Institute for Global Environmental Strategies (IGES)
  • Date submitted: 31 Oct 2011
  • Stakeholder type: Major Group
  • Name: Institute for Global Environmental Strategies (IGES)
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The IGES Proposal for Rio+20
- Version 1.0
Inputs to the compilation document of the
outcome document of Rio+20

November, 2011

Institute for Global Environmental Strategies (IGES)

2108-11 Kamiyamaguchi, Hayama, Kanagawa, 240-0115, Japan
Tel: +81-46-855-3720 Fax: +81-46-855-3702
The IGES Proposal for Rio+20 ‚?? Version 1.0
Inputs to the compilation document of the outcome document of Rio+20

IGES Policy Report

Copyright © 2011 Institute for Global Environmental Strategies. All rights reserved.

No parts of this publication may be reproduced or transmitted in any form or by any means,
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Although every effort is made to ensure objectivity and balance, the publication of research or
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endorsement of IGES financers.

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The IGES Proposal for Rio+20
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Table of Contents

List of Figures
List of Tables

Executive Summary.........................................................................................................................................................vii
Introduction ............................................................................................................................................................... 1
Resilient and Sustainable Society....................................................................................................................... 3
Green Economy in the Context of Sustainable Development and Poverty Eradication ............. 13
Institutional Framework for Sustainable Development (IFSD)............................................................. 22

List of Contributors
References: List of Relevant IGES Publication

This proposal has been developed in response to the call by the United Nations Department of
Economic and Social Affairs (UNDESA) for stakeholders‚?? input to a compilation document to
serve as the basis for preparation of the zero draft of the outcome document of the United
Nations Conference for Sustainable Development (UNCSD: Rio+20). The views and opinions
contained within are based upon IGES research and include inputs from various international
conferences, such as the 3rd International Forum for Sustainable Asia and the Pacific (ISAP2011).
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Box 2-1 Case study: Inter-community/inter-municipality relief in Japan
Box 3-1 Community forest management and REDD+
Box 4-1 Supporting multi-level governance through information exchange and networks

List of Figures
Figure 1-1 IGES vision for achieving sustainable development
Figure 2-1 Sustainable development and resilience
Figure 3-1 Vulnerability caused by excessive pursuit of economic efficiency
Figure 4-1 Reform phases for IFSD
Figure 4-2 Thrust of IEG reform
Figure 4-3 Proposed structure for enhancing information exchange and harmonisation in

List of Tables
Table 3-1 Key approaches/principles
Table 3-2 Roadmap for global green economy
Table 4-1 Short/medium and long-term IFSD reforms
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ADB Asian Development Bank
AECEN Asian Environmental Compliance and Enforcement Network
AEO Asian Environmental Organization
ATCs Asian Topic Centres
CAREC Regional Environmental Center for Central Asia
COP Conference of the Parties
CRED Centre for Research on the Epidemiology of Disasters
EEA European Environment Agency
EIONET European Environment Information and Observation Network
EPI environmental policy integration
EPR extended producer responsibility
G20 Group of Twenty
GA General Assembly
GC Governing Council (UNEP)
GHG greenhouse gas
GMEF Global Ministerial Environment Forum (UNEP)
HFA Hyogo Framework for Action
IEG International Environmental Governance
IFIs International Finance Institutions
IFSD institutional framework for sustainable development
IGES Institute for Global Environmental Strategies
IMF International Monetary Fund
IPBES Intergovernmental Science and Policy Platform on Biodiversity and
Ecosystem Services
IPCC Intergovernmental Panel on Climate Change
ISAP International Forum for Sustainable Asia and the Pacific
JIU Joint Inspection Unit
MDGs millennium development goals
MEAs multilateral environmental agreements
MRV measuring, reporting and verifying
NAMAs nationally appropriate mitigation actions
NEASPEC North-East Asian Sub-regional Programme for Environmental Cooperation
NGO non-governmental organisation
NRCs National Reference Centres
OECD Organisation for Economic Co-operation and Development
PES payment for ecosystem services
REDD reducing emissions from deforestation and forest degradation
SACEP South Asia Co-operative Environment Programme
SCP sustainable consumption and production
SD sustainable development
SDGs Sustainable Development Goals
SPREP Secretariat of the Pacific Regional Environment Programme
TEEB The Economics of Ecosystems and Biodiversity
UKG Union of Kansai Governments
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UN United Nations
UNCRD United Nations Centre for Regional Development
UNCSD United Nations Conference for Sustainable Development
UN CSD UN Commission on Sustainable Development
UNDESA United Nations Department of Economic and Social Affairs
UNDP United Nations Development Programme
UN ECOSOC UN Economic and Social Council
UNEO United Nations Environment Organisation
UNEP United Nations Environment Programme
UNFCCC United Nations Framework Convention on Climate Change
UNISDR United Nations International Strategy for Disaster Reduction
WCDR World Conference on Disaster Reduction
WEO World Environment Organisation
WTO World Trade Organization
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Vision Statement
IGES maintains that sustainable development can only be achieved by addressing the three
interdependent dimensions of economy, society, and environment in an integrated manner.
A Green Economy, supported by a strengthened Institutional Framework for Sustainable
Development is based on safe, secure, and low-carbon energy, with integrated climate
change and development priorities taking into account resilience to natural and manmade

Simultaneously, over the next few decades, international society will need to focus on
achieving global goals that address these dimensions:

(1) Eradicate poverty and meet the basic human needs of all people including safe food,
safe drinking water, adequate sanitation, health care, and universal primary education;

(2) Reorient the world‚??s economic system towards a low-carbon approach, sustainable
resource use, and sustainable use of ecosystem services; and

(3) Secure environmental integrity, particularly through dealing with climate change and

In the Asia-Pacific region, these challenges have become more significant due to population
growth, industrialisation, urbanisation, and economic growth based on unsustainable
consumption and production patterns. The IGES vision foresees the emergence of
interlinked global governance institutions and resilient social and economic systems based
on the principles of sustainable development.

IGES believes that one of the key concepts underpinning integration of the three dimensions
of sustainable development is resilience, and it should be revisited by all countries. The
international community has been reminded by the recent disaster in Japan of the severe
consequences of unchecked vulnerabilities, but also of the value of resilience to minimize
the impact of disasters and hasten recovery. Greater emphasis in policy and research should
be given to resilience, vulnerability and risk management in sustainable development.

To achieve such a resilient and sustainable society in the long-term, discussions should begin
in the Rio+20 process to develop Sustainable Development Goals (SDGs) aimed at reducing
absolute and relative poverty, changing consumption patterns, securing sustainable energy
systems (including renewable energy targets), and increasing resilience.

Resilient and Sustainable Society
A resilient society has the adaptive capacity and robustness to handle shocks while
maintaining functionality, and over time, grow stronger. Sudden extreme events can
damage past achievements and delay progress on sustainable development. The world‚??s
poor are disproportionately exposed to risk, but vulnerability is not necessarily mitigated
simply through economic development or increased income. Globalization, climate change,
and unsustainable development paths will contribute to increasingly frequent extreme

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events with global implications such as natural disasters and economic crises. The key
components for a sustainable and resilient society recommended by IGES include:
(1) Multi-stakeholder/multi-level governance with better participation and a pro-poor and
vulnerable approach for agile, flexible and effective social/political support through
better coordination and utilization of local social ties and knowledge;

(2) Financial schemes for immediate and medium-term recovery which supports
households and small-medium business; and

(3) Decentralized and diversified Infrastructure for energy, water, transportation etc. with
balanced management of supply/demand sides.

The extent to which these components are adopted and integrated in each country are
determined by the local context and through the development of enabling conditions.

Green Economy in the Context of Sustainable Development and
Poverty Eradication
IGES recognises that a key challenge in pursuit of sustainable development is the social,
economic and environmental vulnerability caused by one-sided pursuit of economic growth
and efficiency. An emerging paradigm shift to overcome these key challenges is the concept
of a green economy supported by investment, job creation, international policy coordination,
and the precautionary approach. Towards this goal, IGES proposes the following.

(1) For a low-carbon economy with a resilient, secure energy system

Ô?? Investing in renewable energy, storage and a smart grid is vital to reducing
vulnerability by enhancing a decentralised electricity supply, which would secure a
backup system during a disaster, and by enhancing demand-side management.
Governments should promote this trend by introducing incentives such as feed-in-
tariffs and phase out of fossil fuel subsidies.

(2) For sustainable consumption and production

Ô?? Policy for requiring producers to internalise the costs of recycling and other actions
for reducing resource consumption, e.g. extended producer responsibility (EPR) and
green tax, as well as for making environmental impacts visible to consumers, e.g.
green labelling, must be introduced and supported by increased efforts on education,
training and skills enhancement. The effectiveness of these interventions depends on
environmental awareness of consumers as well as ability of producers to improve
product design and production processes.

Ô?? A phased approach to introduce these policies taking into account the developmental
stages of implementing countries along with international policy cooperation will be
most effective.

Ô?? An international fund for sustainable resource management should be established.

(3) For sustainable use of ecosystem services

Ô?? Wide application of payment for ecosystem services (PES) will contribute to
appropriate pricing and sustainable use of ecosystem services in the context of
poverty eradication. To promote this, accounting systems should incorporate the

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economic benefits of ecosystem services from project level to national accounts.

Ô?? Current practice of pricing ecosystem services based on our willingness-to-pay does
not necessarily promise sustainable use of ecosystems. To overcome this limitation,
the price of ecosystem services can be determined such that policies or actions to
ensure sustainable use of ecosystem services would improve social welfare.

Institutional Framework for Sustainable Development
As the challenges to sustainable development have outgrown existing institutional
capacities, it is now time to update the institutional framework for sustainable
development (IFSD).

IGES‚??s vision on the key principles and directions for IFSD is that it should include: multilevel
governance and participation; integration and mainstreaming among the three dimensions
of sustainable development; the subsidiarity principle; and strengthening environmental
governance, because environment is the foundation for all other human and economic
activity. IGES believes that fundamental reform of IFSD and international environmental
governance (IEG) should be undertaken with a graduated and phased approach. Each
sequence will provide necessary momentum for subsequent steps.

For the short-to-medium term, IGES encourages governments to support the creation of a
Sustainable Development Council to better coordinate and oversee budgeting of all UN
programmes and agencies. IGES also recommends appointing a High Commissioner for SD.
Similarly, at the national level, SD concerns should receive greater attention and be
harmonized and mainstreamed into sectoral work programmes through enhanced national

For IEG, UNEP reform should start with universal membership of its Governing Council to
enhance legitimacy of IEG and eliminate the time-consuming elections of representatives to
the GC. Subsequently, UNEP should be upgraded to a specialized agency, with a decision
making mandate and legal independence. In the longer term, IGES suggests the
strengthening of regional environmental governance through, for example, formation of a
regional environmental hub to be developed in the long run into an Asian Environmental
Organization, similar to regional cooperation frameworks in other regions.

IGES foresees the emergence of interlinked global governance institutions and resilient
social and economic systems based on the principles of sustainable development. The
Green Economy is an important interim milestone in this vision, in particular for poverty
eradication and as a step towards sustainable consumption and production. To support this
transition, a reinforced Institutional Framework for Sustainable Development (IFSD) is a
necessary condition, in which multi-level and multi-stakeholder governance, as well as
equity and social inclusiveness, are crucial.

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1. Introduction
The Institute for Global Environmental Strategies (IGES) 1 proposes the following key
messages and recommendations on the two themes of Rio+20, namely Green Economy in
the Context of Sustainable Development and Poverty Eradication and the Institutional
Framework for Sustainable Development (IFSD) and on the response to the triple disaster in
Japan. Each section incorporates answers to the questions raised by UNDESA‚??s Guidance
Note, including the expectations for the outcomes of Rio+20 and views on existing concrete
and new proposals, by considering forward-looking perspectives on the way forward post-

1.1. Vision Statement

IGES maintains that sustainable development can only be achieved by addressing the three
interdependent dimensions of economy, society, and environment in an integrated manner.
Simultaneously, over the next few decades, international society will be focusing on global
goals that address these dimensions: (1) eradicate poverty and meet the basic human needs
of all people including safe food and drinking water, adequate sanitation, health care, and
universal primary education; (2) reorient the world‚??s economic system towards a low-carbon
approach, sustainable resource use, and sustainable use of ecosystem services; and (3)
secure environmental integrity, particularly through dealing with climate change and
biodiversity. In the Asia-Pacific region, these challenges have become more significant due to
population growth, industrialisation, urbanisation, and economic growth based on
unsustainable consumption and production patterns.

Over the years, gaps in interests and priorities within and among countries have hindered
international cooperation for sustainable development. However, the international
community has been reminded by the recent Great East Japan Earthquake and the
subsequent tsunami and the nuclear accident of the severe consequences associated with
modern development patterns. Japan may have not paid sufficient attention to vulnerability,
rather, it may have too strongly pursued economic development to the detriment of social
and environmental risks, thereby undermining the resilience of society to manmade and
natural hazards‚??all with tremendous economic, social and environmental costs. One of the
key concepts underpinning integration of the three dimensions of sustainable development
is ‚??resilience,‚?? which should be revisited by all countries.

The IGES vision foresees the emergence of interlinked global governance institutions and
resilient social and economic systems based on the principles of sustainable development.
The Green Economy is an important interim milestone in this vision towards sustainable
development. To support this transition, a reinforced IFSD is a necessary condition, in which
multi-level and multi-stakeholder governance, as well as equity and social inclusiveness, are
crucial. A Green Economy supported by a strengthened IFSD is based on safe, secure, and
low-carbon energy, with integrated climate change and development priorities taking into
account natural and manmade hazards.

IGES is an international research institute conducting practical and innovative research for realising sustainable
development with a special focus on the Asia-Pacific region.

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To achieve such a resilient and sustainable society in the long-term, discussions should begin
in the Rio+20 process to develop sustainable development goals (SDGs). Similar to the
millennium development goals (MDGs), potential SDGs may include reducing absolute and
relative poverty, changing consumption patterns, and restructuring energy systems including
renewable energy targets. Indicators for the carrying capacity and boundaries of natural
systems could provide an early warning system for human activities that potentially exceed
thresholds of the planet‚??s life support systems. Strengthening IFSD on issues such as climate
change mitigation and adaptation, biodiversity and forests, oceans and water resources, and
food security among other global issues, could be a solid foundation for goal setting in order
to achieve sustainable development beyond Rio+20. This may require streamlining and
harmonisation of multilateral environment agreements, with more quantitative targets to
enable progress to be more accurately measured than is currently possible.

The following sections of this proposal introduce IGES views on (i) Resilient and Sustainable
Society, (ii) Green Economy, and (iii) IFSD to contribute to effective policy formulation for
sustainable development beyond Rio+20.

Figure 1-1 IGES vision for achieving sustainable development

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2. Resilient and Sustainable Society

2.0. Background

To attain sustainable development, it is essential to understand the impacts of human
activities on the environment and the environment‚??s limited ability to recover from these
impacts and support continued growth. However, in reality, society, the economy, and the
environment are exposed to the devastating impacts of unforeseen events such as natural,
social, and economic disasters. Natural hazards such as earthquakes, volcanic eruptions, and
hurricanes occur every year. Climate-related natural hazards such as extreme floods and
droughts are predicted to increase in frequency and intensity, in part due to the effects of
climate change exacerbated by increasing levels of greenhouse gas (GHG) emissions from
human activities. Social, cultural, and economic events also trigger disruptive clashes such as
conflicts and economic crises. To make matters worse, these sudden, extreme events can
quickly erase past achievements and delay progress towards sustainable development.

‚??Loosely defined, resilience is the capacity of a system‚??be it an individual, a forest,
a city, or an economy‚??to deal with change and continue to develop. It is both
about withstanding shocks and disturbances (like climate change or financial crisis)
and using such events to catalyze renewal, novelty, and innovation.‚?Ě (Folke, 2009)

A resilient society has the adaptive capacity and robustness to handle shocks while
maintaining functionality, and over time, grow stronger. Japan has developed resilient social
systems and invested heavily in disaster management, but the impacts of the triple disaster
on March 11, 2011 showed a continuing vulnerability to such disasters. Globalisation,
climate change, and unsustainable development paths will, inter alia, contribute to the
increasing occurrence of extreme events with global implications, such as natural disasters
and economic crises. Thus, greater emphasis in policy and research should be allocated to
the relationship between resilience and vulnerability in sustainable development.

Figure 2-1 Sustainable development and resilience

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2.1. Key Challenges

Japan is one of the few countries in the world with sophisticated disaster management
policies and practices and has played an important role in establishing an international
cooperation framework for disaster risk reduction by hosting two world conferences on
natural disasters (Yokohama, May 1994 and Kobe, January 2005). In Kobe at the World
Conference on Disaster Reduction in 2005, Japan contributed to the development of the
Hyogo Framework for Action (HFA) with priorities for action expected to result in ‚??the
substantial reduction of disaster losses, in lives and in the social, economic and
environmental assets of communities and countries‚?Ě (UNISDR, 2007).2

However, despite Japan‚??s excellent early warning system on extreme weather, the disasters
in the northeast of Japan on March 11, 2011 revealed the vulnerability of Japan‚??s highly
centralised socio-economic and political systems. The earthquake and tsunami affected a
broad area and resulted in widespread damage, 3 including a major accident at the
Fukushima Daiichi Nuclear Power Plant which has triggered a persisting crisis.

As the disasters unfolded, it became immediately apparent that emergency and relief
operations would be needed on a massive scale; but there were frustrating delays, amongst
other factors, due partly to the time consuming process of decision making within the
central government, and to damage to the key functions of local governments.

Japan has also suffered massive damage to key economic activities as a result of the
disasters. Factories in the area producing essential components for automobiles and electric
appliances were demolished. This resulted in stoppages in the automotive and consumer-
electronics industry in the eastern part of Japan and shortages around the world for weeks
after, which highlighted the short-term vulnerability of global supply chains and ‚??just-in-time‚?Ě
manufacturing systems. The power shortages caused subsequent to the nuclear accident led
small and medium enterprises and households to dramatically reduce energy consumption.
The radioactive materials leaked from the nuclear power plant resulted in heavy damage to
the local agriculture and fishing industries, not to mention the impact on domestic tourism
and exports.

These damages represented significant obstacles to recovery and reconstruction of society
and the local economy. Moreover, due to the damage and subsequent reconstruction,
earlier progress to protect the environment and develop a sustainable society and economy
are also at risk. For instance, radioactive contamination of farmland, water resources, and
fishing areas impose a heavy burden on the government and residents in terms of livelihood
and safety. The disposal of waste material‚??including those contaminated by nuclear
radiation‚??and the rebuilding of homes and Infrastructure will also have substantial
environmental implications. To make up for the power deficit due to the stoppage of nuclear
plant operations throughout the country, conventional coal power plants have resumed
operations, which is making it more difficult for Japan to reduce GHG emissions in
accordance with international agreements.

The HFA, based in part on Japan‚??s experience in the Hanshin-Awaji Earthquake in 1995, was the first document
of its type on disaster risk reduction developed and agreed upon internationally.
Major damages include the loss of about 20,000 lives, thousands of residences, key production bases and
sources of livelihood, and damage to supply chain linkages.

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As reported in the International Disaster Database EM-DAT, maintained by the Centre for
Research on the Epidemiology of Disasters (CRED), global damages caused by natural
disasters are on an upward trend. Asia is particularly vulnerable. From 2000-2009, almost
85% of global deaths from natural disasters occurred in the region (UNISDR, 2010). The
trends are set to continue mainly due to unplanned urbanisation, environmental
degradation and climate change.

In order to pursue sustainable development in a world repeatedly hit by such crises and
disasters, including those related to climate change, IGES proposes that national
governments and international society draw lessons from the challenges that Japanese
society is facing following these disasters. The following issues are not only important with
regard to disaster responses, but also for associated issues which require comprehensive
action, such as climate change adaptation.

2.2. Key Approaches/Principles

Achieving a sustainable and disaster resilient society requires multi-level and multi-
stakeholder adaptive governance, protection of vulnerable people, financial schemes to
insure against and mitigate natural disasters, and decentralised and diversified Infrastructure
for energy, water, and transportation suitable to the local conditions.

Figure 2-2 Key directions and principles

2.2.1. Governance for a resilient and sustainable society

Multi-stakeholder collaboration

In order to build a resilient society, a multi-level governance scheme needs to be developed
in which each stakeholder must conduct complementary actions which can be delivered
most efficiently (WCDR, 2005; Leighton et al., 2011). A flexible system of collaboration
among various national and local governments and communities works more effectively
than simple systems, such as an independent, centralised system or decentralised systems
with no internal collaboration.

Multi-stakeholder collaborative approaches should be incorporated into economic and social
development planning, environmental policies, and disaster management plans. Neither
top-down nor bottom-up approaches alone are sufficient in dealing with major natural

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disasters; rather, there is a need for a balanced and convergent approach. Policy frameworks
have come under scrutiny in light of the increasing number and intensity of climate-related
disasters, and often conflicting actions by different ministries responsible for climate change
and disaster risk reduction indicate the importance of horizontal cooperation. Resilient
societies should build upon cooperation among local municipalities, as well as between
municipalities, NGOs and private companies. A challenging task is to aid the progress of
sustainable relief aid from these stakeholders, which requires that national governments
create an enabling environment to facilitate sustained voluntary relief from different groups
of stakeholders. It is also critical to establish aid and volunteer coordination mechanisms for
the early stages of a disaster. Long-term partnerships, twinning, and pairing between local
governments, schools, a wide range of experts, and business sectors have proven to be
useful in responding to disasters. Important lessons can be learned through international
cooperation and capacity development where countries share their experiences and best

Public participation

Characteristics of each local community and government, such as geography and industrial
and population structure, vary by region and by the type of disaster. Thus, there is a need to
respect such differences in planning and implementing disaster management, mitigation
measures, disaster relief aid, and reconstruction policies. On this account, it is vital to
encourage public participation in disaster management policies as well as overall socio-
economic development (Tobin, 1999; Godschalk et al., 2003; Shaw & Goda, 2004; Palen et
al., 2007), particularly for two reasons. First, the local community may often have greater in-
depth knowledge of the local environment and society than other stakeholders. Their
collective historical knowledge is vital for disaster prevention and during the recovery stage.
Second, reliable and consistent information sharing and crisis management is vital to
strengthen people‚??s awareness, preparedness, and cooperation among governments at all
levels as well as local communities. Public participation is a key element to make relief aid
and rehabilitation sustainable, in a similar fashion, it is necessary to point out ‚??(a) id is to
support the self-reliance of the disaster victims, not to obtrude assistance‚?Ě (Tama, 2011).
The Japanese experiences in disaster relief and recovery well illustrate this point.

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For emergency rescue activities, the first few days following a disaster are absolutely critical.
Thus, a strong community can better manage rescue efforts immediately following a disaster
using their collective knowledge of the area and local society, as well as their well-developed
lines of communication with different stakeholders. However, if the affected area is too
broad, communities experience difficulty in providing support to each other. In this regard,
inter-community and inter-municipality relief aid as elaborated by Box 2-1 below is
considered to be an effective solution for larger areas. When organising relief in the
aftermath of the Sichuan earthquake, the Chinese central government paired disaster
affected communities with communities in unaffected areas (UNCRD, 2009).

Box 2-1 Case study: Inter-community/inter-municipality relief in Japan
The value of inter-community support during the relief and recovery stage has been observed
in the aftermath of the earthquake/tsunami as well as disasters in other countries. As national
and sub-national governments must cover all areas directly impacted by the disaster and because
of their internal rigidities, they have often found it difficult to supply timely relief on a priority
basis. Community-to-community relief has been observed as more flexible than the vertical relief
channel of national government to local community.
Tono City, located in Iwate Prefecture, where the impacts of the earthquake and tsunami were
particularly severe, escaped relatively unscathed and acted as a base for the relief supply
activities of NGOs. An advantage of this inter-community aid was Tono City‚??s proximity to the
devastated areas, which facilitated information collection and logistics. This is a somewhat
unusual example as in a widely damaged area it is often difficult to find less-affected
communities that can extend assistance. Communities further removed from the disaster
affected areas can also provide important support, however. Suginami Ward in Tokyo and the
Union of Kansai Governments (UKG) are good examples. Suginami Ward and other cities have a
long shared history with Minami Souma Cho, one of the areas affected by radiation from the
Fukushima Daiichi Nuclear Power Plant, as sister cities. Suginami Ward used its inter-municipality
network to provide relief assistance to Minami Souma Cho, while UKG sent water and sewerage
technical teams to the area.
In Kurihara City, which suffered from the Iwate-Miyagi Nairiku Earthquake three years ago, the
city focused on tightening neighbourhood relations through jichikai (local neighbourhood
community associations), in which every household takes on a particular role in the community.
After the disasters, the Kurihara City officials could easily assess the level of damage within a few
days, thanks to the jichikai. Since then, Kurihara City has become a centre of inter-municipality
relief aid, especially for neighbouring towns and cities along the coastal area. Kurihara learned
from its past experiences and strengthened information technologies in conjunction with Keio
University. The technologies significantly helped open up communication with the most affected
areas and facilitated estimates of the demand for different levels of assistance in the area.
Kurihara‚??s autonomous relief is based upon the city‚??s disaster resilient mitigation and lessons
from past events.
(Scheyvens et al., 2011)

In Japan, inter-community relief gained popularity after the Hanshin earthquake in 1995.
After the triple disaster in March 2011, relief was provided by various communities and
municipalities, from both inside and outside the disaster affected areas. Matching affected
and unaffected cities to ensure that the relief provided is timely and based on actual needs
can be challenging immediately after a major disaster. In particular in disaster-prone areas
having pre-established sister city relationships would facilitate this process by making use of
existing networks and relationships for relief and rebuilding. Further thought is now required
on how governments can encourage and finance inter-community/inter-municipality

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relationships as part of the process to build more effective channels to provide relief in the
aftermath of disasters.

Pro-poor and vulnerable approach

A pro-poor approach has been recognised as vital to the achievement of sustainable
development (UNDP, 1997; United Nations, 2000; World Bank, 2001) and to reducing
vulnerability to natural disasters (OECD, 2009; World Bank, 2011). In a disaster, both rich and
poor alike are affected, however as history has shown, it is the poor who are
disproportionately affected and the least resilient. This is not simply because of a lack of
finances or other resources but due to the way socio-political systems influence how hazards
affect different social groups. Reducing vulnerability to hazards requires an approach that is
based on an integrated assessment of social, economic, environmental and geographical
vulnerability factors as these are the factors which affect vulnerability and determine if
hazards will become disasters. This type of integrated vulnerability assessment is valid for
both developed and developing countries. After a disaster occurs and after the emergency
relief phase has ended and the community shifts to rebuilding, governments, NGOs, and the
private sector need to closely cooperate and coordinate so as to ensure that all receive the
necessary level of support and are not further adversely affected as a result of personal
conditions such as nationality, family structure, or language ability.

2.2.2 Financial schemes for risk mitigation and smooth recovery

As time passes, the focus of disaster reconstruction moves from life saving activities and
distribution of aid supply to revitalisation of livelihoods and local economic activities. When
discussing ‚??resilience‚?? in the case of extreme disasters, financial support for reconstruction is
crucial especially in the intermediate to long run (Cummins and Weiss, 2009). Considering
the impacts of natural disasters on economic activities, the country‚??s fiscal balance may be
under considerable strain. Consequently, development of financial schemes to alleviate risks
and stimulate post disaster economic recovery is an important point that must be addressed.

Damage to public facilities and Infrastructure causes considerable financial strain;
nonetheless, the impact of the disaster also requires quick and appropriate financial support
to be provided to local businesses and livelihoods. Coordination among different ministries
and other stakeholders to deliver financial support for those affected is certainly needed.
Consequently, a significant challenge is to mobilise sufficient finances to satisfy the
monetary demands needed to revamp the economy and livelihoods of those in the affected
areas (Carpenter, 2010).

The establishment of a disaster reconstruction fund is one example of a public finance
scheme for disaster recovery. Exemplary cases include the reconstruction fund for the
earthquake in Taiwan in 1999, as well as the Hanshin-Awaji reconstruction fund in Japan in

After experiencing the Great Hanshin Earthquake in 1995, Japanese government established
an Act Concerning Support for Reconstructing Livelihood of Disaster (Cabinet Office,
Government of Japan, 2011), which generated a fund to assist financial rehabilitation of
business and people‚??s livelihoods. For this fund, Japan‚??s national government promises 50%
of financial support on the budget of the fund. Nonetheless, since the fund is organized
nationwide, it is still necessary to meet people‚??s monetary needs in a timely manner.

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Consequently, after the Great East Japan Earthquake, new funds were created by local
governments, NGOs, private companies, and local stakeholders to provide financial support
for designated people and business on time. For economic recovery, it is crucial to have
start-up cost for business equipment, raw materials, facilities, and labour. It is important to
provide such financial support quickly, since the community needs to be self-reliant,
otherwise the community will lose the opportunity for self-sustaining recovery.

Another scheme is Alternative Risk Transfer for disaster risks utilising the financial market,
such as insurance linked securities (catastrophe bonds) and weather index derivatives. These
approaches are often discussed as potential responses to climate change adaptation. The
Caribbean Catastrophic Risk Insurance Facility (CCRIF) for natural disasters is a successful
example. The Facility plays a significant role to provide timely financial support to businesses
and communities since ‚??(t)he CCRIF offers an efficient solution to the short-term liquidity gap
faced by CARICOM governments in the aftermath of a major hurricane or earthquake‚?Ě
(World Bank, 2007). It is important for policy makers to use these schemes to reflect social
needs and support individuals and small businesses. The availability of financial support in
the intermediate/long run is necessary for planning disaster resilience and building a pro-
vulnerable society.

For the local businesses in affected areas, quick and fair distribution of relief funds is crucial;
nonetheless, it is frequently observed that people in need do not receive financial support in
a timely manner. Consequently, micro-finance schemes are often developed for local
businesses and industries. The growing number of ‚??micro funds‚?? meets the monetary
demands of local businesses and significantly supports the rebuilding of the local economy
and livelihoods in the months and years after devastating events.

2.3. Decentralised and diversified Infrastructure

Decentralised and diversified Infrastructure is characteristic of an economy that is able to
mitigate the impact of disasters and quickly spring back to normalcy after a major crisis. In
Japan, large scale and regionally centralised electric supply systems, and the tightly
integrated structure of manufacturing supply chains, which were considered most effective
economically, ended up being particularly vulnerable to disruptions caused by the disaster.
Since being highly dependent upon a single energy system discriminates against alternative
energy supply, it means that ‚??society excludes the backup system‚?Ě (Niitsuma, 2011).

