1. Key steps for the identification of Green Economy indicators

2. The Green Economy is an action oriented approach (a vehicle) to support reaching sustainable development. Success is based on : -Inclusiveness (UNCED, 1992), to avoid treating the three pillars of sustainable development as isolated parts of the system. -Customization (UNEP, 2011) green economy strategies need to be conceived, designed and implemented taking into account the local socio- economic and environmental context. United Nations Conference on Environment and Development (UNCED). Agenda 21, as adopted by the Plenary in Rio de Janeiro, on 14 June 1992. United Nations Environment Programme (UNEP) (2011). Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication, Nairobi: UNEP. 1. Introduction 3. Green Growth Knowledge Platform (GGKP) MovingtowardsaCommonApproachonGreenGrowthIndicators GreenGrowthKnowledgePlatformScopingPaper 4. 1. Introduction (2) A booklet and manual present the framework and a step-by-step approach on how to delimit, classify and measure a green economy transformation. It is a practical approach for the identification, definition of use of indicators within the context of the green economy policy process. 5. Ib. Expected use Support country to: Use indicators as a tool for identifying priority issues; Formulating and assessing green economy policy options; Evaluating the performance of policy implementation. Focus is being given on those policy options with multiple dividends. 6. Multiple dividends? Example of the multiple benefits generated by green economy policy interventions. Several stakeholders may benefit from a single intervention, formulated, assessed, monitored and evaluated with a variety of indicators across sectors. Ministry(of(Finance( Ministry(of(Planning( Incen3ves(to( support(the( adop3on(of(green( agricultural( prac3ces( ISSUE:( INDICATOR:( ( ( ISSUE:(( INDICATOR:( ( ( ISSUE:( INDICATOR:( Ministry(of(Water( Ministry(of(Agriculture( Ministry(of(Health( 7. 2. Policy and Indicators Indicators are needed in all phases of the policy cycle, in particular: a.Issue Identification and Agenda Setting Environmental issues and targets b.Policy Formulation Policy interventions c.Policy Assessment Policy costs and effectiveness, impact on well-being d.Policy Monitoring and Evaluation Effectiveness, impacts on well-being and equity 8. 2. Policy and Indicators (2) Policy evalua on makes use of the indicators iden fied in the first two steps, to evaluate the effec veness of the interven on and the emergence of unexpected impacts and trends. Policy formula on analysis focuses on issues and opportuni es and on the broader advantages and disadvantages of policy implementa on Issues, and rela ve policy goals, can be of general nature, social, economic and environmental (with the la er being more relevant for UNEP) Decision making is based on the results of the policy formula on stage, and should account for the forecasted impacts of policy implementa on on the environment, the economy and overall well being of the popula on. Issue Iden fica on and Agenda Se ng Policy Formula on Assessment Decision MakingPolicy Implementa on Policy Monitoring and Evalua on 9. 2. Policy and Indicators (3) Table 1: Overview of the structure of the manual, and main steps proposed to support the policy making process. Starting froma problemor an opportunity, identified with thehelp of agenda setting indicators, policiesareidentified and defined through theuseof policy formulation indicators. Policy assessment indicatorsarethen used to forecast policy impacts, and all thethreecategoriesareused to support monitoring and evaluation. Agenda setting Indicatorsfor issueidentification (Chapter 2) Policy Formulat ion Indicatorsfor policy formulation (Chapter 3) Indicatorsfor policy assessment (Chapter 4) Decision Making- Implement ation Indicatorsfor Monitoringand Evaluation (Chapter 5) Identify potentially worrying trends Assesstheissueand itsrelation to the natural environment Analyzemorefully theunderlying causesof theissue of concern Analyzemorefully how theissue impactssociety, the economy and the environment Identify desired outcomes: define policy objectives Identify intervention options and output indicators Measurepolicy impactsacross sectors Analyzeimpactson theoverall well-being of thepopulation Analyzeadvantages and disadvantages and informdecision making Measurepolicy impactsin relation to the environmental issue Measurethe investment leveraged Measureimpacts acrosssectorsand on theoval well- being of the population 10. 