indicators that have to be used by the participating organisations in their environmental statements and reports. Biodiversity (seen as land use) is a core indicator. Effects on biodiversity are also framed as a direct environmental aspect.

Poverty reduction process Alleviation of poverty is an uncontested international policy goal, most influentially expressed through the Millennium Development Goals (MDGs), but also through other initiatives - such as the Highly Indebted Poor Countries Initiative (HIPC). As these initiatives receive full international support without the need for further justification, the CBD's closer alignment with them, and the integration of biodiversity considerations in the development processes, seems like a pragmatic decision (UNEP/CBD, 2002b, paragraph 8, 2006d, paragraph 6, 21). Also, the CBD's “2010 biodiversity target”, a policy goal set in 2002, justifies the conservation of biodiversity, not only on its own terms, but also “as a contribution to poverty alleviation” (UNEP/CBD, 2002d).

Poverty and biodiversity conservation are two closely related themes, but at the same time in a contesting relationship. In the past, cases of displacement of peoples in the name of conservation have not been uncommon, and an official marriage between economic development and environmental protection in 1992 by the concept of ‘sustainable development’ seemed like a basis for synergetic policies. While formally this goal remains the same, it has been suggested that the balance between the two has recently shifted to the benefit of poverty alleviation. Rather than adjusting human needs to the ecological limitations, the latter are being disregarded and “poverty alleviation has largely subsumed or supplanted biodiversity conservation.” (Sanderson and Redford, 2003, p.390). The CBD seems to be affirming this strategy in an attempt to foster biodiversity conservation through its inclusion into other goals rather than justifying it on its own.

Business-NGO/treaty partnerships A visible expression of an increased presence and coordination between different actors in the policy arena are partnerships between conservation organisations and businesses. Traditionally antagonistic relationships have been transformed into cooperation, built on the idea that a partnership is of mutual benefit. The private sector wins expertise in managing environmental aspects of their activities and a positive reputation for being involved in a public affair, almost a stage on which to showcase its commitments to the environmental goals. The NGOs or treaty bodies benefit from gaining legitimacy and funding, and normally try to exert influence over production patterns of the partnering companies.

The assumption is that a close cooperation between these kinds of institutions will lead to an improved corporate conduct. Yet, the partnerships have been condemned for subordinating conservation to the neoliberal capitalist policies and practices; for leading to a withdrawal from regulatory supervision;

International incentive mechanisms for conservation of biodiversity and ecosystem services and for promoting voluntary (unbinding) agreements rather than putting a stricter regulation in place (MacDonald, 2010).

As noted in different analyses (Affolder, 2010; Bled, 2009; Morgera, 2009, chapter 8), the CBD started its more active period of engagement with the private sector in 2006. But while this was the first time the COP passed a decision on the private sector, a closer look at the COP decisions in the past reveals that the private sector was on the radar of the regime since earlier. In fact, it begun to be addressed as early as 1996, first as a source of funding (UNEP/CBD, 1996b, see also 2000b), and only later as an equal stakeholder in the implementation of the regime, with knowledge and non-financial resources relevant to the attainment of the CBD objectives. The process of a greater involvement of the private sector with the CBD regime has influenced the regime in most far-reaching ways, such as the fact that the private sector has been invited to participate directly in the regime bodies, either as part of national delegations or directly as an addressee (UNEP/CBD, 2006a, paragraphs 2 and 7).

Conclusion The central question of biodiversity as a common action problem on a global scale, and the CBD regime as the central institution to administer it, is that of how to get actors - from states to communities and private actors - to manage their resources sustainably. The question can be recast in terms of available regulatory mechanisms. In this contribution, I have looked at the CBD regime through the lens of the regulatory mechanisms which it has offered to achieve its objective, and I have compared them with those that are sought outside it, which presumably represent a reflection of the actual needs.

My excursion through the existing incentives essentially suggests the following interrelated issues.

More than building new workable mechanisms, the process of incentivising is - at this stage - about utilitarian and pragmatic discourses in biodiversity conservation; the involvement of private actors in the governance of a global resource; the suggestion to use of economic approaches in decisionmaking, and instruments that imitate real markets. To capture the processes, I argued that only a broad conception of ‘incentive’ is appropriate. But apart from the distinction between command-and-control and other type of instruments, the CBD experience suggests another conceptualisation of incentivising.

Two (non-excludable) trajectories of fostering the biodiversity considerations in international governance may be distilled: one through building separate issue-focussed mechanisms; and the other one through the process of ‘mainstreaming’, or integrating, biodiversity concerns into existing norms, institutions, issue-areas, and decision-making strategies. The mission of ‘mainstreaming’ is to align biodiversity considerations with the ‘predominant’ norms, values, actors, and institutions; and to penetrate into the existing processes of decision-making in domains of public policy, and private spheres. These dynamic processes are largely occurring outside the inter-state CBD regime, but the CBD often functioned as their ‘cradle,’ and even their promoter. Just how active or passive the role of the CBD in these techniques has been, and how appropriate, remains a question for a different study.

In so far as it highlights the aspects which the reforming processes are targeting, the case in point also reveals some of the regulatory, institutional, and ethical premises of the 21st century governance.

For institutions and regimes with a relatively weak political capital, such as CBD, the manner of implementation is a strategic choice. The dominant contemporary governance structure dictates that state implementation and prescriptive legislation are supplemented by other regulatory methods which are characterised by more flexibility, voluntary commitments, and market-oriented solutions, all of which envisage a greater role for the private sector. Indeed, the private integration is not always forced, but is often also self-initiated. The private sector itself reaches out to implement the international norms, often regardless of the state. It is commonly suggested that an effective regime for managing a community goal is bound to accommodate these shifts. Indeed, many fields of environmental law and policy have followed the impetuses of the market and private actors. Disregard

Jerneja Penca

for similar adjustments in the field of biodiversity may mean losing out on an opportunity to increase the reach and effectiveness of the regime. But while this adjustment is often presented as the only choice the regimes have, this is not the case. They could just as well opt for a path of implementation which rejects these shifts, and remain loyal to the language and methods of resistance. This second option is rarely found in practice, and this lack of evidence partly explains the indeterminacy as to claiming one or the other method as more effective, or the correct one.



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