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Moving beyond CBA is critical to make the business case to mainstream sustainable development policy and investment choices. Traditionally, CBA is used to judge whether a given policy makes sense from a social perspective. With this tool, the analyst makes a prediction of the future stream of benefits and costs that would result from implementing a prospective policy intervention or project. Using those results, the analyst next discounts all net benefits. In this step, the size of the discount rate will play a key role in the result; i.e., if the discount rate is high, future net benefits will stop being positive very quickly and the proposed project may be dropped or abandoned. The opposite holds true with a low discount rate.
Cost-benefit analysis cannot accurately convey non-quantifiable information that may be important to support reliable decision-making, as it does not capture indicators in scenarios that are difficult or impossible to quantify in monetary terms, or when there is simply not sufficient information about their monetized value to yield a solid statistical prediction. TSA moves beyond this limitation by projecting the consequences of implementing a policy intervention or management strategy in terms of the changes in physical, financial, economic and social indicators used to describe the BAU and SEM scenarios as they unfold over time, and assessing these consequences according to multiple criteria. These descriptions of physical consequences and their assessment in terms of multiple criteria do not always need to be quantitative. TSA draws from all available information, ranging from existing or newly generated data to expert opinions.
A TSA should be conducted for a particular productive sector, and with a specific decision maker in mind. Decision makers will be primarily government officials or business managers, who generally come from a specific productive sector (e.g. Ministry Agriculture, Minister of Energy, hydropower plant manager, plantation owner or cattle farmer). TSA could be particularly useful to decision makes at the Minister of Economy and Finance and Central Planning Agencies that are responsible for reviewing annual budgets and annual budgetary allocations to sector agencies. TSA includes a 5-step approach, as shown in Table 1.
Table 1. TSA 5-step implementation approach
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Step 1: Defining the purpose and scope of the analysis
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Identify the key decision maker and his/her objectives for the analysis;
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Together with this decision maker, refine focus of the sector policy or ES management question
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Together with this decision maker, define TSA scope: spatial scale, time frame, regulatory scale
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Assess and verify available data, to ensure that it is sufficient to fulfill the TSA objective
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Step 2: Defining the BAU baseline and SEM intervention
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Develop consensus and clarity
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Define the BAU baseline intervention
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Define the SEM intervention
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Refine the definition of BAU and SEM
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Step 3: Selecting criteria and indicators
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Determine the criteria for the analysis
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Selecting similar indicators for BAU and SEM, and define additional data needs. Commonly used criteria and indictors include:
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Step 4: Constructing the BAU and SEM scenarios
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Establish links between BAU and SEM interventions, changes in ES and indictors
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Project changes to selected indicators resulting from changes in ES
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Generate data to populate the BAU and SEM curves (per indicator)
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Manage uncertainty
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Step 5: Make informed policy or management recommendations
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Assess when to make a recommendation, and make recommendations, presenting conflicting results.
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The main product generated using the data amassed during a TSA is a set of graphics, with time on the horizontal axis and a measurable indicator, such as revenues or number of jobs, on the vertical axis. In the graph there are two curves, one capturing and depicting BAU and one the SEM scenario. A TSA graphic should be accompanied by a narrative that explains whom it is for (stakeholders), how it was generated (assumptions, data sources) and levels of confidence and uncertainty, among other things. This complementary text will both rationalize the graphs and also act as the bridge between the graphs and policy decisions.
Changes over time
TSA to date
The TSA approach was introduced in the UNDP report, The Importance of Biodiversity and Ecosystems in Economic Growth and Equity in Latin America and Caribbean: An economic valuation of ecosystems, which was launched in 2010 at the 10th Conference of he Parties to the UN Convention on Biological Diversity in Nagoya, Japan. Several pilot TSA studies have been implemented since 2010 and used to support the process of formulating the TSA Guidance that was made available by UNDP in December 2013.
Because TSA is a new approach, it is expected that the first generation of TSA studies may well be rudimentary, and lessons will be generated to strengthen the TSA approach. To date the interest in TSA by governments and the private sector continues to grow. Table 2 below provides an overview of past and present TSA studies.
