The Environment Strategy for Scotland: Driving the Transition to a Nature Positive Economy - A Synthesis of Policy Levers for Governments

9. Methods

This section describes how the literature consulted has been classified to enable the proposal of policy levers that could be used by the Scottish Government to facilitate the transition toward a nature positive economy. For consistency with the recent report on “Reducing Scotland’s International Environmental Impact: Learning from International Best Practices” (Rivington et al., 2023) the macro classification of policy levers to reduce consumption (JNCC; Harris, 2023) has been used, as summarised in Figure 1.

Figure 1. Framework for policy levers proposed by Harris (2023)

What? Which policy levers can be used by governments to improve the sustainability of consumption?

Infrastructure-based

• Sustainable waste disposal and a circular economy
• Supporting local consumption, where appropriate

Information-based

• Ecolabelling and certification
• Awareness raising campaigns
• Education in schools
• Capacity building

Economic

• Taxes on the least sustainable options
• Subsidies for the most sustainable options
• Funding for research and implementation

Regulatory

• Free trade agreements
• Multi-lateral agreements
• Banning or quotas
• Sustainable public procurement rules
• Controls on advertising

The classification of Harris (2023) provides specific policy levers applicable to the sustainability of consumption, which can be grouped under four broad headings: infrastructure-based; information-based; economic; and regulatory.

This classification has been refined to align with mechanisms for enabling transitions to a nature positive economy. The information and infrastructure-based policy levers have been aligned with the approach of Economic Operating Infrastructures (EOI) suggested by Waddell et al. (2023). This reflects their potential to embed wellbeing principles to support a wellbeing economy (Kenter et al., forthcoming; Waddock, 2020c, 2020a) (Figures 2 and 3).

Figure 2. Categories of innovation in the current wellbeing EOI; sources (Waddell et al., 2023).

Narrative research

• Narrative dissemination and education
• Cultural change campaigns

Economic Governance

• Private governance initiatives
• National constitutional reform
• Multi-stakeholder initiatives of intergovernmental organizations

Financing mechanisms

• Integrating wellbeing economies principles into historic infrastructure
• New aggregation mechanisms
• Ecosystems for financing transformation

Exchange mechanisms

• Markets
  • Production chain agreements
  • New technology platforms
  • Product-consumer direct exchanges
• Metrics
  • National accounts
  • Change initiatives metrics
  • ESG ratings of businesses
• Currencies
  • Local currencies
  • Cryptocurrencies

Production structures

• For-benefit organizations
• Partnerships, alliances, and networks
• Benefit corporations

Products and services

• Co-production
• Payment for ecosystem services
• Reducing the ecological footprint of production

Figure 2 presents the EOI list and subcategories reported by Waddell et al. (2023) as relevant to support and sustain ecosystems and lives, improve human well-being, prioritize basic needs, and reduce inequality. The analysis of these infrastructures is based upon non-systematic web- and document-based research published between 2011 and 2021, comprising scientific journals explored in the Scopus catalogue and Google Scholar, and grey literature (reports and web sites). The categories derived consist of economic innovations associated with overarching efforts to shift narratives away from conventional economics towards wellbeing, innovations in approaches to economic governance, financing mechanisms, exchange mechanisms, business structures, and products and services.

A framework for the EOI shows the support and influence, and feedback, of one category on another (Figure 3). Details of the meaning, typologies and subcategories for each of the six EOI are provided in Waddell et al. (2023).

Combining the frameworks of Harris (2023) and Waddell et al. (2023) reveals an overlap between the infrastructure-based and information-based policy levers and some of the EOI. In particular, it highlights narrative research and economic governance infrastructures which encompass a broad range of public, private and blended public-private mechanisms operating at local, national and international scale.

Table 2 summarises categories of policy levers which suits the two schemes, and reflects the ideas and principles of nature positive economies. It presents common recommendations on how to carry out the transition to such an economy, as presented in Part 1 of the results.

Table 2. Categories of policy levers considered for the analysis of nature positive arrangements.

Economic Operating Infrastructure

• Narrative: dissemination and education
  • Regulatory measures - Multilateral agreements
  • Economic measures - Taxes
• Economic governance: national/private/multi-stakeholders initiatives
  • Regulatory measures - Mandatory due diligence
  • Economic measures - Subsidies
• Financing mechanisms: financing transformation (greening finance and financing green)
  • Regulatory measures - Sustainable public procurement
  • Economic measures - Biodiversity offsetting
• Exchange mechanisms: embedding nature value in policy/ metrics for national accounts/ metrics for business/ new currencies (blockchain)
• Product and services: payment for ecosystem service schemes/ ecological footprint reduction and ecolabelling

From reviewing the Economic Operating Infrastructure in Table 2 one can conclude that recommendations for a stronger case towards a nature positive economy do not fulfil the full range of EOI proposed in Figure 2.

At the time of writing (May 2023) it was not possible to source an example directly relating to the concept of a nature positive economy for all the EOI subcategories described by Waddell et al. (2023). The missing EOI mainly refer to exchange mechanisms, such as a new technology platform, and financing mechanisms, such as integrating wellbeing economic principles into historic infrastructures. These two categories make a promising case for new markets. However, although the principles for responsible investment and sustainable stock exchange initiatives align with the principles of a wellbeing economy, no evidence was found of them tackling the natural and environmental domains necessary for transitions towards nature positive economies.

The EOI classification is an open framework capable of encompassing additional categories. The current wellbeing EOI classification is the result of research carried out in 2021 and 2022 of more than 100 case studies in collaboration between the GANE project and the initiatives Catalyst 2030 and Bounce Beyond.

Building on this framework, the Results section is split into two parts.

The first part (‘Recommendations for Enabling Transitions to a Nature Positive Economy’) provides an overview of relevant policy approaches and levers, and recommendations for government actions to transition towards a nature positive economy, derived from the review of selected academic and grey literature. These are expressed in terms of policy actions, but are not comprehensive without research on specific topic areas, by means of a systematic review.

The second part (‘Presentation of Case Studies’) draws on the broad range of evidence published in the scientific and grey literature of types of regulatory, economic, and infrastructural policy levers which can be actioned by governments, regulators and the private sector.