For an economy to be resilient, there must be integration of continuity planning into
business practices, building in a certain amount of redundancy, making sure that various
scenarios for disaster losses have been considered, and fully understanding the residual risks
and underwriting them with relevant insurance policies.

Safe, secure, and green energy systems

An island country having no significant indigenous fossil fuel resources, Japan finds it difficult
to meet its enormous domestic energy demand without a stable, reliable and affordable fuel
supply from overseas sources. This may be one of the major reasons for the country‚??s
continued reliance on and promotion of nuclear energy programmes. However, the accident
at the Fukushima nuclear power plant revealed that the risks related to any nuclear accident
are enormous in terms of geographical expanse, tenure of impacts and array of damage.
Thus, faced with huge energy demands, uncertainty surrounding the safety of nuclear

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energy and climate change implications of increasing use of fossil fuels, Japan is now at a
crossroads trying to figure out how to balance energy demand and supply and which
direction to take to secure future energy supply for the country. Japan now needs to come
up with much enhanced demand-side management in the short to medium-term and a new
long-term supply strategy that will be sustainable and acceptable from an economic,
environmental and social perspective.

IGES‚?? research on post-disaster impacts to Japan‚??s energy policy aims at exploring potential
policy options for filling gaps created by the nuclear power plant accident with a mix of
renewable sources, advanced clean energy technologies and intensive energy demand-side
measures. Scenario assessment suggests that Japan may abandon nuclear energy from its
supply mix in the middle of this century with a moderate cost burden on the economy as a
whole. Using existing conventional fossil fuel facilities to full capacity can reduce the
financial burden of setting up new green field power plants in the immediate future (Asuka,
2011). In the longer term, renewable sources can minimise dependence on energy imports
with extremely high costs and enhance energy security. Indigenous resources like solar, wind,
geothermal and tidal power will need to be explored further and should be supported by
strengthened renewable energy promotion policies, e.g. a new feed-in-tariff law to promote
renewable energy in Japan, introduced in August 2011.

However, sudden fuel switching could leave the domestic economy vulnerable, especially
because of potential power shortages. It is therefore imperative that the reframing of
Japan‚??s energy policy be carefully monitored and precisely managed, taking into
consideration the socio-political and economic landscape. It is also critical to re-examine the
overall balance of energy demand and supply in order to strengthen the policy processes
towards energy transition (Katayama, 2011). Policy discussion in the past tended to
excessively emphasise supply side measures. We need to place a greater emphasis on
demand side management, including at the household and small- and medium-size
enterprise level. The level of electric power conserved in the eastern part of Japan this past
summer was more substantial than the government anticipated.

To address the post-Fukushima electricity supply constraints in Japan, policy makers and civil
society should promote a comprehensive energy policy package which would encompass: (1)
analysing the energy demand structure and enhancing demand-side management; (2)
diversifying energy supply sources; and (3) reforming the electric power system and
distribution grid to enable expanded use of renewable sources. These reforms should be
supported by policy and regulatory measures along with greater participation of civil society.
Strengthening regulations and policy tools towards reframing energy policy is hence an
urgent priority.

In conclusion, the promotion of renewable energy through feed-in-tariffs and appropriate
policies, as well as policies to promote energy saving, are considered to be an important part
of achieving a safe, secure and green energy system.

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Asuka, J. 2011. An IGES questionnaire survey on consequences of Fukushima. Discussion
paper presented during International Forum for Sustainable Asia and the Pacific
(ISAP) Yokohama, 26th-27th July 2011.
Brundtland Commission. 1987. Our common future, Oxford University Press.
Cabinet Office, Government of Japan., Accessed
on 3rd October 2011.
Cummins, J. David, and Mary A. Weiss. 2009. ‚??Convergence of insurance and financial
markets: hybrid and securitized risk-transfer solutions.‚?Ě The Journal of Risk
and Insurance, 76 (3): 493-545.
Folke, C. 2009. On resilience: How much disturbance can a system withstand? With roots in
ecology and complexity science, resilience theory offers new ways to turn crises into
catalysts for innovation. Seed Global Reset.
0/se ed-carl-folke-on-resilience.pdf, accessed 29 September 2011.
Guy carpenter & Company, LLC. 2010. Reinsurance Market Review 2010. Capital Ideas.
IGES. 2012. Greening Governance in Asia Pacific: Institutional for Greener Economy (working
title). IGES White Paper IV (forthcoming).
Katayama, H. 2011. Getting for Local Energy Solutions after the 3.11 Triple Disaster,
Conference Paper at IGES-YCU Joint Seminar on Low-Carbon and Smart Cities held
during 3rd International Forum for Sustainable Asia and the Pacific (ISAP) Yokohama,
26th-27th July 2011.
Leighton M., X. Shen, and K. Warner. 2011. Climate Change and Mitigation: Rethinking
Policies for Adaptation and Disaster Risk Reduction. UNU-EHS.
Niitsuma, H. 2011. Dual Energy Path. Discussion paper presented during International Forum
for Sustainable Asia and the Pacific (ISAP) Yokohama, 26th-27th July 2011.
Palen, L., S. R. Hiltz, and S.B. Liu. 2007. Online Forums supporting grassroots participation in
Emergency Preparedness and Response. Communications of the ACM, 50 (3) March
Pearce L., S. Brody, & R. Burby. 2003. Disaster Management and Community Planning, and
Public Participation: How to Achieve Sustainable Hazard Mitigation. Natural Hazards
28 (2-3): 211-228.
United Nations. 2000. Millennium Development Goals. United Nations Centre for Regional
Development (UNCRD). 2009. Report on the 2008 Great Sichuan Earthquake, March
2009. Disaster Management Planning Hyogo Office.
OECD. 2009. Promoting Pro-Poor Growth: Social Protection.
Scheyvens, H., H. Mori, S. Hayashi, and M. Kobayashi. 2011. Building resilient society:
Lessons from East Japan Great Earthquake, ISAP Discussion Paper, Hayama,
Japan. IGES.

Shaw, R. & K. Goda. 2004. From Disaster to Sustainable Civil Society: The Kobe Experience.
Disasters. 2004. 28(1): 16‚??40.

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Tama, S. 2011. Needs of disaster affected areas and aids for disaster affected areas.
Discussion paper presented during International Forum for Sustainable Asia and the
Pacific (ISAP) Yokohama, 26th-27th July 2011.
Tobin, G. A. 1999. Sustainability and community resilience: the holy grail of hazards
planning? Environmental Hazards 1 (1999) 13-25.
UNDP. 1997. Human Development Report 1997.
UNISDR. 2010. Disasters in Numbers.,
accessed 11 July 2011.
World Bank. 2001. World Development Report 2000/2001 Attacking Poverty.

World Bank. 2007. ‚??Caribbean Catastrophe Risk Insurance Facility: a solution to the short-
term liquidity needs of small island states in the aftermath of natural disasters,‚?Ě
Financing for Relief and Development, IAT03-13/3.
World Bank. 2011. Climate Change, Disaster Risk, and the Urban Poor Cities Building
Resilience for a Changing World.
World Conference on Disaster Reduction (WCDR). 2005. Hyogo Framework for Action 2005-
2015: Building the Resilience of Nations and Communities to Disasters, January 2005.

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3. Green Economy in the Context of Sustainable Development
and Poverty Eradication

3.1 Key Challenges

IGES recognises that a key challenge in pursuit of sustainable development is the excessive
social, economic and environmental vulnerability caused by one-sided pursuit of economic
efficiency (see Figure 3-1).

Economic efficiency Environmental Social Economic
Profit maximisation vulnerability vulnerability vulnerability
Poverty & Price volatility of
Mass consumption & income gaps natural resources
Ecosystem Worsened labourr
degradation conditions
& natural disasters

Figure 3-1 Vulnerability caused by excessive pursuit of economic efficiency

While rapid economic growth in Asia and the Pacific has improved the material standard of
living for hundreds of millions of people, many have been left behind in poverty, and
expanding income gaps are undermining social and political stability. In the name of
competitiveness and labour productivity improvement, employment conditions have
deteriorated in many countries, and the consequent loss of stable livelihoods, including
increasing unemployment, has aggravated social vulnerability. Rapidly increasing
consumption of food, energy and natural resources such as crude oil and iron ore triggers
price volatility of these commodities, which is further amplified by financial speculation.
Over-consumption of such resources mainly driven by the lifestyles and consumption
patterns of the richer segment of the world has accelerated climate change and ecological
degradation, which worsens vulnerability to natural disasters.

An emerging paradigm shift to overcome these key challenges is the concept of a green
economy, although at this stage an internationally agreed definition does not yet exist.

3.2 Key Approaches/Principles

The principles or directions of a green economy in the context of sustainable development
and poverty eradication can be discussed under three major economic-environmental
domains, i.e. low-carbon economy, sustainable consumption and production, and
sustainable use of ecosystem services (see Table 3-1). The political momentum for a green
economy is predicated on investment on green technologies and Infrastructure, and ‚??green‚?Ě
job creation with due attention to current environmental challenges. Such transitions are
already underway (UNEP, 2011b), but further acceleration is required to achieve the implied
paradigm shift. International policy coordination is another aspect to avoid green
protectionism and to make a global green economy attractive and beneficial for developing

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Table 3-1 Key approaches/principles
Sustainable consumption Sustainable use of
Goal Low-carbon economy
and production ecosystem services
Key issue -Further investment in - Change in consumption - Sustainable agriculture
renewable energy patterns and green production
supply chain
Key tool/ - Carbon tax and - Resource consumption - Wide application of PES
measure emissions trading reduction policies, e.g. and green accounting
green procurement scheme
policies, and natural
resource tax
Additional - Mitigation of natural - Provision of more - Contribution to food and
merit disaster risks opportunities for water security
- Creation of green jobs resources use in - Creation of green jobs
- Improvement in energy developing countries and
access of future generations

3.2.1 Low-carbon economy

In the face of climate change and the accompanied risks of intensifying natural disasters,
IGES believes that a precautionary (no-regrets) approach is needed, starting with building a
low-carbon economy with a resilient, secure energy supply system. Investing in renewable
energy coupled with enhanced demand-side energy efficiency measures has the potential to
supplement and eventually replace nuclear and thermal fossil fuel power in the country‚??s
energy mix and can contribute to establishing a decentralised electricity supply which would
secure a backup system during a disaster (Bhattacharya, 2011). Renewable energy can also
help mitigate natural disaster risks associated with climate change, create thousands of new
green jobs (OECD, 2011; UNEP, 2011b), and improve access to green technology through
investment in research and development and subsequent unit price decline, which will
benefit the poor in developing countries through improved energy access.

Governments should promote this trend by introducing incentives, e.g. shifting the tax base
from labour and income to taxing environmental damage such as pollution and
unsustainable resource consumption (OECD, 2011; UNEP, 2011b), and gradually phasing out
environmentally harmful subsidies (Bhattacharya and Kojima, 2010a). However, most
countries fear that such reforms may put their export industries at a disadvantage, making it
difficult for individual countries to take the lead. The acceptance of tax and subsidy reforms
will be significantly enhanced if a large number of countries agree on a joint schedule. While
a global agreement may not be feasible in the short run, major economies having more
financial and human resources, such as the G20, have agreed on phasing-out harmful fossil
fuel subsidies. Therefore, if they agreed on a more comprehensive integrated approach to
ecological tax reform, this would be a significant step towards a global green economy.

Moreover, the mechanisms to promote international cooperation, such as regional energy
market integration (Bhattacharya and Kojima, 2010b), and technology transfer between
countries, not only North-South but also within the South, need to be further developed.
Such international cooperation, however, should not encourage exports of highly polluting
brown sectors from one country to another. Also, a number of countries are concerned
about green protectionism (UN-DESA, 2011).

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Technology transfer for low carbon economy only works if there is capacity to effectively use
the adopted technology, so emphasis should be given to promoting information sharing and
knowledge building rather than concentrating on funding arrangements only. To this end,
promoting existing national information centers, or establishing new ones, could help
develop comprehensive technology needs assessments for each recipient country and a
comprehensive technology availability assessment for each provider country. Strengthening
existing regional technology centers, such as UNEP and APEC environmental knowledge hubs,
to include not only collecting and sharing information but also knowledge building and
advisability, could be done at the regional level and international level (IGES, forthcoming in

IGES believes that, in the short-run, border carbon adjustments should not be implemented
unilaterally, but should be done under the umbrella of an international agreement that
ensures trust and shared understanding of the purpose of the measures and limits the scale
and scope to clearly address leakage concerns (Zhou et al., 2011). In the medium-term,
promoting nationally appropriate mitigation actions (NAMAs) in Non-Annex I countries of
the UNFCCC is a more effective and important approach than border carbon adjustments. A
layered approach which categorizes NAMAs and defines what to measure, report and verify
for each category is quite a useful and practical framework for the emerging measuring,
reporting and verifying (MRV) system (Fukuda and Tamura, 2010).

3.2.2 Sustainable consumption and production

Under the internationally growing demand for limited natural resources, the decoupling of
economic growth and resource use and environmental impacts through the promotion of
green technologies is one instrument to combat resource depletion. Promotion of 3R
(reduce, reuse, recycle) policies and ‚??top-runner‚?Ě approaches play an important role in this
regard. Policy interventions for requiring producers to internalise the costs of recycling, e.g.
introduction of extended producer responsibility (EPR), green tax and subsidies, as well as
for making environmental impacts clearly visible to consumers, i.e. green labelling are
needed. These policies should be introduced in parallel with increased efforts on education,
training and skills enhancement as effectiveness of these interventions depends on
environmental awareness of consumers as well as ability of producers to improve product
design and production processes.

However, there is a limit to pursuing decoupling via increasing resource efficiency at the unit
level of each product, service, and technology. Indeed, decoupling is not a panacea for the
world as a whole: individual countries can achieve a certain degree of decoupling by
outsourcing polluting and resource consuming activities to other countries, but at the global
level there is no opportunity for outsourcing. On the contrary there is growing literature
showing that very little (if any) decoupling has been achieved to date and indicating that
rebound is likely to render global efforts on decoupling ineffective (UNEP, 2011a; Jenkins et
al., 2011). Therefore, to tackle overconsumption against the carrying capacity of the Earth,

4 IGES publishes its White Paper every two years, comprehensively compiling its strategic research results. IGES
Fourth White Paper, which will be published in 2012, focuses on environmental governance and institutions in
Asia Pacific and its contribution to international environmental governance, tentatively entitled as ‚??Greening
Governance in Asia Pacific: Institutional for Greener Economy.‚?Ě For more information on IGES White Paper,
please see

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innovative policies for reducing resource consumption, e.g. introduction of resource tax or
resource consumption cap, may need to be introduced. In this regard, further efforts to
improve sustainability of resource consumption with a full examination of the appropriate
stage of policy intervention along the life cycle of the products (life cycle assessment) must
be made (Kojima, 2011).

Considering the significant disparities in the level of development of industrial Infrastructure,
major stakeholders, awareness, and market structure needed for greener and sustainable
consumption and production activities, the priority tasks of policy intervention to create a
green economy naturally differ between the developed, emerging, and least developing
countries as well as among different regions in any one country. In this sense, a phased
approach to introduce these policies considering the developmental stages of implementing
countries along with international policy cooperation will be effective in setting priorities in
production and consumption. The priorities of policy intervention for SCP should in general
be assigned to policies that satisfy basic needs, such as sanitation and health and other
public services for less-developed economies, and then to the integration of externalities
into consumption and production patterns for emerging economies and into systems
innovation for greener designs and systems for goods, services, and Infrastructure for more
developed economies. The consumption patterns of the richer segment of the world, which
includes both ordinary consumers in the North and the rapidly expanding consumer class in
the South, need to be drastically reconsidered. Changes in the way these groups live and
consume goods and services are prerequisites for freeing up natural resources necessary to
meet the needs of the poor and future generations. Such changes are not possible without a
significant shift in mindsets‚??to the point that increased consumption becomes socially
unfashionable, in the way that littering is no longer acceptable in most developed countries.

Thus, current policies should be revised to promote less resource-intensive development,
resource circulation, resource substitution, total reduction of environmental impact from
consumption, and wider investment for green industries through development of packaged
policy at all stages of the life cycle of products and services. To develop a persuasive
argument for policy makers, analytical tools must be developed to identify effective policy
interventions so as to facilitate a shift in consumption and production patterns and achieve
positive social, economic, and environmental impacts from such a shift. To avoid negative
impacts and secure the effectiveness of policy intervention in consumption and production
patterns, internationally integrated policy approaches are necessary. To financially back-up
such policy integration for SCP, IGES is examining the possibility of establishing an
international fund for sustainable resource management or resource efficiency by utilising a
portion of tax-income from economic policy instruments at different stages of the life cycle
of products and services.

3.2.3 Sustainable use of ecosystem services

Especially for the poor who are more directly dependent on ecosystem services, ecosystem
degradation due to human activities casts a dark shadow over stable livelihoods in terms of
food and water security, natural disaster risks and loss of traditional culture (TEEB, 2011).
Appropriate pricing and sustainable use of ecosystem services in the context of poverty
eradication will be essential for a green economy. An economic system that does not
internalise or recognise nature‚??s contribution to the air we breathe, the water we drink, or
the soil that provides our food, cannot be regarded as ‚??green‚?Ě. In this context, biodiversity

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conservation is an essential tool as loss of biological diversity undermines the value and
resilience of ecosystems (Elmqvist et al., 2003).

Policymakers should internalise negative ecological externalities into the current economic
system, and thereby promote sustainable agriculture and greening of the production supply
chain. The keys to achieving this will be enhancement of economic incentives, e.g. payment
for ecosystem services (PES), and visualisation of the benefits and costs relevant to
ecosystem services, e.g. an accounting scheme incorporating valuation of ecosystem services.
The PES approach encourages shifts from conventional practices that extract maximum
production from the land to more sustainable agriculture and forestry through payments to
landholders in exchange for providing more regulating services (Pagiola and Platais, 2007).
PES also helps to create jobs in local areas because sustainable agricultural practices are
more labour intensive than those depending on excessive use of chemical fertilisers and
machinery. One limitation of this approach is that pricing ecosystem services which are
currently unmarketable based on our willingness-to-pay does not necessarily promise
sustainable use of ecosystem services. For example, pollution charges are one way of pricing
the ecosystem sink services provided by receiving waters or the atmosphere. While there is
a price incentive to reduce the level of pollution, lack of enforcement, poor collection of fees,
or inadequate fines may result in failure to reduce the level of pollution. . An alternative
‚??ecological economic valuation‚?Ě approach is suggested (Kojima, 2011) in which the price of
ecosystem service is determined such that policies or actions to ensure sustainable use of
ecosystem services would improve social welfare.

The relatively new mechanism of reducing emissions from deforestation and forest
degradation (REDD+) is another approach to reward forest managers for maintaining a
carbon sink, as one way of mitigating the greenhouse gases causing climate change.
Combining REDD+ with community-based forest management may be an effective way of
recognizing the valuable ecosystem services provided by the stewardship of forest-
dependent communities and contribute to their economic well-being. Designing such a
system to verify the carbon sequestration benefits and to avoid capture by elites, however,
still requires further work and trial in a range of countries.

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Accounting that incorporates the economic benefits of ecosystem services, as well as the
costs of environmental degradation will enable decision-making on a country‚??s natural
capital, based on a longer-term perspective (World Bank, 2010). As a first step towards the
application of such an accounting scheme, governments need to evaluate the full costs of
loss of ecosystem services due to the construction of public Infrastructure, such as
hydropower dams, and make final decisions based upon a comparison of the potential gains
and losses. Simultaneously, green procurement needs to be re-evaluated from these
perspectives to visualise not only its positive environmental effects, but the economic
benefits derived from less ecological degradation as well. Following these governmental
initiatives, enterprises should be required to assess the ecological impacts of their projects
and production processes, through enhanced environmental impact assessment procedures,
review their supply chain management in this regard, and be required to report on the
sustainability impacts of the company through regular annual reporting procedures, using
models such as those developed by the Global Reporting Initiative.

Box 3-1. Community forest management and REDD+
By stabilizing the Earth‚??s climate through carbon sequestration and storage, forests provide
an ecosystem service that is critical for human survival. Recognizing that deforestation and forest
degradation are contributing to global warming, Parties to the United Nations Framework
Convention on Climate Change (UNFCCC) are in the process of agreeing on a global mechanism
known as REDD+ that foresees the provision of incentives to developing countries to manage
forests for climate change mitigation. REDD+ encompasses activities to reduce/avoid emissions
from deforestation and forest degradation (REDD), and to enhance and conserve carbon stocks
(symbolized by the ‚??+‚?Ě).
In their search for more sustainable models of forest management and to rehabilitate
forests degraded by logging, governments in the Asia-Pacific region have enacted legislation and
established support programmes to provide forest rights to local communities (Scheyvens et al.
2007). Today, community forest management (CFM) is widely accepted as essential for
promoting sustainable forest management and human wellbeing. CFM has developed
particularly in areas of degraded (logged over) forests (Sam and Shepherd 2011), and has played
a significant role in the rehabilitation of landscapes, forests and environmental services. In South
and Southeast Asia, millions of hectares of degraded forests are being managed by communities
(Pfoffenberger 2006), making them key REDD+ stakeholders (Chhatre and Agrawal 2009).
Even though some countries in Asia-Pacific are more advanced than others in the
implementation of CFM, and in spite of ‚?? legal, technical and human ‚?? limitations that different
CFM models face (Scheyvens et al. 2007; Scheyvens 2011), several aspects make CFM conducive
to the implementation of REDD+. CFM promotes the management of forests through local
consensus-based organizations with democratically elected leaders/committees, and it supports
the drafting of norms and regulations (by communities) to control forest access and use. CFM
thus can provide strong local institutional foundations for forest rehabilitation and management,
as well as for the realization of the social and environmental safeguards for REDD+ that
international negotiators have agreed upon. The safeguards include respect of knowledge and
rights of indigenous peoples and local communities, and full and effective participation of
indigenous peoples and local communities in REDD+ (UNFCCC 2010). Additionally, CFM could also
facilitate the participation of communities in forest measurement and monitoring, reporting and
verification, which are all essential elements of REDD+ (Skutsch 2010). Elaborating the existing
CFM models to enable local people to play these roles would contribute to address concerns over
effective engagement of indigenous peoples and local communities in REDD+.
(IGES , forthcoming in 2012)

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3.3. Roadmap

IGES recommends developing a green economy roadmap to move in the directions
mentioned above. As indicated in Table 3-2, we propose several policies and actions in the
short, middle and long term for each major economic-environmental domain.

Table 3-2 Roadmap green economy in the context of sustainable development
Low-carbon economy Sustainable Sustainable use of
consumption and ecosystem services
Short- -Establishment of plan -Promotion of 3R -Good practices on
term: for energy supply policies and top- economic incentives
Greening - Establishment of a runner approach contributing to
current scheme to promote - Development of sustainable use of
economic renewable energy analytical tools to ecosystem services
activities investment identify effective will be compiled and
policy interventions provided through the
on-line database

Mid-term: -Agreement on gradual -Establishment of -Globally accepted
Introducing removal of energy international fund for measures for
key subsidies at the East sustainable resource economic valuation of
regional/ Asia Summit management ecosystem services
global -Establishment of will be framed under
policies to regional cooperation the initiation of the
change the mechanism to promote IPBES
course of technology transfer, in -As indicated by the
regional/ particular of green global partnership for
global technologies, at the green accounting
economy East Asia Summit initiated by the World
-Agreement on Bank, a definitive
implementation rules methodology on green
for the MRV accounting will be
framework at UNFCCC- developed
- Promotion of NAMAs
in Non-Annex I
Long-term: - Establishment of -Development of -As pursued in the Aichi
Reforming regional arrangement innovative reduction Biodiversity Target,
global for energy market policies along with economic aspects of
economy integration recycling and reuse biodiversity and
-Establishment of the policies ecosystem services
WTO rule on will be integrated in all
Environmental Goods decision making
and Services through processes
regional mechanisms - Global assessment of
such as those of the key ecosystem
East Asia Summit services similar to
IPCC‚??s assessment

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towards Sustainable Resource Circulation).‚?Ě Environmental Research Quarterly, No.
162, July 2011, 19-27.
IGES. 2012. Greening Governance in Asia Pacific: Institutional for Greener Economy (working
title). IGES White Paper IV (Forthcoming).
Jenkins, J., Nordhaus, T. and Shellenberger, M. 2011. Energy Emergence: Rebound & Backfire
as Emergent Phenomena. Breakthrough Institute. Available at:
Kojima, S. 2011. Reduce policy towards sustainable society: research on environmental,
economic, and social impacts of resource circulation systems in Asia. Environmental
Research Quarterly 161, 77-94.
Kojima, S. 2011. "The importance and the limitation of conventional valuation: An
alternative approach", presenation at International Conference on Green
Economy and Mountain Development: Emerging concepts, opportunities and
challenges in view of Rio+20, ICIMOD, Kathmandu, Nepal, 5-7 September 2011.

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Organisation for Economic Co-operation and Development (OECD). 2011. Towards Green
Growth. OECD. Paris.
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Pfoffenberger, M. 2006. "People in the forest: community forestry experiences from
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5(1): 57.

Sam, T. and G. Shepherd. 2011. Community forest management. Background Paper for the
United Nations Forum on Forests Secretariat UNFF9: ‚??Forests for People, Livelihoods
and Poverty Eradication‚?Ě. IUCN. New York. Available from: accessed 15 October

Scheyvens, H., K. Hyakumura and Y. Seki, Eds. 2007. Decentralization and state-sponsored
community forestry in Asia. Institute for Global Environmental Strategies. Hayama.

Skutsch, M., Ed. 2010. Community forest moniroting for the carbon market - Opportunities
under REDD. Earthscan. London - Washigton, DC.

TEEB. 2010. The Economics of Ecosystems and Biodiversity: Mainstreaming the Economics of
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Global Partnership.‚?Ě Concept Note prepared by World Bank Environment
Department. December 22, 2010.
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Economy: Trade and Sustainable Development Implications, Report of the Ad Hoc
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Development Preparatory Process, Second Preparatory Meeting, New York, 7-8
March 2011.
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---------- . 2011b. Towards a Green Economy: Pathways to Sustainable Development and
Poverty Eradication ‚?? A Synthesis for Policy Makers. UNEP, Nairobi.
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Mitigation, edited by Blanco, J. and Kheradmand, H. InTech, Croatia

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4. Institutional Framework for Sustainable Development

4.1. Key Challenges

Scientists have identified nine planetary boundaries which should not be crossed if human
civilisation is to continue to thrive (Stockholm Resilience Institute, 2009). Three boundaries
(climate change, biological diversity, and nitrogen input to the biosphere) have been crossed
already, with potentially devastating consequences for environmental, economic and
societal stability if this trend is not reversed (assuming it is possible to reverse these trends
once a threshold has been breached). It is clear that current environmental and
sustainability governance arrangements are inadequate to halt the continuing
environmental degradation. To change the direction of economic systems and stave off
ecosystem collapse, fundamental institutional changes and coherent goals that are
reinforced at global, regional, national, and local levels by consistent incentives, regulations,
policies, and action will be required.

It is widely agreed that the current institutional structure, much of which was developed in
the middle of the 20th century, prior to the recognition of SD, is no longer adequate to
address current challenges. Some progress has been made, as there are now over 500
multilateral environmental agreements (MEAs) and nearly every country has environmental
laws and a national level environment agency responsible for implementation. Governments
and organisations at all levels‚??including the UN, regional, national, and local levels, as well
as businesses and individual persons‚??are now making efforts to work on sustainable
development. However, these efforts do not adequately match the magnitude of the
challenges or the pace of change. Current IFSD‚??at all levels and in many countries‚??suffers
from several serious challenges such as inadequate leadership and coordination,
fragmentation, insufficient funding and human resource capacity, as well as inadequate
compliance and enforcement. At the global level, the sheer number of treaties,
organisations, and meetings complicate effective attendance at meetings and conferences,
and may also divert human resources from urgently needed implementation.

4.2. Key Approaches/Principles

IGES considers the following three principles/approaches to be critical in strengthening IFSD:
1) multi-level and multi-stakeholder governance; 2) subsidiarity; and 3) compliance and

4.2.1. Multi-level and multi-stakeholder governance

The challenges to sustainability will have to be addressed by intergovernmental institutions
and governments, and not only at one level. Multi-level governance is necessary for
coherent and effective action. Vertical and horizontal cooperation between and within levels
is needed to minimise policy tradeoffs and maximise synergies between traditionally

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separate sectors and policy domains, and sustainability goals need to be mainstreamed into
all major societal decisions and sectoral plans. Key functions of multi-stakeholder
participation are to improve coordination among stakeholders, create consensus on
information input into decisions, cohesive implementation, legitimacy, and accountability of
governing stakeholders and decisions made. While multi-stakeholder participation is already
practiced in the intergovernmental arena, it should be strengthened further to include
genuine, effective participation rather than token consultation, not only for the sake of
awareness, but also to improve accountability of decision makers, which can lead to better
enforcement and compliance of environmental laws and regulations (Antonio, 2011).
Progress on other governance levels is required to empower stakeholders by promoting
greater institutionalisation of participation. At the practical level, securing transparency of
decision making processes, involving stakeholders in the early stages of planning, and
effective facilitation functions are vital to synchronise top-down and bottom-up governance
aimed at achieving common goals as seen in Box 4-1 below.

