Abstract
ECOSYSTEMS AND PEOPLE 2023, VOL. 19, NO. 1, 2167865 https://doi.org/10.1080/26395916.2023.2167865 RESEARCH Landholder perceptions of biodiversity offsetting rights and responsibilities: implications for policy reform in New South Wales, Australia Roel Plant and Laure-Elise Ruoso Institute for Sustainable Futures, University of Technology Sydney, Broadway, NSW, Australia ABSTRACT ARTICLE HISTORY Received 14 March 2022 We address the problem of landholder participation in biodiversity offsetting, a policy tool Accepted 9 January 2023 based on principles of market-based incentives. Our study focuses on the working rules of offsetting, specifically the rights and responsibilities of landholders. Our case study is an EDITED BY application of biodiversity offsetting in the Greater Sydney Metropolitan area, New South Eszter Kelemen Wales, Australia. We conduct empirical analysis of landholders’ perceptions of their rights and KEYWORDS responsibilities and subsequently apply an institutionalist perspective to infer implications for Institutions; biodiversity public policy reform. We find that landholders’ perceptions of their rights and responsibility offsets; landholders; with regard to i) providing offsets, ii) receiving money for doing so, iii) land management, and Australia; New South Wales; iv) transferring the land, elicit diverse reasons for (non)participation in biodiversity offsets in abduction; ethnography; the Greater Sydney Metropolitan area. Some landholders consider themselves in alignment Rights with the current working rules of the scheme, others do not. We reflect on these findings by abductively inferring reasons for institutional reform. The broader significance of our study resides in its potential to inform institutional design in jurisdictions where established schemes are under review, or may become subject to review. 1. Introduction recent schemes and major offsetting initiatives Biodiversity offsetting is a mechanism used by include the New South Wales BioBanking and planning authorities and developers to compensate Biodiversity Offsetting schemes (Burgin, 2008; for biodiversity losses associated with economic Wotherspoon and Burgin 2008), which are our development. Over the past two decades, offset focus in this paper. policies have been advanced in a range of coun- The design and practice of offsetting are rooted in tries, including the United States, Australia, Brazil, mainstream economic theory (Turner et al. 1994), Colombia and South Africa. In a thorough effort to where claims of rationality, perfect information and systematically map the global implementation of self-interest align to produce optimally efficient out- biodiversity offsets, Bull and Strange (2018) found comes through the price signal (Ayres 2008). The that roughly 13,000 offset projects extended over pricing of flora and fauna would then serve to protect some 154,000 km , across 37 countries worldwide. nature by incentivising stakeholders with money. The US was the first country to pioneer biodiver- Voices from civil society have questioned whether sity offsetting in the early 1970s, in a major wet- market-based offsetting can ultimately provide posi- land mitigation program (Ambrose 2004; Bull and tive social and environmental outcomes (Gooden and Strange 2018). Australia is another country where ‘t Sas-Rolfes 2020). Critical scholarship has ques- enthusiasm for biodiversity offsetting emerged early tioned the vision of human-nature relationships that on (Salzman 2005; Gibbons and Lindenmayer 2007; biodiversity offsetting promotes. Spash (2015, p. 541), Coggan et al. 2010), with the Australian federal for example, observes that offsets are often used as government using offsets under the Environment ‘pragmatic replacements for appeals to ethics and Protection and Biodiversity Conservation Act direct regulation’ and argues that offset schemes use 1999. This Act provides a legislative framework economic logic to legitimise, rather than prevent, for offsetting to happen, but only through comple- ongoing habitat destruction. Apostolopoulou and mentary State or Territory government measures, Adams (2019), adopting a Marxist historical- sometimes also involving local government as land geographical perspective, extend this strand of criti- managers (Fallding 2014). Australia is generally cism by giving social contestation a central role in considered an early adopter of biodiversity offset- questioning the implementation of offsetting. ting (Sullivan and Hannis 2015). Examples of Focussing on the history of biodiversity offsetting in CONTACT Roel Plant roel.plant@uts.edu.au Supplemental data for this article can be accessed online at https://doi.org/10.1080/26395916.2023.2167865 © 2023 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group. This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. 2 R. PLANT AND L.-E. RUOSO England, these authors draw attention to its class Much less is known about the other main category character and argue for a new emancipatory politics of stakeholders involved in biodiversity offsetting: that would encompass legal rights for nature. the landholders supplying (selling) offsets (Primmer Tensions can arise between, on the one hand, et al. 2019). While a rich literature exists on land- uncritically or pragmatically embracing offsetting holder uptake of various private land conservation and its underlying ontological and epistemic pre- programs, such as publicly funded conservation ten- mises and, on the other, rejecting offsetting alto- ders, agri-environmental schemes and payment for gether. These tensions pose challenges for ecosystem services, (Wilson and Hart 2002; St John researchers studying situations where offset et al. 2010; Morrison et al. 2011; Greiner and Gregg schemes are already established, as is the case for 2011; Burton and Paragahawewa 2011; Sutherland our current study. In such situations, researchers et al. 2012; Garbach et al. 2012; Moon 2013; can