3a. Indicators for Issue Identification Indicators for issue identification are instruments that help decision makers identify and prioritize problems and set the agenda for policy interventions. Four main steps: Identify potentially worrying trends; Assess the issue and how it relates to the natural environment; Analyze more fully the underlying causes of the issue; Analyze more fully how the issue impacts society, the economy and the environment. 11. Step 1: Identify potential worrying trends Tasks: Identify indicators of sectoral performance related to the problem. Collect data relevant to the issue under consideration. Identify national trends and compare them with existing national, regional and global targets. Compare trends with the performance of comparable countries and/or regions. Key questions: Has the trend worsened in recent years? Is the trend in line with national, regional or global targets? Is the trend in line with the performance of similar countries? 12. Step 1: Identify potential worrying trends (2) 13. Step 2: Assess the issue and its relation to the natural environment Tasks: Identify indicators of environmental performance related to the problem. Collect data relevant to the issue under consideration. Identify national trends and compare them with existing national, regional and global targets. Compare trends with comparable countries and regions. Key questions: Is the issue influenced by the environment? For instance by natural resource depletion or degradation, erosion of ecosystem services, or the reduced provision of ecosystem services? 14. Step 3: Analyze more fully the underlying causes of the issue Tasks: Identify causal relations and map them systemically. Evaluate whether multiple causes act simultaneously and are also causally linked with each other. Evaluate their respective strength. Key questions: Is there a causal relation between the trend observed and economic, social or environmental variables? What are the key drivers and pressures? Are there multiple, and simultaneous causes? 15. Step 4: Analyze how the issue impacts society, the economy and the environment Tasks: Identify impacts of the issue on society, the economy and the environment. Identify indicators relevant to the issue analyzed, considering its social, economic and environmental impacts. Relate causes to cross-sectoral impacts using the causal relations identified in step 3. Key questions: How is the problem affecting the system and its socio-economic and environmental performance? Are the impacts of the problem immediate or emerging slowly, and do they last for a long time? 16. 3a. Indicators for Issue Identification (2) 17. 3a. Indicators for Issue Identification (3) 18. 3b. Indicators for Policy Formulation Indicators that allow to evaluate the adequacy of the interventions analyzed, taking into account their repercussions on the key actors in the economy and impacts across sectors. Two main steps: Identify policy objectives; Identify intervention options. This chapter as well as the following ones will differentiate the effects of interventions into (i) outputs; (ii) outcomes; and (iii) impacts. 19. Step 1: Identify desired outcomes: define policy objectives Tasks: Analyze indicators of sectoral and environmental issues. Select target indicators tailored to the national context, with the help of existing global and regional targets: Set specific targets to address the causes of the problem. Set specific targets to reduce the impacts of the problem. Key questions What is the desired outcome that can be reached through policy interventions? What is the key target to be reached? 20. Step 2: Identify intervention options and output indicators Tasks: Identify indicators representing and measuring the main policy instruments considered. Identify indicators representing and measuring the sectoral effectiveness of the intervention considered. Key questions: What are the policy instruments available to address the negative environmental trends? What are current and past policies adopted for the same objective? What should be changed? 21. 3b. Indicators for Policy Formulation (2) 22. 3b. Indicators for Policy Formulation (3) Policy Indicators Green investment R&D investment (% of GDP) EGSS investment ($/year) Green fiscal reform Fossil fuel, water and fishery subsidies ($ or %) Renewable energy incentive ($ or %) Pricing externalities and valuing ecosystem service Carbon price ($/ton) Value of ecosystem services (e.g. water provision) Green procurement Expenditure in sustainable procurement ($/year and %) CO2 productivity of government operations (ton/$) Green job skill training Training expenditure ($/year and % of GDP) Number of people trained (person/year) 23. 3c. Indicators for Policy Assessment Indicators that support the estimation and evaluation of policy impacts across sectors, with a more marked focus on indicators for socio- economic impacts and well-being. Three main steps: Estimate policy impacts in relation to the environmental issue; Analyze policy impacts across sectors; Analyze impacts on the overall well-being of the population. 