Box 4-1 Supporting multi-level governance through information exchange and networks
Information exchange via networking among cities is a simple and effective option to
strengthen relationships between local and national governments and improve capacity and
enhance local actions for environmental management. The nature of the exchange varies by the
type of network, which can be categorised into three types according to size: (1) networks with
many members mainly for information sharing among them; (2) networks with limited number of
members, designed for more intensive information exchange; and (3) bilateral, or city-to-city,
relationships for learning directly from each other. A fourth type is based on having an award
programme for recognizing outstanding achievements or innovation.
Over its lifetime a network may evolve to take on any of these forms, and may at times
simultaneously perform the function of more than one type of network through the action of
individual members. A typical network function is establishing an information sharing platform
for members. For example, the Kitakyushu Initiative for a Clean Environment (KI) has organised
meetings every 2-3 years by convening member cities to exchange knowledge and experience on
effective environmental practices. Thematic seminars were also held in parallel almost once a
year on specific environmental subjects such as solid waste management, water supply and
sanitation, and use of information and communication technologies. Although the KI ended in
2010 the secretariat, IGES, has continued on a similar path with the High Level Seminar on
Environmentally Sustainable Cities. This was developed under the framework of the East Asia
Summit Environment Ministers Meeting, where central government officers and local
government officers, as well as other organisations and research institutions are invited to
exchange views and activities toward development of environmentally sustainable cities. In this
way, the networking function has expanded not only horizontally but also vertically, providing
opportunities to connect various types of organisations through multiple levels of government.
Multi-level networking can be enhanced through information sharing platforms ‚?? such as
offering awards and giving opportunities to outstanding cities to present their activities and
achievements in front of other member cities and other stakeholders, thereby sharing best
practices and giving recognition and further encouragement for them to perform better. In
addition such platforms are also an opportunity to attract external support from central
governments and other supporting organisations.
(IGES, forthcoming in 2012)

4.2.2. Subsidiarity

The outcomes of Rio+20 on strengthening IFSD must address how institutions can best
secure vertical integration of policies from international agreements, through national policy

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to local implementation. Decisions relating to the implementation of environmental and SD
governance should therefore be carried out in accordance with the subsidiarity principle,
which prescribes that issues ought to be dealt with by the smallest, lowest or least
centralised competent unit (Elder, 2011). Doing so may help integrate aspects of top-down
and bottom-up environmental governance. For subsidiarity to really work coherently with
the goals set at the intergovernmental level, it is also important to establish clear procedures
for advancement from policy formulation to action and from planning to implementation,
and to also ensure that the necessary resources are made available at each stage. Under the
principle of common but differentiated responsibility, those who can afford it (not just
developed countries) should assist vulnerable groups and developing countries to build the
necessary human resource capabilities to implement sustainable development activities at
the local level.

4.2.3. Compliance and enforcement

Laws and regulations suited to country specific conditions are among the most important
instruments for transforming environmental and development policies into
action. Generally MEAs can only be implemented if there are matching national laws and
regulations. Without effective compliance and enforcement of these laws and regulations,
however, the intended improvements in human wellbeing and sustainable development
inevitably will fail. Accordingly, it is critical to enhance cooperation between countries to
share best practices on environmental compliance and enforcement, to provide technical
assistance to developing countries in need of capacity strengthening, and to continuously
upgrade regional, national, sub-national and local compliance and enforcement actions.5

4.3. Roadmap and Main Proposals

IGES believes that fundamental reform of IFSD together with international environmental
governance (IEG) should be undertaken through a phased approach at all levels. Each
sequence will provide necessary momentum for subsequent steps, as can be seen in the
following figure:

5 One of the examples of compliance and enforcement in Asia is Asian Environmental Compliance and
Enforcement Network (AECEN). Since 2005, national and sub-national environmental agencies
throughout Asia, with support from the United States Agency for International Development, have
cooperated through AECEN, sharing information on innovative policies and best practices in
compliance and enforcement. Member agencies include Cambodia, India, Indonesia, Japan, Republic
of Korea, People‚??s Republic of China, Lao PDR, Malaysia, the Maldives, Nepal, Pakistan, Philippines,
Singapore, Sri Lanka, Thailand, and Vietnam. AECEN's predominant cooperation mode is through
South-South cooperation, where a mentor country is "twinned" with a beneficiary country, and
environment agency staff from the mentor agency conduct on-the-job capacity strengthening and
training. For more details, see

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Figure 4-1 Reform phases for IFSD

For the short-to-medium term, we encourage governments to support the creation of an SD
Council to better coordinate and oversee budgeting of all UN programmes and agencies. To
function more effectively, IGES recommends that the SD Council cooperate closely with
international finance institutions (IFIs) and Bretton Woods Institutions, along with the
G8/G20, as currently financial and environmental agendas are not well coordinated and
sometimes offset each other. For IFSD, IGES‚??s long-term vision is for a revision of the UN
Charter to (1) enhance the global focus on sustainability issues; and (2) to equip a globalised
world in the 21st century with rules and regulations for the future, not of the past.

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Table 4-1 Short/medium and long-term IFSD reforms

For IEG, we recommend that UNEP should have universal membership of its Governing
Council. This is important to enhance legitimacy of international environmental governance
and will also eliminate the necessity of Governing Council elections (although may impose
minor additional costs). Subsequently, IGES recommends that UNEP be upgraded to a
specialised agency, with a decision making mandate and legal identity. Both these IEG
reform steps can strengthen environmental governance and support downstream

Given a clear need to strengthen currently dispersed regional as well as sub-regional
environmental governance in Asia, IGES suggests the formation of a regional environmental
focal point, which in the long run could be developed into an Asian Environmental
Organisation, similar to increased regional cooperation that is happening in other regions
such as Africa, the Americas, and the EU, and is commensurate with the increased regional
cooperation on economic, trade, and security fronts in Asia. Asian countries should work
towards creating a multilateral environmental information exchange network. Issues related
to energy, resource-use, biodiversity, climate change, and disaster management are
transboundary and can be addressed cost-effectively by regional cooperation, capacity
building, and exchange of information and expertise.

At the national level, IGES recommends that high level focal points and coordination
committees be appointed above the sector ministries to ensure that SD concerns receive
sufficient attention and are vertically integrated and mainstreamed. Specific actions are
mostly taken at the local level, thus initiatives such as those promoting low carbon cities are
of great importance. The national level environmental governance should be improved in
such a way that will further promote local level actions in close collaboration with

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The following sections provide more detailed information on each reform step, as well as
elaborate on essential issues related to functions, funding, and other crucial issues.

4.3.1. Umbrella organisation for SD

Options for creating an umbrella organization for SD include: (1) a reformed ECOSOC with a
change in name and mandate to focus on promoting SD; (2) a new Sustainable Development
Council, separate from ECOSOC; and (3) a reformed and strengthened CSD, by according it a
stronger mandate.

Option 1, changing ECOSOC‚??s mandate to SD and changing its name, would require revision
of the UN Charter, but if SD is a high priority, countries can agree to limit the discussion and
amendment of the UN Charter to this one issue. Changing the name and mandate of
ECOSOC to that of SD Council would institutionalise participation of non-environment
ministries of each country, a crucial requirement for the mainstreaming of sustainable
development governance. ECOSOC already works on SD to some extent. However, a name
change is important to signal that SD is its main focus. With the current name, there may still
be some resistance to SD efforts by ECOSOC, and some may think that non-sustainable
economic activities can still be promoted as ECOSOC‚??s main responsibility, while SD is a side

Option 2 would maintain ECOSOC in its present form, but establish a new SD council. This
could either be new, or as in option 3, be based on a restructuring of the CSD. The CSD could
continue to function as a forum for intergovernmental discussions on SD. However, its focus
would have to be sharpened; it would undertake assessments of the progress towards SD
and work to attract key decision makers from ministries other than environmental ministries.
Regardless of the specific institutional form of the umbrella organisation for SD, in the long
term, it will be necessary to align the efforts to combat climate change with the work on
sustainable development, including their respective institutional frameworks. Agencies and
programmes representing the three dimensions of SD need to work harder to cooperate,
convening regularly to ensure coherence and synergy.

4.3.2. High profile individual to promote SD

It is highly desirable to have a high level person to lead and promote SD, regardless of which
form the umbrella organisation eventually may take. This person could have the title of High
Commissioner for Sustainable Development. Previous efforts to promote coordination of SD
have centred on the establishment of committees. Several coordinating committees have
been formed and disbanded over the years, but their effectiveness has been limited. Also,
UNEP has not been very successful in coordinating UN activities on environment for a variety
of reasons, although steady progress on integrating environmental concerns into other
agencies has been made by the efforts of these agencies. Overall, it is difficult to expect UN
agencies to coordinate themselves, and a main result of past coordination efforts has
resulted in turf battles. A high profile person in charge of SD could be beneficial in terms of
coordination and mainstreaming of SD concerns within the UN, and as a public face of SD in

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the media and to the public. Sadako Ogata, who was the UN Commissioner for Refugees, has
had considerable success in promoting refugee issues and could be a good model to follow.

4.3.3. Greater participation and coordination with Bretton Woods Institutions and
regional development banks

Bretton Woods institutions and regional development banks should more actively
participate in a system-wide committee to better align their work with SD objectives. A
system-wide committee may have a better chance of success with a high level individual as
its chair. It could be worth considering participation of the proposed High Commissioner for
SD at Board of Directors Meetings of IFIs such as the World Bank, International Monetary
Fund, Asian Development Bank and other development banks.

Bretton Woods institutions and G20 central bankers should attend Rio+20 and clarify how
they will promote SD and coordinate with other actors. Moreover, development banks
should be called upon to expand the SD aspect of their development assistance at the
Rio+20 conference. Some are already extensively engaged in SD work, and have emphasised
their SD contributions. However, SD is typically not part of their official mandate. Calling on
these organisations to officially change their mandate could be considered. In addition, new
donor countries should be called upon to ‚??green‚?Ě their development assistance and orient it
towards SD objectives.

4.3.4. SD financing mechanisms

Securing additional financing and making effective use of existing financing are crucial for
enhancing the effectiveness of SD institutions. One way to persuade countries to provide
more funding is to help them understand that SD issues can have security implications and
should be the focus of more interest from defence ministries. For example, environmental
degradation may have grave consequences for food and water supply, which in turn could
lead to security concerns and conflicts over resources. Environmental refugees may
potentially also pose security related problems. Countries should allocate a small amount
from their defence budgets for environmental and sustainable development funding.
Increased small contributions from defence budgets to UN organisations such as UNEP and
MEA secretariats could be a cost effective way to mitigate problems before they degenerate
into expensive and difficult security problems. Other innovative funding options could
include taxes on international financial transactions (Tobin Tax), mining of virgin materials,
international air-passenger mileage and freight transport, etc. Currently the EU is strongly
supporting the introduction of a Tobin Tax and other countries should seriously consider
supporting this initiative. These financing options have the advantage that they do not
derive directly from countries‚?? budgets. Nevertheless, governments of UN member countries
would still oversee the spending.

4.3.5. Convention on Access to Information and Participation

To institutionalise participation and access to environmental information and decision
making, IGES recommends supporting a regional or global convention on Rio Principle 10

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(Murharjanti and Paramita, 2011). Such a convention would strengthen multi-level
governance by improving stakeholder dialogue, policy adoption, and ownership at local
levels. For Europe, a convention on Rio Principle 10 already exists in the form of the Aarhus
Convention, but up-scaling it to the global level is necessary. Moreover, the provision of a
global convention on Principle 10 of the Rio Declaration would help to institutionalise it at all
levels of governance.

4.3.6. Two-phased reform for IEG: universal membership for UNEP, and then a
specialised agency (WEO/UNEO)

IGES believes that incremental reforms to the IEG system are important and should be
undertaken, such as those already underway in, for instance, greening of UN initiatives as
well as clustering of MEA secretariats (JIU, 2010). However, ultimately these measures will
be insufficient, so IGES supports more ambitious and fundamental reform options.
Specifically a two-phased approach to enhance UNEP is recommended. In the first phase,
the UNEP Governing Council could adopt universal membership. In the current system, the
UNEP Governing Council only has 58 members, and decisions must be sent to the Second
Committee of the General Assembly for approval. There is universal participation in the
UNEP GC, in which non-members may participate in discussions, but non-members may not
vote. Non-members already send delegates to the Global Ministerial Environment Forum,
which meets in conjunction with the GC. Universal membership would lend greater
legitimacy for UNEP GC to be the ‚??global voice for the environment‚?Ě which is difficult with
only 58 members. Universal membership would also eliminate the need for governing
council elections, which consume much time and energy.

Universal membership might also help improve coordination and synergies among MEAs,
which, due to comprehensive membership and centralised decision making of the GC forum,
could be deliberated in clusters, as already practiced in biodiversity related conventions and
the chemicals cluster. It would make it possible have MEA COPs to coincide with the UNEP
GC, thereby creating significant financial as well as time efficiencies. Currently, without
universal membership it is difficult for UNEP GC to make recommendations to MEAs that
have members which are not represented in UNEP‚??s GC. Moreover, IGES suggests that any
new MEA secretariats should be placed at either UNEP in Nairobi, or in Geneva. Recent IGES
research (Olsen, 2011) shows that, compared to the current status, the financial implications
of establishing universal membership are not very large.

In the longer-term, IGES recommends upgrading UNEP to a Specialised Agency i.e. World
Environment Organisation (WEO) or United Nations Environment Organisation (UNEO).
Legally, this might be accomplished through a GA resolution (UN Charter Article 57) rather
than a treaty, which could be difficult to ratify in some countries. This would mean that
decisions no longer have to be referred to the General Assembly where they might be
affected by unrelated issues. Thus, a WEO would provide a legal mandate and autonomy to
enhance the strength of environment ministers. Capacity building should be an important
function of a WEO/UNEO, particularly in areas related to policy formulation, reporting,
negotiation, and implementation of MEAs, and there is evidence that developing countries

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are interested in more capacity building from UNEP. UNDP, the World Bank, and regional
development banks, among others, already undertake some capacity building, although this
tends to be more focused on projects. However, overall efforts are still inadequate.
Increased effort should take place in cooperation and coordination with other agencies‚??
work according to the ‚??Delivering as One‚?Ě UN initiative, including adequate representation
of UNEP in UN Country Teams. Of course, additional funding would be needed. But the
mandate would need to be agreed on before contentious issues regarding funding could be
deliberated, perhaps agreeing on innovative funding options, such as those summarised in
previous sections. The flowchart below depicts how reforms could be undertaken in phases,
each creating momentum for the next step:

Figure 4-2 Thrust of IEG reform (Olsen, 2011)

The UN should lead by example and practice what it preaches. Recommendations such as
those suggested in the UN Joint Inspection Unit (JIU 2008), which include clear division of
labour among UN organisations, limitations on the creation of new MEA secretariats, and
improving transparency of use and management of programme support costs are useful to
be considered.

4.3.7. Regional initiatives (Asia-Pacific)

It is important also to consider how IFSD will translate to regional and sub-regional levels. In

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particular for Asia-Pacific, this will be an important consideration: as the region increasingly
becomes the world‚??s economic and production centre, adverse impacts are taking a toll and
many countries are facing serious environmental issues that include pollution and depletion
of natural resources. IGES suggests that improvement in coordination and information
sharing among countries in the region is a good first step that can enhance transparency and
access to environmental information, as well as exchange of good practices in the region;
these are the foundations for better environmental and SD governance. One possibility to
improve coordination would be to create a relatively small regional organisation or focal
point, which in the long run could be developed into an Asia Environmental Organisation. .

Figure 4-3 Proposed structure for enhancing information exchange
and harmonization in Asia-Pacific
Source: Adapted from EEA/EIONET model (EEA, 2011).

The flowchart above depicts how such a focal point could act as an information hub‚??both
collecting and disseminating information on the state of the environment. The institution
would use identified Asian Topic Centres (ATCs) of expertise in a given area. The National
Focal Points then could be appointed from ministries or agencies as key partners of the focal
point and should preferably include a mixed range of ministries. In addition to encompassing
the link from regional to national level, they would also coordinate with National Reference
Centres (NRCs), who would be appointed by the NFPs to collect information as required by
the central institution.

The Asia-Pacific region already has a wide-range of existing institutions at the sub-regional
level, including the North-East Asian Sub-regional Programme for Environmental
Cooperation (NEASPEC), Secretariat of the Pacific Regional Environment Programme (SPREP),
South Asia Co-operative Environment Programme (SACEP), and the Regional Environmental
Center for Central Asia (CAREC). The focus and potential of each of these institutions would
have to be subject to additional research to identify the extent to which extent they could

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become involved as ‚??Asian Topic Centres‚?Ě and information collection hubs. It would also
have to be determined which organisation would become the central hub collecting and
disseminating the information. Similar approaches may also be needed in other regions.

4.3.8. National initiatives (environmental policy integration)

On national levels, IGES believes that greater efforts should be made to improve synergies
between environmental and developmental policies and practices. One way to do this is to
enhance environmental policy integration (EPI), which is defined as a ‚??deliberate attempt to
prioritize the protection of the environment before any trade-offs are made between
environmental, economic and/or social objectives‚?Ě (Lenschow, 2009:8). Sustainable
development, therefore, should be designated as an overarching principle of policy decisions
in any sector or level. This is important because significant impact can only be achieved if
environmental concerns are integrated into those ministries that are the main contributors
to environmental damage (Mueller in Lenschow, 2002:58). Full integration is complex and
presupposes political continuity and support. IGES suggests that improving vertical
integration will benefit the persistent implementation gap at the local level. For that to
happen it will be necessary to strengthen the national decision making processes and involve
local governments to ensure that both funding and capacity is made available.

4.3.9. Local initiatives

Local governments in many areas have already made strong efforts to effectively address SD
issues in an integrated way, including efforts related to Local Agenda 21. Good examples of
local action in the Asia-Pacific include the development of low carbon cities, smart cities, and
other partnerships between local governments. City level networks help to share best
practices and assist with capacity building. These initiatives should be further developed and
strengthened. At the same time, multi-stakeholder involvement and cooperation with the
private sector, educational institutions and other stakeholders should be promoted. Finally,
IGES believes that solid reporting mechanisms should be established and maintained to
ensure vertical coherence and consistency between planning and implementation.

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AECEN. 2009. Regional Statement on Advancing Effective Environmental Compliance and
Enforcement in Asia. Asian Environmental Compliance and Enforcement Network., accessed 21 September 2011.
Antonio, Ella. 2011. ‚??Options for Strengthening Sub-regional and Regional Environment and
Sustainable Development Mechanisms in Aspac‚?Ě. Presentation at: Expert Workshop
on Strengthening Environmental and Sustainable Development Governance: Asia-
Pacific Perspectives. ISAP 2011. 4_Dr.Ella.pdf, accessed 19
September 2011.
EEA (European Environment Agency). 2011. Environment Connects. http://www.eionet.- , accessed 21 September 2011.

Elder, Mark. 2011. ‚??Introduction‚?Ě. Presentation at: Expert Workshop on Strengthening
Environmental and Sustainable Development Governance: Asia-Pacific Perspectives.
ISAP 2011.,
accessed 18 September 2011.
IGES. 2012. Greening Governance in Asia Pacific: Institutional for Greener Economy (working
title). IGES White Paper IV (Forthcoming).
Inomata, Tadanori and Enrique Roman-Morey. 2010. ‚??Environmental Profile of the United
Nations Organizations‚??. Review of their In-house Environmental Management
Policies and Practices. Geneva: United Nations Joint Inspection Unit. JIU/REP/2010/1., accessed 21 September
Inomata, Tadanori. 2008. Management Review of Environmental Governance within the
United Nations System. Geneva: United Nations Joint Inspection Unit.
accessed 18 May 2011.
Lenschow, A. 2009. Innovation in Environmental Policy? Integrating the Environment for
Sustainability. United Kingdom: Edward Elgar Publishing, Limited.
Murharjanti P. and Dyah Paramita. 2011. ‚??The Access Initiative: Moving from Principles to
Rights‚?Ě. Presentation at: Expert Workshop on Strengthening Environmental and
Sustainable Development Governance: Asia-Pacific Perspectives. ISAP 2011. activity20110725/s2-2_Prayekti.pdf, accessed 21
September 2011.
Olsen, Simon Hoiberg and Elder, Mark. 2011. ‚??Strengthening International Environmental
Governance by two-phased Reform of UNEP: Analysis of Benefits and Drawbacks‚?Ě.
IGES Policy Report. Vol.42. October 2011.
Rockstroem J. et. al. 2009. Planetary Boundaries: Exploring the Safe Operating Space for
Humanity. E& S Home, Vol. 14. No 2. Art. 32., accessed 21 September 2011.
Senge, Peter. 2008. The Necessary Revolution: How People and Organizations are Working
Together to create a Sustainable World. New York: Doubleday.

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List of Contributors

Overall Contributions and Coordination
Hideyuki MORI
Peter KING
Takashi OTSUKA
Robert David KIPP
Muneyuki NAKATA

Chapter 2: Resilience and Sustainable Society
Atsushi WATABE
Robert David KIPP

Chapter 3: Green Economy in the Context of Sustainable Development and Poverty
Satoshi KOJIMA
Yasuhiko HOTTA
Takashi YANO

Chapter 4: Institutional Framework for Sustainable Development
Simon Hoiberg OLSEN

Note: This report and all relevant IGES publications are available on the IGES website.


1. The 3rd International Forum for Sustainable Asia and the Pacific
(ISAP2011): The Asia-Pacific Multi-stakeholder Dialogue on Rio+20

a. Institute for Global Environmental Strategies (IGES). International Forum for Sustainable Asia
and the Pacific (ISAP2011) Chair‚??s Summary. October 2011.

2. Resilient and Sustainable Society

a. Bhattacharya, Anindya (2011) Impact Assessment of No-Nuclear and More Renewable Energy
Policies in Japan (Preliminary findings), Presentation Paper for 3rd International Forum for
Sustainable Asia and the Pacific (ISAP) Yokohama, 26th July 2011.

b. Hidefumi Imura (ed.) (2011) Local Energy Solutions, Presentation Paper for 3rd International
Forum for Sustainable Asia and the Pacific (ISAP) Yokohama, 26th July 2011.

c. Hidefumi Katayama (2011) Getting for Local Energy Solutions after the 3.11 Triple Disaster,
Conference Paper at IGES-YCU Joint Seminar on Low-Carbon and Smart Cities held during 3rd
International Forum for Sustainable Asia and the Pacific (ISAP) Yokohama, 26th-27th July 2011.

d. Hidefumi Katayama (2011) Low Energy Management in ‚??UNEP Bridging the Gap Report
(Chapter 4) (Draft).‚?Ě

e. Scheyvens, Henry, Hideyuki Mori, Shinano Hayashi and Masanori Kobayashi (2011) Discussion
Paper: Building Resilient Societies, Draft Presentation Paper for 3rd International Forum for
Sustainable Asia and the Pacific (ISAP) Yokohama, 26th July 2011.

3. Green Economy

a. Kojima, Satoshi, Kei Kabaya, and Takashi Yano. ‚??Green Economy for Sustainable Development:
Japan Should lead the policy shift towards global poverty alleviation.‚?Ě IGES Policy Brief. Vol. 12.
June 2011.

b. Bhattacharya, Anindya. ‚??Renewable Energy: A Strategic Policy for Sustainable Development.‚?Ě
IGES Policy Brief. Vol.10. April 2010.

4. Institutional Framework for Sustainable Development (IFSD)

a. Olsen, Simon Hoiberg and Elder, Mark. ‚??Strengthening international environmental governance
by two-phased reform of UNEP: Analysis of benefits and drawbacks.‚?Ě IGES Policy Report. Vol. 42.
October 2011.
ISAP 2011 Chair‚??s Summary

Chair: Prof. Hironori Hamanaka, Chair of the Board of Directors, IGES

Day 1 26 July

Morning Session on the Hayama Proposal and Implications of Japan‚??s disasters

People recognized the importance of thinking about the future energy mix of Japan with new and
flexible perspectives after the Fukushima triple disaster. Energy policy and climate policy are different
sides of the same coin and we should seek low carbon, high safety, and high energy security ‚?? keeping in
mind there may be costs to bear for these positive goals. Research institutes such as IGES should play an
important role to provide qualitative and quantitative analysis and concrete proposals to contribute to
the ongoing discussion on Japan‚??s future courses of action. In this regard, it was urgently called for
continued dialogue among stakeholders such as the ones we had at ISAP 2011, learning from the
German experience. The future direction of the international regime for climate change mitigation is
very unclear. Parties including Japan should make compromises to make the discussion move ahead for
our common future. The Hayama Proposal as proposed by the IGES climate change group may stir
further discussion inside and outside of Japan.

Afternoon Session on Resilient Societies

A decentralized system for risk reduction, relief, and recovery with differentiated roles under a
comprehensive plan was proposed and discussed during this session in which:
‚?Ę National governments have a facilitating and enabling role
‚?Ę Local government has the responsibility for decision making and implementation, and for
promoting horizontal cooperation and participation of different stakeholders.

It is essential to revitalize decentralized, localized, and self-reliant socio-economic systems which value
and support inclusive and meaningful participatory processes as a way to facilitate effective risk
reduction, relief work, and reconstruction on the pathway to a transition towards a resilient and
sustainable society. In this regard, the importance of community-based approach was emphasized.

Day 2 27 July

Morning Session on Governance for Sustainable Development

Despite the many challenges we need transformational change in addressing the weaknesses in current
governance arrangements.
‚?Ę Greater attention must be paid to horizontal and vertical integration ‚?? genuine and informed
multi-stakeholder participation and multi-level integration: the involvement of women and civil
society groups, business and local governments at all levels need to influence the outcome of
‚?Ę Access to information and meaningful public participation in policy decision making process to
enhance accountability and implementation, possibly through a global or regional convention.
‚?Ę International and regional organizations need to play a proactive role in engaging with national
and sub-national stakeholders, while sub-national stakeholders can take a more proactive role to
engage with the national government to promote change.

If we agree that the status quo is not sufficient to address current and future sustainable development
problems, then we cannot fear the challenges and consequences of making fundamental changes in the
UN charter.

Afternoon Session on Green Economy

The East Japan disasters, including the Fukushima nuclear accident, reveal that the existing social and
economic system does not fully account for environmental and social costs. The concept of green
economy is important in this context. The session discussed how the implication and definition of a
green economy may vary depending on the developmental stage, but sharing the common goal of
sustainable development. One of the key discussion points was how green economy can improve the
daily lives of poor people, not only in developing countries but also in developed countries. The
importance of technology transfer and application, particularly exploring opportunities between
south-south was emphasized, indicating a need for improving education to develop the capabilities
necessary for technology transfer and to provide the skills that will sustain green job growth.

In closing Prof. Hamanaka and Mr. Rae Kwon Chung, Director, Environment and Sustainable Development
Division of UNESCAP shared their final thoughts for ISAP2011. Prof. Hamanaka recapped the main
messages from each plenary session, which he said he hoped would be used towards developing a
sustainable and resilient society and promoting green economy in the context of achieving sustainable
development and alleviating poverty, bearing in mind the diversity of the Asia-Pacific region. Mr. Chung
closed ISAP2011 by offering a reminder of two points ‚?? the first challenge is to reach out to convince the
other two pillars, the other ministries, the other NGOs, as speaking to the converted is no way to achieve
cross-cutting goals. The second challenge is to have more clarity within the environmental policy
community as internal disagreements weaken the messages and do little to clarify the misperceptions
and understanding about sustainable development. IGES and other institutes need to clarify and educate
the national delegates going to Seoul and Rio de Janeiro. That is the challenge of our times, to overcome
the knowledge gaps by working together and overcoming our collective challenges to human survival on
planet Earth.
Impact Assessment of No-Nuclear and More Renewable Energy Policies
in Japan (Preliminary findings)
Anindya Bhattacharya, Senior Energy Economist, Economy and Environment Group, IGES
July 29, 2011

To estimate the impact of reduction and substitution of nuclear energy and increasing use of
renewable energy in the electricity supply mix in Japan using bottom-up technology driven
energy systems model (TIMES-Japan).

The impacts are to be estimated under three main parametric contexts prevailing in the market
to evaluate the nuclear energy‚??s acceptance or rejection compared to other technologies:

i) Technical feasibility,

ii) Cost of supply and

iii) Environmental impacts.

Primary research questions
What will be the total system cost?

What will be the electricity supply cost in the country?

What will be the energy and electricity supply portfolio of the country?

What will be the impact on GHG emissions reduction target?

1. Reference Energy Scenario (REF): This is the business as usual scenario with pre-disaster conditions
of energy supply and demand.

2. Fossil Fuel Scenario-Long Run (SFF-LR): In this scenario a long term nuclear power supply reduction
policy has been adopted. Nuclear power supply gradually goes off from the supply mix by 2050 with
a three-step reduction target. In addition to that CCS (carbon capture and sequestration)
technological intervention is also restricted until 2040 based on its current level of R&D status in
- 2020: Nuclear power supply reduces to 13% from 30% at 2009
- 2030: Nuclear power supply reduces to 5% from 30% at 2009
- 2050: Nuclear power reduces to 0% from 30% at 2009
3. Fossil Fuel Scenario-Short Run (SFF-SR): In this scenario an immediate cut off of all nuclear power
supply is considered by 2015.

4. Renewable Energy Scenario (REN): In this scenario a moderate renewable energy supply policy is
introduced with 15% wind and 25% solar energy supply by 2050 in Japan. Due to various
environmental and regulatory obstacles geothermal development is not very prospective in Japan as
of now. Therefore, we deliberately restricted the penetration of geothermal in the supply mix only
to 10% by 2050.

Basic assumptions
Following are the basic energy service demand drivers in the model to determine the final energy

REF Demand Driver

2005 value=1

0.5 POP

2005 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

Fig.1: Ref case energy service demand drivers
Note: GDPP: GDP per capita, GDPPHOU: GDP per household, HOU: Number of households, POP: Population

Primary energy prices are also very important for the bottom-up models. The basic assumptions are
shows in the figure below:

Fuel price assumption in the model




2010 2020 2030 2040 2050

Fig.2: Primary fuel prices

In addition to above mentioned assumptions the model also assumed there is no changes in the final
energy service demand in the market duet to policy changes. Therefore, the scenarios simulate the
steady state conditions of the demand function. As a matter of fact, only supply curve shifts over the
constant demand curve to achieve the partial equilibrium conditions for the optimal solutions under
different conditions mentioned under three policy scenarios. Work is in progress to also estimate the
energy service demand changes due to various policy measures.

The costs of technologies are also very important for this study as they determine the final technological
intervention in the system. The following table shows the reference case cost comparison between
different nuclear technologies and renewable mainly solar and wind.

Table 1: Reference case technology investment cost comparison (selected technologies only)

( USD@2000 /KW) 2003 2004 2005 2008 2010 2018 2023
Advanced Nuclear 2380.00 4200.00
Nuclear Fusion 4200.00
Nuclear LWR 2100.00 3705.88
Solar PV Centralized 9399.18 8354.78 6300.00 4760.00 3133.06
Solar PV Decentralized 10997.00 9775.08 7371.00 5569.20 3360.14
Wind centralized on-shore 2800.00 1775.40 1775.40
Wind centralized off-shore 4177.60 3236.80
Wind decentralized-onshore 1671.60 1662.66
Source: Data has been drawn from the TIMES Integrated Assessment Model (Version 4.3.3) base data which are
primarily collected from IEA and other external sources.

