Institutions and Management

New metrics are available and need to be further developed to capture the implications of a country's activities on land use in other parts of the world, if the overall development is to become more globally sustainable.

Payment for Ecosystem Services, Certification, and Labeling

Three management concepts can be used to help measure and achieve sustain-ability: payments for ecosystem services (PES)—a system that compensates those whose land provide services by those who benefit from those services (de Groot et al. 2002), sustainability certification (Rameststeiner and Simula 2003), and labeling (Amacher et al. 2004). These methods allow market mechanisms to guide consumer choice and behavior at very large scales of economies and societies. The key to these methods for enabling sustainability is to have access to some specific measures. For instance, PES needs measurement of the service function and its value; certification requires measures that demonstrate sustainable management of a natural resource product; and labeling requires quantification of the content of inputs in the product, such as the carbon footprint of the product. Some of the information for labeling can come from a direct measurement of the product content, or an LCA can be deployed to get a more detailed suite of measures both up- and downstream.

The challenge is to incorporate the value of services that the land provides beyond simple provision of food and raw materials. This implies the need for sustainable utilization of the land over time both directly (as in the provision of food and fuel) or indirectly (as in climate mitigation through carbon sequestration).

Successful PES schemes require assessment of the range of ecosystem services that flow from a particular area and who they benefit, a measure of the economic value of these benefits to the different groups of people, and a market to capture this value and reward land managers for conserving the source of the ecosystem service. Carbon sequestration is a promising model of PES. The emerging carbon financial markets herald the first solid example of an economic system in which the environment and environmental services are internalized through payments for ecosystem services. Sequestration is not spatially bound; buyers and sellers can be anywhere. Differential sequestration potentials and risks can be based on location. It is technically scale neutral. Compared to other PES models, carbon has an economically lower-bond threshold needed to cover costs of participation.

There has been growing experience with embedding sustainability values into product generation through the processes of certification. For instance the Forest Stewardship Council provides a means to certify sustainable forest management. The process of certification provides consumers clear market signals about the product that is being purchased. Given a consumer preference for a sustainable product stream, the choice can be made at each transaction. Other certification regimes exist and many more are coming on line. The British retail giant, Tesco, is developing a line of carbon-labeled products. Although this is not true certification, it does involve labeling of information. More creative work could be incorporated into development of land-based PES, certification, and labeling.

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