Now You See Me – Can Consumer-Labels help promote the Provision of Ecosystem Services?

Now You See Me – Can Consumer-Labels help promote the Provision of Ecosystem Services?

by | Dec 6, 2022 | Results

Many studies show that consumers may be willing to pay a premium for food products with additional value such as regional production, certain social standards, or biodiversity related aspects. But what is needed to convince food processors, retailers, and other value chain actors to engage in the process of developing products reflecting this societal demand? After all, establishing the necessary structures, relationships and institutions is, at least initially, a rather costly process. In Contracts2.0 we conducted a study asking food industry experts, how a value chain approach could help to ensure the long-term provision of ecosystem services.

Labels can help consumers make informed choices

There is theoretical evidence that consumers would pay a higher price for higher production standards. Especially, when farmers, being on the forefront, are sufficiently compensated for making the additional effort to bring about the desired ecological impact.

But – this must be clearly communicated to consumers! Labels can help the consumer to make informed choices by marking the added value of a product. While this can be very helpful when making a purchase, it is easier said than done. Every time we enter a store, we are confronted with endless options and ample choice. Yet every consumer reacts differently to the various marketing instruments used to prompt purchases. Therefore, some experts say, that relying on just one instrument for promoting the added value, such as a label, does not suffice and it should rather be a mix of different instruments (Label, QR-code, Point-of-sale instruments), so consumers can pick the one most suitable for themselves.

In line with that, the current EU Farm to Fork strategy intends to integrate a sustainable labelling framework to empower consumers to make sustainable food choices. However, the European Commission has not yet been explicit about how to implement this. Since the idea of “sustainable” can be interpreted in many ways, in Contracts2.0 we wanted to test how we can use product labelling to increase the provision of Ecosystem Services in particular.

What do experts think about a new labelling framework for Ecosystem Services?

To successfully implement a new label, all stakeholders along the food value chain should be involved in its design process. We interviewed producers, label organisations and retailers in Germany, Poland, Spain, and Sweden to find out where the 45 participants see potential for the introduction of a new product label for Ecosystem Services. The experts were chosen due to their particular expertise in consumer behaviour and valuable insights in gaps in the current labelling landscape.

Figure 1: Food value chain actors considered in the study (Icons from freepik, flaticon.com).

To learn about the individual attitudes towards a new label, we asked participants to sort prepared opinion statements according to their personal agreement with it and justify their placement. This way we were able to compare and analyse the experts’ opinions and categorise them into common viewpoints. More than half of the experts were in favour of such a potential Ecosystem Services labelling framework and even proposed concrete recommendations for its design. A smaller part of the expert group was rather critical of introducing new Ecosystem Service product labels, either because of the multitude of already existing labels or the technological requirements to successfully track provided Ecosystem Services along the value chain.

                                   Figure 2: Example of a grid in which statements were sorted into.

Where do we go from here?

We used the identified similarities to develop and propose three label prototypes that differ in terms of presentation and verification of services, rewarding farmers, and relating products to verified producer services.

1) A producer-driven Ecosystem Services label: this label is independent of any existing labels and only focuses on the provision of Ecosystem Services in the value chain rather than any other product characteristic. Farmers are directly remunerated according to their contribution and independent third-party organisations verify the compliance. The mechanism behind this label is similar to EU organic: farmers receive subsidies for their environmental effort and are able to realise market advantages because of their distinguished products.

2) A consumer-oriented information label: Here, we argue that increased visibility through the label increases the product’s demand enough to lead to higher product prices. The farmer in this model is not directly remunerated by the government for additional effort (such as with pillar 2 payments with respect to organic farming) but rather compensated by higher market prices, since consumers are likely willing to pay higher prices for these high-quality products. In contrast to the first label type, which is backed by third party institutions, this label is being verified by national governments and existing policy mechanisms. In that line, the monitoring can be done by already existing organisations, such as it is currently done in the case of agri-environmental climate measures.

3) A reformed EU organic label: similar to the mechanism of the second prototype this one aims at using market advantages ideally resulting from increased demand though existing but extended environmental labels. Specific Ecosystem Services are clearly linked to the product rather than a general classification as “eco-friendly product”. Here also, existing institutions could be used for certification and thus help to streamline the process. So, this can be seen as an extension or redefinition of the already existing EU organic label.