Annex 2: Strengthening livelihoods through environmental action”
“Strengthening livelihoods through environmental action”
A study of UNDP projects in the environmental area undertaken in 2015, analyses the contributions that these bring to human development, with a livelihoods approach. The analysis shows how these projects, in the areas of biodiversity and ecosystems and climate change, which are usually seen as promoting global environmental benefits, also improve the capitals that produce socioeconomic benefits and livelihoods to the target populations.
One of the central questions that guided the revision of this portfolio was: What has been the achievements and the viability of the strategies used for generating opportunities and improvements in the quality of life of the poorest and most vulnerable populations of the region?
The livelihoods approach applied recognizes the multidimensionality of poverty, and provides a method for understanding the interactions between conservation strategies for natural resources and the environment, and the generation of benefits for target populations. This approach identifies five types of capitals with which the social groups count: human capital, social capital, natural capital, physical capital, and financial capital. These resources are organized and combined in different ways creating diverse strategies, depending on the interests and context of the households and communities.
The analysis shows that the projects contribute substantively to the populations` sustainable livelihoods, particularly in the rural area. This contribution is expressed in three types of results: 1) improvements in the productive environment of the families and creation of employment, 2) enabling conditions for policies for sustainable natural resource management, and 3) strengthening of human, financial, physical, natural and social capitals.
64% of the analyzed projects include small scale actions linked directly to productive activities of rural families and their natural environment. More than half of the projects support the creation of assets and improvements in the productivity of their capitals. The use of financial instruments, particularly credits, economic incentives and Payment for Ecosystem Services, produce immediate improvements in the lives of some beneficiaries. Even though the impacts of these benefits are hard to quantify, the project report that the families have employment and that they invest in the wellbeing of their homes and children (education). From the point of view of the social/institutional capital, all project strengthen the human capital and strengthen the institutional setting, improving of facilitating spaces for planning and participation. They identify their objectives in integral contexts and address them from a perspective guided by the environmental problematic of the country and its policies.
The analyzed environmental actions were categories according to their principal strategies for action, with the following conclusions:
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The projects with a national-sector approach, have an impact on all five capitals, but primarily creating the policies and environmental norms that improve the performance of sectoral institutions and the strengthening of organizations, be these public or private. As part of these processes, strategies benefitting biodiversity and ecosystems; while making the productive activities more sustainable, the effect on households of the beneficiaries savings and/or increases in income.
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Projects with a territorial approach also implement environmental practices that improve the state of biodiversity and natural resources; however, they show more outputs in the strengthening of social capital, in the creation of policies (regulation for sustainable natural resource management) and the development of capacities and knowledge.
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The projects that promote market instruments such as credits, improve the access to financial resources and the commercialization of products in the market, but also strengthen social capital, developing capacities in farmers’ organizations and enterprises.
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There are multiple links to public policies in the environmental portfolio, which could be strengthened to simultaneously promote socio economic and environmental objectives. This is in line with the SDG agenda that promotes integrated approaches and solutions for sustainable development.
Source: PNUD/Elizondo 2015 (mimeo): Análisis del impacto que ha tenido el portafolio ambiental del PNUD visto desde la óptica de medios de vida sostenibles.