Preliminary Results
1. Impact on overall electricity supply portfolio: This result indicates that LNG and Natural Gas will be
dominating the supply fuel market in Japan especially for electricity production. Coal will still remain
as one of the major sources of power in the country under all the scenarios analyzed here unless it is
deliberately replaced by other technologies. Geothermal is a potential alternative for nuclear base
load supply in Japan. However, it requires plenty of regulatory and environmental policy changes to
become viable. High cost due to high labor cost and high land cost in the country may hinder the
introduction of the Biomass energy in Japan.

REF Case Elec Supply Portfolio REN -Elec. Supply Portfolio
100% 100%
90% 90%
Wind Wind
80% 80%
Solar-PV Solar-PV
70% 70%
Nuclear Nuclear
60% 60%
50% 50%
Hydro Hydro
40% 40%
Geo&Tidal Geo&Tidal
30% 30%
Gas&Oil Gas&Oil
20% 20%
Coal Coal
10% 10%
0% 0%
Biomass Biomass
2005 2010 2020 2030 2040 2050 2005 2010 2020 2030 2040 2050

FFS-SR Elec. Supply Portfolio
FFS -LR Elec. Supply Portfolio
Solar-PV 70%
Nuclear 60%
50% Hydro
40% Geo&Tidal
Coal 10%
0% Biomass
2005 2010 2020 2030 2040 2050
2005 2010 2020 2030 2040 2050

Fig. 3: Electricity supply portfolio for Japan under different scenarios

2. Impact on total energy supply system cost: This is the net present value of the total cost required to
achieve the target set under the scenarios in the system. The discount factor is around 10% which is
factored over the total life time of each individual technology in the system. This shows that if Japan
goes for immediate replacement of nuclear power supply with other sources the country has to take
the maximum burden of energy supply which will be 2.5% higher than the current cost or 225 Billion
USD additional cost. Renewable energy scenario is expected to have much lesser financial impact on
Japan which is around 105 Billion USD of additional cost compared to the reference condition.

% Change in system costs compared to baseline


% chnage to baseline





FIX 0.35% -1.60% 1.83%
INV 0.82% 2.93% 2.15%
VAR 4.10% 5.36% -6.37%
Total 1.11% 2.41% 1.12%

Fig.4: Changes in system cost under different scenarios

3. Electricity production cost and retail price in the market: In this analysis we estimated only the
electricity production cost and not the other costs like transmission and distribution, commercial
costs etc. However, it is assumed that the majority of the supply cost of power in Japan is the
production cost. Given the condition that there is no change in other cost component then %
change of the production cost of electricity can be attributed to the % change of the supply costs
and retail price of electricity that the consumers are paying. Based on this assumptions we have
estimated the following changes in the electricity prices in the market under different scenarios:

% Change in cost of electricity production to REF



100% REN


2020 2030 2040 2050

Fig.5: Changes in electricity supply/production cost under different scenarios

This result indicates that under the fossil fuel based scenario with immediate nuclear energy cut off
plan may increase the electricity generation cost and thereafter the supply cost by 250% compared
to the current level by 2020. However, it has been estimated that under all the potential alternative
scenarios, price escalation is must. But renewable energy option with no nuclear supply beyond
2050 predicts the lowest price escalation until 2050.

The following figure (Fig.6) shows how the market price of different fuels changes compared to the
REF scenario in Japan. Oil Crude is also predicted here which shows that 2020 is the most expensive
year for Japan under all scenarios except renewable energy. All other fuels show some increasing
trend in the mid to long term horizon for Japan as the fossil fuel demands still remain high for the
country. Among all fuels, natural gas is expected to have very high price escalation in Japan (around
400%-500%) due to high demand by the power companies.

% Change in gasoline price comapred to REF
% Change in oil-crude import price compared to REF
FFS-LR 200%
Poly. (FFS-LR)
Poly. (FFS-SR)
50% R² = 0.8708 R² = 0.8262
2010 2020 2030 2040 2050
2010 2020 2030 2040 2050

% Change in diesel price comapred to REF
% Change in Natural Gas Price comapred to Ref
250% FFS-LR
300% FFS-SR
150% REN
100% Linear (FFS-LR)
Poly. (FFS-SR)
R² = 0.8398 R² = 0.7252
2010 2020 2030 2040 2050
2010 2020 2030 2040 2050

Fig.6: Changes in different fuel prices in the market compared to REF scenario

4. GHG emission: To achieve better CO2 emissions reduction, Japan needs to have aggressive
renewable energy penetration policy in place. Model predicts that under both the fossil fuel
scenarios, CO2 emissions will increase rapidly over the reference scenario. Moreover, faster
penetration of renewable energies than REN is necessary to satisfactorily reduce CO2 emissions until
2040. After 2040 when the percentage of renewable energy supply goes above the fossil fuels, then
only the emissions reduction impacts are observed. Therefore, renewable energy supply is one of
the key controlling factors of GHG emissions in Japan.

Total CO2 emissions comparison
1250.0 REF
Million ton
1200.0 FFS-LR
1150.0 FFS-SR
1100.0 REN
2010 2020 2030 2040 2050

Fig.7: CO2 emissions under different scenarios

Preliminary conclusions 1
Japan may go forward with no-nuclear option but the financial burden of system development
will be generated. It appears that use of existing facilities to full capacity can reduce the
additional investment burden in the short run. Renewable energy scenario is expected to have
much lesser financial impact.

Japan needs to develop its base load alternatives like geothermal and tidal to substitute nuclear.
Solar and Wind appears intermittent compared to nuclear power supply. More aggressive
renewable energy policy is required.

Retail power price is expected to increase under both the scenarios. Fossil fuel scenarios will
increase the crude and gas import burden and subsequent cost of supply.

Primary energy prices are expected to shoot-up in the short run due to sudden surge in demand
and lack of supply. However, the prices are expected to fall gradually.

Japan needs to commercialize its geothermal potential to reduce the environmental impact of
non-nuclear supply portfolio. Geothermal and tidal seems to be viable as alternative to massive
replacement of base load nuclear power.

In the short-run LNG (liquefied natural gas) import increases with increase in NG (natural gas)
based power generation. Coal is expected to be dominating the supply under no nuclear
scenario at least until 2050.

Japan needs to develop the CSP (concentrated solar power) technology for grid connected solar
supply enhancement. So far roof-top standalone PV is predominant.

This result and conclusions are preliminary in nature and should be used as indicative figures. Any part of the
document should not be quoted without author‚??s permission.

Lunch¬ Session,¬ 26¬ July¬ 2011

Local¬ Energy¬ Solutions
(„?®„?ć„?ę„?ģ Áģ°Áź?„Āę„Ā?„Ā?„??Ś?įŚ??„Āģś?ļś?ßÔľ?

[¬ Moderator¬ ]¬ Prof.¬ Hidefumi Imura šļ?śĚ?Áß?ś??
[ ]
Senior¬ Policy¬ Advisor,¬ IGES¬ /¬ Professor,¬ Yokohama¬ City¬ University

Mr.¬ Kazuhiko¬ Kobayashi¬ ŚįŹś??šł?ŚĹ¶Ôľ?Ś??šĻĚŚ∑?Śł?Ôľ?
Executive¬ Director,¬ Office¬ for¬ Environmental¬ Future¬ City¬ Promotion,¬ Environment¬ Bureau,¬ City¬ of¬ Kitakyushu
M M t N b t ki šŅ°ś??ś≠£šļļÔľ?ś®™śĶ?Śł?Ôľ?
Mr.¬ Masato¬ Nobutoki
Director¬ General,¬ Climate¬ Change¬ Policy¬ Headquarters,¬ City¬ of¬ Yokohama
Mr.¬ Kentaro Yamaguchi ŚĪĪŚŹ£ŚĀ•Ś§™ť??Ôľ?Á•?Ś•?Ś∑ĚÁ??Ôľ?
Director,¬ Photovoltaic¬ Power¬ Generation¬ Promotion¬ Division,¬ New¬ Energy¬ and¬ Global¬ Warming¬
Ph liP G iP i Di i i NE d Gl b l W i
Countermeasures¬ Department,¬ Environment¬ and¬ Agriculture¬ Bureau,¬ Kanagawa¬ Prefectural¬ Government
Mr.¬ Shigeru¬ Inoue šļ?šł? ś?źÔľ?Ôľ?ś ™Ôľ?šł?ŤŹĪŚ?įś??Ôľ?
Deputy General Manager City Planning Project Mitsubishi Estate Co Ltd
Deputy¬ General¬ Manager,¬ City¬ Planning¬ Project,¬ Mitsubishi¬ Estate¬ Co.,¬ Ltd
Mr.¬ Tsunehiko Nakagawa šł≠Ś∑ĚśĀ?ŚĹ¶Ôľ?Ôľ?ś ™Ôľ?ś?•Á?£Ť?™Ś??ŤĽ?Ôľ?
General¬ Manager,¬ Planning¬ and¬ Advanced¬ Engineering,¬ Development¬ Division,¬ NISSAN¬ MOTOR¬ CO.,¬ LTD.
Local¬ Energy¬ Solutions:¬ Background¬ and¬ Objective
Energy,¬ Environment¬ and¬ Economy Ôľ?„?®„?ć„?ę„?ģ„?ľ„?ĀÁ?įŚĘ?„?ĀÁĶ?śł?„Āģ„??„?™„?¨„?≥„??Ôľ?
‚?ź How¬ can¬ we¬ resolve¬ the¬ tri‚?źlemma,¬ after¬ Fukushima? Ôľ?Ś??Á?ļšļ?ś??„??ŚŹ?„Ā?„Ā¶Ôľ?
‚?ź Energy:¬ Less¬ dependence¬ upon¬ nuclear¬ energy,¬ More¬ renewable¬ energy¬
‚?ź Environment:¬ De‚?źcarbonization,¬ low‚?źcarbon¬ cities,¬ low‚?źcarbon¬ society
‚?ź Economy:¬ Green¬ economy/green¬ innovation,¬ ¬ ¬ recovery¬ and¬ reconstruction
y y/g , y

Local¬ Energy¬ Solutions:¬ ¬ Challenges¬ and¬ Opportunities¬ for¬ Local¬ Communities
Good practices and policies Ôľ?Ś?įŚ??Á?ļ„ĀģśīĽŤ∑ĮÔľ?
Good¬ practices¬ and¬ policies
‚?ź Low‚?źCarbon,¬ Smart¬ Cities¬ ‚?ź‚?ź‚?ź Smart¬ grids,¬ smart¬ meters,¬ BEMS,¬ HEMS,¬ CEMS
Ôľ?šĹ?Á?≠Áī ť?ĹŚł?„?Ā„?Ļ„??„?ľ„??„?∑„??„?£„?Ā„?Ļ„??„?ľ„??„?į„?™„??„??„?Ā„?Ľ„?Ľ„?ĽÔľ?
‚?ź Community based approach: Collaboration among local stakeholders
Community‚?źbased¬ approach:¬ Collaboration¬ among¬ local¬ stakeholders¬
‚?ź Concerted¬ actions¬ with¬ enterprises¬ (especially,¬ SMEs)¬ and¬ households¬ ¬
‚?ź Deployment¬ of¬ local¬ energy¬ sources Ôľ?„?®„?ć„?ę„?ģ„?ľ„ĀģŚ?įÁ?£Ś?įś∂?Ôľ?
‚?ź Reduction¬ of¬ peak¬ energy¬ consumption¬ during¬ summer¬ (šĽ?Ś§Ź„ĀģÁĮ?ť?ĽÔľ?
di f k i di (šĽ?Ś§Ź„ĀģÁĮ?ť?ĽÔľ?

Further¬ Discussions
‚?ź Short,¬ Medium¬ and¬ Long¬ Term¬ Actions Ôľ?Á?≠ś??„?Āšł≠ś??„?Āť?∑ś??„ĀģÁ?ģś®?„Ā®Ť°?Ś??Ôľ?
‚?ź International¬ Transfer¬ of¬ Knowledge¬ and¬ Technology Ôľ?Ś?Ĺť??Á??„Ā™Ť¶?ť??Ôľ?
Local¬ Energy¬ Solutions:¬ Discussion¬ Issues¬ Ôľ?Ťę?Á?ĻÔľ?
ÔĀģ Finance¬ (Ť≥?ť??Ôľ?
Information¬ Sharing¬ about¬ New¬
‚?Ę More Subsidies +
More¬ Subsidies¬ +
Ideas and Ongoing Projects and
Ideas¬ and¬ Ongoing¬ Projects¬ and¬
‚?Ę Mobilization¬ of¬ Private¬ Money
ÔĀģ Institution Ôľ?Ś?∂Śļ¶Ôľ?
ś??Ś Ī„ĀģŚ?Īś??
‚?ĘB i
Barriers¬ and¬ Reform
dR f
‚?Ę RPS¬ (Renewable¬ Portfolio¬ Standard)
‚?Ę Energy¬ Market¬ Reform¬ (Separation¬ of¬
Systematic¬ Approach¬ Based¬ on¬ Local¬
Power¬ Generation¬ and¬ Distribution)
Knowledge¬ and¬ Achievement ť?ĀÁ?ļť?ĽŚ??ť?Ę
Ś?įŚ??„ĀģÁ?ļś?≥„ĀęŚ?ļ„Ā•„ĀŹšĹ?Á≥ĽÁ??ŚŹ?ÁĶ?„ĀŅ ‚?Ę TGC¬ (Tradable Green¬ Certificates),¬
Renewable¬ Energy¬ Certificates
ÔĀģ Technology Ôľ?ś??Ť°?Ôľ?
‚?Ę Renewable Energy,¬ New¬ Energy
‚?Ę Innovation¬ for¬ technical¬ breakthroughs
Clearer¬ Visions¬ and¬ Policies
Clearer Visions and Policies
‚?Ę Smart¬ grid,¬ EVs, Battery,¬ ‚?ź‚?ź‚?ź
Local¬ Energy¬ Solutions

Economy Centralized vs Decentralized
Centralized¬ vs.¬ Decentralized¬
ÁĶ?śł? Approach
Less¬ Dependency¬ upon
Fossil¬ Fuels
Less¬ Dependency¬ upon
Less Dependency upon
N Nuclear¬ Energy
Technology¬ &¬
Social¬ Reform
„?®„?ć„?ę„?ģ„?ľ Renewable¬ Energy¬

Energy¬ Saving

Further¬ Debate¬ Continues¬ to
IGES‚?źYokohama¬ City¬ Joint¬ Seminar¬ on¬ Low¬ Carbon¬ and¬ Smart¬ Cities¬ (Part¬ 1)
IGES‚?źś®™śĶ?Śł?Áę?Ś§ßŚ≠¶Ś?ĪŚź?„?Ľ„??„??„?ľÔľ?šĹ?Á?≠Áī ť?ĹŚł?„?Ľ„?Ļ„??„?ľ„??„?∑„??„?£ Ôľ?

ÔĀģ Dr Shobhakar Dhakal:
Dr.¬ Shobhakar Dhakal:¬
‚?? Role¬ of¬ Cities¬ in¬ Climate¬ Policy
ÔĀģ Ms Yoko Maki Á?ß Ť??Ś≠źÔľ?Ś∑ĚŚī?Śł?Ôľ?Ôľ?
Ms¬ Yoko¬ Maki
‚?? Carbon¬ Challenge¬ by¬ the¬ City¬ of¬ Kawasaki
ÔĀģ Dr. Kanako Tanaka Á?įšł≠Ś? Ś•?Ś≠źÔľ?Ôľ™Ôľ≥ÔľīÔľ?:
Á?įšł≠Ś? Ś•?Ś≠źÔľ?Ôľ™Ôľ≥ÔľīÔľ?:¬
Dr.¬ Kanako
‚?? Information¬ Network¬ for¬ Blackout¬ Prevention
ÔĀģ Dr.¬ Hidefumi Katayama Á??ŚĪĪÁß?ŚŹ≤Ôľ?Ôľ©ÔľßÔľ•Ôľ≥):¬
y )
‚?? Life¬ Energy¬ Management¬ ¬ Strategies
ÔĀģ Dr.¬ Leena Srivastava:¬
‚?? Indian¬ Energy¬ and¬ Environmental¬ Perspectives¬
Discussion Paper: Building Resilient Societies

Prepared for the plenary session on building resilient societies at the International
Forum for a Sustainable Asia-Pacific (ISAP) 2011 held in Yokohama, Japan

Henry Scheyvens (IGES), Hideyuki Mori (IGES), Robert Kipp (IGES), Shinano
Hayashi(IGES), SVRK Prabhakar(IGES), Izumi Tsurita (IGES), and Masanori Kobayashi
July 26, 2011

The purpose of this draft of the discussion paper is to frame the discussions that will
take place in the Resilient Societies Plenary Session in the International forum for
Sustainable Asia and the Pacific (ISAP) in July 26, 2011. The discussions will later be
reflected in this paper and IGES will publish it as one of the outputs of ISAP 2011.

This discussion paper begins by looking at the only international agreement on
disaster risk reduction, the Hyogo Framework for Action, and considers the review
of progress made on this agreement in light of the current situation facing Japan ‚??
the so-called East Japan Great Earthquake/Tsunami (EJGET). In the discussion the
question is raised as to what is a resilient society ‚?? in particular in the context of
modern development and technological advances. Cases are given drawing on
recent fieldwork carried out in the areas most severely affected by the triple
disaster in Japan (tsunami, earthquake, nuclear) which provides a backdrop for the
deeper discussion on building resilience to extreme events and making resilience a
part of the recovery and rebuilding process.

1. The need to invest more in building disaster resilient
Globally, the frequency and magnitude of catastrophic disasters is projected to
increase. The series of disasters in eastern Japan that the nation is now grappling
with highlight the need and urgency for greater attention towards building disaster
resilience through national and sub-national policy and planning.

Just a few weeks after the 2004 Indian Ocean tsunami the World Conference on
Disaster Reduction was held in Hyogo, Japan. The main output from that meeting
was the Hyogo Framework for Action 2005-2015: Building Resilience of Nations and

Communities to Disasters, a comprehensive and systematic guidance document to
strategically reduce disaster losses which was endorsed by 168 member states in
2005. The Hyogo Framework for Action (HFA) builds on a previous document, the
Yokohama Strategy, and was the first document of its type to be developed and
agreed upon internationally on disaster risk reduction. With the expected outcome
of ‚??the substantial reduction of disaster losses, in lives and in the social, economic
and environmental assets of communities and countries‚?Ěi the HFA outlines five
priorities for action:
1. Ensure that disaster risk reduction is a national and a local priority with a
strong institutional basis for implementation.
2. Identify, assess and monitor disaster risks and enhance early warning.
3. Use knowledge, innovation and education to build a culture of safety and
resilience at all levels.
4. Reduce the underlying risk factors.
5. Strengthen disaster preparedness for effective response at all levels.

The 2009-2011 HFA progress review shows increasing attention to risk identification,
preparedness, and monitoring; in addition the HFA and associated processes have
contributed to creating a common language and understanding of the key
components of disaster risk management.ii However, across income levels and
regions achievements have been much slower or even regressing in addressing the
underlying risk drivers, developing governance structures and institutions, and in
using education and knowledge to build a culture of resilience. The result is an
impaired ability to prepare for and respond to disasters, often as a result of disaster
risk management being spread across multiple ministries or located in institutions
with little resources or power to influence change to address extensive and
intensive disasters.

Extensive risk develops through mainly localized but frequently occurring disasters
spread across a country or region and are often related to climate variability such as
flooding in Bangladesh.iii In the case that a particular area is subject to infrequent
but highly destructive disasters with relatively greatly lose of human life, the
intensive risk of the area is said to be high (Ibid.). The Haiti earthquake in 2010 which
resulted in almost 500,000 casualties and 1.2 million displaced persons,iv and the
triple disaster in Japan which resulted in almost 25,000 dead or missing and over
100,000 displaced personsv are recent examples of intensive disasters.

Natural disasters can be classified as biological, geophysical, hydrological,
meteorological and climatological. There is potential for the human toll and
economic costs of all of these to increase. Due to climate change, some areas are
likely to become more vulnerable to biological disasters, such as insect infestation.
The series of disasters in eastern Japan and the recent series of earthquakes in
Christchurch, New Zealand remind us that developed countries are not immune to
geophysical events such as earthquakes and volcanic eruptions, though deaths are
likely to be greatest in countries experiencing rapid, unplanned urbanization, such
as Haiti, vi where 222,570 deaths were reported from the January 12th 2010
earthquake.vii Hydrological disasters such as flooding are projected to increase in
some areas because of climate change, but experiences in China, the Philippines and
other countries of the region show that environmental degradation, e.g. reduced
forest cover in upper catchments, also contributes to the frequency and scale of
these disasters. The summer heat wave in Russia in 2010 responsible for wildfires
that destroyed a third of the wheat crop and that caused up to 56,000 deathsviii
was an example of an abnormal weather event, many of which have been reported
from around the globe in recent years. These provide signals of the increasing
frequency and severity of meteorological disasters (storms) and climatological
disasters (extreme temperature, drought and wildfire) that are projected due to
climate change.

Due to better preparedness and recovery planning made possible in part by
economic growth, over the past 40 years mortality risk from natural hazards has
been decreasing; however economic growth has not resulted in lowered economic
loss from natural hazards.ix From the 1970s to 2008 while the number of fatalities
from disasters significantly decreased, world economic losses due to natural
disasters has been steadily ‚?? and often times sharply- rising.x However these losses
only account for the direct physical impacts of disasters ‚?? the long term affects on
the local economy in a case such as the recent disasters in Japan could result in
significant impacts on Japan‚??s economic outlook in addition to their energy future ‚??
and that of other countries which have included nuclear energy as a major part of
their energy mix. In terms of extensive disasters the impacts have been greater in
lower income countries and those with governance issues, but as the recent
incidents in Japan shows new vulnerabilities can arise as a result of the complexities
and interdependencies created in technologically advanced, modern, higher-income
countries if resilience is not reassessed in terms of the new development context.
Without suitable governance and institutional arrangements risk can actually be

constructed rather than mitigated through development, regardless of the size of
the economy or system of government.

The interconnectedness of development, technology, and disaster risk raises
questions as to the resilience and vulnerability of societies ‚?? not just developing
societies, as has been the primary focus of discussions on these two factors, but
also the resilience and vulnerability of modern ‚??developed‚?Ě societies in the face of
intensive risk, partly as a result of technology and Infrastructure development, and
increasing extensive disasters due in part to climate change, the so called
‚??emerging risks‚?Ě.

Globally, the number of natural disasters and their costs are increasing
The EJGET is set against a
backdrop of upwards trends in the
number of global disasters
reported and the costs of their
impacts. As reported on the
International Disaster Database
EM-DAT, which is maintained by
the Centre for Research on the
Epidemiology of Disasters (CRED),
2010 was the deadliest year in at
least two decades for natural
disasters. CRED reports that in
2010 some 385 natural disasters
killed more than 297,000 people
worldwide, affected more than 217
million others and caused damages
Time trend of
to the tune of US$124 billion.xi Asia
reported natural
is particularly vulnerable. From
disasters, 1975-2010.
2000-2009, almost 85% of global
deaths from natural disasters Source: UNISDR. Undated.
occurred in the region. xii These 2010 Disasters in Numbers.
upward trends are set to continue
due to unplanned urbanization,
environmental degradation and climate change.

What is a disaster resilient society?
Until the EJGET, Japan was presented as an example of a resilient nation, well
advanced in mitigating and bouncing back from natural disasters. The magnitude of
the EJGET, however, was not planned for. With a large population, much of whom
resides on the coastal plains and fringes, a modern economy in which production
chains are spread across the country (and globally), and with a centralised domestic
energy system, Japan found itself vulnerable to this catastrophic event. Already,
central and local governments are discussing a range of practical solutions, but
these specific solutions need to be underpinned by a shared vision of what a
disaster resilient society looks like, and a set of principles for building disaster
resilience into the recovery process.

As Brenton Prosser and Colin Peters point out, it can be difficult gaining agreement
amongst policy makers on what resilience actually means.xiii Nevertheless, there
appears to be enough common ground to build policy.xiv

Put simply, a disaster resilient community can be defined as ‚??the safest possible
community that we have the knowledge to design and build in a natural hazard
context‚?Ěxv ‚??minimizing its vulnerability by maximizing the application of disaster
risk reduction measures‚?Ě. xvi The expressions ‚??safest‚?Ě and ‚??minimizing its
vulnerability‚?Ě are important. We cannot complete insulate our communities from
natural disasters. We cannot conquer the more powerful forces of nature, and
indeed this has been a painful lesson from the EJGET.

In terms of the disaster management
cycle, which consists of disaster
prevention (mitigation and Disaster
preparedness), response, and recovery
and reconstruction, a disaster resilient
society is one that ‚??mitigates and
prepares for the possibility of natural
disasters, is able to deliver quick and
Recovery and
effective emergency assistance to Response
victims, and is capable of a smooth
transition to implementation of
recovery and reconstruction.‚?Ěxvii

There are several concepts that are useful for understanding disaster resilience.
First is the notion that resilience consists of a number of elements: Robustness ‚??
inherent strength, resistance; Redundancy ‚?? system properties that allow for
alternative options, choices, substitutions; Resourcefulness ‚?? capacity to mobilise
resources; and Rapidity ‚?? speed with which disruption can be overcome and
services, income, etc. restored.xviii

Second is the notion of ‚??resilience domains‚?Ě. These are: Technical ‚?? physical
systems ‚?? location based and distributed critical facilities; Organization ‚?? attributes,
dynamics of organizations and institutions; Social ‚?? attributes, dynamics of
communities and populations; and Economic ‚?? attributes, dynamics of
organizations and institutions. xix In Japan, perhaps too much emphasis and
confidence has been placed on the technical domain, i.e. engineering feats designed
to protect communities and Infrastructure from natural hazards, and too little on
organizational, social and economic domains.

The concepts of levels and scope of preparedness are also important. The literature
on disaster resilient communities focuses on the local level, and discusses the
broader context for community resilience in terms of ‚??enabling conditions‚?Ě.
However, in a highly integrated economy, such as Japan, the EJGET teaches us that
resilience requires the state to provide more than just enabling conditions for local,
community-level resilience. Disaster resilience at the national level requires a
whole-of-government approach that builds disaster resilience into the national
economy. The EJGET has taught us that in Japan even energy policy must be
considered in the design of national disaster mitigation strategies.

Facing once in hundreds of years natural disaster, the society which can minimize
the damage and return normal as soon as possible, is sustainable. Above all,
building resilient society means nothing more or less than establishing sustainable

Principles for building disaster resilient society
In his reflection on the series of disasters in eastern Japan, Professor Ryokichi Hirono
proposes a set of principles relevant to building disaster resilience in Japan using the
concept of the 4H‚??s (Horizon, Head, Hands, Hearts).xxii

He discusses horizon as the need for ‚??national and local visions of long-term
development of all regions of the country‚?Ě, with a particular emphasis on areas
previously affected by catastrophic disasters. Here, a scenario approach to natural
and man-made disaster prevention and impact minimization that lays out
cost-effective alternatives would be useful.

Heads, he explains, refers to:
Immediate and early drafting by local governments on the basis of the closest
consultation among the people in the [disaster affected areas], with assistance and
support of central government, of immediate, short-,medium- and long-term measures
to be taken by individuals, communities and all the other stakeholders, to prevent and
minimize the adverse impact of all disasters, all of which requires the following: i)
strong political leadership at the top, ii) transparency of public information and
accountability of local and central governments to all stakeholders, iii) closest possible
cooperation and collaboration among all stakeholders; iv) clear definition of the
responsibilities of all stakeholders, particularly the roles of local and national
governments, v) cross-sectoral coordination and integration among sectors and
government ministries and departments, e.g. agriculture, fishery, forestry,
manufacturing, power, transportation , communication, finance, services, housing,
health, education, welfare, security and armed forces, etc.xxii

Hands, Professor Hirono explains, is about mobilising all traditional and recent
knowledge and experiences, as well as generating new knowledge, through public
participation and expert analysis to prevent and mitigate both natural and man-made

Hearts is about:
Involving all stakeholders in the decision-making processes related to disaster
prevention and impact minimization through: i) basic education at school and in
communities, ii) practical skill training and exercises at all levels, c) inculcating of the
sense of ownership and participation among all citizens in local communities.xxii
Although Professor Hirono‚??s discussion is specific to Japan, many of the principles are
generic and have broad application.

Japan faces its most severe crisis and largest reconstruction effort since
Just before 3pm on 11 March 2011, at a magnitude of 9.0 Mw one of the largest
earthquakes since modern recording began occurred off the eastern coast of Japan.
With its epicenter approximately 72 km east of the Oshika Peninsula, the
earthquake generated a massive tsunami that breached and washed over wave
barriers and destroyed entire towns on Japan‚??s eastern coast. Analysis later showed
that the tsumami was over 20 ‚?? 30 meters in some areas.

Magnifying the scale of the disaster, the tsunami also washed over wave defenses
protecting the Fukushima I and II Nuclear Power Plants, destroying reactor cooling
systems at the No. 1 Plant and triggering a meltdown in three of its reactors.
Hydrogen explosions destroyed the storage chambers of two reactors. On 12 March
2011, the Government ordered residents within 20km of the Fukushima power
plants to evacuate. A scheduled evacuation order was released for some villagers
located in the 20 ‚?? 30 km zone. Other areas in the 20 ‚?? 30 km zone were designated
as ‚??emergency evacuation preparation areas‚?Ě.

The impacts of the EJGET have been enormous and a massive humanitarian relief
effort involving government, civil society and international support is now
underway. 15,550 deaths, 5,688 injured, and 5,344 people missing have been
confirmed.xx Almost half a million houses and buildings were totally or partially
destroyed, xxi and more than 130,000 people have been placed in temporary
shelters. The survivors have experienced shortages of food, water, shelter,
medicine and fuel. Prime Minister Kan described the aftermath of the EJGET as the
most difficult crisis that Japan has faced since the Second World War. With the
Government setting aside US$48.5 billion in emergency spending as a first step,
Japan‚??s largest reconstruction effort since the War is now underway.

As a mountainous island nation located on the ‚??Pacific Rim of Fire‚?Ě in one of the
most tectonically active parts of the world, and with a climate that features both
typhoons and heavy snowfalls, Japan is used to natural hazards, whether
earthquakes, tsunamis, floods, or landslides. Japan has built up a certain degree of
resilience to these and, in fact, people from around the world have travelled to
Japan to study the lessons it has learned and its technological advances on disaster
preparedness. New Zealand, for example, is interested in learning from Japan on
how to reconstruct the city of Christchurch, which was badly damaged by a series of
earthquakes beginning in September 2010.