Informed by various experts, our findings can contribute to the current discussion on the design of the sustainable labelling framework under the Farm to Fork strategy.

In the next steps we want to test whether consumers are actually, and not just in theory, willing to pay for products that are certified to be particularly biodiversity-friendly.

The detailed results have been summarised in a study that is currently under peer review. When publicly available we will link the study here.

 

Ⓒ Christoph Schulze, ZALF
Ⓒ Title picture: Lyza Danger Gardner
Combining collective agri-environmental contracts with a payments-by-results approach

Combining collective agri-environmental contracts with a payments-by-results approach

by | Nov 30, 2022 | Results

In his Master thesis, Max Sonntag analysed the potential for combining collective and payment-by-results elements for agri-environmental contracts, based on interviews with ten intermediaries from England. These intermediaries are facilitators of farmer groups who receive funding from the Countryside Stewardship Facilitation Fund (CSFF) for their work to align the management options of farmers on largely adjoining holdings.

The key research question of this study was “What are potential benefits and challenges of combining a collaborative payment for ecosystem services approach with results-based measures?” The particular focus was the role of the intermediary, here the facilitator of a Facilitation Fund group in England (see Practice Abstract 2 here).

Facilitators are responsible for bringing together a group of (at least four) farmers, covering at least 2,000 ha of (largely) adjoining land. They organise group meetings and farm walks, invite expert speakers and align the Countryside Stewardship management options that farmers enrol in. CSFF is technically not a collective contract, as the payment is transferred only to the facilitator. The degree to which the farmers collaborate depends on their individual engagement in the group. There tends to be less cooperation when there is a high proportion of pre-existing individual agri-environmental contracts within the group (Jones et al., 2020, p. 65) as farmers cannot change their contracts before the agreed end date.

Facilitators in this study worked with groups in the regions where the Results Based Agri-environment Payment Scheme (RBAPS) pilot in Northern England (Wensleydale) and East Anglia (Norfolk and Suffolk) was implemented. Therefore, they had an awareness of what a results-based approach could entail, and some farmers in these areas had made positive experiences with the pilots (more information). 

Combination is promising…

In general, facilitators thought that a combination of collective and results-based elements was a good idea and would work well. Five interviewees commented that the Facilitation Fund groups could be used as a platform by farmers to exchange and share knowledge on how to achieve results, and farmers in the group could more easily be trained to undertake self-assessments of results achieved. Alternatively, the facilitator would be on hand to help with the assessment of their plots. Three interviewees stated the result-based approach could enhance friendly competition among members, and access to results-based payment options could encourage more farmers to join the group. There was also the view that farmers who are members of Facilitation Fund groups already demonstrated an interest in learning and innovation regarding environmental activities and therefore would likely be keen to explore result-based options.

…but are there enough trained facilitators? 

Facilitators stressed that results-based payment are not suitable for every case. Indicators needed to be carefully chosen to ensure they are reliable and do not result in a high administrative workload for the farmers, and results-based payments needed to be coupled with a base payment (e.g. via an action-based measure) to reduce the risk to farmers. Current facilitation fund facilitators were seen to be well placed to work with groups to expand into result-based schemes. However, some interviewees had doubts whether there are enough facilitators with the right skills available to be able to advise farmer groups on results monitoring and effective group work at the same time. This suggested additional training for facilitators would need to be made available if such a combination of approaches was to be rolled out.

Onerous paperwork is a barrier 

Interviewees had concerns about the amount of paperwork. Five facilitators already perceived the administrative work related to the Facilitation Fund as onerous, and were weary of an increase if a results-based approach added to this load. In addition, many Facilitation Fund groups currently have no monitoring activities in place, neither with regard to the outcomes of their agri-environmental management, nor the success and social capital of the group as a whole (Prager, 2022). This lack of experience may be a particular hurdle for setting up a result-based approach and the related assessment and reporting activities.

In a scenario of combined collective and result-based elements, a majority of the interviewed facilitators believe that assessing results of management activities, helping with monitoring and providing 1-to-1 advice would be a key aspect of their new role. Others felt their role would not change much: they would continue to facilitate the group’s work as a neutral third party, organise training and help with spatial targeting.