opt to pursue a ‘third way’ type of inquiry, in Mettepenningen et al. 2013; Van Herzele et al. between mainstream economic analysis of optimal- 2013; Taylor and Van Grieken 2015; Greiner 2015; ity and market failure, and critical deconstruction De Krom 2017), there exists only limited literature of offsetting. Such a ‘third way’ inquiry, then, on landholders’ uptake of biodiversity offsets. One would have as its objective the identification of Australian example is Coggan et al. (2013), who policy reforms that are informed by the workings address different stakeholder views (including land- of offsetting. It can follow a two-layer approach, holders) on the transaction costs of offsetting. connecting human activity in the offset marketplace A European example, Calvet et al. (2019), was also with the overall actual and future outcomes of identified, who report on the determinants of offsets a scheme. Regarding the first layer – human activ- acceptability among farmers in France. Other stu- ity in the offset marketplace – a broad literature dies report on the public perception of biodiversity carries ample evidence that landholder participa- offsets, but did not specifically focus on landholders tion in conservation schemes can be problematic who may supply offsets (e.g. Scholte et al, 2016; for a range of reasons. Beyond price – the main Burton et al, 2016). ‘carrot’ in offsetting and other market-based The aim of our study is to investigate the possible mechanisms – there are many other known factors policy implications of factors beyond the credit price that determine participation rates of landholders in signal that are at play in offsetting – that is, factors market-based mechanisms for biodiversity conser- often considered external under a mainstream eco- vation (St John et al. 2010; Burton and nomic approach. Pursuing the ‘third way’ of inquiry Paragahawewa 2011; Van Herzele et al. 2013). outlined above, we adopt the institutionalist eco- Empirical elicitation of such factors can offer an nomic perspective developed by Daniel Bromley and understanding of the workings of the offset market- colleagues (Bromley 2004, 2008; Vatn 2005; Lee place – that is, how landholders interact with the 2009). We operationalise this perspective by incor- working rules of an offset scheme. The second porating Primmer et al. (2019)’s notions of offsetting layer, which is the evaluation of biodiversity off- rights and responsibilities. Seen as institutional cate- setting meeting its ultimate public policy goal – gories, offsetting rights and responsibilities can elicit securing long-term biodiversity outcomes from empirically how landholders relate to the institutional a whole-of-society perspective –, then builds on setting of biodiversity offsetting and how this setting the inquiry into the working rules of offsetting influences their uptake of offsetting. schemes (the first layer). If we move away from Our case study is the established biodiversity offsets notions of optimisation for allocative efficiency and scheme in New South Wales (NSW), Australia. Our allow for plural understandings (Kothari et al. research questions are: do the current working rules of 2019) of the relationships between humans and biobanking in NSW correspond with landholders’ per- nature, then we can adopt the premise that ceptions of their rights and responsibilities with respect a broader diversity of participants in offsetting to offsetting? And, if not, what policy implications may lead to more sustained outcomes. Such diver- could be inferred from any misalignment? sity would allow a broader range of environmental The article is structured as follows. Section 2 intro- values (held by landholders) to be incorporated in duces the institutionalist economic perspective and the scheme; not giving landholders discretion over its central focus on abduction. This section also intro- the ecological values of offsets provided, but rather duces offsetting rights and responsibilities. Section 3 giving them more opportunity to participate in presents our case study, the biodiversity offsets offsetting. scheme in the Greater Sydney Metropolitan area, It has been shown that biodiversity offset mar- NSW, Australia, and explains our methodology for kets can meet the needs and worldviews of the data collection and analysis. Section 4 presents find- buyers – often developers – of offsets (Sullivan and ings in four thematic subsections: provision of offset; Hannis 2015; Spash 2015; Primmer et al. 2019). receiving payments; management of the land and ECOSYSTEMS AND PEOPLE 3 transfer of the land. This section is then followed by Pragmatism of Charles Sanders Peirce (De Waal a discussion (Section 5), exploring emerging argu- 2013; Atkin 2015), volitional pragmatism links ments for policy reform. Section 6 concludes the a theory of action based on abduction with the paper. realm of public policy. It offers the conceptual tools for establishing an account of the need for economic and political change. Volitional pragmatism comple- 2. Economic institutions and biodiversity ments a growing body of empirical work in social offsetting science on collaboration, institution building and Modern environmental governance largely occurs in political process (Vatn 2005). Volitional pragmatism and through institutions. Institutions are the rules or invites the abductive study of economic actors’ per- rule sets of governance that constitute both formal spectives on the future and their ‘working out’ on and less formal aspects of organising action and how that future ought to unfold. This future-oriented perspective places emphasis on the reasons for behaviour. Institutions both shape and constrain eco- nomic and political behaviour: they provide the humans acting collectively – in our case the govern- expectations, stability and meaning that are essential ment bodies responsible for biodiversity offsetting to the coordination of economic and political life and the overall