SUSTAINABILITY ASSESSMENT A Review of International Experience and Practice
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1 INTERNATIONAL INSTITUTE FOR ENVIRONMENT AND DEVELOPMENT SUSTAINABILITY ASSESSMENT A Review of International Experience and Practice By Barry Dalal-Clayton and Barry Sadler First Draft of Work in Progress December 2004 This document represents a draft version of this report as at the date indicated above. It is work that is still very much in progress and we will continue to edit, update, expand and revise the text. It includes author s reminders, notes and comments. Comments and offers of inputs (information, cases) are welcomed. Work generously funded by The Royal Norwegian Ministry of Foreign Affairs IIED 3 Endsleigh Street London WC1H 0DD, England, UK Tel: Fax: Contact barry.dalal-clayton@iied.org Website:
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3 CONTENTS PART 1: Introduction and approaches to sustainability appraisal 1. Introduction 1.1 Study background and rationale 1.2 Study themes and approach 1.3 Background trends and drivers in impact assessment and strategic planning Integration via strategic planning Integration via assessment 1.4 On the relationship of SEA and SA 1.5 Focus on terminology 1.6 A second look what is being integrated in sustainability appraisal? 1.7 Sustainability appraisal in practice 1.8 Recapping where we are 1.9 The inevitability of making trade-offs and compromises 2 Sustainability Appraisal Frameworks and Approaches 2.1 Retrospective approaches to measuring and analysing sustainability Accounts-based approaches Narrative assessments Indicator-based assessments An example of retrospective application Contributing measurements and analyses Deciding what to measure: a framework of parts and aims 2.2 Prospective approaches to assessment ASSIPAC Threshold Capital model Others [to be added] 2.3 The need to make trade-offs and compromises PART 2: Dimensions of sustainability 3 Environmental assessment for sustainability assurance 3.1 Background: on the notion of limits 3.2 A framework for assessing environmental sustainability Basic concepts Valuation of capital stocks The Natural Step The IPAT relationship Basic premises and principles for electing a standard for environmental sustainability 3.3 Environmental sustainability principles Supply side principles Demand side principles 3.4 Approaches and tools for assessing the environmental sustainability of development Ecological footprint analysis Strengthening EIA and SEA as sustainability instruments iii
4 3.5 Precautionary guidelines for integrated environmental management (IEM) Safe minimum standards Harnessing the market Regulatory enforcement and damage liability 3.6 Conclusions and recommendations 4 Economics -based approaches 4.1 Introduction 4.2 Economic definitions of sustainability and economic sustainability The term sustainability Types of capital 4.3 Economic applications of sustainability assessment 4.4 Approaches to integrating economic variables with social and environmental variables Approaches to integration in the estimation of impacts 4.5 Evaluation and comparison integration of economic, environmental and social variables Assessment of projects Assessment of policy Economic performance 4.6 Regional sustainable development assessment 4.7 Debt sustainability assessment 4.8 Advanced sustainability analysis 5 Social assessment approaches 5.1 Introduction 5.2 Principal findings 5.3 Social sustainability Components of social sustainability Basic needs and social well-being Social capital Social and cultural dynamism Equity: basic needs plus what? 5.4 Some specifics on substantive integration (Social) sustainability objectives: Social sustainability measures: Analytical and integrative tools and procedures aimed at substantive integration: Trade-off formats: 6 On integrated assessment 6.1 Interpreting intregration 6.2 Experience in the UK 6.3 Other experience with integrated assessment 6.4 Approaches and techniques to support decision-making Sustainability-based environmental assessment 6.5 Consistency analysis matrix for policy assessment 6.6 Sustainability test 6.7 Sustainability impact assessments iv
