Gerhard WeissEFICEEC, BOKU Vienna

The governance of innovationNew financing mechanisms for forest

ecosystem services in Europe and their implications for forest governance

20.8.20042

The governance of innovation

New financing mechanisms for forest ecosystem services in Europe and their implications for forest governance

FAO, Rome, October 4-7, 2010

International Conference-Forum:Emerging Economic Mechanism: Implications for Forest-

Related Policies and Sector Governance

20.8.20043

Research background

• European Forest Institute Project Centre INNOFORCE (2001 - 2008) • European Forest Institute Central-East European Regional Office EFICEEC (since 2009) • Study on the Development and Marketing of Non-Market Forest Products and Services (FORVALUE) for EC DG AGRI (Mavsar et al. 2008) • COST Action E51 “Integrating Innovation and Development Policies for the Forest Sector”

Do not talk about „functions“ but …

• … ecosystem services (MEA) • … marketability (Ostrom et al. 1994; Merlo et al.

1996; Glück 2000; Mantau et al. 2001; Pettenella et al. 2007)

• … innovation (Rametsteiner et al. 2005; Slee

2006; Niskanen et al. 2007; Rametsteiner et al. 2010)

• … policy/governance (Buttoud 2002; Böcher 2008; Rametsteiner et al. 2010; Weiss et al. 2011)

Limited marketability of forest ecosystem services

Mantau et al. 2001

Innovation systems: actors and institutions

Rametsteiner et al. 2005

0 4 6 8 10 12 Ministry: Section Forestry

Ministry: Section rural development

University: forestry departments

Federal Forest Research Institution

Chamber / interest group (small forest holdings)

I nterest group: large forests

Foresters

Federal Govt. I nstitutions

Innovation processes

Three dimensions: • information flows, • cooperation of actors, • financing.

Rametsteiner et al. 2005; Weiss et al. 2011)

Types of financing mechanisms

Examples (PUBLIC – or MIXED):

Taxes – or Conservation Banks

Examples (PUBLIC – or MIXED):

Subsidies – or contracts

Examples (MIXED):

New markets - Carbon trade

Examples (PURE PRIVATE):

Trade with forest goods

Examples (PURE PRIVATE):

Spiritual or cultural services

Examples (PURE PRIVATE):

Eco-sponsoring, donations, gifts, certification

Use of financing mechanisms in EU(government answers)

Conclusions from an innovation system perspective

Ecosystem services are hardly seen as a business field by forest owners and by governments:

• Forest owners fight off social demands instead of developing entrepreneurial offers

• Systematic knowledge base and data lacking• Easier to talk about innovations regarding wood

than regarding other ecosystem services

Conclusions from an innovation system perspective ctd.

Gaps in policy: • Comprehensive innovation policies are lacking for the

forest sector• Innovation is seen important by policy-makers and

documents but innovation support measures are rare • Lack of cross-sectoral coordination • Forest sector is hardly connected to the NIS• Sector focuses on traditional products and neglects new

business opportunities

Changing role of governance

The traditional division of state and market spheres increasingly breaks up and leads to a paradoxical development:

• Trend to involve private actors in governance, e.g. through market-based instruments,

• … but there are new roles for governmental / institutional actors!

Policy action is needed regarding public AND private mechanisms

Public mechanisms:• Further develop public or mixed

instruments (PES, new markets,…)Private mechanisms:• Support private sector in order to use and

develop new products or services

Systemic innovation support

Three dimensions for action:• to intensify the information on new market

opportunities, • establish cross-sectoral bridges, • and to provide innovation-oriented

incentives (seed money; LEADER approach; etc.).

thank you

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