societal outcomes of public biodiver- (Vatn 2005, p. 60). ‘Institutionalism’ gained promi- sity policy – to undertake specific events – such as nence in American economics during the interbel- policy reform – today. lum, declining after WWII (Rutherford 1994). Early As volitional pragmatism is in essence American institutionalism stressed institutional a conceptual tool, or an approach to enquiry, it change and evolution, for example through analysis must be linked to concrete aspects of institutional of the role of new technology as a driver of change in settings in order to yield data for analysis. To this society’s underlying habitual ways of living and end, Primmer et al. (2019)’s findings on offsetting thinking. Thus, the early institutionalists saw institu- rights and responsibilities offer an entry point into tions not merely as ‘constraints’ on individual action. Bromley’s institutionalist perspective: offsetting rights and responsibilities, and how they are experi- Rather, institutions were seen as embodying generally accepted ways of thinking and behaving and mould- enced and/or perceived by economic actors, can be ing the preferences and values of its actors. In recent taken to represent the individual and collective decades, there has been renewed interest in institu- habits, beliefs and social norms associated with tional perspectives on economics, especially in its biodiversity loss. Thus, eliciting experiences and applications to environmental governance and policy perceptions with respect to offsetting rules and design (Van Den Bergh and Stagl 2003; Paavola and responsibilities can expose the ‘working rules’ of Adger 2005; Slavikova et al. 2010). a scheme beyond what is formally stated and Institutional economics may be defined as a school documented. of economics that emphasises the importance of non- From literature review, Primmer et al. (2019) market factors (as social institutions) in influencing inferred that commonly acknowledged rights of economic behaviour (Merriam-Webster 2011). In our landholders relate to property, i.e. the rights to: case, our interest is in the social institutions influen- access the area; extract resources; manage the area and its resources; exclude others from using the cing landholder (non)participation in offsetting. The logic of abduction, a distinct mode of inquiry in area; and transfer the rights. Primmer and collea- institutional economic analysis (Bromley 2004), can gues then identify what the rights and responsibil- bring together empirical evidence about observed ities of landholders could be in the context of factors and the accepted rules of offsetting. Under a biodiversity offsets scheme : i) the right to pro- the abductive mode of inquiry, the ‘ends in view’ of vide offsets; ii) the right to generate an income; iii) a particular mode of governance of an offset scheme the right and responsibility to manage the land; are produced by experimentation and subject to con- and iv) the right to transfer the land. We adopt stant change. This approach differs from the deduc- these four categories to organise and present our tive mode of inquiry which characterises own findings from a case study of biobanking in the Greater Metropolitan Sydney area, NSW, contemporary mainstream economics: when main- stream economists use accepted rules as the (scienti- Australia. We focus on how rights and responsibil- fic) basis for policy prescriptions that claimed to be ities are perceived differently by participating and ‘welfare enhancing’ or ‘efficient’ then deduction non-participating landholders. We will also look at becomes the basis of normative prescriptions about how different rights and responsibilities can con- what is thought best to do (Bromley 2004). flict with each other, as well as with landholders’ Bromley’s theory of volitional pragmatism (2008, perceptions of the rights of nature (Chapron et al. 2006) advances the strand of thought outlined above. 2019) and the right of society at large to biodiver- Epistemically rooted in the classical American sity. The former (rights of nature) is a departure 4 R. PLANT AND L.-E. RUOSO from Primmer et al. (2019), who do not consider 3.1. Case study: biodiversity offsets in the nature as a legal actor in biodiversity offsetting. Greater Western Sydney area Rather than considering the rights of nature and Our project employs a case study of the biodiver- of society at large per se, we use landholders’ per- sity offsets scheme in NSW, where offsets are ceptions of the rights of nature and of society as priced monetarily. In 2008, the NSW government, proxies, analysing how their perceptions of rights of developed the Biodiversity Banking and Offsets nature and society at large might conflict with the scheme, commonly known as biobanking, an offset perception of their own rights and responsibilities, scheme designed to address the loss of biodiversity as landholders. values in NSW. Under a change in legislation, a reformed scheme became effective in 2016, called the NSW Biodiversity Offset Scheme (BOS). While 3. Materials and methods the scheme has undergone changes regarding sev- eral of its characteristics (Byron et al. 2014), the Eliciting experiences and perceptions with respect principles for landholder participation remain to offsetting rights and responsibilities can expose unchanged. Credits are generated when landholders the ‘working rules’ of a scheme beyond what is enter a binding agreement (called biobanking formally stated and documented (Primmer et al. agreement under the old legislation and biodiver- 2019). Our methodological design comprises three sity stewardship agreement under the current leg- tiers of inference (Figure 1). First, we apply induc- islation) to improve and maintain the biodiversity tive coding of stakeholder interviews (Charmaz values of their land in perpetuity. These credits are 2006), and then deductively interpret our coded then sold directly on the market, brokered by the