Facilitator role is similarly important in other countries

In conclusion, facilitators have an important role in supporting farmer groups in environmental management. This is in line with observations from other agri-environment climate schemes, such as the Dutch national collective scheme (Berner, 2021), or the result-based Burren Programme in Ireland (Nietzschmann, 2021, Master thesis, more information), where facilitators are involved in multiple roles. These include, for instance enabling communication and coordination among participating famers, offer advice and extension services, assist with the spatial targeting of measures to the most suitable areas in the landscape, join in the monitoring activities, or re-distribute and administer payments to farmers received from the government.

Facilitators view a combination of collective and results-based approaches favourably and most are ready to embrace the challenge of this innovation. Nevertheless, a number of design and administrative challenges remain to be tackled.

 

To cite: Sonntag, M. (2021): Combining a collaborative PES approach with a payments-by-results approach in England: Process Net-Map interviews with Countryside Stewardship Facilitation Fund’s intermediaries. Master thesis in Integrated Natural Resource Management at Humboldt University Berlin, December 2021.

Supervision: Claudia Sattler (ZALF) & Martin Scheele (HU)

Blogpost written by: Katrin Prager & Claudia Sattler 

Pictures: Jennifer Dodsworth & Katrin Prager (taken at a contracts2.0 stakeholer workshop in Ireland)

Contracts2.0 at the ESP Europe Conference

Contracts2.0 at the ESP Europe Conference

by | Nov 4, 2022 | Workshops & Events

The Ecosystem Service Partnership Conference offered a welcome opportunity to discuss the topics and research of Contracts2.0. From the 10th until 14th of October, the Ecosystem service research community gathered in Heraklion, Crete, to spend five warm autumn days together discussing transformative ecosystem research, the future of education, and values.

Discussing motivating contract design

The researchers working in the Contracts2.0 project were well represented and hosted several sessions. For instance, the session “Motivating contract design for the provision of ecosystem services and biodiversity in agriculture”, facilitated by Bettina Matzdorf, discussed the development and implementation of innovative contract models to produce more biodiversity and ecosystem services in the agricultural landscape.

Eszter Kelemen talked about the results from the Policy Delphi study, which was carried out as part of the Contracts2.0 project and explored how and under which circumstances novel contractual solutions could be better implemented within the European policy context.

Then, in his talk about farmers’ preferences for new agri-environmental-climate measures (AECM), Wojciech Zawadzki presented the results from the stated-preference-based Discrete Choice Experiment, where farmers could choose between practice-based and results-based agri-environmental measures.

Reflecting the implementation of novel contractual models

In the session on “Results-based approaches and other integrated models as drivers for ecological conservation and policy integration”, István Szentirmai gave a presentation on the case study Őrség National Park where new results-based and value chain contracts were designed together with practitioners. Dieter Mortelmans talked about the experiences from the contract innovation labs in Flanders to shift towards results-based agri-environmental measures and simultaneously achieve policy integration in rural municipalities faced with high land pressures.

Making local knowledge count

The last of the sessions that incorporated the Contracts2.0 project was “Making local knowledge count: co-design principles and practices for agri-environmental programmes”, facilitated by Francis Turkelboom. In this session, Louise Vercruysse presented the lessons-learned regarding practitioner participation in the co-design of agro-environmental contracts. Inés Gutiérrez-Briceño held a presentation on how to find incentives to move towards agroecological transition in the Community of Madrid and Jennifer Dodsworth discussed the mapping processes of co-design within Agri-Environment Scheme Development in North-England. Unfortunately, due to technical problems, these last two presentations were quite difficult to follow. The discussion in this session centred around the question of how to deal with local power dynamics and whose knowledge to include.

 

Food for thought: the role of science and researchers

The conference hosted a number of captivating keynote speeches. On the second day, for instance, Contracts2.0 researcher Ezster Kelemen, gave a talk about the inclusion of indigenous knowledge in Ecosystem Service research.

Who do you include? And how do you navigate the different layers of marginalization?

