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Payment for Ecosystem Services An Accountability Framework to Improve Marine Fisheries?

Katherine Short. Imperial College Conservation Science, Department of Ecology and Evolution, Silwood Campus, Imperial College London (MRes, Part-Time) and Marine Advocate, Indo-Pacific, WWF New Zealand.

SOME MARINE FISHERIES REMAIN IN CRISIS

In the twenty years since the historically enormous Grand Banks Cod fishery collapsed, many fisheries globally have continued to decline, whilst some in more developed countries (USA, New Zealand and Australia), have stabilised or started to recover – in fisheries management, if not in ecosystem-based terms (Ward et al, 2002). Whilst debate rages (Worm et al, 2006, 2009) about the metrics of decline and recovery, there is clear agreement on the significantly increased wealth potential of sustainably managed marine fisheries (WAVES, 2012), significant cost of recovering them, (Ye et al, 2012, World Bank 2009), and the need for public private partnerships to invest in practical initiatives for enhanced sustainability. (Ecosystem Marketplace, 2010).

PAYMENT FOR ECOSYSTEM SERVICES (PES) PES acts as an umbrella for approaches that provide conditional positive incentives to manage ecosystems to produce environmental services (Sommerville, 2009). The lack of property rights is often held up as a mitigating factor against Marine PES given the common property nature of many marine contexts. Appropriately defining rights is key for marine resource stewardship and to strengthen fisheries improvement approaches – both public and through partnerships, a range of tools need to be applied – economic, ecological and social.

FIGURE 4: Conceptual PES Framework

SOLUTIONS Since the closure of the Grand Banks cod fishery in 1992, many actors involved with fisheries management internationally have tried a range of approaches to address unsustainable fisheries including government initiatives such as the FAO Code of Conduct for Responsible fisheries, which has had mixed results. (Pitcher et al, 2009), to non-government such as the Marine Stewardship Council (MSC), through to NGO facilitated and private sector partnership Fisheries Improvement Projects (FIPs).

The MSC operates a robust market incentive 3rd party, independent certification scheme to operationalise the MSC Fishery Standard. About 6% of global marine fisheries landings are MSC certified and a further 4-5% are in the process.

FIGURE 5: Conceptual Institutional Framework

ACKNOWLEDGEMENTS

I would like to acknowledge and thank my supervisory committee: Dr E.J Milner-Gulland, ICCS, Imperial College, Dr David Agnew, Standards Director Marine Stewardship Council and Ms Dawn Martin, President, SeaWeb. I thank WWF for allowing me time to also spend on this work and the WWF Coral Triangle team for their insights, challenge and support as I explore this particular subject in relation to the global centre of marine biodiversity.

REFERENCES California Environmental Associates. (2011). Review of Fishery Improvement Project work for The David and Lucile Packard Foundation. Unpublished study. Ecosystem Marketplace (2010). Paying Poseidon: Financing the Protection of Valuable Ecosystem Services MSC Annual Report, 2010/2011 Pitcher, T.J., Pramod, G., Kalikoski, D. and Short, K. (2009) Evaluations of Compliance with the FAO (UN) Code of Conduct for Responsible Fisheries. Nature. 457. pp. 658-9. Sommerville, M. M., J. P.G. Jones, and E. J. Milner-Gulland. (2009). A revised conceptual framework for payments for environmental services. Ecology and Society 14(2): 34. Ward T, Tarte D, Hegerl E, and Short K. (2002) Ecosystem-based management of marine capture fisheries. World Wide Fund for Nature, Australia: 80 p. World Bank (2012). Moving Beyond GDP. How to Factor Natural Capital into Economic Decision Making. World Bank. (2009). Sunken Billions: The Economic Justification for Fisheries Reform. World Resources Institute. (2011). Nature in Performance. Initial recommendations for Integrating Ecosystem Services into Business Performance Systems. Worm B, Hilborn R, Baum JK, Branch TA, Collie JS, Costello C, Fogarty MJ, Fulton EA, Hutchings JA, Jennings S, Jensen OP, Lotze HK, Mace PA, McClannahan TR, Minto C, Palumbi ST, Parma AM, Ricard D, Rosenberg AA, Watson R, Zeller D. 2009. Rebuilding global fisheries. Science 325: 578-585 Worm B, Barbier EB, Beaumont N, Duffy JE, Folke C, Halpern BS, Jackson JBC, Lotze HK, Micheli F, Palumbi SR, Sala E, Selkoe KA, Stachowicz JJ, Watson R. (2006). Impacts of Biodiversity Loss on Ocean Ecosystem Services. Science 314: 787-760. Ye, Y., Cochrane, K., Bianchi, G., Willmann, R., Majkowski, J., Tandstad, M. and Carocci, F. (2012), Rebuilding global fisheries: the World Summit Goal, costs and benefits. Fish and Fisheries.