findings in terms of biodiversity offsetting rights Biodiversity Conservation Trust (BCT), an inter- and responsibilities. Induction involves reasoning mediary in charge of the management of the from observation, via analysis, to theory. Scheme. The funds generated from the sale of Deduction, on the other hand, involves reasoning these credits cover the Total Fund Deposit (TFD) from an idea, via observation to a conclusion. We held in trust by the BCT to make the annual land then apply a third tier of inference, the logic of and vegetation management payments (Part abduction (Paavola 2004), to explore how the A payment). Landholders typically also generate ‘ends in view’ of offsetting as a tool of environ- a profit on top of the TFD from the sale of credits mental governance might be articulated, and (Part B payment). unpack the reasons that government bodies Our case study location was the Greater Sydney responsible for managing offsetting policy might Metropolitan area (see Figure 2 below). As of wish to consider reforming it. In our context, the May 2019, nearly half of the biobanking agreements term abduction refers to the place of explanatory made under the scheme (the Biodiversity Banking reasoning in generating hypotheses. Below, we and Offsets Scheme at the time) were located in introduce our case study, and subsequently this area (N = 84, or 47%). Moreover, most of the explain our data collection process. past and planned urban development is situated in this region. Data collection primarily covered six local gov- ernment areas (LGAs) in the Greater Sydney Metropolitan area: the Wollondilly, Penrith, The Hills, Camden, Campbelltown and the Hawkesbury. Within the Greater Sydney Metropolitan area, these areas represent a range of settings for biodiversity conservation. Where Campbelltown and Penrith are LGAs near Sydney and are largely developed, the LGAs of Camden, Wollondilly and The Hills are situated further away and still have bio-diverse bushlands while being under pressure for development. Finally, the Hawkesbury LGA represents the other end of the spectrum, with an area that is largely preserved and faces less development pressures. The selected LGAs also represent different degrees of landholder participation, with landholders in Wollondilly, Figure 1. Methodological design. Penrith and The Hills participating actively (29, ECOSYSTEMS AND PEOPLE 5 Figure 2. Greater Sydney Metropolitan area (NSW, Australia) and BioBanking agreements per region between May 2010 and May 2019. 14 and 9 contracts respectively), while landholder with 14 interviewees who participate in the Scheme, participation in Camden, Campbelltown and and represented the four types of landholders identi- Hawkesbury is minimal (5, 4 and 2 contracts) (as fied earlier (including some individual landholders). of May 2019). Additionally, we conducted 14 interviews with 20 interviewees who did not participate in the Scheme. These interviews were conducted with individual 3.2. Data collection and analysis landholders (primarily rural residential landholders, as well as a few farmers), as they were identified as In the early stages of the research, four groups of the landholder category with poor participation. stakeholders were identified by the research team A fifth category, companies offsetting their own and its collaborators, as representing the ‘pool’ of developments, exists. However, we did not consider participants or potential participants in the scheme: it, as our focus was on offset carried out by a third i) public institutions; ii) religious congregations; iii) party rather than by a company having the impact entrepreneurial landholders (individuals who buy itself. land and biobank it strategically to generate Interviewees’ awareness of the Scheme ranged a profit) and iv) individual landholders (e.g. farmers, from landholders who were not aware of the concept rural living landholders). According to project colla- of biodiversity offsets and of the specific biodiversity borators, entrepreneurial, religious and public land- offsets scheme in NSW, to landholders who partici- holders readily participated in the Scheme, while pated in the biodiversity offsets scheme in NSW individual landholder (e.g., farmers, hobby farmers (Table 2 below). Interviewing both participants and and rural residential landholders) participation was non-participants enabled us to understand what pre- poor. We wanted to understand the reasons that vented some landholders from participating, and compelled landholders to participate or, on the con- what enabled others to participate. trary, to not participate in the Scheme. To do so, we To recruit landholders, we contacted agencies, conducted 24 semi-structured interviews with 34 organisations and associations that work with landholders (Table 1). Ten interviews were conducted Table 1. Type of landholders (participants and non-participants) interviewed. Relationship to Scheme Type of landholder Number of interviews conducted Number of interviewees Participants Religious congregations 2 3 Public landholders 2 2 Entrepreneurs* 2 3 Farmers (graziers) 3 4 Rural residential landholders** 1 2 Non-participants Rural residential/hobby farmers 12 18 Farmers (horticulture) 2 2 Total 24 34 *One entrepreneurial landholder was in the process of participating in the biobanking Scheme. However, we included him in the ‘participant’ category as he was not seeing any obstacle to his future participation, beside the credit price that was low at the time of the interview. **These rural-residential landholders bought land that was already biobanked. 6 R. PLANT AND L.