Her presentation made us reflect on our own position and role as researchers in local power fields. Giving a voice to representatives of local communities may not be enough, and true inclusivity is challenging and requires creative methods. These topics would come back at different times during the conference, and especially in the sessions related to participatory contract co-design.

Another remarkable keynote speech was given by Esther Turnhout about transformative ecosystem services research. She addressed the lack of diversity in the science community and the misconceptions about the science-policy-interface by both scientists and policy makers. There is not enough attention given to the interests and power relations within science, and the dominant framing of research problems. Esther calls for epistemic disobedience, for scientists to claim cognitive justice and integrate a plurality of paradigms. Furthermore, science is not an objective source, but should be part of the “messy, democratic game” that is politics. Definitely one to think about.

All in all…

…it was a successful conference for the Contracts2.0 researchers. Not only to present our work and discuss it with fellow researchers, but also to get inspired by people engaged in similar projects, make new connections and networks, and to reflect critically on our own research.

© Text and Pictures: Louise Vercruysse

To Innovate or not to Innovate? – A Danish Study on Conservation Grazing Schemes

To Innovate or not to Innovate? – A Danish Study on Conservation Grazing Schemes

by | Sep 27, 2022 | Results, Work progress

A study on different options to improve a scheme on conservation grazing revealed that Danish farmers are not hugely keen on adopting innovative contractual approaches. Even though many of the Danish farmers feel the need to increase the ecological impact of the measures, they argue that this could be achieved by improving the existing schemes.

How relevant are findings from the Innovation Lab to the Danish farming community?

Contracts2.0 aims to develop innovative contracts between farmers or land managers and other public or private bodies, which help to strengthen the implementation of agri-environmental measures in agriculture. This is done mainly in the Contract Innovation Labs (CIL), which have a regional or local base. In our Danish case, innovative solutions for contracts on conservation grazing have been developed on the island of Bornholm, which covers 1.3 % of the Danish agricultural area and is the home of 1.2 % of the Danish farmers.

In our CIL, the farmers of Bornholm expressed interest in the integration of innovative components to boost the impact of the existing measures. However, are the novel solutions developed in a specific region also applicable in national contexts? To check the national applicability of the innovative approaches, we initiated a survey addressing affected farmers all over Denmark. 370 farmers, a little less than 10 % of all farmers currently participating in a scheme on conservation grazing, provided answers.

 

The Top 4 preferred options are old acquaintances

The question we considered as the most important, dealt with potential options to provide farmers with additional payments for additional efforts. Six different options were listed, and each farmer could choose up to three favoured options.

The option that farmers point to as most interesting actually already existed earlier (albeit to a limited extent) in older versions of the Danish scheme for the management of grassland and natural areas. More than four out of ten farmers indicate that they would be interested in obtaining additional payment for small areas and areas with difficult access, i.e. areas with relatively high management costs.

The second most popular option is to get extra payments for more specific requirements. Again, this is an option previously available in the Danish scheme with differentiation according to, for example, the use of fertilisation and grazing pressure at different levels.

Thirdly, a little more than one in three farmers is interested in obtaining additional pay out for following a management plan for the contracted area. Today, management plans are already a reality for a number of farmers managing publicly owned land, but the support scheme is currently not directly linked to the plan. The most frequent model in these situations is that the authorities lease the land to the farmer and that the farmer holds the contracts on conservation grazing and gets the payment for this.

In fourth place is a bonus payment for maintaining areas of high nature value (HNV) according to the map of the Agricultural Agency. At present, aid is not differentiated according to the HNV-levels of the land, as the HNV feature is only used to determine whether land outside Natura 2000 areas is eligible for enrolment in conservation grazing schemes or not.

What about the rest?

Only slightly more than one farmer in five would opt for a scheme offering an additional payment when meeting certain nature quality indicators. Slightly fewer than one in five farmers would like to see a bonus payment for high local contract coverage (agglomeration bonus). The latter has been tried for a period of time with a small additional payment of 10% for local coverage of more than half of the eligible area.

Additionally, two thirds of the farmers are interested in improving the management of grasslands in the conservation grazing scheme to improve or secure the nature content. Apparently half of these farmers are even interested in improving management without additional payments.