Over US

$2.5bn

global annual sales at retail value of MSC labelled seafood

More than

1,600 companies in 80 countries with MSC Chain of Custody Certification

Over 50 leading companies worldwide have made public commitments to source MSC certified seafood

Around 6% of all wild caught seafood certified to the MSC’s standard

WWF, the conservation organisation and Sustainable Fisheries Partnership facilitate FIPs towards MSC certification: 43 projects (14.5M tonnes) & 17 projects (1.2 M tonnes) respectively totalling 19% of global landings (CEA, 2011). In fewer cases aquaria, other NGOs and niche consultancies also play this role. Thus management, timeframes, objectives and accountability frameworks are hugely inconsistent across them. This is exacerbated by a lack of transparency about the investments being made and ecological outcomes. However, associated with the 50 leading company commitments to source MSC, is both significant purchasing power and investment potential. Can terrestrial PES experience guide the design of new accountability mechanisms? Can PES valuation tools (i.e. Marine InVest) be deployed alongside new corporate governance tools (i.e. Corporate Ecosystem Service Valuation, Global Reporting Initiative) in the seafood sector?

11% + 19% = 30% Global fisheries

MSC certified and/or committed to

improving

50 leading companies

committed to sourcing MSC $, £, ¥, ??

Pressure

Common PES Conditions (Adapted from Sommerville, 2009)

In Marine Fisheries

Well-defined environmental service.Provisioning, Regulating, Cultural, Supporting (MEA, 2005) i.e. seafood, habitat, nursery, wildlife, prey.

Environmental service (ES) purchased by at least one service buyer. Multi-scale definitions of local i.e. supply chain.

Parties voluntarily involved. Depends on institutional context (Sommerville, 2009).

Payment conditional on environmental service provision.

Seafood sector is dependent on biodiversity. Significant work to quantify via ES valuation.

Incentive must be positive.Cultural and behaviour change is essential to reset status quo. Markets and supply chain are committed.

Incentive payment for ES must be cash. ~Not necessarily. Other incentives: i.e. influencing stewardship.

Scheme must provide ES additionality to the situation without the ES scheme.

e.g. Marine Stewardship Council is an incentive scheme but not directly restoring marine ecosystems.

ES must be provided by service providers with well-established property rights. ~

Depends on institutional context. Multi-scale rights.

PES scheme must be adequately enforced.Monitoring, control and surveillance is core to effective marine fisheries management.

Source: WAVES, 2012.

“A flurry of studies have examined the economic value of ecosystem services delivered by oceans, but little has happened to bring this theoretical value into

the real modern economy. Until these ideas are practiced in places where money changes hands, the cost of environmental degradation will not be

embedded in the cost of producing goods and services derived from the sea – and there will be no economic incentive to preserve the sea for future

generations”. (Ecosystem Marketplace, 2010)

FIGURE 1

FIGURE 2. The Scale of Potential Investment?

In Figures 3-5, I have developed conceptual and institutional frameworks that explore the working hypothesis that more private sector seafood supply chain investment can be secured to improve fisheries given: i) Greater financial accountability, ii) Clear ecological accountability, iii) Adapted ecosystem service

valuation tools, and, iv) Effective institutional

frameworks. This underpins a unique exploration of the constellation of related sustainable seafood tools.

FIGURE 3: Multiple Tools Align to Incentivise Leveraged Investment in Improving Marine Fisheries

MSC, 2011