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Annex 3: Sustainable Development Community of Practice meeting, March 2015. Agenda
Tuesday 10 March
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8.00-8.30 AM: Registration
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8.30-10.00 Welcome
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Introduction Martin Santiago, UNDP Resident Coordinator and Resident Representative, Panamá
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Opening speech Gina Casar, UNDP Associate Administrator
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RBLAC Priorities Susan Mc Dade, Deputy Director, RBLAC
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The Regional Hub Rebeca Arias, Director, Regional Hub for LAC
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Q&A
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10.00-10.15 Instructions for the CoP
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10.15-11.30 Setting the Context
Keynote speeches:
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A post 2015 Climate Change Agreement Emilio Sempris, Sub-Administrator, Autoridad Nacional del Ambiente, Panamá
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The post Hyogo Framework Jo Scheuer, Chief of Profession, Climate Change and Disaster Risk Reduction, BPPS (video)
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Q&A
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11.30-11.45 Coffee Break
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11.45-13.30 UNDP`s role in Sustainable Development
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The Strategic Plan and Structural Change
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Thematic opportunities and challenges
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Organizing at the regional and national level for improved service delivery
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Discussion
Nik Sekhran, Chief of Profession, Sustainable Development, BPPS, NY
Matilde Mordt, Regional Team Leader, Sustainable Development, Regional Hub for LAC
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13.30-15.00 Lunch
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15.00-17.30 Multidimensional Poverty in Theory and Practice
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Practical Exercise: Getting to know the MPI Gonzalo Pizarro, Regional Policy Adviser, Regional Hub for LAC
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Keynote speech: The Concept of Multidimensional Poverty William Pleitez, Executive Director, Millenium Challenge Corporation
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Applying multidimensional poverty perspective to public policies) Ricardo Aparicio, Deputy Director for Poverty Analysis, Consejo Nacional de Evaluación de la Política de Desarrollo Social (CONEVAL), Mexico
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Discussion
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19.30 Welcome dinner
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Wednesday 11 March
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-10.00 SDG`s in practice: Emerging work on the ground
Panel: Country Experiences Brazil, Belize and Jamaica
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10.00-10.15 Coffee break
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10.15-12.30 UNDP’s Social and Environmental Standards
A tool for Sustainable Development and Quality Programming
Fernando Hiraldo, Deputy Resident Representative, UNDP CO Panama
Gisele Didier, Programme Officer, UNDP CO Panama
Holly Mergler, Specialist Social and Environmental Standards, BPPS
Oliver Page, Regional Technical Adviser, Regional Hub for LAC
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12.30-14.00 Lunch
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14.00-16.00 Climate Change: A cross cutting development challenge
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UNDP’s work in LAC in Climate Change Matilde Mordt
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Building resilient and sustainable territories: adaptation and mitigation actions for human development Colombia
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REDD+: an opportunity to integrate climate change, mitigation, governance, human rights and poverty reduction Ecuador
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Climate Change and Gender Mexico
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Discussion
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16.00-16.15 Coffee break
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16.15-18.00 Reducing poverty and inequality
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Social Protection Schemes in LAC Livia Maria Nogueira, Project Analyst, IPC-IG
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Conditional Cash Transfers Dominican Republic
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The Fiscal Toolkit Mexico
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Discussion
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Thursday 12 March
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8.30-11.30 Separate sessions presenting country experiences, tools and mapping best practices and demand.
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Inclusive Green Economy / Sustainable Development Pathways
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Poverty - Environment links and tools: PEI Handbook and integrated programming UNEP + Uruguay
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Transforming Production Sectors Cuba
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Green Commodities and Green Lending Costa Rica
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Jobs & Livelihoods
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Youth and Employment Dominican Republic
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Informal sector Argentina y Colombia
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Ecosystem management & Livelihoods Brazil
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Energy for Sustainable Development
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Sustainable Energy for All (SE4ALL)
Oliver Page
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Barbados & OECS Energy Strategy
Barbados
El Salvador
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Governing extraction of natural capital in LAC: challenges and opportunities for UNDP
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Mining (Extractive Industries)
Dominican Republic / Peru / Suriname
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11.30-12.30 Improving collaboration: Prioritization and action plan for the year ahead
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12.30-14.30 Lunch
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14.30-18.00 Bilateral meetings with Regional Center Staff and between Country Offices
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Friday 13 March: Technical Working Sessions
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8.30-1.00 MDGs, Multidimensional Poverty and Regional IDH
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8.30-17.30 Accessing environmental financing for sustainable development