While Japan continues to struggle with the resulting humanitarian and nuclear crisis,
discussion has already begun on how to build a more disaster resilient society. In a
press Conference on 01 April 2011, Prime Minister Kan presented an ambitious vision
for reconstruction:
We must then begin preparations toward reconstruction. In fact, we will go beyond
mere reconstruction, creating an even better Tohoku and even better Japan. We

are moving forward with the creation of a reconstruction plan that has this big
dream at its core. I have received many opinions over the telephone from the
mayors of each city, town and village in the disaster-stricken area. These opinions
will be incorporated into the plan for instance, in some areas we will level parts of
mountains in order to create plateaus for people to live on. Those residing in the
area will then commute to the shoreline if they work in ports or the fisheries
industry. We will create eco-towns, places which use biomass and plant-based fuel
to provide natural heating. We will outfit cities with Infrastructure to support the
elderly. We aim to create new kinds of towns that will become models for the rest
of the world.

The Cabinet Office established the multi-stakeholder reconstruction planning
council (officially named ‚??The Reconstruction Design Council in response to the
Great East Japan Earthquake‚?Ě). The Council held 12 meetings over three months and
adopted an action plan that underscores the need to promote reconstruction driven
by the local communities. Disaster preparedness and wider use of renewable energy
were also highlighted as guiding principles. Each prefecture and city has also formed
reconstruction committees.

Case study: Rikuzentakata, Iwaki Prefecture
Rikuzentakata, a city located on the coast in Iwaki Prefecture, is one of the tsumami affected areas.
The city‚??s death toll was 1,087 with 704 people recorded missing as of May 2011, out of a total
population of 24,246. Economic damages included 3,159 houses completely destroyed; 1,368 fishing
boats destroyed (the loss valued at 6.4 billion yen); seaweed and shellfish farming facilities
destroyed and fish products damaged; damage to the harbor to the tune of 3.5 billion yen; livestock
farms destroyed in two places (3 million yen); horticulture destroyed in 99 places (77.4 million yen);
and 336 ha of rice paddy inundated (7.1 billion yen). The number of persons evacuated reached
10,143 and as of May 2011 49 evacuation shelters were operating. The temporary housing is being
developed, with 2,200 units expected to be available.
In Rikuzentakata, about 10 fishery ports were operating before disaster. One contentious issue is
whether to restore all the ports or consolidate them into a few that will be reconstructed. Funds
are limited but the local fishermen are generally against privatizing the ports. The fishermen prefer
to maintain schemes based on fishing rights that are in the form of collective fishstock/marine
resource management. The current reconstruction financing is bound to support the restoration of
the previously existing Infrastructure, and is not designed to support the rationalization or
consolidation of Infrastructure systems. Private partnerships have also been considered, for
instance, to support oyster framing restoration in Miyagi. However, this is closer to philanthropic
donations rather than investment, and the volume of financing is still far below actual needs.

2. Building resilience to contend with extreme events
(infrequent, catastrophic disasters)
Building resilience for infrequent, catastrophic disasters needs special attention.
Economic imperatives may lead to a playing down of the risks and likely
consequences of extreme, irregular events, though Professor Ryokichi Hirono
argues that that Japan should have been prepared for the EJGET and provides a list
of previous large-scale events that pointed to the possibility of this type and scale of
geophysical event.xxii

Restoration of inundated and salinity affected paddy lands
Restoration of inundated and salinity affected paddy lands is another important task in the
reconstruction process in the aftermath of the EJGET. Farmers face financial and physical
constraints to restore damaged paddy land and farms. Options that have been suggested
include removing saline soil and replacing it with deeper lying unaffected soil or soil from other
areas. Phytoremediation ‚?? the treatment of environmental problems by growing plants ‚??such
as rice, sunflower and rape/colza has been suggested. However, once paddy land is converted
to farmland, it would take years to convert the farmland back to paddy land. The pros and cons
of these proposals need further assessment.

Extreme events are sometimes labelled ‚??black swans‚?Ě. They are events that are
outside of normal expectations as past experience does not suggest their likelihood
of occurrence. Human memory may not span sufficient generations to ensure that
lesson from the history of extreme events is incorporated into today‚??s planning and
decision-making, or there simply may be no past human experience of a similar
event. Even when there is living memory, the profit motive or competing demands
on public funds may lead to avoidance of the costs for preparing for infrequent

A lesson from the EJGET is that human engineering feats that aim to obstruct the
forces of nature cannot protect against the most powerful natural phenomena.
Wave barriers have, in the past, successfully protected parts of Japan from tsunamis
and will continue to do so for more frequent events of average magnitude. But this
type of engineering solution can lull people into a false sense of security, with
potentially very high human and economic costs, as we have witnessed with the
EJGET. The discussion in Japan has turned to the organizational, social and
economic domains of disaster resilience.

Case study: Inter-community relief
The value of inter-community support during the relief and recovery stage has been
observed in the aftermath of the EJGET as well as disasters in other countries. As national
and prefectural (state) governments must cover all areas directly impacted by the EJGET
and because of their internal rigidities, they have found it difficult to supply timely relief
on a priority basis. Community-to-community relief has been observed as more flexible
than the vertical relief channel of national government to local community.
When a community not directly impacted by the disaster is coupled with a disaster
affected community to provide relief, the relief work can be better focused and thus
more effective. When organizing relief in the aftermath of the Sichuan earthquake, the
Chinese central government paired disaster affected communities with communities in
unaffected areas. The unaffected communities competed between themselves to assist
their counterpart communities, and this unconventional approach of inter-community
relief aid worked successfully.
In Japan, inter-community relief gained popularity after the Hanshin earthquake in 1995.
After the EJGET, relief was provided by various communities and municipalities; from
both inside the disaster affected area (Tono City, Kurihara City, etc.), and outside the area
(League of Kansai Municipalities, Suginami Ward, etc.).
Tono City, located in Iwate Prefecture, where the impacts of the earthquake and tsunami
were particularly severe, was relatively unscathed and became a relief supply center for
non-governmental organizations (NGOs). An advantage of this inter-community aid was
that Tono City is close to the devastated areas, which facilitated information collection
and logistics. This is somewhat of an unusual example as in a widely damaged area it is
difficult to find less affected communities that can extend a helping hand. Communities
further removed from the disaster affected areas can also provide important support,
however. Suginami Ward in Tokyo and the Unions of Kansai Governments (UKG) are
good examples. Suginami Ward and other cities have long relationships with Minami
Souma Cho, one of the areas affected by radiation from the Fukushima Daiichi Nuclear
Power Plant, as sister cities. Suginami ward used its inter-municipality network to provide
relief assistance to Minami Souma Cho while UKG sent water and sewerage technical
teams to the area.
A challenge in organizing inter-community relief aid is coordination. Matching affected
and unaffected cities to ensure that the relief provided is based on needs can take time,
though sister city affiliation certainly facilitate this process. In Japan, further thought is
now required on how government can encourage inter-community relationships as part
of a process of building more effective channels to provide relief in the aftermath of

3. Building resilience into recovery and reconstruction
In the aftermath of a catastrophic disaster, decisions will be taken that have
long-term consequences. At an early stage there is a need to identify effective
processes for ensuring that resilience building is integrated into the recovery and
reconstruction process, so that the impacts of future natural hazards are better
mitigated and societies more able to cope with these. Disaster management
planning should provide a framework for making informed decisions in a time of
chaos and uncertainty, as well as direct decision-makers towards the longer term
goal of disaster resilience.

Diagram below presents holistic approach for recovery from catastrophic disasters.
It lays out a general governance structure for building resilient society by taking a
multi-level, multi-stakeholder scheme. There are many stakeholders involved;
nonetheless, it is necessary for each of them to conduct actions which can be
delivered most efficiently. For instance, national government should provide
atmosphere where local stakeholders can play active roles such as providing funds,
decentralizing authorities, creating special economic zone, etc.

At the local level, local government needs to know community specific demand of
assistance, and implement policies. At the same time, options and tools ‚??
regulatory (e.g. land use zoning) and non-regulatory (e.g. the acquisition and
setting aside of hazard-prone lands) ‚?? should be set out and their costs and benefits
closely studied. Relief aid conducted by NPOs and private companies is important
as well as that of other municipalities. Coordination of these stakeholders‚??
activities is crucial, since national and prefectural governments cannot flexibly
correspond various needs in local areas. Challenging task is to maintain consistent
relief aids from these stakeholders; therefore, national government should set
environment to facilitate endurable voluntary relief from different kinds of

Renewable energy promotion in Kuzumaki Town
Kuzumaki Town is a leading locality in promoting renewable energy. Based in the mountainous
area in Iwate Prefecture, Kuzumaki produces far more energy through its wind turbines, wood
chips and bark, and cow dung than it consumes and sells the surplus to the local power
company. The success of Kuzumaki can be attributed to its entrepreneurial mayor and
ingenious staff of the town office trained in the leading dairy farm, Koiwai. Kuzumaki was
successful in obtaining subsidies from the government. On the other hand, it also faces some
constraints in expanding renewable energy. The local power company has a quota to buy
renewable energy and it prevents the town from investing in renewables. The distance
between the site and settlement area makes it difficult to promote cogeneration and
household waste for biogas application.

4. Moving from linear to holistic thinking and
contemplating deeper structural reforms
Prosser and Peters explain that disaster resilience is characterized by its
‚??complexity, interactivity and interconnectedness‚?Ě that traditional linear policy
thinking, which is reductionist and works from policy to solution within ‚??tightly
defined conceptual modes‚?Ě, is unable to handle.xxiii They call for non-linear and
holistic policy approaches, which require disaster resilience to be the collective
responsibility of all members of society. The challenges are to facilitate both bottom
up and high level engagement, and implement the principle of subsidiarity to
promote local level flexibility within a strong national framework for disaster
resilience. xxiv This understanding leads to the definition of a disaster resilient
community as one that ‚??works together to understand and manage the risks that it
confronts, but is also aware of the responsibility of all levels of government.‚?Ěxxv

Resilience includes the ability to ‚??bounce back‚?Ě, but this should not be viewed as
merely returning to the way things were. Catastrophic natural disasters can
highlight structural weaknesses in societies that make them vulnerable to
large-scale natural hazard events. Deep structural reforms may be required, and the
aftermath of a major disaster may allow for discussion of reforms that otherwise
could not take place in ‚??normal‚?Ě circumstances.

Dealing with waste
Millions of tons of waste were generated by the EJGET that is now obstructing the
reconstruction process but might also provide opportunities. Basic separation of waste
has been undertaken, but this is not sufficient for final disposal. Biofuel production from
wooden waste has been suggested as one way to make constructive use of the waste;
however, this requires time for storing the waste and could interfere with
reconstruction processes. Creating wave/tide breaking woodlands on waste mounds or
using them for memorial parks have also been suggested, though the technical
feasibility of these proposals needs to be further examined.

The EJGET has shown that the belief that the preventive measures taken against
earthquakes and tsunamis at nuclear power plants were adequate was mistaken.
This has led to a deep review of the nuclear power policy in Japan. At the G8
Summit in France, Prime Minister Kan explained his government‚??s determination to,
as soon as possible, reduce Japan‚??s dependence on nuclear power by increasing the
use of renewable energy such as solar, wind and geothermal power to 20% of the
total electricity requirement of Japan by 2020. Will this be possible or ‚??enough‚?Ě?
What other deep reforms are necessary for building disaster resilience in Japan that
should now be on the discussion table? How can these reforms be embraced by a
future vision for a low carbon, resource efficient, and resilient Japan? These and
similar questions about deep reforms and a future national vision now need to be
placed on the discussion table. Determining who should participate in this
discussion and how it should be facilitated are equally important as deciding the
subject matter.

In light of these questions, and to facilitate discussion on solutions, the following
framework for rehabilitation in the Fukushima area of Japan near the damaged
nuclear power plant was created:

Approach to disaster areas in Fukushima should be different with others, since
effects of radioactive materials need to be considered carefully. The diagram
above lays out holistic approach divided into various levels. Considering
characteristics of the hazardous materials, compensation scheme is major part of
relief actions, including providing alternate lands for locals.

5. Conclusion and the way forward
The preceding sections have outlined major global issues facing policy makers and
other stakeholders facing disaster management challenges using the triple disasters
in Japan as a current case of risk, relief, and recovery. Globally the most outstanding
success factor has been a marked reduction in mortality-risk from disaster. Saving
lives is, for obvious reasons, of primary importance, but quality of life is also a
fundamental development and disaster management issue. Economic growth and
technological advances have added immeasurably to quality of life and changed the
social, political, and environmental landscape more rapidly in the past century than
any other period of time in history. However these advances have also opened up
new risks due in part to the human contributions to climate change generated by
our rapid growth, to remarkable technological advances such as nuclear energy,
and Infrastructure developed without sufficient planning for disaster risk. The latter
two situations are arguably made all the more troubling by poor governance and
institutional failures due in no small part to short-term thinking. The results of such
actions are more extensive and intensive risks suffered mainly by the most
vulnerable populations, and increasingly within more developed areas.

The sudden, shocking, and in some ways unexpected nature of the recent disasters,
in particular the triple disasters in Japan, are cause for deeper discussion on
vulnerability, risk, and the policy decisions that need to be made for building a
resilient and sustainable society.

UNISDR (United Nations International Strategy for Disaster Reduction Secretariat). 2007. Hyogo
Framework for Action 2005-2015: Building the Resilience of Nations and Communities to Disasters:
Extract from the final report of the World Conference on Disaster Reduction.
UNISDR (United Nations International Strategy for Disaster Reduction Secretariat). 2011. Global
Assessment Report on Disaster Risk Reduction. Geneva, Switzerland: United Nations International
Strategy for Disaster Reduction.
UNOCHA (United Nations Office for the Coordination of Humanitarian Affairs). 2010. Haiti situation
report 19. New York, USA: United Nations Office for the Coordination of Humanitarian Affairs.
Japanese Red Cross Society. 2011. Japan: Earthquake and tsunami. Operations Update n4., accessed 12 July 2011
vi, accessed 12 July 2011.
Guha-Sapir, D., F. Vos, R. Below and S. Ponserre. 2011. Annual Disaster Statistical Review 2010 ‚?? The
Numbers and Trends. Centre for Research on the Epidemiology of Disasters (CRED), Université
catholique de Louvain ‚?? Brussels, Belgium, p.1.
Ibid. p.25.
UNISDR. 2011.
Baritto. 2009. Disasters, Vulnerability and Resilience from a Macro-Economic Perspective, Lessons

from the Empirical Evidence. Background paper for the 2009 ISDR Global Assessment Report on
Disaster Risk Reduction.
Guha-Sapir, D., F. Vos, R. Below and S. Ponserre. 2011. p.1.
UNISDR. Undated. 2010 Disasters in Numbers., accessed 11 July 2011.
Prosser, B. and C. Peters. 2010. Directions in Disaster Resilience Policy. The Australian Journal of
Emergency Management, 25:3.
McAslan, A. 2009. The Concept of Resilience. Torrens Resilience Institute, Adelaide.
Geis, D.E. 2000. By Design: The Disaster Resistant and Quality-of-Life Community. Natural Hazards
Review 1(3). pp.151-160.
Twigg, J. 2009. Characteristics of a Disaster Resilient Community: A Guidance Note. University
College of London.
JICA. 2008. Building Disaster Resilient Societies: JICA‚??s Cooperation on Disaster Management. Japan
International Cooperation Agency.
Bruneau. M. and K. Tierney. Resilience: Defining and Measuring What Matters. Multidisciplinary
Center for Earthquake Engineering Research.
Japanese National Police Agency. 11 July 2011. Damage Situation and Police Countermeasures
associated with 2011Tohoku district - off the Pacific Ocean Earthquake., accessed 11 July 2011.
Hirono, R. 2011. East Japan Great Earthquake/Tsunami (EJGET) and Tokyo Electric Power Company‚??s
(TEPCO‚??s) Fukushima No. 1 Nuclear Power Plant Disaster (NPPD), 11 March, 2011: Lessons Learnt from the
EJGET and NPPD. Presentation at the PECC Seminar, Perth, W.A., Australia, 11-13 April, 2011.
Prosser, B. and C. Peters. 2010. p.10.
Ibid. p.11.
COAG. 2009. National Disaster Resilience Statement, Excerpt from Communiqué, Council of
Australian Governments, Brisbane, 7 December. Quoted in Prosser and Peters. 2010. p.11.

(Prepared for the International Forum for sustainable Asia and the Pacific 2011 in
July 26, 2011)

POLICY BRIEF June 2011 vol.12

Green Economy for Sustainable Development:
Japan should lead the policy shift towards global poverty alleviation

Policy Proposals

The present socioeconomic activities of developed countries are in excess of environmental
carrying capacity. Accordingly, the adoption of environmental taxes and payment for ecosystem
Satoshi Kojima
services (PES) schemes that reflect the consumption of ecosystems services and environmental
services on economic activities is required to establish a genuine green economy model that is
IGES Economy and
compatible with environmental carrying capacity of the Earth. The creation of such a model calls Environment Group
for shifting away from values that excessively seek convenience and reconsidering lifestyles de-
pendent on mass production and mass consumption.

In order to spread the advanced energy and environmental technologies of Japan to emerging
and developing nations eager to switch to green economy models, it is essential to carry out pre-
cise matching of needs, giving consideration both to Japan‚??s green innovation and to the green
economy models of emerging and developing countries. A detailed plan for international stan-
dardisation of technologies, regulations, norms and standards in the environmental field (in co-
operation with other Asian countries) is also urgently required. Kei Kabaya
Associate Researcher
In order to prevent policy on green economy from leading to green protectionism, efforts are nec-
IGES Economy and
essary to create mechanisms by which green economy policies promote sustainable production Environment Group
within exporting countries. This can be accomplished through the bilateral combination of green
certification and technology transfer to promote sustainable methods of production that fulfil the
conditions of green certification.

A framework to carry out effective green economy-related discussions that overcome the dif-
fering standpoints of countries must not be based on any uniform definition of green economy.
Rather, we must promote flexible approaches that allow countries to utilise not only their own
green economy policies but also those of others to achieve their priority goals, including poverty
eradication, while sharing a common objective: to shift to green economy on a global scale. Takashi Yano
Policy Researcher
IGES Economy and
(For further details on these proposals, please refer to p.6) Environment Group

Environmental Nation in the 21st Century, and policy
‚??Green economy‚?Ě draws considerable attention
and initiatives have been put into place toward form-
internationally. ‚??Green economy in the context of sus-
ing a green economy.
tainable development and poverty eradication‚?Ě will
feature as a key theme for the United Nations Confer-
The financial crisis of 2008 further raised the status
ence on Sustainable Development (UNCSD), to be
of green economy to the level of a major global issue.
held in Rio de Janeiro in 2012, marking 20 years since
As a means to overcome the financial crisis, many ma-
the Rio Earth Summit in 1992. The United Nations
jor industrial nations, including the US, the EU, Japan
Environment Programme (UNEP) has carried out the
and the Republic of Korea, have laid out green new
Green Economy Initiative since 2008, and released
deal policies focused on employment creation and
the Green Economy Report in February 2011 (UNEP
economic stimulus based on large-scale investment in
2011). The Organisation for Economic Co-operation
renewable energy and other green industries. While
and Development (OECD) launched the Green
the concept of a green economy has been highlighted
Growth Strategy in 2008, and green growth is set forth
as the theme for the 50th anniversary of its founding in as a method to stimulate economies based on growth
of green industries, there is also debate on interpret-
ing green economy as a shift from existing economic
models focusing on GDP growth to more sustainable
The concept of green economy is not new. It has
socioeconomic systems. Moreover, there are nega-
been advocated since the late 1980s to imply a bal-
tive arguments against the green economy concept of
ance between environment and economy. Further-
developed countries that are blessed with advanced
more, the report released by the World Commission
technological capacity and a wealth of funds and hu-
on Environment and Development (WCED 1987) in
man resources. Doubts have been raised on whether
1987, that put the concept of sustainable development
the concept can provide a prescription for sustainable
in the spotlight, also sparked debate on green econo-
mies.1 However, it was in the latter half of the 2000s development on a global scale that includes emerging
and developing nations.2
that the green economy concept began to attract its
current level of attention. At the Fifth Ministerial Con-
ference on Environment and Development in Asia and In this manner, while the green economy concept
the Pacific (MCED 2005), held in 2005 in the Republic holds great potential and has captured the interest of
of Korea, the Seoul Initiative on Green Growth was many countries and international organisations, the
adopted as a regional co-operation framework aimed lack of agreement on definition increases the risk of
at achieving a balance between environmental pres- convoluting the debate. This policy brief will explore
ervation and economic growth through methods such the debate regarding the green economy concept
as improvement of eco-efficiency. The Republic of within the UNCSD process, and will cover initiatives
Korea has since pursued green growth and a green in various countries from the perspective of advance-
economy with great fervour. President Lee Myung- ment of global sustainable development. It will also
bak, inaugurated in 2008, set forth ‚??low carbon and analyse Japan‚??s initiatives related to green economy
green growth‚?Ě as the national vision. Likewise, Japan and make a proposal on the vital role of Japan in link-
set forth the formation of a ‚??low carbon society,‚?Ě a ing green economy polices from developed countries
‚??sound material-cycle society‚?Ě, and a ‚??society in har- to global sustainable development.
mony with nature‚?Ě as the pillars of its Strategy for an

For instance, the work published as an introductory guide to environmental economics in 1989 by Pearce et al. (1989), that aroused a great deal of
interest, defined a green economy as an economy in alignment with sustainable development.
In this document, OECD member countries are referred to as developed nations, BRICS (Brazil, Russia, India, China and South Africa) as emerg-
ing nations, and all other countries as developing nations.


1 Trends in Debate on Green Economy within the UNCSD Process
emerging and developing countries and the potential
The two Preparatory Committee Meetings and one
for environmental policies to hinder equity of trade
Intersessional Meeting held by the UNCSD have
(green protectionism); the second category involves
played a key role in leading discussion on green
domestic issues, such as the decoupling of economic
economies. At the First Preparatory Committee meet-
growth from environmental burden and green taxation
ing held in May of 2010, definition and interpretation of
schemes including environmental taxes.
the concept of a green economy was the main subject
of discussion, and arguments both for and against
At the Second Preparatory Committee meeting held
the concept were revealed. Issues of concrete green
in March of 2011, attention focused more on concrete
economic policy and the outcomes expected from
issues, in particular international issues, rather than
UNCSD were also given the floor as framework for fu-
the definition of a green economy. The debate covered
ture debate took shape.
support for technology transfer, financial assistance
and capacity building for emerging and developing
At the subsequent First Intersessional Meeting held
nations, as well as avoidance of green protection-
in January 2011, a positive common recognition of the
ism in international trade. In this manner, the debate
green economy as a means to realising sustainable
on green economies within the UNCSD process has
development began to ferment. Debate on the content
changed course with each meeting, shifting from de-
of a green economy also began to take shape, and
bate on definition to more concrete issues, and from
became divided into roughly two categories. The first
discussion on domestic issues to international ones.
of these is international issues, such as support for

2 The Respective Positions of Countries on Green Economy Initiatives and International Debate
countries and developed nations. Many countries
Regarding initiatives towards a green economy, it is
are engaged in initiatives in waste management and
found that Japan purports formation of the three pil-
recycling in attempts to form sound material-cycle
lars (a ‚??low carbon society,‚?Ě a ‚??sound material-cycle
societies. Environmental labelling and green purchas-
society‚?Ě, and a ‚??society in harmony with nature‚?Ě). It is
ing initiatives have been carried out mainly in OECD
also clear from debate within the UNCSD process that
member nations, with Europe implementing the most
international interest lies in the areas of ‚??international
aggressive measures in this area. However even in
co-operation‚?Ě and ‚??green protectionism‚?Ě. Based on
Europe, where importance is attached to resource
these issues, this brief presents the following over-
efficiency, it is rare to find cases that utilise these
view of the respective positions of countries related to
measures to achieve a fundamental shift towards
policy and international debate on green economies.
systems based on environmental carrying capacity.
In response to calls to create societies in harmony
A glance at various countries shows that interest in
with nature, many countries carry out biodiversity
low carbon societies is on the rise. The stable sup-
conservation efforts or economic value assessment of
ply of energy, indispensable for economic activity,
ecosystem services. Aiming to measure the costs of
is an issue faced by most countries. The creation of
environmental burdens such as pollution and to reflect
low carbon societies requires a shift in energy source
economic value assessment of ecosystem services in
from fossil fuels to clean energy, which is less depen-
policy formation, the UN and World Bank have taken
dent on carbon. Plans and initiatives on the develop-
on a leading role in advancing the development of
ment and adoption of renewable energy in particular
green national accounting.
are gaining force in many countries. Improvements
in energy efficiency are one way of switching to low
carbon and are regarded as important in many Asian


neither an international treaty related to the formation
An examination on the progress of initiatives in vari-
of sound material-cycle societies, such as the Frame-
ous countries shows that of the three areas, relative
work Convention on Climate Change for low carbon
headway has been made in the formation of low car-
societies, nor international funding mechanisms re-
bon societies. This state is due to the vigour of private
lated to the formation of sound material-cycle societ-
industry activities. Namely, the low carbon market
ies. Another factor is the difference of geographical
has already been established and is closely related to
scopes. While global issues such as the reduction of
energy issues toward which private investments have
greenhouse gas emissions are relatively easily justifi-
actively been made. Measures aimed at the formation
able for international co-operation, the formation of
of sound material-cycle societies are both those that
societies in harmony with nature is an issue greatly in-
promote cyclic use of resources and those that control
fluenced by local conditions, and is difficult to address
and manage the toxic substances and waste formed
through international co-operation.
in course of resource use. While pricing mechanisms
function effectively for the former, adjustments based
Regarding green protectionism, there are fears that
on market mechanisms do not adequately function in
green certification and border adjustment measures
the case of the latter. Initiatives related to the forma-
could be used to protect domestic industries. Green
tion of a society in harmony with nature are insuffi-
certification is a method of awarding certification to
cient. Namely, the costs of restoring ecosystems and
products that meet environmental standards as a
the value of ecosystem services are neither necessar-
means to differentiate them from those that do not. If
ily reflected in the pricing of goods and services nor
based on the high environmental standards that follow
integrated into market mechanisms. National account-
developed nations‚?? technological capacity, green cer-
ing has drawn attention as an attempt to internalise
tification has the potential to hinder the exports of de-
these costs and values. However, mere comprehen-
veloping countries. Moreover, border adjustment mea-
sion of the state of environmental and ecosystem cap-
sures could potentially lead to excessive protection of
ital use is insufficient. The pressing issue remains as
domestic industries. Border adjustment measures aim
to whether these costs and values can be reflected in
to prevent decline in the international competitiveness
actual market prices through payment for ecosystem
of countries that have adopted climate change miti-
services (PES) or other schemes.
gation measures, such as carbon tax and emissions
trading schemes, in relation to countries that have not
In order to shift from the current brown economy to
adopted similar measures. They are a system for re-
green economy, funds and technology are essential
funding climate change mitigation costs on exports to
regardless of the stage of economic development.
countries that have not adopted measures or of taxing
Developing countries in particular, without sufficient
imports from these countries. The respective positions
funds and technology, have strongly asserted that
of major countries on border adjustment measures
developed countries should provide support. On the
are shown in Figure 1. With the exception of certain
other hand, while developed countries understand
countries, Annex I countries to the Kyoto Protocol
the necessity of international co-operation in creating
either support or favour these measures, while non-
green economies, and have promoted funding and
Annex I countries are opposed. In general, the figure
technological support, most efforts are related to the
shows the juxtaposition of developed versus emerging
formation of low carbon societies: very few interna-
and developing nations, with emerging and develop-
tional efforts have been seen in the formation of sound
ing nations particularly fearful of green protectionism.
material-cycle societies and societies in harmony
Therefore, creation of a system that allows for the
with nature. One cause of this discrepancy is the fact
realisation of the primary goals of border adjustment
that initiatives are not appropriately integrated into
measures while avoiding the traps of green protection-
market mechanisms, much in the same manner as
ism is necessary.
debate over domestic initiatives. Furthermore, there is


Republic of Korea
Ecuador Germany
Brazil United States of America France
South Africa New Zealand Japan United Kingdom Australia

negative neutral positive

Figure 1 Stance of major countries regarding border adjustment measures

Note: The above figure is based on analysis of country trends by the authors and is not necessarily based on
official declarations of countries.