24. Step 1: Estimate policy impacts across sectors Tasks: Select and analyze indicators of policy impacts on other sectors. Key questions: Is the policy having positive/negative impacts on other sectors? 25. Step 2: Analyze impacts on the overall well- being of the population Tasks: Select and analyze indicators of policy impacts on: Employment, total wealth, access to resources, etc. Select and analyze composite indicators of well- being, such as: Human Development Index (HDI), Gender-related Development Index (GDI), Millennium Development Goals (MDGs), Genuine Progress Indicator (GPI). Key questions: What is the impact of the policy on the overall well-being of the population? 26. Step 3: Analyze advantages and disadvantages and inform decision making Tasks: Identify indicators to estimate the costs of reaching selected targets through various policy interventions (e.g., include, capital and O&M, training costs, etc.). Identify indicators to evaluate expected benefits and avoided costs of the investment and interventions considered. Identify and analyze indicators that highlight the presence of possible synergies and/or side effects. Key questions: What is the economic cost of the targets and intervention(s) proposed? How does it compare to the cost of inaction? What are the economic and cross-sectoral benefits of policy options in the short, medium and long-term? Which options are expected to generate the maximum cross- sectoral benefit at the minor cost? 27. 3c. Indicators for Policy Assessment (2) 28. 3c. Indicators for Policy Assessment (3) Wellbeing and equity Indicators Employment Construction (person, %) Gini coefficient Total wealth Value of natural resource stocks ($) Net annual value addition/removal ($/year) Access to resources Access to modern energy (%) Access to sanitation (%) Health Level of harmful chemicals in drinking water (g/litre) Number of people hospitalized due to air pollution (person) 29. 3d. Indicators for Policy Monitoring and Evaluation Indicators for policy monitoring and evaluation support the assessment of the performance of the intervention implemented. The integrated policymaking cycle is continuous, if impact of policies expectations, unsolved issues remain high in the agenda. Three main steps to measure: Policy impacts in relation to the environmental issue (indicators for issue identification); Policy performance (indicators for policy formulation); Impacts across sectors and on the overall well- being of the population (indicators for policy assessment). 30. Measure policy performance Tasks: Measure policy impacts in relation to the environmental issue Use target indicators selected in the policy formulation phase. Use indicators of sectoral performance identified in the issue identification phase. Measure the investment leveraged Use indicators for policy formulation. Measure impacts across sectors and on the overall well-being of the population Use indicators for policy assessment. Key questions: Is the policy implemented contributing to solving the problem? Are the costs estimated in line with actual implementation expenditure? Is implementation progressing as planned, with coordinated actions across key stakeholder? Is investment (from public or private sources) being effectively leveraged by the policy implemented? Is there any cross-sectoral impact being observed as a result of policy implementation? Is the policy contributing to inclusiveness and well-being? 31. 5. Conclusions Work done to highlight the role of indicators in all phases of the policy cycle, adopting and proposing an integrated approach. Aimed at providing assistance for the development and implementation of policies that would effectively contribute to the green economy transition. 32. On the selection of indicators Indicators should be assessed against a number of basic features, including (OECD, 2011): Policy relevance: the indicator needs to address issues that are of (actual or potential) public concern relevant to policy-making. Analytical soundness: ensuring that the indicator is based on the best available science is a key feature to assure that the indicator can be trusted. Measurability: the need to reflect reality on a timely and accurate basis and be measurable at a reasonable cost. Usefulness in communication: the ability to provide understandable, easily interpretable signals for the intended audience. 33. Summary of stages and steps for the identification of GE indicators 34. For more details, please read http://www.unep.org/greeneconom y/Portals/88/documents/research_ products/MeasuringProgress.pdf Thank you www.unep.org/greeneconomy