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The finish line for the MDGs: MAF and MDG reports Gonzalo Pizarro, Regional Advisor for MDGs, Poverty and Human Development (1,5 hour)
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Latest guidelines
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Regional Sample – Peru, Belize, Uruguay
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From an MDG Observatory to an SDG Observatory
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Lessons from a framework focused on problem-solving Saint Maarten
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Follow up on implementation (including the CEB process) Colombia, Costa Rica
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Transitioning to SDG Implementation Framework
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From relief to combat and poverty eradication: the process of construction of multidimensional poverty measures from the paradigm of human development and capabilities approach Jimmy Vasquez, UNDP Ell Salvador (1 hour)
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The evolution of the concept of poverty. UNDP, human development and the capabilities approach
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Measuring multidimensional poverty
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Regional Human Development Reports George Gray Molina, Chief Economist, RBLAC (1,5 hour)
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The status of the Regional HDR
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Sub regional reports:
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Caribbean
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Central America
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Southern Cone / Andean
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Evaluation and end of the CoP
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Implementing UNDP Strategic Plan: Environmental Finance Opportunities (1 hour)
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Technical teams and contributions to UNDP SP outcomes
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Update on different funding sources
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Perspectives for GEF 6 programming: (40 mins)
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Looking back to go forward: lessons from GEF 5
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New elements from GEF 6
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Enhancing efficiencies and impacts- Programming: a new generation of design (2 hours 15 mins)
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Identifying best-bet options for programming GEF 6 resources to increase efficiencies, impacts and contribution to UNDP SP
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Programming alongside other UNDP programs
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Combining funding windows – designing multifocal projects
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Enhancing efficiencies and impacts- Operations: a new generation of implementation (2 hours)
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Implementation Arrangements; optimizing differential roles; cost recovery policies.
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Tools for improving planning and delivery
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Conclusions and next steps (45 mins)
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Main challenges for mobilizing environmental finance
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Specific strategies, tools and services to address challenges and increase opportunities
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Next steps and timelines
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Evaluation and end of the CoP
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Annex 4: SDSN Amazonas Progress Report
I.1 Background
Launched by UN Secretary-General Ban Ki-moon in August 2012, the Sustainable Development Solutions Network (SDSN) mobilizes scientific and technical expertise from academia, civil society, and the private sector in support of sustainable development problem solving at local, national, and global scales. It aims to accelerate joint learning and help to overcome the compartmentalization of technical and policy work by promoting integrated approaches to the interconnected economic, social, and environmental challenges confronting the world. The SDSN works closely with United Nations agencies, multilateral financing institutions, the private sector, and civil society.
The SDSN is building a global network of universities, research centers, civil society organization, and other knowledge centers for sustainable development and support of the Sustainable Development Goals. National and Regional SDSNs are established to accelerate practical problem solving for sustainable development at the local, national, and regional level. They are each convened and coordinated by one or more National SDSN Centers or Regional SDSN Centers.
The purpose of Regional SDSNs is to mobilize universities, research centers, civil society organizations, business, and other knowledge centers around practical problem solving for sustainable development. Each Regional SDSN has its own priorities focusing on all or a subset of the following objectives:
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Engaging in the global discussion on shaping the post-2015 development goals, including help to national governments to participate and lead in the global negotiations;
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Promoting Solution Initiatives for sustainable development in the region or beyond that can have a transformative impact on sustainable development;
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Promoting education for sustainable development;
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Assisting governments in diagnosing local, national, and regional sustainable development challenges and in devising long-term strategies.
Regional SDSNs are hosted and convened by one or more institutions from the region. Several networks have been launched or will be launched shortly:
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Amazon – Hosted by Amazonas Sustainable Foundation (FAS), Manaus, Brazil
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Andes – Hosted by the Universidad de Investigación de Tecnología Experimental (Yachay Tech)
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Australia/Pacific – Hosted by Monash University, Melbourne, Australia
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Caribbean – Hosted by the University of the West Indies, Kingston, Jamaica
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Great Lakes – Hosted by the University of Rwanda
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Mediterranean – Hosted by the University of Siena, Siena, Italy
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Sahel – Hosted by the Université Cheikh Ante Diop in Dakar, Senegal
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South Asia – Co-Hosted by TERI University in New Delhi, India and BRAC University in Dhaka, Bangladesh
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Southeast Asia – Hosted by the United in Diversity Forum in Bali, Indonesia
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