3 The Green Economy Aspirations of Japan and Related Issues
the World Bank. While the former focuses on produc-
The course Japan has mapped toward a green
tion efficiency, the fact that the initiative will not bring
economy and the initiatives underway in that direction
about reduction in production or consumption volume
warrant examination. Furthermore, the stance Japan
itself is an issue. Regarding the latter, there is doubt
has revealed on the major points of debate within
that the political will exists domestically to adopt mea-
the UNCSD process (namely support for technology
sures in earnest, from the perspective of a shift from
transfer, financial assistance and capacity building and
conventional national accounting.
avoidance of green protectionism), is also examined
Regarding support for technology transfer, finan-
cial assistance and capacity building and avoidance
Japan named the Environment and Energy Super-
of green protectionism, two issues under debate in
power Strategy based on green innovation one of the
the UNCSD preparatory process, Japan has shown
seven strategies of the New Growth Strategy set forth
a favourable stance towards the former, but has not
by cabinet decision in 2010. Policies and initiatives
revealed its position on the latter. In the background
with relevance to the economy are being put in place
of Japan‚??s support for international co-operation in
toward formation of a ‚??low carbon society‚?Ě, a ‚??sound
building green economies lies its experience in car-
material-cycle society‚?Ě and a ‚??society in harmony with
rying out numerous development support projects in
nature‚?Ě, as set forth in the 2007 Strategy for an Envi-
social Infrastructure and other fields, mainly in Asia.
ronmental Nation in the 21st Century. The low carbon
As a matter of fact, the New Growth Strategy clearly
field in particular has heralded attention from industry,
states the intent to unfold environment-related social
government and academic sectors, and relevant ac-
Infrastructure provision packages in Asia. However,
tivities are particularly robust, including development
the prominence of China and the Republic of Korea in
of low carbon technologies and deliberation on taxes
recent years is striking, and competition in the Asian
for global warming mitigation, as well as drafting of a
region has intensified in Japan‚??s strong areas of envi-
roadmap for reduction of greenhouse gas emissions.
ronmental technologies and advanced Infrastructure
On the other hand, economic policies on sound mate-
provision. Hence, support paired with national interest
rial-cycles and harmony with nature are at present less
certainly requires a shift from conventional methods
advanced. Some efforts are evident, such as the initia-
as well. Meanwhile, avoidance of green protectionism
tive to reflect the resource productivity indicators ad-
must be considered, including measures to address
opted domestically in the OECD Green Growth Strat-
various situations. Japan must consider whether or
egy, as well as the declaration of intent to support the
not to levy tax on imported products equal to that of
partnership on green national accounting promoted by


domestic ones if carbon taxes are domestically ad- international community.
opted. Further, this stance must be revealed to the

4 The Vital Role Japan Should Play in the Realisation of Green Economies: a Proposal
is compatible with environmental carrying capacity of
The twin ultimate objectives of green economies
the Earth is an extremely difficult issue. It will some-
on the path to realising sustainable development are
times require industrial restructuring which may make
poverty eradication and a shift towards socioeconomic
considerable and painful reductions in scale in some
systems compatible with environmental capacity of
industrial sectors. The majority of debate on green
the Earth. Meanwhile, promotion of a green economy
economy makes allowances for affected industries
is a pressing issue for Japan. It is an approach to
and tends to be limited to discussion on improvement
creation of a sustainable society through employment
of productivity and efficiency that does not require ex-
generation and economic growth while tackling envi-
tensive adjustments to the scale of activity. However, it
ronmental commitments such as the achievement of
has become widely recognised that the socioeconomic
emissions reduction targets agreed upon in the Kyoto
activities of developed countries at present are in ex-
Protocol. We propose the following win-win approach,
cess of environmental carrying capacity of the Earth. If
in which Japan‚??s green economy policy can be utilised
all people in the world realised a standard of living on
to solve global issues, while contributions to the world
par with developed countries, the Earth would suffer
through international co-operation can in turn lead to
too heavy a burden to withstand. Developed countries
promotion of Japan‚??s green economic policy.
are strongly called upon to make earnest efforts to
‚?Ę Creation of a green economy model compatible
realise genuine green economies that are compatible
with environmental carrying capacity of the Earth
with environmental carrying capacity of the Earth. It
‚?Ę Promotion of international co-operation and green
is essential to shift away from values that excessively
innovation via dispersion of Japan‚??s energy and
seek convenience and to rethink lifestyles dependent
environmental technologies
on mass production and mass consumption.
‚?Ę Formation of trade policy that promotes sustain-
able production while guarding against green
In two regards, Japan enjoys advantageous condi-
tions for the creation of a green economy model. First,
‚?Ę Contribution to international debate on green
Japan has a record of past achievements in promot-
ing policy aimed at creation of a sound material-cycle
society. Moreover, the recent earthquake and nuclear
(1) Creation of a green economy model
accident have resulted in an opportunity to review the
compatible with environmental carrying
appropriate socioeconomic systems. If we consider
capacity of the Earth
the present crisis as a critical turning point for shifting
Along with advancing various policies on the 3Rs,
to a green economy compatible with environmental
Japan has pioneered policy for realising a sound ma-
carrying capacity of the Earth, such a shift would not
terial-cycle society that takes into account controls on
only spur Japan‚??s sustainable development, but would
resource use, such as the application of resource pro-
also facilitate other developed nations to develop their
ductivity indicators as policy objectives. Furthermore,
own green economy models. It would further lead to
revision of energy policy greatly dependent on nuclear
securing the resources required for provision of the
power is unavoidable following the critical accident at
fundamental Infrastructure essential to the eradication
the Fukushima Daiichi Nuclear Power Plant, and the
of poverty in developing countries. Such a shift would
need to control the volume of resource use accord-
be a great contribution to international society.
ing to environmental carrying capacity of the Earth,
including energy consumption, has become widely
recognised. The shift to a socioeconomic system that


In order to materialise this win-win solution, a de-
tailed matching process that takes into consideration
Necessary number of earths

the perspectives of both Japan‚??s green innovation and
nuclear power

the green economy in emerging and developing coun-
CO2 from use of
fossil fuels
tries is essential. It is further imperative to immediately
fishing grounds

draft a detailed plan for international standardisation

of technologies, regulations, norms and standards

in the environmental field in co-operation with other
cultivated land
Global Japan USA China India
Asian countries. Utilising the knowledge Japan has
accumulated related to policy on the 3Rs, investiga-
Figure 2 Ecological footprint (2003)
tion and information provision in areas where potential
Prepared by the authors based on WWF research (2006).
need for technological and financial support is high
Note: This figure shows the amount of environmental resources that would be required
if all people in the world were to lead lifestyles at the various consumption levels
(such as creation of sound international systems for
(y-axis units: number of earths). For example, if all people of the world lived at the
same consumption level as the people of Japan, approximately 2.44 earths would be
cyclic use of resources) could be effective. Addition-
required. The breakdown in color shows that the contribution of CO2 from use of fossil
fuels (the area of forests required for absorption) is large. Moreover, nuclear power
ally, if the economic benefits of the sustainable use of
energy is shown in fossil fuel conversion.

ecosystem services can be reflected in market mecha-
nisms through adoption of green national accounting,
technological innovations in the use of ecosystem ser-
vices (green agriculture technologies and technology
From the perspective of facilitating the shift to a
to utilise lumber from thinning), which have developed
green economy, we must consider mechanisms for
comparatively slowly until now, can be expected. This
reflecting our consumption of ecosystem services and
would further enable international co-operation related
environmental services on economic activity, such as
to the creation of societies in harmony with nature.
environmental taxes and PES schemes. Furthermore,
the adoption of green national accounting and envi-
(3) Formation of trade policy that promotes sus-
ronmental accounting in private industry must be de-
tainable production while guarding against
liberated in order to reflect the value of the ecosystem
green protectionism
and environmental capital that provide these services
In order to avoid green protectionism, mechanisms
onto accounting systems.
to prevent obstacles to equitable trade must be delib-
erated based on assessment of the influence of green
(2) Promotion of international co-operation and
economic policy on trade and the environment. Efforts
green innovation via dispersion of Japan‚??s en-
are also necessary to venture even further to create
ergy and environmental technologies
mechanisms that allow for policy to promote sustain-
Dispersion of Japan‚??s advanced energy and envi-
able production on the part of exporting countries. For
ronmental technologies to the emerging and develop-
instance, if green certification and technology transfer
ing countries that are eager to shift to green econo-
are paired bilaterally, sustainable production methods
mies is another important international contribution.
to meet with green certification are facilitated. Re-
For instance, export of social Infrastructure projects in
search on sustainable production and border adjust-
water-related technologies and green transportation,
ment measures is relatively embryonic. If proposals
both in partnership with private industries and utilis-
on such mechanisms are made through new policy
ing overseas development assistance (ODA), has the
research in addition to existing research, further im-
potential to link the promotion of a green economy
portant international contributions can be made.
in Japan to the eradication of poverty and facilitation
of sustainable development in developing countries.
(4) Contribution to international debate on green
Japanese companies could also benefit by securing a
market for green products.
Differences in the standpoints of countries within


the international debate on green economies have per capita
become evident. While some countries have doubts ecological

about the concept of green economy or believe the
developed nations
concept should be loosely defined according to the per capita
circumstances of respective countries, some argue capacity

that if the definition of a green economy is made emerging nations

overly flexible, the validity of the concept itself will be developing nations

damaged. A major point of dispute is the fear that the
concept of green economy according to developed
nations is premised on green technologies and will Figure 3 Hypothetical path for the shift to lifestyles within
limits of environmental capacity
thus be a constraining factor on development in least
developed countries in particular.

is important to pursue a win-win approach which links
In order to address this negative potential and to
these green economy policies to poverty eradica-
advance constructive debate that overcomes the dif-
tion and the promotion of sustainable development in
ferent standpoints of countries, it is desirable to allow
countries apprehensive that the green economy con-
countries to utilise not only their own green economy
cept will put constraints on development.
policies but also those of others to achieve their prior-
ity goals, including poverty eradication, while sharing
Application of such a flexible approach allows for
a common objective: to shift to green economy on a
countries with differing standpoints to debate on an
global scale. For instance, realisation of green econo-
equal footing, and paves the way for debate on ways
mies in developed countries could imply a shift to
to facilitate co-operation among countries with dif-
socioeconomic structures that are compatible with en-
fering circumstances. As international debate on the
vironmental capacity and environmental constraints.
green economy concept is furthered in the future (both
For emerging and developing countries, realisation
within the UNCSD process and otherwise), creation
of green economies could imply becoming greener
of a framework for effective debate that overcomes
(such as improvements in efficiency and advances in
differences in country standpoints will surely be an im-
productivity in countries eager to improve energy ef-
portant intellectual contribution.
ficiency and resource efficiency). At the same time, it


Pearce D. A. Markandya, E. Barbier, 1989: Blueprint for a Green Economy London: Earthscan
UNEP, 2011: Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication (
WCED, 1987: Our Common Future Oxford: Oxford University Press
WWF, 2006: The Living Planet Report 2006 WWF


This paper utilises a part of the research results of the ‚??Dispersion Support for the 2010 Asia-Pacific Forum for Environment and Development and Basic
Research Work on International Trends‚?Ě, which was conducted based on a subcontract from the Ministry of the Environment to IGES. The authors would like
to express our sincere appreciation to the Ministry of the Environment. However, the opinions and proposals contained in this paper are those of the authors,
not of the Ministry of the Environment.

Institute for Global Environmental Strategies
2108-11 Kamiyamaguchi, Hayama, Kanagawa, 240-0115 Japan
TEL : +81-(0)46-855-3700 FAX : +81-(0)46-855-3709 E-mail:
Copyright © 2011 Institute for Global Environmental Strategies. All rights reserved.
Although every effort is made to ensure objectivity and balance, the publication of research results or their translation does not imply IGES endorsement or acquiescence with their
conclusions or the endorsement of IGES financers. IGES maintains a position of neutrality at all times on issues concerning public policy. Hence conclusions that are reached in IGES
publications should be understood to be those of the authors and not attributed to staff-members, officers, directors, trustees, funders, or to IGES itself.

Printed on 70% recycled paper and 30% eco-pulp

Policy Brief #10 April 2010

Renewable Energy: A Strategic Policy for

Sustainable Development
Anindya Bhattacharya

There is ample evidence of underproduction of renewable energy across
the world, in spite of there being the necessary resources to produce RE, including
technology and finance. It seems politicians and law-makers have yet to be
persuaded about the importance of renewable energy to solve the problem of
energy security and sustainable development and to act on it seriously. As a matter
of fact, renewable energy sectoral investment is highly correlated to the
Anindya Bhattacharya
Policy Researcher
international oil price movement. This further proves the continued myopic views
IGES Economy and
of the law-makers about the spectrum of benefits that renewable energy brings.
Environment Group Hence, a lack of steady policy support for renewable energy is not only
jeopardising the matured development of this promising market but also stopping
the world from taking advantage of using it for multipurpose benefits including
its use as a risk hedging instrument in the increasingly uncertain conventional
energy market. Renewable energy policy has fallen into the trap of a boom-bust
cycle of world economy and the corresponding international energy price
fluctuation. Such policy is therefore unable to deliver its full benefit to society,
including creation of green collar jobs and even reducing the electricity tariff for
consumers. To overcome this bottleneck, the author has suggested a two-tier
solution. First, mainstreaming risk-explicit cost benefit analysis of renewable
energy policy at a country-specific level and second, improving regional
cooperation to harness the maximum benefits of available resources scattered
across countries with geographical proximity. It is indeed a strategic choice for the
policy-makers to decouple renewable energy development activities from the
boom-bust cycle of economy for seamless progress towards sustainable

Many Governments and law makers have not yet been persuaded on the
direction of mainstreaming renewable energy generation in the overall energy policy
development processes in the world. Renewable energy-based green power policy is still
considered to be an expensive path for development, and so even after several boom-bust
cycles of the world economy, policy makers remain hesitant to take a target based
approach to increase green energy supply in the total energy mix. There are several other
cases in and around Asia where in spite of having excellent potential and a good enabling
Copyright © 2010 Institute for Global
environment, renewable energy is still heavily underproduced. It seems that politicians
Environmental Strategies. All rights reserved.
and lawmakers are yet to be persuaded about the use of renewable energy to address the
Although every effort is made to ensure
issues of energy security especially in the case of energy price fluctuation. It has been
objectivity and balance, the publication of
research results or their translation does not
estimated that out of 2700 Twh total theoretical potential of renewable energy in Asia,
imply IGES endorsement or acquiescence
only around 6% has been harnessed (Romero et al 2008). In fact, technical and financial
with their conclusions or the endorsement of
IGES financers. IGES maintains a position of
constraints can limit the commercially available renewable energy by around a half of the
neutrality at all times on issues concerning
public policy. Hence conclusions that are
total theoretical potential. While it is true that many governments are now proactively
reached in IGES publications should be
promoting renewable energy in the face of imminent price hikes for fossil fuels due to
understood to be those of the authors and
not attributed to staff-members, officers,
increasing demand, there are several countries which have not yet taken actions to add
directors, trustees, funders, or to IGES itself.

more renewable energy into the supply mix and which are still focusing on a future
energy supply based on fossil fuel. As a matter of fact, the new concept of Green New
Institute for Global
Deal, a green economy policy initiative which also includes renewable energy, might also
Environmental Strategies
be very short lived indeed as it primarily depends on the individual country‚??s plan of
future development and growth.
Ś?įÁź?Á?įŚĘ?ś?¶Á?•Á ?Á©∂ś©?ť?Ę

In the past, whenever the price of fossil fuel fell for various reasons including
economic recession, there was a sharp reduction in renewable energy investment and
Research and Development (R&D) budget along with a drop in decisions to adopt new
policies to promote renewable energy. Figure1 below consists of two juxtaposed graphs
showing the trend in the last couple of decades of total research and development budget
allocation for renewables especially solar and wind in IEA member countries, and
‚??Whenever there is an increase compares this trend to international oil price fluctuations. It indicates that whenever
in oil price, more green energy there is an increase in oil price, more green energy budgets tend to be introduced into
budgets tend to be introduced the market. This is not only the case for the developed world but also in developing
into the market.‚?Ě countries too. Anticipating more uncertainties in the world economy in the near future,
oil and other fossil fuel prices are expected to remain volatile in nature. Hence,
renewable energy will continue to be subject to the boom-bust cycle of fossil fuel prices
in the international market.

Crude Oil Prices
2006 Dollars
PDVSA Strike
OPEC 10% Quota Increase
Iraq War
Asian Financial Crisis
Iran / Iraq Asian Growth
$60 War
Series of OPEC Cuts
4.2 Million Barrels
2006 $/BARREL

$50 Revolution

U.S. Price War

Yom Kippur War
Oil Embargo
70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06
71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07
WTRG Economics ‚??1998-2007
1947 - Aug. 2007 C
U.S. 1st Purchase Price (Wellhead) ‚??World Price‚?Ě* (479)293-4081
Avg U.S. $29.08 Avg World $32.23 Median World $26.90

USD (2006) millions
Small Hydro
(10 MW)
Large Hydro
(>10 MW)
Bioenergy 1,500
solar thermal
Solar heating
and cooling 0

‚??74 ‚??90 ‚??00 ‚??06
Source: IEA, 2008

Figure 1: Renewable energy R&D budget compared to the crude oil price

The major problems arising out of such fluctuation in renewable energy
policies are a decrease in investment interest from the private sector companies in
this sector as well as an increasing amount of sunk cost1 which is finally becoming
irrecoverable and is a bad investment for the whole economy. Overall, the
‚??Inconsistent and fluctuating inconsistent and fluctuating government policies in the renewable energy sector
government policies in the creates boom/bust cycle in the market jeopardising any long-term investment
renewable energy sector creates planning by companies. The renewable energy sector is still in the developing stage
boom/bust cycle in the market and so needs continuous policy support from the Government to become matured.
jeopardising any long-term It is difficult for private sector investors to afford longer market uncertainties while
investment planning by the main onus is on the government to create enabling environment for renewable
Sunk cost refers to the investment which never gives a return to the investors.

Policy Brief #10 April 2010 © IGES
energy investment. As a matter of fact, abandoning one 5 MW wind farm
(on-shore) project during its construction period will generate around USD5
million in sunk assets which will never give any return. Similarly, a 10 MW solar PV
project if abandoned can generate USD25 million in sunk assets plus around 70
year-round jobs (Kobos et al.)
Lack of understanding of comprehensive benefits of renewable energy use
is perhaps the main reason of failure to persuade the law makers for having a stable
renewable energy policy in the country. There could be three main reasons for lack
of understanding. The first one is, having negative perception about the relatively
‚??Having negative perception
longer time span needed to accrue the benefits of high-cost renewable energy
about the relatively longer time
compared to conventional energy. Although the gestation periods for renewable
span needed to accrue the
energies are much shorter than conventional large scale power plants but their pay
benefits of high-cost renewable
back periods are still very long mainly due to high installation costs and lower off-
take level. In Japan, pay back time is around 10 years for solar energy even with the
increased level of Feed-in-Tariff scheme. It may take more than 5 to 10 years to
observe the net benefits of the green energy supply in the economy.
‚??Underestimating the The second one is, underestimating the co-benefits of renewable energy
co-benefits of renewable such as power sector investment risk coverage. Benefits are accruable even in a
energy such as power sector shorter time. Renewable energy investment in an investment portfolio for the
investment risk coverage.‚?Ě electricity sector can be considered a substitute to risk insurance premium which is
paid mainly to mitigate the adverse impacts of a sudden rise in oil prices or a sudden
increase in carbon price. The mechanism of using renewable energy as risk coverage
insurance is based on the modern financial market portfolio theory whereby an
increasing number of less risky assets in an investment portfolio whose investment
returns are not correlated among each other can actually hedge the risk of single
asset investment. The investment return should be seen from the portfolio‚??s total
return perspective rather than any individual investment return. Energy portfolio
diversification with more renewable energy options whose fuel supply risk is nil or
very low could actually give a wider space for risk mitigation of fossil fuel price
The third one is, ignoring the benefit of larger use of renewable energy to
‚??Ignoring the benefit of larger
create downward pressure on retail energy prices. More renewable energy means
use of renewable energy to
reduced demand of fossil fuels for power generation and therefore, reduced price of
create downward pressure on
fossil fuels in the market. Less expensive fuel can further help to compensate
retail energy prices.‚?Ě
consumers‚?? additional spending on higher electricity tariff due to increased level of
expensive renewable energy supply. It has been estimated that in the United States, a
1% drop in natural gas demand can reduce the long-term wellhead gas price by
0.75-2.5% (Wiser, 2004) and there would be a subsequent reduction of retail gas
prices on the market. In certain cases like wind and solar PV technologies, use of
renewable energy may not increase the retail tariff for the consumers (like remote
area water pumping, refrigeration, street lighting etc. WEC, 1994) but can still help
to reduce the fossil energy demand and prices subsequently. Moreover, as explained
by Neij (1997), learning-by-doing can also reduce the costs of renewable energy
supply which further increases the net benefits of renewable energy for retail fossil
energy price reduction. There are three different studies ( EIA, UCS and Tellus)
shown together in Figure 2 below which demonstrate the impacts of increasing
renewable energy generation ( by increasing RPS quota from 10% to 20%) on
average wellhead gas price on the US market. It has been estimated that increasing
RE generation from 50 to 800 Billion kWh can reduce the average wellhead gas
price by 60 cents/MMBtu. This indicates that even though renewable energy is
apparently expensive, it has a certain damping effect on the fossil fuel price by
controlling the demand in the market2

Set of these studies predict that increase in renewable energy generation can cause a reduction in US natural gas
consumption within the range of 1 to 11% and this can further suppress the natural gas prices within the range of
zero to 18% ( Bolinger et al. 2008) ( The broken line indicates the trend of decreasing well head gas price
compared to increasing level of renewable energy generation)

-3- Policy Brief #10 April 2010 © IGES
Figure 2: Renewable energy generation Vs Wellhead Natural Gas Price

It is a policy decision of the law-makers to create an enabling environment
first where investors can invest more in renewable energy in spite of it not being cost
competitive. In the end, by virtue of the economy of scale and learning by doing,
the renewable energy sector itself can break the inertia of growth which will bring
benefits to the consumers by helping to reduce the electricity tariff. Thus an increase
in the supply of renewable energy can bring an additional benefit to the whole
economy in the long term.
‚??R i s k e x p l i c i t c o s t b e n e f i t In this respect, risk explicit cost benefit analysis of the renewable energy is
analysis of the renewable very much needed. Policy makers should think of an effective alternative to reduce
energy is very much needed.‚?Ě the risk of international fossil fuel price fluctuation and its negative economic and
financial consequences on the national economy. Risk covering financial
instruments like forward contracts and options which sometimes account for a half
of the total supply cost, often play a decisive role in investment planning in the
highly price-sensitive energy market. In natural gas importing countries like the
United States, power companies are paying 0.4 to 1.7 cents/kWh (Bolinger et al,
2008) additionally to the gas supplier as price premium just to have a long-term
price contract to avoid very high prices in the spot market. From 1996 to 1999 oil
importers in the United States already paid around USD 5 per barrel as premium
for a 12 month contract compared to the world average price of crude oil, which is
around 17 to 20 billion USD per annum (EIA, 2009). Very recently, US crude oil
futures for delivery in 2014 are traded at USD 80/barrel while the market price was
just USD 50 /barrel. This further indicates that even during the lower crude oil
price oil importers are still ready to pay hefty premiums (USD 30/barrel in this
case) just to avoid supply uncertainty. Risk explicit cost benefit analysis of the
power sector investments can influence the investors in favor of renewable energies
even though they are apparently more expensive than the conventional sources. It is
therefore, important for the law makers to create an enabling environment in the
market where the investment risks not covered by the government are explicit. It has
been estimated that a 1% increase in renewable energy supply in the Japanese
electricity supply portfolio can reduce the portfolio risk by 1% which can
significantly reduce the expenditure on risk-covering premiums (Bhattacharya and
Kojima, 2010).
‚??Regional cooperation can help Regional cooperation can help to have cost competitive renewable energy
to have cost competitive supply domestically. Policy-makers can also think of increasing multi-country
renewable energy supply regional cooperation to enhance the utilisation of renewable energy in the domestic
domestically.‚?Ě market. There is unlikely to be uniform distribution of the renewable energy
potential among the countries. To avoid both underutilisation and higher marginal
production costs, regional cooperation among the countries to harness all possible
potential of renewable energy can overall bring a win-win solution to the problem
of high cost. Quite often it happens that the RE potential lies within the country
which has less capacity to harness, in contrast to having less potential than a more
capable country. To avoid such disparities, having cross border renewable energy
Infrastructure development can be a win-win solution. It has been estimated that

Policy Brief #10 April 2010 © IGES
Jinghong hydro power project in the Yunnan province of China can export more
than 3 million kW of electricity to Thailand over a cross border transmission system
by 2017. This would be around 30% less expensive compared to the cost of same
amount of electricity production in Thailand (Bhattacharya et al. 2009). Similarly, a
power transmission line connecting China, Republic of Korea (ROK) and Russian
Far East (RFE) can help to bring hydro electric power from RFE to ROK during
summer and RFE to China during winter to meet the peak demands. RFE power
flows to China can displace coal-fired power generation within China. As a matter
of fact the net benefits of such interconnection could be around USD 750 million
per year as avoided costs in the recipient countries like China and ROK (Hippel,
01). Moreover, this kind of project can also bring a win-win solution to the
macroeconomic effects on both the countries in terms of increased GDP. Both
China and Thailand can expect their respective GDP to increase by USD76 and
USD47 million respectively thanks to this Jinghong hydro power project alone. In
addition, both the countries would be able to reduce CO2 emissions by 1 million
tonnes each. Table 1 shows the impacts of Jinghong cross border hydro power
project investment on China and Thailand.

Table 1: Impacts of energy sector investment on economy and environment in Asia
Impact of cross
Cross border Impact of energy
border hydro project
hydro project sector investment on
investment on GDP
investment CO2
Countries growth
Change from BAU Change from BAU
Million USD
(mil.t-CO2 )
(Million USD)
China 76 ‚?? 1.0
Thailand 45 ‚?? 0.9
Source: Bhattacharya and Kojima, 2009

‚??Creating green collar jobs.‚?Ě Creating green collar jobs. Policy-makers can use renewable energy to
create a new employment category called ‚??green collar jobs‚?? and can then even
improve the national employment rate amidst global economic downturn. Table 2
shows the job creation potential of each renewable energy technology on a global
average basis which is indeed comparable to conventional power generation cases. In
fact, the US economy under the Obama administration is now emphasising the
green growth mechanism in spite of the ongoing economic recession to create more
‚??green-collar‚?Ě jobs to address both the environmental and the economic
development issues together. It is expected that this new economic stimulus package
worth around USD one trillion, can create more than 3.5 million jobs in the United
States. Table 2 below shows how different renewable energy technologies can create
employment at different stages of development. It appears that there are more jobs
created during the commissioning period than after commissioning. Nevertheless,
the renewable energy sector can further nourish the development of a skilled global
labour force that is required for its long term operation and maintenance activities.
In Asia, given the potential of renewable energy generation and given its
employment generation capacity, around 1 million jobs can be created3. Apart from
such organized sector job creation, renewable energy can immensely contribute
towards the rural livelihood generation through unskilled and semi-skilled job
creations. Renewable energy can even engage women in the income generating
activities in the rural areas which can further create multiplier effects on the national
economy as well ( Mehta et al.). Finally, while the policy-makers puzzle over the
issue of effective utilisation of the billions of dollars of special stimulus money to
revitalise the economies across the world, investment in renewable energy can bring
relief to the economy.
Number of jobs has been estimated using both the REN21 projection of number job creation per MW of
renewable energy and estimated Asian renewable energy potential (Romero et al. 2008). As a conservative estimate
it is assumed that only 50% of the total theoretical potential would be harnessed.

-5- Policy Brief #10 April 2010 © IGES
Table 2: Employment generation potential of renewable energy technologies

Estimates of Employment Coefficients ( No. of Job/MW)

Manufacturing &
Technology O&M Total

2 5 7

Small hydro 11.3 0.22 11.52

Wind 2.6 0.3 2.9

Biomass 3.7 2.3 6

Solar PV 7.1 0.1 7.2

Waste to energy 3.7 2.3 6
Source: REN21 RE Global Status Report 2007, p37

By virtue of its less risky characteristics coupled with other benefits
including dampening impacts on fossil fuel prices, electricity tariff and enlarging
‚??Renewable energy can bring a impact on macroeconomic outputs, employment status etc., renewable energy can
win‚??win solution to this world bring a win‚??win solution to this world which is reeling under severe economic,
which is reeling under severe social and environmental crisis. Moreover, based on the previous discussion,
economic, social and renewable energy can be treated as context neutral strategic solution for sustainable
environmental crisis.‚?Ě development and can be freed from any conditionality of the surrounding economic
situation. Unfortunately, global renewable energy policies appear to be very
unpredictable and closely follow the trends in fossil fuel prices, which is further
linked to the economic boom-bust cycle. Instead of their context neutrality nature,
the reality surrounding renewable energy development is still very much subject to
context. However, we can no longer afford to continue with such swinging policies
of renewable energy which can permanently jeopardize sustainable economic
growth. The world cannot afford to see another oil shock in the near future either,
and so needs to invest more on renewable energy. If so, that will determine the
point of no return on the path to sustainable development. Policy and law makers
should realise that given the level of uncertainties in the modern economy, it is
almost impossible to predict the energy market with any reasonable certainty. As a
matter of fact any delay could prove very costly. It is much safer to develop an
alternative like renewable energy to protect the world from future energy
uncertainties and to ensure a sustainable growth path. Continued promotion of
renewable energy is therefore indispensable for modern society.

Policy Brief #10 April 2010 © IGES
Bhattacharya, Anindya and Kojima, Satoshi 2009. Impact of Cross Border Energy
Infrastructure Investment on Regional Environment, Society and Climate
Change. In Infrastructure for a Seamless Asia. Tokyo: Asian Development
Bank and Asian Development Bank Institute.
Bhattacharya, Anindya and Kojima, Satoshi 2010. Power Sector Investment Risk &
Renewable Energy: A Japanese case study using portfolio risk optimization
method. Working Paper, Economic Analysis Team, IGES, Hayama. (Under
review of Energy Policy Journal special issue on Renewable Energy
Bolinger, Mark and Wiser, Ryan 2008. The Value of Renewable Energy as a Hedge
Against Fuel Price Risk In Analytical Methods for Energy Diversity & Security
edited by M. Brazilian: Elsevier.
Energy Information Administration. 2008. Financial Reporting System Survey - Form
EIA-28. Washington D.C.: EIA
Energy Information Administration. 2009. Independent Statistics and Analysis.
Washington D.C.: EIA
Hippel, David F. 2001. Estimated Costs and Benefits of Power Grid
Interconnections in Northeast Asia In Northeast Asia Grid Interconnection
Workshop. Beijing. Nautilus Institute.
International Monetary Fund. 2008. World Economic Outlook - Financial Stress,
Downturns and Recoveries. Washington D.C: IMF.
International Energy Agency. 2008. Deploying Renewables: Principles for Effective
Policies. Paris. IEA.
Kobos, Peter H., Erickson, Jon D., Drennen, Thomas E. 2006. Technological
learning and renewable energy costs: implications for US renewable energy
policy. Energy Policy 34 (13):1645-1658.
Mehta, Aasha K., Mohapatra, G., Ali, A., Mukherjee, Suparna D. 2009. Renewable
Energy for Rural Livelihoods in MNRE-UNDP-FRG Project Villages in
Rajasthan and Uttarakhand: A Report. New Delhi. Indian Institute of Public
Neij, Lena. 1997. Use of experience curves to analyse the prospects for diffusion and
adoption of renewable energy technology. Energy Policy 25 (13):1099-1107.
Romero, Jane, Elder, Mark, Bhattacharya, Anindya,. 2009. Strengthening
ASEAN+3 Renewable Energy Strategies. International Energy Journal (in

-7- Policy Brief #10 April 2010 © IGES
Institute for Global
Environmental Strategies
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Policy Brief #10 April 2010 © IGES
IGES Policy Report-2011-04

Strengthening international
environmental governance
by two-phased reform of UNEP:
Analysis of benefits
and drawbacks

Governance and Capacity Group, Institute for Global Environmental Strategies (IGES)
IGES Policy Report 2011-04


Simon H. Olsen and Mark Elder
Institute for Global Environmental Strategies (IGES)

2108-11 Kamiyamaguchi, Hayama, Kanagawa, 240-0115, Japan
Tel: +81-46-855-3720 Fax: +81-46-855-3702
URL: http//

Strengthening International Environmental Governance by Two-phased Reform
of UNEP: Analysis of Benefits and Drawbacks
IGES Policy Report


Copyright © 2011 Institute for Global Environmental Strategies. All rights reserved.