Conclusions from the Danish Survey

Three observations can be made from the results presented here. Firstly, none of the presented options alone would be attractive for the majority of farmers. Secondly, the contract option featuring an individual management plan, developed in the Innovation Lab Bornholm, scores relatively high in the survey among the farmers from other parts of the country. Thirdly, the options with innovative elements, like results-based payments or collective implementation score relatively poor.

For further reference, see our survey results in the Graph below.

Bottom line…

…tweaking the existing schemes can bring about desired results in terms of conservation grassland management. Many farmers are generally interested in improving management to improve or secure the nature content of the grasslands under agreement. The Contract Innovation Lab on Bornholm suggests integrating the innovative approaches in the implementation of nature protection management plans in the agri-environmental schemes on conservation grazing under the Common Agricultural Policy.

The survey which also covers farmers’ views on other issues of agri-environmental programs (e.g. checks/controls, advisory services) is reported in Andersen, E.: Landmændenes syn på tilsagn om pleje af græs- og naturarealer (original, in Danish). A reviewed English translation is available here. 

How to utilize SWOT results in a Multi Criteria Decision Making (MCDM) model

How to utilize SWOT results in a Multi Criteria Decision Making (MCDM) model

by | Apr 8, 2022 | Results, Work progress

It is challenging to identify the deciding success factors for an effective and efficient implementation of collective agri-environmental schemes (AES). The relatively short implemantation phase of the  collective model as a nationwide scheme and the diversified environment around the different implementation levels make identifying success factors a rather complex task. We found no common indicators or quantitative data to compare agricultural collectives regarding their performance to realize their environmental targets. So the question for us was: How to make the performance in different cases easily comparable and thus identify the relating success factors via a Multi criteria Decision Making model?

The only available data to tackle this question was qualitative data collected in SWOT analyses at the beginning of the project. Each Contract Innovation Lab (CIL) was asked to complete a SWOT analysis assessing internal and external factors that affect the effective provision of environmental public goods. However, the challenge remained to simultaneously compare the results of several SWOT analyses and use them in a multi-criteria decision-making (MCDM) model. To this end, we introduced a new technique: The SWOT scorecard (Rudolf and Udovč, 2022). Here we explain how we developed this new technique.

1. Preparing a decision tree for MCDM

In the first step of our modeling process, we created a decision tree, a decision support tool typically using a tree-like structure to visualize decisions and their potential consequences. We used an individual decision-making approach based on a qualitative analysis of the relevant literature. Using a hierarchical top-down approach, we identified the main goals and the corresponding attributes, criteria, and sub-criteria that should influence the synergy between aspects in the collective case studies.

The criteria are still being investigated and are not yet final. However, for testing the SWOT scorecard technique, they were appropriate.

2. From SWOT Scorecard to MCDM model

The following steps describe how the SWOT scorecard technique can be used to arrange qualitative data to feed into an MCDM DEX model.

Step 1: First, we organized descriptive SWOT results by criteria for every analyzed collective scheme, making sure to keep track of the origin of data (S, W, O, and T factors). This step gives us a set of so-called ‘prime input data.’

Step 2: We applied the SWOT scorecard technique, transforming the ‘prime input data’ with a formula to numeric results. The SWOT scorecard sums the importance of S, W, O, and T factors for the criteria.

Step 3: Transforming the SWOT scorecard results to a descriptive scale that can be used in the DEX model. This gives us options of values of basic attributes and is the input data for the DEX model.

Step 4: In the last step, the descriptive values are fed into the DEX model. The SWOT scorecard keeps track of the results from SWOT analysis. It considers the diversity of collective schemes, which results in the appearance of common variables that can be described with the same name. This is key for comparing the collective schemes regarding environmental public goods delivery. Furthermore, we get results of success factors for any number of collective AES.

3. Towards a decision support tool

The DEX model is a first step towards building a decision support tool for decision-makers dealing with the design and implementation of collective AES, who would like to understand better the success factors contributing to an improved provision of environmental public goods. We are now building a user-friendly interface that links our database and the DEX model to make it accessible for decision-makers.

For more detailed information, check our paper, which was published in Sustainability, vol. 14 (2), 2022.

Written by: Janja Rudolf, Biotechnical faculty, University of Ljubljana (Slovenia)