-E. RUOSO Table 2. Landholders’ awareness of the scheme. Number of Participant/non-participant Level of awareness of the scheme interviewees Non-participant interviewees Not aware of the concept of offsets and of the Scheme 4 Aware of the concept of offsets but not of the Scheme 5 Aware of the concept of offsets and of the scheme but decided not to 8 participate Enquired about the scheme but: i) decided not to participate; 2 ii) may participate Assessment in process. Might participate 1 Total number of non-participant interviewees 20 Participant interviewees Participate in the scheme 14 Total number of participants interviewees 14 Total number of interviewees (participant and non- 34 participant) were developed for each stakeholder so as to adapt Table 3. Stakeholder categories interviewed. to their experience/role in the Scheme. Number of Number of Interview transcripts with landholders and other Stakeholder category interviews participants TOTAL stakeholders involved in the Scheme were system- Local government 1 3 3 State government 1 3 3 atically analysed using NVivo software. Initial Consultants 3 3 9 inductive thematic coding (Charmaz 2006) was Environmental group 1 1 1 (Landcare) used to identify salient themes. Those initial themes TOTAL 6 10 16 were then placed into Primmer et al. (2019)’s rights and responsibilities framework: i) Right to provide offsets; ii) Right to receive money. iii) Right and landholders in our case study location. Staff members responsibility to manage the land; and iv) Right to or volunteers in those agencies/organisations/associa- transfer the land. Finally, we applied abduction, as tions shared a summary of our research with their presented in Section 2, in order to interpret our members through email and social media. We also findings on rights and responsibilities in terms of publicised our research project in two local news- policy action. These interpretations are presented papers in the Camden and Wollondilly area. We in the Discussion section (Section 5). then employed snowball sampling to recruit addi- tional participants. Semi-structured interviews were conducted face-to 4. Findings -face. Interviews lasted between 60 to 90 minutes. All interviews were recorded and transcribed. The inter- This section presents landholders’ perspectives on the views were structured around three main sections: 1. different rights and responsibilities related to land- Characteristics of the landholder and the land opera- holders’ participation in the biobanking scheme. tion; 2. Landholders’ experience and perspective of the Scheme ; and 3. Factors influencing decision- 4.1. Providing offsets making regarding private land conservation (see Appendix 1 for the Interview guide) . Prior to the For the landholders interviewed, the right to provide interview, participants were given a consent form. offsets was tied to: i) the rights of nature and society Each participant agreed to the terms and signed the as a whole, and ii) the responsibility to pay for eco- consent form. logical assessment. Firstly, we provide an overview of In addition to landholders, semi-structured the range of perspectives expressed by landholders interviews were also conducted with other stake- about the relationship between the right to provide holders involved in the Scheme (see Table 3 below). offsets and the rights of nature and society as a whole. The aim of those interviews was to gain additional Secondly, we present a misalignment between the information on the functioning and management of right to provide offsets and the responsibility to pay the Scheme, its strengths and weaknesses, as well as for ecological assessment as expressed by landholders. to gain insights on the types of landholders who participate/do not participate in the Scheme and 4.1.1. Rights of nature, rights of society as a whole their reasons for doing so. While those were the Interviewees identified three different understandings general topics of interest, distinct interview guides of the alignment of the right to provide offsets and ECOSYSTEMS AND PEOPLE 7 the rights of nature and society as a whole. We pre- protection of biodiversity through biodiversity offsets sent these understandings as a gradient going from could be effective. Some also doubted the ability of total alignment to total misalignment. the Scheme to protect ‘like-for-like’ plant community The first understanding, expressed by one land- types in the future. For example, one respondent holder only, was that the right to provide offsets and explained that in the future there will be no more the rights of nature are fully aligned. For this landholder native vegetation available to offset further impacts of the Scheme offered a satisfactory strategy to maintain development within the same community type. biodiversity in the Greater Sydney Metropolitan area, as A second commonly expressed reservation regarding it helps to foster greater ecological connectivity: the governance of the Scheme was that vegetation loss in one specific area might be offset in another area, Western Sydney has tiny little patches all over it, which will therefore disadvantage the humans and none of which are viable, okay? But if you accept animals living in the area that experienced a loss in the fact that they’re not going to be viable, and you biodiversity: go to the areas where you have substantial country that has a much lower value, because you’ve got to [I]n terms of residential development, [.], it concerns look at the economics of it, and has great potential me to say, ‘All right, we’re going to put all these for connectivity and all the rest of it. That is where towers here and knock down this bushland and you need to maintain your biodiversity in those we’re going to go out to the Hawkesbury and regen- areas (P20). erate a paddock and regrow some trees in a paddock or whatever’. What’s happened to this environment The second understanding was that the right to pro- here that you’ve destroyed? It’s different. It’s not the vide offsets and the rights of nature and society are same [. . .] You’re not able, really to replace that and partially misaligned. For some landholders, the right you’re not able to replace [the value] that has for the to provide offsets is misaligned with the rights of people and livestock that live there; the