The Institute for Global Environmental Strategies (IGES) is an international research institute
conducting practical and innovative research for realising sustainable development in the Asia-Pacific

No parts of this publication may be reproduced or transmitted in any form or by any means,
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translation does not imply IGES endorsement or acquiescence with its conclusions or the
endorsement of IGES financers.

IGES maintains a position of neutrality at all times on issues concerning public policy. Hence
conclusions that are reached in IGES publications should be understood to be those of the
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Printed in Japan
Printed on recycled paper

Acronyms and Abbreviations ................................................................................................................................ vi
Tables and Figures .................................................................................................................................................... vii

Acknowledgments ................................................................................................................................................... viii
Abstract............................................................................................................................................................................ 1
1. Introduction: Defining the scope of the paper ....................................................................................... 2

1.1 IEG reform and multilevel relevance ............................................................................................................... 2

1.2 Why broader reform is needed and why it would matter ...................................................................... 3

1.3 Chronology of the IEG debate .............................................................................................................................. 4

1.4 The reform options ................................................................................................................................................... 5

2. Reform Phase 1: Universal Membership of UNEP GC/GMEF........................................................... 7
1.5 The arguments ........................................................................................................................................................... 6

2.1 The difference between universal membership and universal participation ............................... 8

2.2 Legal aspect of universal uembership ............................................................................................................. 9

2.3 Universal decision-making ................................................................................................................................... 9

2.4 Application in practice ........................................................................................................................................ 11

2.5 Financial aspect of universal membership ................................................................................................. 11

2.6 Establishing permanent country representation .................................................................................... 11

2.7 Unanswered questions of funding of the governance regime ........................................................... 12

2.8 Structural aspect of universal membership and its relation to MEAs ........................................... 12

2.9 Clustering MEAs under a GC umbrella ......................................................................................................... 13

3. Reform Phase 2: Establishing a specialized agency on environment....................................... 16
2.10 In sum........................................................................................................................................................................ 14

3.1 Legal aspect, benefits and drawbacks of a specialized agency: ....................................................... 16

3.2 Decentralised decision-making ....................................................................................................................... 16

3.3 Strengthen the environment voice on international and national levels .................................... 17

3.4 Combining top-down agenda setting with bottom-up integration ................................................ 18

3.5 Financial aspect, benefits and drawbacks of a specialized agency ................................................ 18

3.6 Membership defined by level of contribution ............................................................................................ 18
3.7 Structural aspect, benefits and drawbacks of a specialized agency: ............................................. 19

3.8 Environmental mainstreaming in the UN: Done deal? ......................................................................... 19

4. Conclusion: ........................................................................................................................................................ 21
3.9 In sum .......................................................................................................................................................................... 20

4.1 From pledge to action: cooperation among stakeholders .................................................................. 23

Literature: .................................................................................................................................................................... 26
4.2 Reasons for resistance and reasons for support ...................................................................................... 24

ASEAN Association of Southeast Asian Nations

CBD Convention on Biodiversity

CM Council of Ministers

COP Conference of the Parties

COW Committee of the Whole

CPR Committee of Permanent Representatives

ECOSOC Economic and Social Council

EMG Environment Management Group

EU European Union

GA General Assembly

GEF Global Environmental Facility

GHG Greenhouse gases

GEGC Global Environmental Governing Council

GC/GMEF Governing Council/Global Ministerial Environment Forum

IEG International Environmental Governance

ILO International Labour Organization

LDC Least developed country

MEA Multilateral Environmental Agreement

MoU Memorandum of Understanding

SWMTEP System-wide Medium Term Environment Programme

TEMM Tripartite Environment Ministers Meeting

UM Universal Membership

UNEO UN Environment Organization

UNEP UN Environment Programme

WEO World Environment Organization

WHO World Health Organization

WMO World Meteorological Organisation

WTO World Trade Organisation


Figure 1: Thrust of IEG Reform‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶.....5
Table 2: Universal Membership‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶.15

Table 3: Specialized Agency‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶.‚?¶‚?¶.21

Figure 4: Cooperation on implementation levels..‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶‚?¶..23


The author of this report gratefully acknowledges the financial support provided by the
Ministry of Environment of Japan for the research conducted under this study.

Throughout the research process and reviewing of the final report the author received essential
support, comments and input from the following: Maria Ivanova (Global Environmental
Governance Project), as well as Mori Hideyuki, Imura Hidefumi, Mark Elder, Ogihara Akira,
Robert Didham, and Lewis Akenji (Institute for Global Environmental Strategies).

Although this work provides recommendations for international environmental governance, the
views and opinions contained within are those of the author alone, and in no way does it imply
the endorsement or acquiescence of the Ministry of Environment or any other government
agency in Japan.


This paper aims to contribute to the debate on strengthening international environmental
governance (IEG) architecture towards more effectively promoting environmental
sustainability. To this end, the paper will analyse two broad reform options: 1) introducing
universal membership of UNEP‚??s Governing Council, and 2) elevating the status of UNEP to a
specialized agency. The paper will analyze the broad reform options by focusing on their legal,
financial and structural implications as well as on potential benefits and drawbacks of each
option. In addition to these broad reform options, the paper acknowledges the importance of
incremental reform of environmental governance that is taking place to enhance efficiency of
environment work within the United Nations (UN) and on national levels. While these
incremental improvements are valuable, the paper argues broader reform of IEG and UNEP in
particular will be necessary to improve environmental governance, as stronger legal clout is
ultimately necessary to arrive at more effective environmental governance architecture.
Proposing broader reform, the paper argues that the two summarized IEG reform options
should be implemented in a phased approach, and that benefits of broader reform would accrue
not only to international environmental policy making, but also strengthen the role of
environmental vis-√ -vis economic policy making on national and local levels. Thus, the paper
recommends that countries‚?? and citizens‚?? support the broad IEG reform options for the benefit
of both international and national environmental governance.


Many countries are making progress addressing their environmental problems, but it is unlikely
that a purely nation-state approach will suffice in addressing the international and global
dimensions of environmental issues. At the same time, however, the current international
governance architecture that has emerged over the last four decades is disjointed and inefficient
and therefore unable to function effectively. As a result, environmental legislation remains
notoriously weak. Stronger international environmental governance (IEG) architecture is
necessary to safeguard the international and national environment and ensure that human
well-being does not suffer from environmental degradation.

IEG refers to the international mechanisms, institutions and stakeholders that manage
environmental challenges. The concept is related to how environmental issues reach the
political agenda, how policies are formulated, and how programmes are implemented
(IGES 2006). To match the limited scope of this paper, IEG will be defined as governance in
context of the United Nations and particularly its relation to reform of the United Nations
Environment Programme (UNEP). It should be pointed out that IEG is undertaken by a
multitude of actors, and even though its role looks to be primarily international, bolstering it on
the intergovernmental level would possibly benefit both national and local environmental


While much of the IEG debate has taken place in the intergovernmental arena, vertical linkages
must be made to the realities on domestic implementation level. For example it should be
emphasized that stronger legal and financial capacity of the IEG architecture will have
multilevel benefits. Neglecting the impact on national level will make little sense, as decision
makers, who represent their nation states, will not recognise the relevance and interest in
supporting IEG. IEG reform should therefore be analysed for the potential contributions to
national level policy making.

Apart from the need for vertical integration to enable to downstream flow of benefits from the
international to the national and local levels, environmental policymaking can be bolstered by
horizontal integration. This can happen by uniting ministries, as for example the ministry of
ecology, sustainable development, transport, and housing in France. Germany introduced green
cabinets, which improved the agenda setting capacity of its environmental ministry (Lenschow
2009:102). Sweden and the Netherlands have experimented with green reviews of national
budgets (Ibid.:75). Above and beyond national levels it has also been possible to strengthen
environmental legislation. For example the Treaty establishing the European Union (EU) states
that environmental protection, ‚??‚?¶requirements must be integrated into the definition and
implementation of the Community policies‚?Ě (EU1997).

These tools and processes exemplify how national level environmental policy making has been
strengthened to allow environmental concerns to gain more influence compared to traditional
economic policy making. While these examples are inspirational and encourage reproduction in
other contexts, the strengthening will continue ad-hoc and in a haphazard fashion as long as the
main agenda setter on the international level remains weak. The paper will therefore emphasize

that strengthening UNEP by altering its legal, structural and financial composition would realize
considerable scope for improving effectiveness of multilevel environmental governance.


IEG needs to be strengthened not only because of the emerging environmental problems faced
by multiple countries, but also to allow environmental decision-making to better match
economic decision-making. Before examining the details of that argument in the context of
UNEP, it will be necessary to provide a brief overview of some of UNEP‚??s inbuilt shortcomings.
UNEP was founded in 1973 with a broad mandate establishing it as the designated authority of
the United Nations system in environmental issues at the global and regional level (UNEP 2011).
However, it was never given autonomous decision-making power, and with the global increase
of environmental issues, the lack of legal independence and funding has proven detrimental for
its ability to successfully address environmental challenges. Earlier research (WRI 2002;
Ivanova 2010; Biermann and Bauer 2007) establishes a number of reasons to the mixed
successes of UNEP, which ‚?? among other factors - emphasize limited authority and funding as
main reasons for UNEP‚??s weakness.

The lack of centralized authority on IEG has resulted in the current fragmented environmental
governance architecture. As could be observed over the last four decades, the gradually
emerging environmental challenges have resulted in an impressive web of multilateral
environmental agreements (MEAs) and programmes both within and outside of the UN‚??s
purview. It has been established (Kanie 2007, Najam et al. 2006) that there currently are well
over 500 such MEAs. Many of them overlap, and governments, especially those with limited
financial and human capacity, are severely challenged with their administration
(ECOLOGIC 2004). Thus, the decentralized decision-making regarding these agreements can be
said to be one detrimental characteristic of the currently fragmented IEG regime. In response to
that fragmentation, the section on universal membership (see below) will argue that universal
membership of UNEP GC/GMEF has the potential to address the issue.

Universal membership could centralize decision-making, which would resemble a significant
efficiency and effectiveness improvement of IEG. However, the paper will argue that
establishing universal membership is not an end in itself, but a strategic step towards
strengthening IEG. The paper argues that a universally representative forum of environment
ministers begs the subsequent provision of autonomous decision-making authority. Equipping
environment ministers at the GC/GMEF with such authority would enable stronger
international environmental policy making. This benefit can be assumed not only because of the
purely environmental mandate and specialization of the GC/GMEF, but also in comparison to
the current situation it would be an advantage for IEG. Currently, environmental proposals are
always at risk of being sidelined in the United Nations General Assembly (GA), where decisions
from the GC/GMEF have to be approved.

Finally, it must be emphasized that IEG reform must be approached with a view to make a
change to some of the above-mentioned weaknesses. It would make little sense for example to
increase the authority of UNEP without matching funding to enable to institution to address the
environmental issues. The sections below will address the issues of decision-making as well as


The debate on environmental governance goes as far back as the Stockholm Conference on
Human Environment in 1972, which resulted in the creation of UNEP. Twenty years later, the
Rio Summit gave birth to the Commission for Sustainable Development (CSD), with a broader
mandate on sustainable development, tasked to oversee progress of Agenda 21. Later on, the
UN established a Task Force on Environment and Human Settlements, which found gaps in the
IEG system. To improve coordination, the Environment Management Group (EMG) and the
Global Ministerial Environment Forum (GMEF) were created, the latter as a bi-annual forum to
take place with the UNEP Governing Council. In the first years after the millennium, European
and French initiatives attempted in vain to create sufficient momentum for the establishment of
a World Environment Organization (WEO). Subsequently, the UN itself established a High Level
Panel on System-wide Coherence, which articulated ‚??Delivering as One‚?? as a priority
undertaking to improve coherence and coordination within the UN system (UN 2006). Two
internal assessment reports of the Joint Inspection Unit (JIU) followed in 2008, and 2010,
respectively, making concrete recommendations towards UNEP reform (Inomata 2008). The
debate also went to the General Assembly, which resulted in a draft paper on options for
strengthening IEG, however this never led to a Resolution, and in 2009, the GA tabled the issue
due to lack of consensus. Although there was consensus on the overall need for stronger IEG, the
way forward was still out of reach for agreement in the GA. In 2009, the GC/GMEF revived the
process by establishing a consultative group of ministers of high-level representatives, who
were tasked with identifying options for strengthening IEG. Late in 2010, the group presented
the Nairobi-Helsinki Outcome on the options for reform (UNEP/GC.26/L.4/Add.1 2011). The
recommendations were subsequently debated in UNEP‚??s 26th Governing Council in February
2011, which brought overall agreement on the options, but lacked consensus on which of them
should be taken to strengthen IEG. It is now hoped that the occasion of Rio20 could serve as a
platform for countries to make headway on the issue.

Research on the issue has brought a large number of analysis of the situation and proposals for
a way forward. They can be classified as ranging from 1) those that support broader reform
(Biermann 2007 and 2011; Biermann and Bauer 2004 and 2005,); 2) those that debate whether
reform would benefit the delivery of governance on the ground (Ivanova 2011; Tarasofsky 2002
and 2003) those that believe that incremental changes are the best, ranging from extending
membership of the UNEP GC/GMEF to universality (Tarasofsky 2002), or the most realistic
(Najam, Moltke, and Adil Najam, Tarasofsky 2002), given the lack of commitment to broader
reform from governments at large. The research of this paper leans on the existing body of work
on IEG in the way that it does not dispute the utility of incremental reforms, however it takes
vantage point in assuming the feasibility of the most ambitious of the existing research
proposals, if they could be carried out in the right sequence, as illustrated in subsequent


The introductory section above established that there are shortcomings to the current IEG
architecture and that reform is needed. However, several details have to be clarified to
determine the actual steps that the international community needs to take to realise a stronger
IEG architecture. Addressing demand for such information, the paper will argue for the
feasibility of two options: a) introducing universal membership (UM) of UNEP‚??s Governing
Council/Global Ministerial Environment Forum (GC/GMEF); and b) establishing a specialized
agency on environment. The paper will highlight both benefits and drawbacks of these options,
as providing more information on the implications can garner more support for strengthening
IEG. In addition to providing information on the feasibility of these options, the paper will argue
that a phased approach of introducing the legal and structural changes would be the most
successful. The sequence in which the reform options could be introduced is depicted in the
figure below, essentially arguing that incremental reforms, as ongoing, are fundamental to
broader reform, where universal membership of UNEP GC/GMEF represents the initial step, and
the creation of a specialized agency, the second step. Of course this kind of contextual sequence
is artificial and begs the question as to how precisely such institutional upgrading would benefit
environmental governance at multiple levels. To answer this, the subsequent chapters will
examine each reform option, and propose a structure on implementation levels as well. 1

Figure 1: Thrust of IEG Reform

Source: Authors interpretation

See Figure 4 ‚??Cooperation on implementation levels‚?Ě on page 23.

Apart from the broad reform options, there are other areas that need strengthening, both within
the UN and outside of the UN‚??s regime, and particularly on national and local levels. Incremental
reform options to IEG in a UN context are often supported by UN member states. The
incremental changes are can be immediately implemented within UNEP‚??s current mandate and
within the UN system. For example, the recent report of the UN Joint Inspection Unit (JIU) has
made a series of recommendations that fall into the ‚??incremental category‚?? (JIU 2008 and 2010).
These are mainly focused on improving effectiveness within the UN system.

Many improvements can be introduced that can benefit effectiveness of environmental
governance and efficiency of overall UN response, including the ‚??One-UN Initiative‚?Ě, which aims
to bring more coherence into UN response at all levels. The incremental reform options are
certainly important, because their implementation may determine the level of subsequent
support to broader reform. In addition, they can be implemented under the current institutional
settings. However, if environmental governance is supposed to be strengthened in earnest,
incremental options will not suffice. Broader reform is necessary to equip UNEP with the
authority and budget to better carry out the tasks related to environmental governance.

The need for better institutional Infrastructure to respond to current and emerging challenges
can be seen in another significant anthropogenic effect, namely climate change, whose
abatement is arguably one of the most important global concerns. There is significant global
agreement that greenhouse gases (GHGs) have to be drastically reduced by the middle of this
century, but the details and sources of mitigation are still cause for much disagreement among
countries. Nevertheless, it can safely be assumed that the current business-as-usual will not
effectuate the needed reduction in GHGs, and that a socio-economic transformation, aided by
effective and strong institutional architecture will be necessary.


The last decades have given birth to a wide variety of actors and institutions in the
environmental governance field. This has happened as a result of growing demand for research,
capacity building on implementation, multi-level governance, monitoring, reporting and
information sharing, and participation to name but a few. The various areas as well as their
cross-cutting nature makes it is clear that many actors, not one, will be necessary to answer to
the demands for stronger environmental governance. Acknowledging this multi-stakeholder
aspect of the discussion on improving environmental governance, the paper will approach the
IEG discussion in the context of the United Nations, its reform and what IEG reform could mean
for UNEP (GA 2010). The paper will focus on the financial, legal, and structural implications of
the options and will assess their feasibility and potential benefits and drawbacks.

The paper will argue that the creation of universal membership of the Governing Council
(option a) may be necessary to create the appropriate forum for examining other more broad
reform options, including the option of elevating UNEP to a specialized agency for the
environment (option b). It is important to remember that the discussion on a specialized agency
has been addressed in the Governing Council before. At the same time, a proposal for universal
membership has also been submitted to the UN Economic and Social Council (ECOSOC) for
approval at the UN GA in the past. But neither proposal succeeded in achieving ratification.

For one, this hints that ECOSOC and the GA may not be appropriate forums for decision-making
on environmental governance, and secondly, that another forum could be better suited for this
debate. ECOSOC‚??s mandate may be too broad and the GA too preoccupied with other issues.
Additionally, proposals to strengthen environmental governance may have been met with
scepticism because decision makers there have viewed the proposed measures for
strengthening environmental governance as potentially compromising political and economic
issues that are primarily dealt with in these larger decision-making forums.

The lack of attention can be appreciated, as ECOSOC ‚??‚?¶serves as the central forum for
discussing international economic and social issues, and for formulating policy
recommendations addressed to Member States and the United Nations system‚?Ě (UN 2011). It is
with this experience in mind that the creation of universal membership of the Governing
Council must be viewed not as an end in itself, but as an important step towards creating a
legally autonomous decision-making forum. A dedicated forum for decision-making on
environment may better be able to make subsequent decisions on environmental governance,
needed to more effectively address the mounting challenges to environmental sustainability.

In view of the above, the paper will argue that both options (a and b) for reform are feasible and
effective means for strengthening IEG and must be considered seriously by decision makers if
the stalemate of international environmental governance is to be solved. The options are
presented in logical succession, arguing that achieving agreement on universal membership
would be an initial step to strengthen IEG. Providing universal membership (see figure above)
to the GC/GMEF would turn it into a global environmental governance forum with global
representation and universal decision-making capacity. Arguably, such a forum could be better
suited than ECOSOC or GA for debate and decisions on subsequent reform options for IEG, in
particular also on option b) the establishment of a specialized agency on environment
(Section 3).


The option of universal membership dates back to 1998, when a UN task force recommended it
in a report on environment and human settlements (UN 1998). Member States were unable to
agree on the issue, because its advantages were not clear (UNEP 2004). Universal membership,
however, clearly relates to a part of UNEP‚??s mandate, and introducing it would enable UNEP to
better ‚??‚?¶keep under review the world environmental situation in order to ensure that emerging
environmental problems of wide international significance receive appropriate and adequate
consideration by Governments‚?Ě (GA 1972).

The added emphasis shows one of the shortcomings on non-universal membership; because
how can a non-universal council like the current Governing Council with its 58 members
adequately address global environmental issues? This shortcoming is known, and has been one
of the main arguments in earlier proposals for universal membership (UNEP 2004). Related to
this lack of representation, the limitation of 58 members of the GC can also be said to perpetuate
the north-south divide and inhibit the establishment of global governance including effective
environmental cooperation.

Establishing universal membership is an important step signaling commitment of the
international community to equal participation and responsibility, which are important aspects

of empowerment and sustainable development governance. Universal membership is certainly
no guarantee that the north-south divide may be bridged as negotiation blocks may form that
perpetuate the schism. But creating a global decision-making forum will send an important
political signal that values such as common responsibility and inclusiveness are taken seriously.


When universal membership was proposed in the past, a compromise was achieved by
establishing the UNEP‚??s Global Ministerial Environment Forum. 2 This provided for the next-best
solution: universal participation. Subsequently that forum would take place in parallel with the
UNEP GC. However, participation does not equal membership. In reality, once decisions have to
be made, the GMEF becomes the ‚??exclusive‚?Ě GC with only 58 voting members.
Counterarguments to the proposal for universal membership have emphasized the benefits that
universal participation already lends to the GC/GMEF. Certainly these have to be acknowledged,
and much awareness and capacity has been built by this arrangement that has provided a forum
for the world‚??s environmental policy makers to meet and greet. However, universal
membership should be viewed as a step towards establishing global representation of
environmental decision makers in the true sense of ‚??decision-makers‚??.

If universal decision-making were achieved it would subsequently be possible to argue for the
provision of legal autonomy to the GC. Doing so would ensure that environmental issues could
find sufficient response amongst the world‚??s environment ministers, who are mandated to give
importance to environment related issues. This could remove some burden from the United
Nations General Assembly (UNGA), which in any event may give environment issues attention in
the way they relate to economic and political issues. Addressing environmental issues in an
economic and political forum is also important but just not sufficient. Instead, it may be
necessary to grant universal membership to UNEP GC and create a more dedicated decision-
making body necessary to address many challenges facing environmental sustainability.

The need to create a stronger environmental decision-making body can be recognised in the
historical context. Since UNEP‚??s inception in 1972, crosscutting environmental problems have
increased globally. Coherence in addressing issues related to air, biodiversity, climate,
desertification, or water has become relevant for all countries‚?? development. Extending the
membership to all states would match the global scope of overarching environmental
challenges, including the need to properly address Principle 7 of the 1992 Rio Declaration on
common but differentiated responsibilities. Moreover, it would empower the GC/GMEF to
better determine the course of environmental governance as it was originally envisioned in
Resolution 2997 from 1972.

Skeptics argue that universal membership would make decision-making cumbersome when
many voices have to agree on many points. This is a valid concern, which could be partly
addressed by establishing either an executive board or an elected bureau of GC representatives.
This bureau would be mandated to deal with day-to-day management issues and leave

It was established in 2000.

overarching issues related to the governance of the environment to the GA of the UNEP
Governing Council.

One major drawback to introduction of universal membership is that it could mean that some
countries lose comparable advantage in the GC decision-making process, as their vote will mean
less with increased numbers of voting members. This has to be acknowledged as a significant
hurdle hindering its introduction. In addition to the issue on influence, some countries oppose
universal membership, because they fear it would create precedence for other UN organisations
and bodies. Universal membership may be viewed as cumbersome for decision-making. To
accommodate this, it could be possible to alter the decision-making structure of the GC. The
following sections will summarize legal, financial and structural aspects of universal
membership of UNEP‚??s Governing Council as well as provide information to the benefits and
drawbacks of such decisions.


The legal implications of universal membership are related to the convening role of the
GC/GMEF and, as previously mentioned, it should be noted that the GC/GMEF has a dual
function, distinguishing between the GMEF with universal participation, and the GC with its
decision-making mandate limited to the 58 members. It can therefore be observed that the
plenary of the GC, called the Committee of the Whole (COW) shifts between acting as GC and
GMEF, depending on whether decisions have to be made or not. Changing this practice by
extending decision-making responsibility to all countries would require a UNGA resolution, but
it would not be considered impossible, as UNEP could remain a subsidiary body of the UNGA. 3


Currently the GC uses the UN unanimity rule of decision-making. While this may be the most
democratic method of voting, it also has certain drawbacks, including the increasing difficulty
and inefficiency in reaching consensus amongst a greater number of voting members. To
address this it could be possible to consider introducing new decision-making techniques. This
could avoid opaque negotiation situations, 4 as well as lowest-common-denominator decisions
or stalled negotiations due to inability to reach consensus.

There are examples from existing institutions that utilize multi-level co-decision-making
systems. The co-decision procedure has become central to the European Community's decision-
making. It is based on the principle of parity and means that neither the European Parliament
nor the Council of Ministers (CM) may adopt legislation without the other's agreement
(EU 2008). If agreement cannot be reached at initial attempt, disagreeing parties have the
option of proposing changes to the proposal. These then have to go through a second reading by

If UNEP‚??s status is elevated to that of Specialized Agency, then its reporting line may change. Legally,

specialized agencies are not required to report to the UNGA but can specify the nature of their
relationship to ECOSOC and the GA additionally.
4 The World Trade Organization (WTO), which bases decision-making on consensus-based voting, has

been criticized for being non-transparent in its decision-making process. It is said that negotiations often
are kept informal with major developed countries being the most influential representatives in these

the European Parliament in order to either pass or be vetoed. This modality could be used in
two instances being a) cases where block politics happen and working compromises need to be
identified; and b) in cases where the GC/GMEF and the UNGA disagrees.

Other European Union (EU) voting practices can enhance efficiency of decision-making. At the
moment, EU proposals are decided by qualified majority voting. 5 In a qualified majority voting
scenario, a majority of over 71 percent of voting members‚?? weight has to agree before a decision
can pass. In practical terms it means that each member is assigned a weight (a number of
votes); and in order for the CM to pass a bill, the aggregate weight of those voting for it must
equal or exceed a set quota of 71 percent. 6

Due to increasing number of EU member countries, the Lisbon Treaty (2009) decided to amend
the voting structure to double majority voting in 2014. This means that the qualified majority
condition specifies requirements not only in terms of a certain percentage of voting members
but also with regards to the proportion of population represented. The new system is meant to
ensure fairness in decision-making, as larger countries can benefit in terms of their share of
population, while the one-country-one-vote part of the double weighed system in turn benefits
smaller countries.

Primarily, the new voting system will be introduced to ensure that the larger countries will not
be able to force decisions without sufficient support by smaller countries. 7 As a secondary
benefit majority voting speeds up the decision-making process, when compared to consensus
based decision-making and thus can be considered useful also for efficiency improvements. A
potential drawback to this kind of decision-making could include its apparent complexity.
Implementing such a system may require awareness-raising of its functions and advantages. In
the case of UNEP, Nairobi could design voting software that calculates the qualified thresholds
automatically so that only the essential delivery of position remains as key task for negotiators.

A similar method is practiced by the Global Environmental Facility (GEF), which uses double
weighed majority. In a GEF voting scenario, support for a proposal requires at least 60 percent
majority from all member countries and 60 percent majority from total contributions. This
ensures that important decisions are not made only by those members that contribute the most
to GEF‚??s budget, but provides voice also to those that do not necessarily have the most financial
capacity for a certain decision (Werksman 2003).

The evolving voting systems of the EU (supplemented by the example from GEF) indicate that
increasing memberships of any group or forum will result in more complex decision-making
procedures. However, the example shows that decision-making systems can be adjusted to
accommodate both needs for efficiency as well as for democratic influence even in face of
increasing (or universal) membership. Overall this indicates that institutions can evolve to
respond better to the demands of the environment and that of their growing membership.
Moreover, and perhaps most importantly, it also shows how decision-making systems can be

Also called weighted decision rule.

The concept of weight is calculated by countries‚?? population size.
7 In detail the double majority voting system means that at least 55% of EU states must vote in favour of a

proposal and at least 65% of the EU population must be represented in that group. To block a proposal, at
least four countries must form a so-called ‚??blocking minority‚??>

designed to anticipate the heterogeneity of members and bring the highest degree of
transparency and fairness into the decision-making modalities.


Double weighted majority could be applied to situations for decisions involving larger funding
for programmes. One factor could include funding as a variable additional to number of
supportive countries. When legislative changes were proposed, a special triple weighted
majority could be envisioned, in which not only funding but also number of countries as well as
population determine the outcome of a vote. At the same time changing the voting structure
would not be a precedent, because as shown above, if GEF is considered as a part of
environmental institutions, then decision-making systems of the current environmental
institutions are already diverse. This being said, it may be useful to propose additional research
into the benefits and drawbacks of these options, to better provide information on the most
suitable option for decision-making at a Global Environmental Governing Council (GEGC). This
could be a conditionality to be managed by initiating countries that make the proposal for
universal membership in Rio.


Similar to the overall core funding of UNEP, funding of the GC/GMEF is administered by the
UNGA. This is a normal modus-operandi for programmes and funds that are subsidiary to the
UNGA. Financing of the annual GC/GMEF derive from the UN Environment Fund.

It is important in this respect to note that the GC/GMEF itself absorbs only around one percent
of UNEP‚??s total annual budget. Thus, compared to the funding that is in fact needed to halt the
destruction of the environment, the financial consequences of introducing universal
membership of the governing council are negligible at best (ECOLOGIC 2004)). Since the event
itself spends only miniscule proportions of UNEP budget, it makes little sense to use financial
implications to argue against universal membership.

Earlier research on the issue of funding support for GC/GMEF revealed that the budgeting of the
GC already anticipates and calculates the participation by non-members as well as members
(reflecting the current universal participation of the GMEF). Countries are aware of that, and
even developing countries that are not current members of the GC are invited to participate at
the GC/GMEF with the understanding that the UN will cover the logistical cost of their
participation. As this kind of support for participation is already common practice, universal
membership would not place any additional financial burden on member states, neither directly
as financial expenses for their participation, or indirectly on member states‚?? contributions to UN


A drawback related to the financial implications of universal membership, however, could
concern states that do not yet have permanent representation in Nairobi (Ecuadorian Ministry

of Foreign Affairs 2011). 8 Especially Latin American countries do not have embassies in Kenya, 9
and universal membership would incur additional expenses to establish a permanent presence
in Nairobi. However, it can be expected that the bulk of the cost would be a one-time expense to
establish a consulate or embassy on location. Until that is achieved, currently practiced interim
solutions are possible: Latin America appoints representative focal points to ensure that
information from UNEP‚??s Committee of Permanent Representative (CPR) meetings is forwarded
to all countries concerned (Danish Ministry of Environment 2011). 10 However in the long run,
countries would have to establish permanent missions on location, and additional cost would be
expected from that.


