Grace Wong, C. Luttrell, L. Loft, A. Yang, M. Brockhaus, S. Arwida, J. Tjajadi, Pham T.T., S. Assembe-Mvondo, A. Nawir

Hanoi, 11 November2015

Design of 3E REDD+ Benefit Sharing Mechanisms: Learning from Other

Experiences

Outline

Assessing 3Es in REDD+ benefit sharing

Types and feature of BSMs reviewed

3E+ outcomes

1. Effectiveness

2. Efficiency

3. Equity

4. Cross-cutting issues

• Key lessons

What do we mean by ‘benefit sharing’ in REDD+?

Benefit sharing = distribution of direct and indirect net gains from the implementation of REDD+

Direct benefits: Monetary gains from finance related to REDD+ Benefits associated with the increased availability of

forest products and ecosystem services Indirect benefits include improved governance, capacity

building and infrastructure provision

Benefits come with costs: Direct financial outlays (implementation and

transaction costs) Foregone revenues from alternative forest land and

resource use (opportunity costs) Benefit sharing mechanism = range of institutional means,

governance structures and instruments that distribute the net benefits

What do we mean by ‘benefit sharing’ in REDD+?

Assessing 3Es in BSM: incentives, institutions, outcomes

The design for a REDD+ benefit sharing mechanism needs to address …

the distribution of incentives

creation of enabling institutional conditions

change in LU practices to realize carbon and non-carbon outcomes

… in an effective, efficient and equitable manner

Luttrell et al., 2013; Wong et al., forthcoming

What lessons can we learn from other sectors and experiences for REDD+

benefit sharing?

1. How to operationalize equity, identifying target groups, setting up eligibility criteria? Who has the right to benefit?

2. Are incentives provided for inputs or outcomes? And which is more effective in changing behavior?

3. What is the process of participation and decision-making at multiple levels?

4. How is accountability and outcomes measured and monitored?

Types and features of BSMs reviewed

What kind of BSM is it? What type of governance practice is it?

Payment for Ecosystem

Services (PES)

Community Forestry

systems (CF)

Conditional Cash Transfers

(CCT)

Indigenous People’s trust funds in Brazil

(IPTF)

European Rural Development Policy (RDP)

Forest revenue redistribution

schemes

Anti-corruption measures in

Indonesia (ACM)

Standards and certification

(S&C)

Voluntary Partnership

Agreement (VPA) under FLEGT

Who should benefit from REDD+?

A REDD+ incentive is only one of many drivers influencing behavioral patterns in land use and forest governance

Payments as incentive to induce change in land use behaviour and governance

Payments are targeted to people who can provide these services in most cost-efficient manner

Equity = who has the right to benefit?

Lessons from the ongoing review of BSMs and governance practices

Lessons for: 1) Effectiveness

1. Use of input or intermediate indicators do not capture impacts or long-term outcomes – PES/CCT: the costs of monitoring longer-term outcomes often result in simplified proxy input indicators that do not adequately capture impacts or performance

2. Use of existing governance systems to reduce transaction costs – Forest redistribution (Cameroon): important to not reinforce flaws in existing systems

3. Involve local government 4. Coordination – discussed everywhere but often lack the

resources and institutional authority/ mandate

Lessons for: 2) Efficiency

1. Role of intermediaries – critical to bridge between the global/national/corporate and multiple local beneficiaries . Examples: National Fund for Forest Financing (FONAFIFO) which manages the Costa Rica PES and the FAS which manages Bolsa Floresta in Brazil.