birds and the nature as offsets involve a process of destruction of animals (P27). nature to make way for development. However, it is For some landholders, the misalignment of the also partially aligned, as it allows for some degree of Scheme with the rights of nature was not due to faults restoration and protection. As such, it was considered in its governance structure and working rules, but by some as ‘better than nothing’ (P19, P22) or ‘our rather to the nature of the concept of biodiversity only option’ (P6): offsetting in itself, which allows the destruction of Population has got to go somewhere; houses have got nature. One landholder expressed the unacceptability to go somewhere. So if they can do that and help us of the offsetting concept as follows: keep our little bits of bush in pristine condition, preserved, then it’s at least. . . I think it’s better than [W]e shouldn’t be clearing [t]here and then growing nothing (P22). stuff here. We just shouldn’t be clearing there (P3). Other landholders shared this partial misalignment In addition, those landholders considered participat- view and responded to it by making their participa- ing in biodiversity offsetting as equivalent to support- tion conditional. For example, one interviewee work- ing developers’ profit-making activities through ing for a Council explained that the Council would destruction. One landholder explained that she not offset the impacts of mining projects or develop- would rather use her own money than receive ments within the boundary of the Council area. money from developers: A rural-residential landholder who did not partici- pate in the Scheme explained that she would only I would rather do it on our buck [. . .] than do it to consider biodiversity offsetting if the development think that I’m helping some bugger make some more causing the impact demonstrates public good out- millions (P3). come, for example the development of a train line in an underserviced area. 4.1.2. The responsibility to pay for ecological The third understanding was that the right to assessment provide offsets is fully misaligned with the rights of The rules of the Scheme in NSW require landholders nature and society at large, for two reasons: i) the to pay the costs of the mandatory initial ecological current working rules of the Scheme do not allow assessment of their land. This requirement was often alignment, and ii) the nature of biodiversity offsetting perceived as misaligned with the right to provide itself is fundamentally misaligned with the rights of biodiversity offsets as it acts as a deterrent for land- nature. Several landholders expressed doubt regard- holders who cannot afford to pay for the initial ing the working rules of the Scheme. For example, assessment, and/or are reluctant to spend the money while offsets are to be provided ‘in perpetuity’, some without having certainty that the assessment will landholders knew of offset sites that were subse- allow them to enrol into the Scheme: quently cleared. This led them to doubt whether 8 R. PLANT AND L.-E. RUOSO [W]e do not want to outline money for something 4.2.2. Payment as incentive that we don’t really understand or know anything For other landholders, making a profit out of biodi- about and might not happen (P7). versity offsetting was an important part of why they participated or considered participating in the For others, it also appears to be unfair for the assess- Scheme. ment cost to be the responsibility of the landholder: Depending on the objectives of the landholders, To me it’s incongruous that I have to fund an assess- the profit could be used for different purposes. For ment of the quality of the vegetation if the [. . .] a multi-generational farming family participating in Scheme wants to assess my property, they’re wel- the Scheme, biodiversity offsetting was a way to come, but why should I pay for it? If they want the vegetation retained, come and assess and make me make the profit needed to keep the farm going. an offer. It seems that the cart is before the The family used offsetting to protect the integrity horse (P2). of the farm by preventing a split and to use the profits to diversify investments: A lot of farming families fight and split the farm up 4.2. Receiving money [. . .] if you take the option away, you effectively sell the right to do anything to the land and; therefore, In this subsection, we focus on landholders’ perspec- [. . .] no argument can be made and then you take tives on their right to receive money in exchange for that cash and invest it in things that are unemotional conservation work. We distinguished two main per- [. . .](P21). spectives i) payment as compensation, which is about receiving payment to cover the costs of conservation For the two public landholders interviewed, the work; and ii) payment as incentive, where the pay- profit generated by their participation in the ment needs to allow for a profit. Scheme was set aside as a sinking fund for other works, or as money to be allocated to other biodi- versity protection projects. For more ‘entrepre- 4.2.1. Payment as compensation neurial’ landholders participating in the Scheme, Some landholders put emphasis on payment as land was bought for the purpose of enrolling it in compensation. This was notably the case for reli- the Scheme and deriving a profit from it. Finally, gious congregations participating in the Scheme. some rural-residential landholders saw offsetting as The two congregations interviewed often stated a way to make a profit out of their land. However, that the main motivation to participate in biobank- contrary to the multi-generational farming families, ing is an ethical one: the need to ‘take our part in public landholders and entrepreneurs, these land- caring for this land and restoring native vegetation’ owners did not yet participate in the Scheme as (P16). They referred to the 2015 Laudato si of Pope they were unconvinced regarding its economic Francis and its call to ‘care for our common home’. soundness. They appeared to calculate the oppor- As a result, religious congregations put more tunity cost of their land based on its residential emphasis on compensation as illustrated by an development value, i.e. what the land could be interviewee whose congregation sold credits at worth if it were to be rezoned from agricultural a price that did not recoup the opportunity cost: or rural use to residential or urban use. One land- The opportunity cost money was quite low, but we holder expressed a concern about locking in his wanted to do it, because we wanted to have some land under the Scheme as follows: land, at least, that maintains the native [vegetation], yes (P16). There is more development going on in the area [.]