5 PART 3: Methodologies and their application 7 Land use and natural resource-based instruments 7.1 Land evaluation methodologies 7.2 Land use sustainability analysis (LUSA) 7.3 Sustainability assessment of farms 7.4 Sustainability assessment of renewable energy projects 8 Business and industry approaches to sustainability assessment 8.1 Environmental sustainability assessment 8.2 Corporate sustainability assessment 8.3 Product sustainability assessment 8.4 Sustainability assessment for enterprises (SAFE) 8.5 Sustainability assessment model (SAM) 8.6 Sustainable project appraisal routine (SPeAR) 8.7 Sustainability assessment for investment Bank Sarasin method Centre Info method 8.8 Sustainability assessment at Shell, Canada 8.9 SIGMA (Sustainability-integrated guidelines for management) 9 Trade applications 9.1 The UNEP framework 9.2 The EC approach to sustainability impact assessment of trade policy 9.3 Other applications 10 Urban, municipal and community applications 10.1 The BEQUEST categorisation 10.2 Municipal approaches 10.3 ISCAM (integrated sustainable cities assessment method) 10.4 Campus sustainability assessments 10.5 Citizen-based assessment 10.6 Municipal project sustainability assessment 11 Global sector-wide approaches 11.1 The sustainable paper cycle study 11.2 The World Commission on Dams 11.3 The Mining, Minerals and Sustainable Development (MMSD) project PART 4: Institutional arrangements and experience in developing countries [incomplete other materials to be included] 12 Experience in Africa 12.1 Southern Africa Southern African views on sustainable development and approaches to sustainability appraisal Integrated environmental management and integrated planning v
6 Socio-economic Empowerment Charter for the South African mining industry National Environmental Management Act (NEMA 1998) Sustainable development reporting by mining companies Cape Action Plan for the Environment Human settlement policy framework Rössing uranium mine sustainability assessment, Namibia 12.2 Ethiopia 13 Experience in Asia 13.1 Aral Sea region 14 Donor approaches 14.1 Australia - Ausaid 14.2 Canadian International Development Agency (CIDA) 14.3 The World Bank PART 5: Retrospect and prospect 15 Sustainability appraisal and strategies for sustainable development 15.1 On the challenge of sustainability appraisal 15.2 Scenario planning 15.3 Learning from strategic planning frameworks Targets New thinking on strategies Strategy principles and characteristics Strategies should be learning systems Establishing a coordinated system A pattern of change Strategies: a shared challenge in the North and South Time to seize the opportunity 15.4 The role of SA in sustainable development and poverty reduction strategies 16 Conclusions and recommendations for further work References Appendices 1 The ASSIPAC sustainability assessment checklist 2 Canadian framework for the application of precaution in science-based decision making 3 Key references on the social dimension of sustainability appraisal 4 Basic system orientors 5 UNEP s integrated planning procedure 6 UNEP s Integrated Assessment and Planning Approach: Format for undertaking a preliminary assessment (with examples for element 2 of the planning process) 7 Sustainability indicators relating to transport vi
7 Boxes 1.1 Background of the review 1.2 Impact assessment as an synthetic approach 1.3 Sustainability assessment: examples of approaches/applications and their brand names 1.4 General sustainability requirements 1.5 The Bellagio principles for assessing progress towards Sustainable development 1.6 Sustainability appraisal in the UK 1.7 Hong Kong Guideline on Sustainability Assessment (SA) 1.8 Strengths and dangers of an integrative sustainability assessment framework 2.1 Agenda 21 as a basis for analysis 2.2 The quest for a single indicator of sustainable development 2.3 Examples of sustainable development indicator initiatives 2.4 Steps in the ASSIPAC framework 2.5 Threshold 21: core model 2.6 Examples of customised T21 applications 2.7 Examples of trade-offs 2.8 Possible general rules for decisions about trade-offs and compromises (basic options), and general process considerations 3.1 World Bank operational definition of environmental sustainability 3.2 Principles and sstem conditions for long-term sustainability 3.3 The IPAT Relationship 3.4 Strong sustainability rules 4.1 Integrated assessment of trade liberalisation banana sector in Ecuador 4.2 The importance of social capital for project success 4.3 Capturing feedback mechanisms between economy and environment computable general equilibrium modelling - Vietnam 4.4 Long-term integration of economic and environmental variables Pakistan 4.5 Modelling of sustainable development indicators Fraser River