2. Addressing scale 3. Using geographical targeting to increase effectiveness and

efficiency – avoiding areas of high opportunity costs (CF in Indonesia) or identifying areas of high priority to ensure sustainable outcomes (RDP)

4. Clarifying tenure based on the nature of the ecosystem service

Lessons for: 3) Equity

1. Setting eligibility criteria for identifying target beneficiaries often entail trade-offs between efficiency and equity

2. Techniques for assessing and recognizing the level of costs and to whom they are accruing - S&C periodic review of producer costs (Fairtrade)

3. Setting fair payments and payment structure – phased and upfront payments are useful for enabling broad participation - Plan Vivo TGB

4. Paying attention to the type of benefit • There is a focus on development activities and co-benefits • Pros and cons of cash depend on context • Securing rights may be an important co-benefit

Cross-cutting issues: Accountability/ legitimacy/ MRV

1. Inclusion and participation in process – under-representation of certain groups in decision-making creates risks of elite capture and undermines legitimacy of the system

2. Transparency – anti-corruption measures in Indonesia: transparency is not sufficient by itself: enforcement and penalties are also important

3. Dispute resolution 4. MRV – FLEGT uses independent auditing and multi-

stakeholder oversight to ensure credibility

Key points for design of national REDD+ benefit sharing

Effectiveness depends strongly on governance and requires rigorous MRV system to monitor benefit flows and to measure impacts and outcomes depending on the REDD+ objectives Managing issues of scale, bundling and targeting can increase

efficiency Assessing who benefits and structuring payments to address

equity can involve trade-offs with efficiency Mix of benefits and instruments – in many cases, indirect and

non-cash benefits are important An inclusive multi-stakeholder process is critical for ownership

across multiple levels, legitimacy and sustainability

• Key publications: Assembe-Mvondo et al. 2015. Comparative Assessment of Forest and Wildlife Revenue Redistribution in Cameroon.

CIFOR working paper 190. Loft, L. et al. 2015. Taking stock of carbon rights in REDD+ candidate countries: Concept meets reality. Forests 6:1031-60. Börner et al. 2015. Mixing Carrots and Sticks to Conserve Forests in the Brazilian Amazon: A Spatial Probabilistic

Modeling Approach. PLoS ONE 10(2): e0116846. doi:10.1371/journal.pone.0116846 Luttrell et al. 2015. Lessons from voluntary partnership agreements for REDD+ benefit sharing. CIFOR Occasional Paper

no 134. Luttrell et al. 2014 Who should benefit from REDD+? Rationales and realities. Ecology and Society 18(4): 52. Pham et al. 2014. Local preferences and strategies for effective, efficient and equitable PES benefit distribution options

in Vietnam: Lessons for REDD+. Human Ecology DOI: 10.1007/s10745-014-9703-3 Pham et al. 2013. Approaches to benefit sharing: A preliminary comparative analysis of 13 REDD+ countries CIFOR

working paper 108. Assembe, S. et al. 2013. Assessment of the effectiveness, efficiency and equity of benefit sharing schemes under large-

scale agriculture: Lessons from land fees in Cameroon, European Journal of Development Research

• Series of information briefs: Arwida S. et al. 2015. Lessons from anti-corruption measures in Indonesia, CIFOR InfoBrief 120. Nawir A. et al. 2015. Lessons from community forestry in Nepal and Indonesia, CIFOR InfoBrief 112. Gebara MF. et al. 2014. Lessons from local environmental funds for REDD+ benefit sharing with indigenous people in

Brazil. CIFOR InfoBrief 98. Loft L. et al. 2014. Lessons from payments for ecosystem services for REDD+ benefit-sharing mechanisms. CIFOR

InfoBrief 68. • Myers et al. 2015. Benefit sharing in context: A comparative analysis of 10 land use change case studies in Indonesia.

CIFOR InfoBrief 118. Tjajadi et al. 2015. Lessons from environmental and social sustainability standards. CIFOR InfoBRief 119. Wong G. 2014. The experience of conditional cash transfers: Lessons for REDD+ benefit sharing. CIFOR InfoBrief 97. Yang A. et al. 2015. What can REDD+ benefit sharing mechanisms learn from the European Rural Development Policy.

CIFOR InfoBrief 126.

Thank you!

http://www.cifor.org/redd-benefit-sharing/

With co-financing from:

The CIFOR REDD+ Benefit Sharing project is supported by: