Nine steps for cost-benefit analysis of forest landscape restoration activities

You have just been asked to run a cost-benefit analysis for applying restoration techniques to a degraded landscape. Do you have a clear picture of what to measure and which data, tools or frameworks you should consider? Do you know who your stakeholders and investors are? Overwhelmed? Don’t be. IUCN’s new report can help you break it down into a tiered and logical process.

Forest-agriculture division, Bolivia.

Forest landscape restoration (FLR), although often misconstrued as having high upfront costs and low initial returns, benefits society locally by generating start up jobs, improving soil productivity and water resources, aiding in erosion control, improving biodiversity conservation, stimulating the economy, and manifesting in many other tangible ways. It also benefits society on a global scale by sequestering carbon and promoting global health and security. Of course, this only addresses half of the balance sheet.

Costs associated with FLR interventions are also essential to any equation that aids decision-makers weighing the pros and cons of their actions. The possible costs of FLR can be assessed in terms of material inputs, the needs and goals of the people involved, long-term versus short-term gains, financial investments and so on. Without a reasoned look at both the costs and benefits, a truly balanced decision cannot be made.

When embarking on a decision to engage in the most effective and efficient FLR intervention, there are a dizzying number of considerations such as who benefits; on what timeline will the benefits be realised; and who pays for it, to name a few. Ultimately, do stakeholders and investors see this restoration as an investible opportunity?

To aid with producing a formalised assessment of FLR interventions, a recent IUCN report, A Cost-Benefit Framework for Analyzing Forest Landscape Restoration Decisions, lays out:

“…a framework for accounting for the ecosystem service and economic impacts of forest landscape restoration activities in a way that allows the results to be structured to inform multiple types of restoration decision-making that can help decision makers understand the trade-offs of different restoration scenarios.”

A nine-step programme for achieving success in the cost-benefit analysis process is the primary take away from this report. Each step in the progressive framework addresses a separate but indispensable aspect of the process in the analysis. The end result is intended to aid decision makers in prioritising investments in FLR, and to complement existing and  robust mechanisms like the Restoration Opportunities Assessment Methodology (ROAM). Together, these FLR tools can help decision makers with other goals, such as setting prices for payment for ecosystem services, identifying sources of restoration finance, identifying low-cost/high-benefit pathways towards carbon sequestration, and identifying priority landscapes for restoration based on return-on-investment analysis. 

The nine steps are also outlined in the simplified version depicted in this infographic.

Ideally, this cost-benefit analysis framework will help decision makers maximise their FLR potential vis a vis the finite financial resources that can be allocated to restoration. So breathe a little easier when you’re faced with running a cost-benefit analysis for applying restoration techniques to a degraded landscape. You are only nine steps away.

Don’t forget that International Day of Forests (21 March) is right around the corner. 

Work area: 
Forest Landscape Restoration
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