Basin, British Colombia, Canada 4.6 Valuation techniques 4.7 Application of the EDRC in three sectors in Chile 4.8 Integrated assessment of the cotton sector in China 4.9 Assessment of trade liberalisation effects on the fisheries sector, Argentina 4.10 The Genuine Progress Indicator 4.11 The ISEW applied in Chile 4.12 The revised applied ISEW in Austria 5.1 Tools for stages in integrated assessment and planning 5.2 Principles for integrated policy appraisal 5.3 Process for indicator selection 6.1 Forms of integration 6.2 Computer-aided Sustainability Evaluation Tool (CASET), Hong Kong 6.3 Integrated environmental impact assessment: a Canadian example 6.4 UK Guidance on SEA and SA for national policies 6.5 UK Guidance on SEA and SA of development plans 6.6 Tasks in sustainability appraisal proposed by the Town and Country Planning Association key components of a proposed integrated sustainability assessment framework 6.8 Generic sustainability-based criteria for evaluating the significance of effects vii
8 6.9 Generic criteria for evaluating the significance of trade-off elements 7.1 Proposed steps in sustainability assessment of renewable energy projects 8.1 Environmental sustainability assessment: six questions areas 8.2 Corporate sustainability assessment: the case of Crystal Flash, Michigan, USA 8.3 Product sustainability assessment (PROSA): five basic steps 8.4 Six steps in sustainability assessment for enterprises (SAFE) 8.5 Bank Sarasin sustainability assessment procedure 8.6 The triple bottom line and sustainable capitalism 9.1 UNEP manual for integrated assessment of trade policy 9.2 Sustainability impact assessment of WTO multilateral trade negotiations 10.1 Examples of issue considered in DOTIS 10.2 ISCAM (integrated sustainable cities assessment method) 10.3 Sustainability assessment of Ann Arbor Campus, University of Michigan 10.4 Citizen sustainability assessment: key questions for solid waste management 10.5 Community sustainability assessment checklist 11.1 World Commission on Dams: performance assessment of large dams 11.2 Strategic priorities for dams and guidelines for good practice in assessing options and planning and implementing dam projects 11.3 The MMSD process 11.4 MMSD North America s seven question framework 12.1 Sustainable development: A South African perspective 12.2 Integrated environmental management and planning: separate systems 12.3 Integrated development plans, South Africa 12.4 Development of the Cape Action Plan for the Environment 12.5 Rössing uranium mine sustainability assessment 12.6 A sustainability development appraisal in Ethiopia 14.1 Applying sustainability assessment at CIDA: Implications for policy integration and process consolidation 14.2 Review of World Bank environmental performance and assessment work 15.1 A framework for sustainability analysis 15.2 Futurology: experience from India 15.3 Uses of scenarios in environmental assessments 15.4 Global Scenarios 15.5 Steps in the European Environment Agency s story and simulation approach 15.6 Scenario-planning in South Africa 15.7 National conservation strategies and national environmental action pla ns 15.8 Poverty reduction strategies 15.9 Illustrative steps for starting, managing and continually improving a strategy for sustainable development Scenario planning and the Dutch National Environmental Policy Plan Progress with PRSPs: Key points of the comprehensive review by World Bank and IMF 16.1 Best practice sustainability assessment process viii
9 Figures 1.1 Sustainability appraisal terminology and acronyms: alphabet soup 1.2 SEA approaches moving towards sustainability appraisal 2.1 Gross Domestic Product versus Genuine Progress Indicator:United States Environmental weight declines as the number of human subsystems increases 2.3 The Dashboard of Sustainability: an example for Canada 2.4 Group Barometer of Sustainability, showing the well-being of North and Central America. 