In a larger perspective, universal membership of the GC could form a suitable platform for
discussions on expanding UNEP‚??s funding options. Perhaps the granting of universal
membership could come with a conditionality that requires the universal forum to earnestly
deal with the larger issue of lacking funding for IEG. Fair decisions on this issue could then be
made in a forum with global membership consisting of developed and developing countries at
equal level and with equal influence in the decision-making process (see section above on
change of voting structure).

The modalities of introducing innovative financing mechanisms such as Tobin Tax, levies on
international air-travel, or assessed contributions as a miniscule proportion from countries‚??
defense budget should also be openly discussed. These are well-known options for financing the
environmental governance regime. More focus on such discussions would be timely; as would
more focus on a related issue being the overall lack of consistency of funding, which is
hampering with effectiveness of planning and execution of UNEP‚??s operations. 11

There remain additional questions pertaining to financing of a functional environmental regime
and financing of the implementation of Multilateral Environmental Agreements (MEAs) on
national level. Universal membership is clearly not a silver bullet for environmental governance,
but it should be considered as an important intervention to strengthen it. It is clear, however,
that much higher budgets for environment will be necessary in the coming years to address
implementation gaps, as well as lacking capacity and access to technology - all pertinent issues
repeatedly addressed by developing countries in intergovernmental negotiations. These
substantial hurdles to implementation could be addressed by a GC/GMEF with universal


As was briefly mentioned in the introductory paragraphs, the sense in establishing a global
forum to address international environmental issues could be considered a normative truism.

Personal communication

See for a list of embassies in Nairobi. Currently the

only Latin American countries represented are Argentina, Brazil, Chile, Colombia Costa Rica, Honduras
and Venezuela.
10 Personal communication
11 Personal communication

And as such, most people would tend to agree with need for a better IEG architecture. However,
it should be clearly illustrated how universal membership could better address shortcomings in
the current environmental governance structure as well as how it would contribute to
improving the environment. This is necessary to make a convincing argument for universal

One oft mentioned criticism of environmental governance focuses on the problem of overall
fragmentation, overlap and inefficiency. In response to this critique, mainstreaming efforts have
been undertaken in the chemicals cluster and the biodiversity related conventions. These efforts
show that MEAs can either be clustered according to issue-based, functional/organizational
criteria, or they can have a particular regional scope by co-locating and merging secretariats
(Najam 2006; Fauchald 2010).

In this regard, introducing universal membership could potentially contribute to enhancing
coherence and efficiency of the several hundred existing environmental agreements by creating
an umbrella forum for centralized decision-making on MEAs. The close relationship between
UNEP and many MEAs is written in the text of the conventions. For example, the following
excerpts from the Convention on Biodiversity (CBD) show structural and financial links
between UNEP and the MEA:

Decision I/4: ‚??Designates the United Nations Environment Programme to carry out the
functions of the Secretariat of the Convention while ensuring its autonomy to discharge‚?Ě
(CBD 1994).

Decision I/6: ‚??Designates the United Nations Environment Programme as the Trustee of the
Trust Fund for the Convention on Biological Diversity‚?Ě (CBD 2010).

The Rotterdam Convention contains similar decisions, cementing its relationship with UNEP
(and the FAO):

Decision RC-1/9: ‚??Invites the Executive Director of the United Nations Environment Programme
and the Director General of the Food and Agriculture Organization of the United Nations to
appoint an Executive Secretary in consultation with the Conference of the Parties through the
Bureau‚?Ě (Basel 2010).

‚??The Executive Director of UNEP and the Director-General of FAO delegate their authority to
the Executive Secretary from UNEP and FAO, to act on their behalf, to represent the Secretariat
and to carry out its functions‚?Ě (WHO 2007).


The examples above illustrate the institutionalized relationships between UNEP and the MEA
Secretariats. They show that, in addition to being responsible for the initial establishment of

many MEAs, UNEP functions as a secretariat for many of them. As can be seen in the legal text
from these conventions, there may be possibilities for further developing the relationship
between UNEP and the MEAs, in particular if UNEP GC/GMEF is equipped with universal
membership and decision-making capacity. That way, the forum could become a venue for co-
reporting, sharing of best practices and enhance coherence among MEAs. Establishing such a
forum might incur some up-front cost for establishing it, but it is expected that it could yield
cost-benefits in the long term (Urho 2010).

The possibilities for introducing such co-reporting and decision-making on MEAs at GC/GMEF
would have to be researched in detail, since drawbacks could include that it might compromise
the legal autonomy of MEAs as well as overlap with the functions of the Conference of Parties
(COP). Such potential for conflict between UNEP and MEAs may also be one of the major reasons
to why universal membership has not been accepted despite repeated suggestions and
arguments in its favour. 12 To avoid the potential for conflict between UNEP and MEAs it would
be necessary to formulate agreements that clearly designate the roles of the respective forums.
Doing so might make the option of MEA COP co-location with UNEP GC a politically viable and
acceptable option for UNEP and for the established MEA secretariats. This could make the
current IEG system less fragmented and more efficient, both in terms of time, and finances.

Apparent discrepancies between the universality of the GC/GMEF and MEAs with only limited
membership could be addressed by way of discerning between ‚??multilateral‚?? and ‚??plurilateral‚??
agreements (Biermann 2011). Accordingly, members of GC that would yet have to ratify an
agreement could participate with observer status, as is already practiced in other forums. Such
multi-tier membership could also have the potential of enhancing ratification ratios of MEAs
among laggard states.

Finally, positioning some MEAs under a UM GC/GMEF would present a good opportunity for
effectiveness gains, as doing so could result in better reasoning for national level policy and
implementation committees that could better articulate policies and measures to respond to the
needs of thematically related MEAs on the ground. In the long-term, the clustering of MEAs in a
single forum could enhance compliance and enforcement of the agreements. Modalities used in
the trade regime hint at possible measures, as the WTO is utilizing a system of ‚??cross-agreement
sanctioning‚?? (Wendell 2011). This option allows the suspension of concessions under other
agreements, if some reason or another, penalties under the non-compliant agreement is

2.10 IN SUM

UNEP GC 26 was not able to make a decision on universal membership. While some countries
stated their support, others clearly did not; and diverging views on this issue remain. The
arguments presented above will hopefully contribute to a better understanding of the potential
advantages of universal membership and the options for introducing new voting systems to

See Fauchald, Ole 2010. International Environmental Governance: A Legal Analysis of Selected Options.

Fridtjof Nansens Institut. for a detailed analysis of the
benefits of clustering MEAs under UNEP. Additionally, see for
details on countries‚?? in favour of universal membership.

outweigh and avoid some of the potential drawbacks of increased membership. As stated, it will
be important to clearly demonstrate to decision makers that universal membership will not
change the amount of funding needed to convey the annual GC/GMEF. The following table
summarizes some of the main points made in the previous section:

Expected benefits Potential challenges

‚?Ę Global representation and increased voice of ‚?Ę Some countries may perceive increasing
ministries of environment and better recognition of number of ‚??voices‚?? in GC/GMEF as loss of
global environmental issues; comparable advantage in decision-making
‚?Ę Increased efficiency in decision-making; process;
‚?Ę Enhancement of coherence and efficiency of MEAs;
‚?Ę Could create precedence for other UN
‚?Ę Clustering of MEAs under a forum with universal
organizations and bodies‚?? membership
membership could yield long term cost-benefits;
‚?Ę Better addressing MEAs would enhance UN
‚?Ę Financial consequences of introducing universal
credibility with member states and increase likelihood
membership of the UNEP GC should be fully
of continued support for subsequent broader reform
investigated and reported;
of IEG;
‚?Ę Not all countries have permanent
representatives in Nairobi;
Required input Expected output

‚?Ę Change decision-making modality from consensus to ‚?Ę Global forum could make strong decisions on
qualified majority; environment and improve effectiveness of IEG;
‚?Ę Establish executive board or elected bureau for day- ‚?Ę Faster decision-making process;
to-day management;
‚?Ę Possibility to cluster decision-making on MEAs;
‚?Ę If GC/GMEF becomes decision-making umbrella over
‚?Ę Lessen operating cost of COP/MOPs when
related MEAs, ‚??cross-agreement sanctioning‚?? to
mainstreamed with GC/GMEF;
incentivize compliance with agreements could be
‚?Ę Possible to enhance compliance by use of
‚?Ę Multiple MEAs under one roof should be handled by ‚??cross-agreement sanctioning‚?? between related
way of discerning between ‚??multilateral‚?? and
‚??plurilateral‚?? agreements;
‚?Ę Certainty among member states that universal

Table 2: Universal Membership
membership will not change cost of annual

Source: Author‚??s compilation

Trade-offs will have to be taken into consideration if environmental governance is to be
meaningfully reformed. The tradeoffs refer to the potential efficiency gains from locating a
number of MEAs under UNEP GC. Existing MEA secretariats might not agree to that. However it
is worth to remember that the final decision to change the location of the MEAs or not can be
executed gradually, and ultimately depends not on the willingness of the MEA Secretariat but
the intentions of member states.

Finally, the introduction of universal membership could be combined with a conditionality, i.e.
that the empowerment of the forum shall be linked with commitment and responsibility to deal
with other central issues to the IEG process such as predictability of funding, proposing the
establishment of legal autonomy and decision-making power, implementation assistance from
UNEP in support of MEAs on country level, and other concrete steps needed to strengthen

environmental governance and bridge the implementation gap. However, these issues require
consensus on important but contentious further steps that a universal forum equipped with
decision-making power could address. Subsequent tasks of determining detailed strategies for
supporting MEAs on country level, additional capacity building for governments, and other
crucial issues needed to strengthen environmental governance could be approached effectively
by elevating the status of UNEP from its current programme to a specialized agency on


The discussion on strengthening international environmental governance has progressed over
the last decades but a conclusion is as lacking as ever. The recent Nairobi-Helsinki consultation
process established points on forms, functions and responses that, if implemented, will bolster
IEG. The discussions concluded with agreement to focus on five different forms, some of which
entail incremental improvements to existing bodies as well others with broader reform
objectives (UNEP 2010). This section will limit its focus to the option for establishing a
specialized agency on environment.


In the UN context, specialized agencies are created to address issues that UN and member States
deem important enough to justify the creation of an autonomous agency. Such agencies have
their own legal identity, a plenary decision-making body (General Assembly), a representative
executive body and a secretariat. They can be established by a resolution from UNGA
(UN Charter, Article 57), to which they are linked through ECOSOC. In addition, the UNGA
(UN Charter, Article 63) can determine the details of the agency‚??s relationship with the UN, and
to what extent it would have to follow recommendations of ECOSOC.

Establishing a specialized agency for environment would demand great political commitment
from the international community, because it entails creating a legally autonomous agency with
its own decision-making power. This is a conscientious issue, because doing so could remove
environmental decision-making power from the GA and ECOSOC. Critical voices argue that this
drawback is sufficient to consider elevating UNEP‚??s status to a specialized agency for
environment as an unrealistic option.


The decentralization of autonomous decision-making may certainly deter some parties from
supporting this option. However, it might be helpful to consider this issue in a different context
and argue that if decision-making on environment related issues were to be deliberately
removed from ECOSOC and GA, it would be possible for the latter bodies to better focus on
overarching economic and political governance issues. Indeed, these issues have an
environmental dimension, but concentrating environmental decision-making in an autonomous
agency could potentially make environmental decision-making more effective, and this is
needed for the current governance structure.

EU practices indicate that decentralization of power can be useful. In its establishing treaty
(Amsterdam Treaty), the institution acknowledged the importance of ‚??proportionality, and
subsidiarity‚?? and made them central and determining principles of its decision-making structure
(EU 2011). Accordingly, subsidiarity is used to decentralize decision-making on behalf of the
EU,‚?Ě ‚?¶in areas which do not fall within its exclusive competence‚?Ě (EU 2006). For environmental
governance on the UN level it could mean that the UNGA delegated technical decisions on
environment to the specialized agency. Contrarily, similar rules would apply to the GA of the
specialized agency, which would have to (and legally could, by means of UN Charter Article 63)
consult decisions of great economic and social importance with the UNGA before making


While the call for establishing a specialized agency on environment is pertinent, it has not yet
been accepted and international environmental governance remains crippled. A similar
situation can be observed on country levels, where ministries of environment often find
themselves positioned rather badly in the national decision-making hierarchy. There is a need
for elevating the status of environmental agencies and ministries on national as well as on
international levels, because UNEP in a sense is representing all national environmental
authorities. Compared to the situation in 40 years ago, environmental authorities in the world
have become full-fledged ministries in many countries. This gives a good reason for
strengthening UNEP accordingly. Establishing a specialized agency for environment would
create an autonomous decision-making structure on the international level that could help
policy makers translate international decisions into national level environmental policies. More
national level clout of environmental ministries could benefit not only increased capacity of
environmental officials, but also enhance agenda setting and negotiation power in the national
policy formulation and assessment processes.

The potential drawback of creating a separate decision-making structure has often been used as
one of the main arguments for UNEP retaining its status as a programme. Countries have argued
that a programme by its very definition is nimble, flexible and therefore able to better
mainstream environment throughout decision-making (Ivanova 2007). It is an important point;
in fact the increase of cross-cutting environmental issues has only lent more amplitude to the
need for integrating environmental concerns throughout policy making processes at all levels.
However, the question is whether weak and badly funded programmes are really the right
vessels to enhance the voice of the environment in a choir of strong singers.

As was mentioned, an environment programme has not been able to sufficiently determine the
international political agenda. A stronger body with legal impetus to oversee the integration of
environmental concerns throughout decision-making is becoming increasingly relevant to halt
environmental degradation. In relation to the sustainable development discourse, it has also
become clear that the environmental dimension of sustainable development has been neglected
in favour of economic growth. Realizing the need to reaffirm the importance of the environment
as fundamental foundation economies and well-functioning societies, it is therefore argued that
ministries of environment and natural resources need a much stronger and autonomous body
to place the environmental agenda better at all levels of the governance discourse.


A specialized agency would not displace environmental focal points in other ministries, nor
would its purpose be to unite and mainstream all environmental divisions and programmes
under one. This kind of bottom-up integration on the implementation level is already underway.
Environmentalists perceive as a significant progress that many public and private sector
institutions have established either environmental terms of reference as part of their mission,
or have positions dealing with environmental mainstreaming. At the same time, however,
bottom-up integration is not sufficient, and a specialized agency would be needed to steer top-
down integration of environmental concerns into planning, policy-making and evaluation.
Options that are specific to the legal clout and personality of a specialized agency would include
better agenda setting in the policy making process, stronger legal and regulatory purview, and
the ability to raise serious concerns with regards to other environmentally harmful policy


In addition to considerable political will for its establishment, a specialized agency will need
more and predictable funding to position environment higher on the agenda and carry out the
functions of its mandate. Normally agencies determine the details of their funding arrangements
with their constituents. Many specialized agencies, as for instance the International Labour
Organization (ILO), the World Meteorological Organization‚??s (WMO) and the World Health
Organization (WHO) derive parts of their funding from assessed contributions.

Assessed contributions are normally based on countries‚?? capacity to pay and measured by
factors such as national income and size of population. There are minimum and maximum
ceilings to the contributions, ensuring that no state pays more per capita than the per capita
contribution of the highest contributor (WHO 2000). Other parts of the budget can derive from
extra budgetary donations, trust funds and partnership agreements that can be earmarked for
special cooperation programmes.


Some agencies, including the WHO, also allow for differentiated memberships that provide
space for countries, territories, or other actors with lesser contributions to partake as
observers, or with a limited voting capacity (WHO 2009). A concrete example of heterogeneous
membership systems can be seen in the World Tourism Organization that was elevated to
become a UN Specialized Agency in 2003. It has differentiated membership status that apart
from effective members also accommodates associate members, affiliate members and
observers (UNWTO 2011). The membership status however, does not depend on level of
financial contributions, as these are decided on an assessed scale, but membership status is
tailor made to sovereign states, territories, associations, or private entities. While this example
shows the option of differentiated membership status, it would have to be determined whether
similar differentiation would be possible as a factor of funding contributions, since such could
potentially increase the political willingness towards establishing a specialized agency.
However, such proposal should also be cautiously approached, since it might result in an agency
without ‚??effective‚?Ě and paying members.

The ILO introduced a flexibility mechanism in 2006 to give countries some leeway in the event
that they were unable to cover their assessed contributions. Since resilience to financial and
economic fluctuations would be considered a necessary element of any funding structure for the
future, it could be useful to design the financing structure of a specialized agency with such an
inbuilt flexibility mechanism. In addition, a specialized agency could derive parts of its funding
from ‚??other‚?? sources and ‚??miscellaneous income‚??, and allow fund raising from the private sector
and philanthropists to play a role that matches the expected responsibility from various
stakeholders in a more effective and multi-level environmental governance system. A related
issue was also briefly mentioned in the section on universal membership, where the intention
would be to establish the GC/GMEF as suitable forum determining the details of such
‚??innovative funding‚?? systems.

Comparing the financial implications of a specialized agency with those of universal
membership of the GC/GMEF, it becomes clear that the former would entail much greater
changes to funding structure and amount to have a fair chance to succeed. Merely establishing a
specialized agency without making inroads on funding issues would be a recipe for disaster and
probably even weaken environmental governance if that is possible. A honest effort therefore
requires that details are determined with regards to how the agency should respond to
requirements set forth in its mandate, including concrete budget lines for implementation
activities. The funding related issues may also constitute one the most major drawbacks of the
specialized agency option, and also explains why, despite prolonged attention in international
negotiations, it has been impossible to introduce such upgrading of UNEP.


As seen in Resolution 2997, a main component of UNEP‚??s mandate is to coordinate as well as
review the direction of the environmental work within the UN system (UNEMG 2011).
Formerly, this part of the mandate fell under the System-wide Medium Term Environment
Programme (SWMTEP). It was introduced in 1999, but then abandoned and replaced with the
current Environment Management Group (EMG).


Today there are as many as 44 environmental divisions and offices in the UN. Most of those have
appeared not because of UNEP‚??s success in mainstreaming environment in the UN, but because
agencies and UN bodies themselves have gradually mainstreamed environment in the system. It
may therefore be that a new UNEP as specialized agency should not even be primarily
concerned with the UN response to environment, but should focus more on serious problems
related to persistent implementation gap of environmental agreements on national and local
levels, regional and national capacity building etc. Therefore, elevating UNEP to a specialized
agency on environment is not so much about effectively mainstreaming environment
throughout the UN system but more about the need for a stronger institution to position
environment issues better on the global political agenda and create a body with the mandate to
respond to demands on regional and national levels. Strengthening of UNEP only at the
international level would not be sufficient. Asia, which has become the world‚??s production
center, should have much stronger regional environmental institutions to better deal with
increasing environmental issues. A stronger regional representation could in turn strengthen

the environmental work of regional and sub-regional bodies, including Tripartite Environment
Ministers Meeting (TEMM) in North-east Asia, or the environmental programmes of the
Association of Southeast Asian Nations (ASEAN).

Interviews with current and former UN staff identified one of the main reasons for UNEP‚??s
failure to coordinate environment within the UN system as being rooted in the fact that the
programme, with its relative legal weakness, has been unable to sufficiently leverage and
influence many of the larger programmes and agencies within the UN (UN 2011). 13 And as
mentioned, the mainstreaming task is already happening to a large extent, throughout UN
bodies and their initiatives. However, the 44 existing environment divisions and UN initiatives
indicate that fragmentation and overlap is still a problem that needs to be addressed both inside
the UN system and on country level. In this regard, expanding the ‚??One-UN Initiative‚?Ě would be
beneficial as would clustering MEAs. This might also enhance the UN‚??s level of credibility and
also support from member States both to the UN at large and to broader reform options as those
discussed in this paper. While larger efforts are needed to address fragmentation and overlap,
initial steps would include signing of Memorandums of Understanding (MoUs) between UNEP
and the respective agency or institution aimed at effectively harmonizing the environmental
work among the institutions. 14

Finally, if UNEP were to become an agency it would also be better positioned to suggest and
debate legal instruments in its plenary forum (GC/GMEF) as well as adopting them in its own
General Assembly. Even though a specialized agency would not be as closely related to the UN
as a programme is, provisions could be made so that the Agency remained a central member of
the UN‚??s Chief Executives Board for Coordination (CEB). 15 Doing so would be important to
ensure that, also in the future, it would remain central to coherence and cohesion of
environmental work within the UN and its related specialized agencies. 16

3.9 IN SUM

The discussion on programme vs. specialized agency has been tabled at many
intergovernmental discussions, and while on several occasions many UN member States have
supported the upgrading of UNEP to a specialized agency - there has never been sufficient
impetus for the establishment of a specialized agency on environment. 17 However, Rio 2012 can
create sufficient momentum and support from governments to agree on a Roadmap that can
determine the direction as well as milestones to strengthen IEG, and perhaps consider the
possibilities for establishing a specialized agency on environment. The following table sums up
some of the points made in the text above:

Personal communication; Nairobi and Bangkok (2011).

Member states could initiate this development by submitting a request for a UN GA resolution.
15 Additionally, a previous paragraph also summarized Article 63 of the UN Charter, which provides

options for legal affiliation between the UN and a specialized agency.
17 Biermann (2007) states that, over time 50 countries have supported the creation of a Specialized


Expected benefits Potential challenges

‚?Ę Placing ‚?Ę Removes some of the environmental decision-
environmental decision-making with
GC/GMEF could allow ECOSOC/GA to better focus making power from the GA and ECOSOC;
‚?Ę Ingrained belief that an environment programme by
on overarching economic and political governance
issues; its very definition is nimble, and flexible and therefore
‚?Ę Would be well positioned to debate legal instruments better able to mainstream environment throughout
in its plenary forum (GC/GMEF) as well as adopting decision-making than an agency;
‚?Ę Widespread (but erroneous) belief that a specialized
them in its own General Assembly;
‚?Ę Increased efficiency of environmental decision- agency would no longer be affiliated to the UN (UN
making; Charter, Article 63);
‚?Ę Increased clout of environmental ministries could ‚?Ę Demands great political commitment from the
enhance agenda setting and negotiation power in international community;
‚?Ę The requirement for more and predictable funding to
national policy formulation and lead to more effective
environmental policy making; position environment higher on the agenda may deter
‚?Ę Better agenda setting in national policy making countries from supporting this reform option;
‚?Ę Merely establishing a specialized agency without also
process, stronger legal and regulatory purview, and
the ability to veto the agenda of other making inroads on funding issues would be a recipe
environmentally harmful policy proposals; for disaster. It therefore would require that details be
determined with regards to how the agency should
respond to requirements set forth in its mandate,
including concrete budget lines for implementation

Required input Expected output

‚?Ę Political commitment from international community; ‚?Ę Autonomous decision-making structure on the
‚?Ę Needs a legally autonomous agency with own international level that could help policy makers
decision-making power; translate international decisions into national
‚?Ę Resolution from UNGA (UN Charter, Article 57); level environmental policies and
‚?Ę For political feasibility GC/GMEF should implementation;
consult decisions of great economic and social
‚?Ę Environmental concerns would be better and
importance with the UNGA before making decisions
more strongly represented in international as
(UN Charter, Article 63);
well as national policy formulation agenda;
‚?Ę Could include other constituencies than just
‚?Ę Environmental dimension of sustainable
governments (example from ILO‚??s structure (industry,
development receives more attention compared
labour unions, governments) and representatives
from civil society); to economic and social dimensions, that
‚?Ę More effectiveness of IEG would have to prioritize traditionally have had higher priority;
top-down integration of environmental concerns into
planning, policy making and evaluation also on
national levels;
‚?Ę Would need more and predictable funding to position

Table 3: Specialized Agency
environment higher on the agenda;

Source: Author‚??s interpretation


By highlighting a number of weaknesses of current IEG, the above sections have argued for a
broad reform to UNEP in order to strengthen IEG and to enable a better response to current and
anticipated environmental challenges. The paper has argued that reform and strengthening of

IEG is important because 1) environmental challenges have grown in impact and magnitude
along with globalization but the architecture has not yet evolved to respond to these emerging
challenges; and 2) governance has become multi stakeholder and more participation is needed
from all stakeholders in order to ensure coordinated and synergetic governance.

To address the issue of environmental governance reform, the paper has established that
incremental reform options, while important, will not suffice to significantly strengthen IEG.
Instead it has proposed a phased reform consisting of two broader reform options and
summarized key points related to each. The analysis has focused on legal, financial, and
structural implications of the reform options, and emphasized possible benefits and drawbacks
as summarized in the tables above. The two options have been presented in succession to argue
for their relatedness and make a case for how countries could create momentum towards
broader reform and strengthening of environmental governance by mobilizing support for
introducing universal membership of the UNEP GC/GMEF.

As for the first reform option of universal membership, the paper has argued that it would be
possible to accommodate the increased complexity of universally voting members by adopting a
qualified majority voting system to improve efficiency of decision-making. The feasibility of the
decision-making was exemplified by the EU, which has gradually adopted qualified majority
voting to accommodate increasing members. Apart from empowering global environment
ministers by creating such universal membership, the paper has also shown how it could
become a decision-making umbrella for MEAs, thereby clustering debate and decision-making
of those of the treaties that already have a close relation to UNEP written in their legal texts.
This would benefit both coherence and efficiency of IEG.

Apart from being the first phase of a broader reform of UNEP, it is of course true that universal
membership can be viewed as a reform option in itself and without connection to other reform
options. It is conceivable that it could be introduced primarily for the benefits of global
representation and better decision-making on IEG issues, arguably these benefits are significant
and sufficient to justify it. If the UNGA were to provide the GC/GMEF with universal
membership and decision-making power, it is very likely that it would significantly empower
the ministers at the GC/GMEF to make strong environmental decisions, because conversely to
the GA, the GC would be a forum especially mandated for environmental issues. This would give
a different priority to environmental decision-making when compared to the GA, where other
issues have had higher priority.

Subsequent to universal membership of the GC/GMEF, the second broad reform phase of
establishing a specialized agency, was also emphasized. In this regard the paper argued that an
environmental policy makers‚?? forum with universal membership could propel the creation of a
globally representative decision-making forum for international environmental policy. If this
could be achieved it would be an obvious next step to negotiate a UN GA Resolution towards
establishing a specialized agency with legal independence, but affiliated to the UN. Such a
mandate could have a tremendously positive effect on the clout of environmental agenda
setting and policy making, internationally and nationally.


Since international environmental agreements often fall short on national levels and in the
stages of implementation, it will not be sufficient to keep IEG purely on the intergovernmental
arena. To address this issue, the paper has argued that benefits for national level environmental
policy have to be identified. To do so, more support must be provided to environmental
ministries and agencies on national and local levels. Strengthening environmental ministries on
national and local levels is a two-way process. For the UN-bodies, it will be necessary that they
continue to cooperate and implement cohesively expanding on the ‚??One-UN‚?Ě initiative and
articulate ways of cooperation as well as demarcation between and among the agencies.
Environmental governance in this way will fall beyond UNEP as an agency and some tasks will
have to be undertaken in cooperation or by representation of other UN agencies, NGOs and
national stakeholders, according to which solution is the most effective and efficient. The
cooperation could be visualized by means of the following figure:

Figure 4: Cooperation on implementation levels

Source: Author‚??s interpretation

Exchange of knowledge and good practices between countries and sectors is also depicted in the
figure, this kind of initiative can take place bilaterally decided and organized by countries

themselves and with the help of agencies. Reporting of progress for least developed countries
(LDCs) and reporting on MEA commitments overall could then be done to the plenary forum of
the specialized Agency (UNEO/WEO). For national policy makers, the strengthening of the
environmental mandate in comparison with other ministries will have to be implemented in
national decision-making processes. As was emphasized in the paper, a direct benefit could be
harnessed if policy makers were to take advantage of the efficient decision-making in the
GC/GMEF and agree on issues to strengthen implementation of environmental agreements on
national level. Moreover, a specialized agency could initiate the establishment of domestic
‚??interlinkages‚?? committees tasked with identifying thematic links between environment and
other important sectors of the economy such as water, energy, transport, etc. In this regard the
paper has argued that additional integration of environmental concerns could be achieved
politically through enhanced environmental agenda setting, influence on national budgeting or
other interventions that may vary according to national circumstances. The paper has argued
that doing so would result in better enforcement of MEA commitments, especially if MEA co-
decision could become part of the GC/GMEF as decisions could be made more efficiently.

While the two-phased reform proposal establishing universal membership of the GC/GMEF and
establishing a specialized agency resemble significant reform options, essentially the
improvement of IEG has to be carried forward by decision makers themselves. This implies that
the conscientious issues concerning amounts and predictability of the IEG regime‚??s funding
need to be addressed along with capacity building for developing countries, better integration of
environment issues into decision-making, monitoring and assessing the environment, access to
information and environmentally sound technology and other emerging issues.


If universal membership and specialized agency options resemble the way forward, the
question still lingers then why governments have not chosen to sufficiently back them up and
initiate their implementation long ago. Partly this can be explained by an overall lack of trust in
the UN and the multilateral system of negotiation and decision-making as a whole. Countries
and their citizens have increasing trouble seeing the relevance of the complex international
governance structures. The UN itself should continue to emphasize its internal reform to show
that incremental efficiency improvements are being undertaken. Among other measures it will
therefore be important to undertake thorough analysis of how the identified options in the
Nairobi-Helsinki Outcome will actually improve the functions and tasks identifies as important
for IEG. Additionally, it is important that the UN leads by example and shows not only how
environmental governance can be effectively mainstreamed in their organization, but also why
it should remain a relevant and credible institution for the global community.

National level governments also play a decisive role in determining support or resistance to
strengthening environmental governance. On these levels it could be advised to place effort on
national awareness campaigns and information dissemination. The public must clearly
understand the role of the UN, the links between international environmental governance
structures and their lives and how the international environment affects the well-being of local

It is important to make this point; because many states remain convinced that strong
international governance would compromise their national sovereignty. In fact, global

governance will not compromise the sovereignty of states. On the contrary, because global
environmental impacts can be felt increasingly on the local scale, globalization has extended the
reach of nation states‚?? interest. It should therefore be in the interest of sovereign nation states
to upgrade and mandate institutions whose purpose is to address global environmental issues
to improve the quality of the global and local environments.


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