Biodiversity policies are about promoting “the conservation of biological diversity, the sustainable use of its components and the fair and equitable sharing of the benefits arising out of the utilisation of genetic resources” (CBD, 1992). The aim of improving and maintaining biologically diverse habitats and ecosystems is to create net benefits to society by realising all of biodiversity’s values: material benefits, as well as those that are less easily quantified.

For all areas of social policy, the decision to implement a policy should be determined by the balance of benefits and costs. But when we are concerned about well-being, benefits and costs cannot be limited to monetary terms, but must include any impact that results from policy implementation. In that sense, there is little disagreement amongst policy analysts: all agree that, broadly, policy must reflect the wishes of the community. Where the disagreement begins, however, is over how the benefits and costs will be measured.

At an abstract level, biodiversity policies are about change. Successful policies change the way society interacts with the natural environment so that society gains most from the use and/or conservation of biologically diverse habitats and ecosystems. These potential welfare gains from changes in the use of habitats and ecosystems are the foundation for, and deliver political legitimacy to, specific biodiversity-related policy objectives. The starting point for such biodiversity policies is the realisation by policy-makers that such welfare gains can be achieved. Policy objectives then must state the outcomes to be accomplished. Typical examples of such objectives are “the preservation of a genetically viable population of Maculinea in its natural habitat up to the year 2100” or “a reduction of pesticide exposure of songbirds in the UK by 10% by 2010”.

Biodiversity policies have an explicit time dimension. The total economic value of biodiversity concept contains some important intertemporal components, such as option values, exploratory values or quasi-option values (Bulte and Withagen, 2006), and bequest values (Pearce and Moran, 1994). These values are conceptually tied to the future in the following ways:  Option values arise from the continued preservation of habitats and ecosystems by allowing conversion decisions to be postponed into the future.

The starting point of this book is that biodiversity policies can create both winners and losers. This capacity is likely to be more pronounced the more the policy objectives deviate from the current status quo and the more uneven the distribution of income and wealth was prior to the implementation of the policy.

Having discussed the first point in Part I, in Part III we describe how to put the last three points – procedural, institutional approaches and their combination – into practice, mainly for national policies. International policies are noted briefly for the channels through which they are relevant, and for the magnitudes of the transfers occurring. In each chapter the main issues are introduced then descriptions and comparisons of different solutions are given, followed by some illustrating cases. The intention is to encourage policy-makers to take steps towards using participatory methods for cooperating with important stakeholders affected by policy. By doing so, considerable distributive effects can be prevented, mitigated or made acceptable at an early stage of the policy process.

Biodiversity policies commonly involve changes in how land is used. For previous users, this means additional costs, lower benefits or a foregone profit. Institutional changes are a way of responding to these changes in the welfare position of those affected by the policy. They do so by granting them a degree of control in the form of a property right, use right, or entitlement or by offering them participation in newly created institutions such as contract schemes or new markets.

We now turn to the most profound method for handling distributive issues: the active involvement of indigenous and local communities in the management of biodiversity. This approach combines the procedural elements of communication and participation with the institutional elements of creating rights and ownership in the implementation of the policy. Such an approach dilutes the power and influence of the policy-maker to a significant extent: participation in or even devolution of ongoing management decisions to stakeholders mean that the policy-maker sacrifices control over policy implementation. This can even result in fundamental changes to the policy itself.

Successful biodiversity policies improve welfare overall by correcting the fundamental externalities of managing biologically diverse habitats and ecosystems. Within the overall improvements, however, biodiversity policies can create winners and losers. OECD policy guidelines call explicitly for a consideration of these distributive effects on the absolute and relative wellbeing of different groups of people. This book has presented an analysis of the distributive impacts of biodiversity policies across different groups, across different spatial scales and across time. We have offered methods for measuring the impacts and explained the relationship between policy objectives, instrument choice and distributive outcomes. We have also considered arguments from the economic literature for addressing distributive issues within biodiversity policy choice, and offered different methods for integrating distributional concerns into policy-making and for managing conflicts induced by biodiversity policies. Finally, we have presented a wealth of case studies to document both the complex chains leading to distributive outcomes, and best practice in merging efficiency and equity considerations in policy design, implementation and ongoing management.