2.5 Individual Barometer of Sustainability, showing the well-being of Canada 2.6 Simplified stages in the soft systems methodology 2.7 Example of a systemic arrangement of parts 2.8 Sustainability components arranged hierarchic ally 2.9 T21 core model 3.1 ********* 4.1 Steps in regional sustainability assessment procedure 6.1 Five-stage approach to SEA / SA 6.2 Integrated Sustainability Assessment Thinking Tool 6.1 Integrated Sustainability Assessment Thinking Tool 7.1 Sustainability polygon for a Swiss mixed farm 7.2 Sustainability appraisal for renewable energy projects 8.1A SAFE status quo analysis 8.1B SAFE questionnaire 8.2 A SAM signature for a typical oil and gas field development 8.3 Example SpeAR diagram for University of California Mercur campus 8.4 Bank Sarasin country rating: The Netherlands 8.5 Absolute sustainability portfolio 10.1 Part of City of Melbourne sustainability assessment questionnaire 10.2 Integrated assessment framework 12.1 Approach to the Cape Action Plan for the Environment (CAPE) Project 15.1 Rationale for a systematic approach to sustainable development strategies 15.2 A continuous improvement approach to sustainable development strategies 15.3 Constellation of mechanisms contributing to a sustainable development strategy Tables 1.1 The evolving paradigm from EIA to SA? 1.2 Integration of environmental assessment and governance 1.3 EIA, SEA and Sustainability assessment compared 2.1 Three main approaches to measuring and analysing sustainability 2.2 Indicator-based assessments of sustainability 2.3 ASSIPAC topic integration categories 3.1 The evolving paradigm -- from EA to ESA and SA 4.1 Methods for integrating economic, environmental and social analysis 4.2 Example debt sustainability analysis: Benin 5.1 Western Australian sustainability principles and criteria 5.2 Draft set of indicators for the Human & social sub-system for New Zealand/Aotearoa 6.1 Integration of environmental assessment and governance 6.2 Stages, decisions and outputs of SEA and sustainability appraisal 6.3 Example sustainability appraisal framework 6.4A Testing the consistency of policy elements for a hypothetical land-use plan 6.4B Example of a policy impact matrix for forecasting 6.4C Example of a policy record sheet ix
10 6.5 Examples of sustainability appraisal on providing piped water to isolated rural communities in Ghana 7.1 Objectives, benefits and disbenefits and potential data sources relating to renewable energy: some examples 8.1 Corporate sustainability assessment criteria and weightings 8.2 Stages in the SAM corporate sustainability assessments 8.3 Centre Info capital indicators 8.4 Centre Info calculation of social capital note: example for Belgium 8.5 Shell Canada sustainable development principles 8.6 Scoring sustainability at Shell Canada 8.7 SIGMA management framework 9.1 SIA of EU-Chile trade negotiations 10.1 The BEQUEST categorisation of environmental assessment methods: examples 11.1 Example (environment) question, with hierarchy of objectives, indicators and measurements 12.1 Scorecard for the broad-based Socio-economic Empowerment Charter for the South African Mining Industry 12.2 National policy principles for environmental management, South Africa 15.1 Changing approaches to strategies 15.2 Environmental review of Vietnam PRSP 15.3 SAIEA PRSP assessment framework x
11 ACKOWLEDGEMENTS This report has been prepared with generous financial assistance provided by the Royal Norwegian Ministry of Foreign Affairs (MFA). We are grateful for the support and encouragement of Inger-Marie Bjonness (MFA) and Knut Opsal (NORAD). The report has been prepared as part of a programme of work to investigate the role and potential of sustainability appraisal as a key tool for sustainable development. It is also a contribution to the work programme of an OECD Development Assistance Committee (DAC) Task Group on SEA. The latter aims to review experiences of, and opportunities for, using SEA and sustainability appraisal; develop DAC guidance on SEA; develop tools to assist with the advocacy/marketing of SEA with decision-makers; and provide for a continuing interagency and cross-sector forum to share experiences and learn lessons in using SEA in development cooperation, and to track progress. We have drawn information from a wide variety of web-based and other sources and are grateful to many individuals who have provided assistance or pointed us to relevant areas of work Grateful thanks must also be extended to the participants of several workshops on sustainability appraisal organised in association with colleagues and partner organisations, particularly: (a) Government officials and practitioners workshop (hosted by Southern Africa Institute for Environmental Impact Assessment, 3 March 2004) (b) Mining Sector workshop (hosted by South African Chamber of Mines, 4 March 2004) (c) Specialist meeting (Victoria, Vancouver Island, 23 April 2004) and (d) Round Table, IAIA 04 (Vancouver, 28 April 2004) xi
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