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Indicator 7.61: Methods to integrate costs and benefits into markets, policies, and accounting

An indicator for Criterion 7: Legal, Institutional, and Economic Framework for Forest Conservation and Sustainable Management

What is the indicator and why is it important?

This indicator assesses the ability to fully account for the costs and benefits of public and private decisions on forest resources. Although information on traditional economic measures of forest market values is usually available, information on social and environmental values is incomplete. Lack of such information in national accounting frameworks can result in poor understanding of the relative value of all forest goods and services, including nonmarket and market values. Similarly, this lack of information could lead to poor allocation of forest resources. Better national accounting practices can also help identify areas where public intervention may improve market allocations.

What does the indicator show?

No specifically required mechanisms exist to develop and incorporate environmental and social costs and benefits into national accounting systems in the United States and its forest resources at this time. Many means exist, however, by which public policies consider environmental effects related to Federal and State projects, and at times private land actions. These include the process-based National Environmental Policy Act, which requires analysis of the impacts of major Federal actions on the environment.

The Endangered Species Act prescribes specific measures to protect threatened and endangered species and uses rigorous means to list such species. The National Forest Management Act Federal regulations include specific directions to provide for ecosystem diversity through a combination of process requirements and prescriptive guidance.

Research and planning are used as part of informational and educational policy mechanisms to implement these environmental and social components of national forest planning actions. Various incentives, subsidies, and taxes also are provided for planning by States, and the protection of endangered, threatened, or rare species and ecosystems. These include specific Federal or State programs and private market actions in forest certification, wetlands banking, and cap-andtrade systems for endangered species or carbon storage. These and other ecosystem services are becoming a much greater focus of both public and private forest management.

Table 61-1: Policy and Governance Classification

What has changed since 2003?

National efforts toward environmental accounting for a broad range of goods and services, including forests, have been considered but not adopted, to date. Most forest products firms and organizations have also now adopted official sustainability policies and are championing corporate social responsibility (CSR) actions such as forest certification, ISO 14001 certification, or CSR policies and statements to burnish their positive environmental image and gain market recognition.

Criterion 7 Indicators