. So that will change the nature of the area quite a bit. This was also the case for several non-participant I suspect there’ll be rezoning of land and all sorts of rural-residential landholders who indicated that things, so if we do BioBank we’re going to lose that profit was not a priority and, in some cases, high- potential (P34). lighting that profit seeking was going against their This concern contrasted with the perspectives of values: multi-generational family farmers who seemed to I wouldn’t want to make money out of it, because base their opportunity cost on the farming value of that doesn’t fit in with what I’m trying to do for the the land: environment, but I wouldn’t like to be doing a whole lot of work, which is, I’m paying for every- As far as an opportunity cost in terms of losing the thing (P15). land for farming there’s no argument. We’re always going to do much better out of the biobank (P22). When asked what they would use the money for, they often explained that they would be satisfied if In practice, a sharp distinction between payment as the Scheme could cover management costs and incentive and payment as compensation did not help them employ contractors to do the work. always exist: some landholders who value payment ECOSYSTEMS AND PEOPLE 9 as incentive sometimes also value the compensation As such, it appears that the perceived policy objective dimension. This was notably the case for some public of the Scheme, in addition to securing biodiversity landholders who explained that the compensation outcomes, is also to provide landholders with the allowed them to carry out conservation activities opportunity to derive an income from it by under- that they could not otherwise have undertaken. taking the land and vegetation management work A farmer participating in the Scheme also explained themselves. This is particularly relevant for land- that payment as compensation was important as it holders on small and/or degraded properties who, enabled him to contract bush regenerators to according to one consultant interviewed, are unlikely improve the ecological state of the land. Finally, an to generate a profit from the sale of credits, and whose entrepreneurial stakeholder who bought a property to only financial gain from biodiversity offset would be offset it, also wants to live on the property. The through deriving an income from management activ- compensation payment provided him with the ability ities. This also applies to second-tier landholders (i.e. to generate an income for himself as he conducts the landholders who bought a property on which conservation activities. a biobanking agreement has already been set up) who Among the landholders interviewed, those putting did not benefit from the profit derived from putting emphasis on payment as incentive were more often the land under offset. participants in the Scheme than those putting empha- The second viewpoint stemmed from the obser- sis on payment as compensation. However, this vation that the quality of management undertaken divide does not always hold true as some rural- by landholders varies widely. One interviewee residential landholders who do not currently partici- argued that the best way to ensure consistency in pate, but are interested in the Scheme, put emphasis quality would be to take the management out of on payment as incentive, while participant religious the hands of landholders altogether. Making the congregations put emphasis on compensation. hiring of restoration practitioners compulsory may secure more positive biodiversity outcomes on pri- vate properties. However, this solution may not 4.3. Managing the land fully resolve this tension as, according to one of our interviewees, there is disagreement, within the Issues around the right to manage land were often ecological restoration industry, regarding adequate brought up by other stakeholders, such as consultants practices and methods. and the representative of Landcare interviewed, In our interviews, participant landholders often rather than landholders. In contrast, issues related placed more emphasis on payment as incentive to the responsibility to manage the land was men- than payment as compensation. When landholders tioned by landholders. (participant or non-participant) put emphasis on compensation, they did not always appear to use it 4.3.1. The right to manage the land to derive an income. However, the hypothesis that Two perspectives on the right to manage the land preventing landholders from deriving an income were identified: by not being allowed to manage their land may discourage some to participate cannot be (i) the right to manage the land is directly related discarded. to the right to provide offsets and to receive money for it; 4.3.2. The responsibility to manage the land (ii) the right to manage the land is misaligned or in Two overall perspectives emerged from the land- contradiction with the right of nature and holder interviews with regard to the responsibility society at large. to manage the land. The first related to their ability to carry out the required management Illustrating the first viewpoint, one of the consultants activities. The second related to landholders’ con- interviewed argued that the initial objective of the cerns in having to deal with unforeseen manage- Scheme was to enable landholders, principally farm- ment issues within the financial constraints of the ers, to derive an additional revenue stream from the Scheme. protection of biodiversity on their property: Some landholders interviewed did not express Landowners who have good years and bad years and doubts about their ability to complete the work, probably more bad years than good years, do not because they had expertise in ecological restoration make a lot of money [. . .] [but] if landowners have or were using the services of experienced restoration got the right [biodiversity] values, there’s nothing practitioners. In comparison, other landholders dis- wrong with them receiving an appropriate level of payment to managing that biodiversity and that’s played low confidence regarding their ability to actually putting the value on biodiversity (P41). undertake conservation work on their land and 10 R. PLANT AND L.-E. RUOSO You have no way of knowing what’s going to happen stated that they would rather participate in group in the future and restricting people to what they can activities for conservation, such as joining and can’t do might place some sort of burden (P27). a Landcare group, rather than work on their prop- erty alone. They would need to get ‘information on At the other end of the spectrum, other land- how to go about what you’re doing anyway for star- holders saw participating in offsetting as a way ters, until you get into it’ (P12) and receive ‘advice to safeguard the bequest value of their land, on how to do it’ (P4). ensuring that the conservation work they had undertaken on their property would be main- Concerns related to having to deal with unex- tained in the future. They saw the right to parti- pected management issues within the financial con- cipate in offsetting and the right to transfer land straints of the Scheme were mostly raised by non- as going hand in hand: participants. Such concerns crystallised on the poten- tial for new weeds, not present at the time of the I wouldn’t be opposed to something which would ecological assessment, to emerge. The costs of mana- preserve what we’ve done in our lifetime on this ging such weeds would therefore not be property to ensure that the vegetation remains [. . .] accounted for: I would hate to think that another person purchas- ing this property would simply come in with Ten years ago, we did not have Chilean needle grass. a bulldozer and say, ‘I hate trees’, and bulldoze We did not have African love grass. A part of that them all (P26). Scheme is they do not want that on this property. That is extremely difficult to control (P8). These two opposite perspectives were expressed by non-participant landholders. Participants in the This concern also pertained to changing regulations Scheme often did not make mention of possible con- for chemicals, which might lead to changes in costs tradictions between the right to participate in offset- related to weed management. ting and the right to transfer the land. This is most Among the landholders interviewed, those who wor- likely because most do not intend to sell their land in ried about their ability to carry out conservation activ- the near future or manage public land that will not be ities were non-participants. However, not all non- sold. participants voiced this concern. Indeed, some expressed strong confidence in their bush regeneration skills. 5. Discussion 4.4. Transferring the land We have elicited perceptions of offsetting rights and responsibilities by probing stakeholder perceptions On the issue of transferring the land, some land- around rights and responsibilities. This has yielded holders perceived the right to participate in biodi- a picture of the working rules of the offset schemes versity offsetting as contradicting the right to in NSW. To explore the normative policy implications transfer the land. In contrast, others saw these of our findings, we turn to the logic of abduction. rights as compatible. Abductive reasoning involves inference to the best Contradiction was mainly felt by landholders explanation (Tavory and Timmerman 2014). Our who worried that due to the restrictions imposed study set out to investigate the possible policy implica- by offsetting, putting an agreement on their land tions of factors at play in offsetting that would be would impact their ability to sell the property at considered external under a mainstream economic a good price. This was of particular importance approach. Our research asked whether the current for older landholders who may need to downsize working rules of biodiversity offsets in NSW corre- in the future and will need the money from the spond with landholders’ perceptions of their rights and sale to fund their retirement: responsibilities with respect to offsetting. Our findings If we did decide that we needed to sell the property, suggest this correspondence is far from perfect. that would put a restriction on us, and it might make In this section we first reflect on and discuss our set it a lot more difficult to sell the property, and if we of observations (Section 5.1) to subsequently identify were in a situation where we really needed to sell the implications for policy reform (Section 5.2). Here, our property, and that could mean the difference primary interest is in possible reasons for policy change between selling and not selling, then that would really put us in hardship (P11). rather than in specific policy recommendations. Some landholders also felt that entering into an agreement would burden successive landholders, 5.1. Synthesis of landholder perceptions of particularly if these were their own children, redu- offsetting rights and responsibilities cing the option value of the land by imposing restrictions on what can be done with it in the The overall picture that emerges from our findings is future: that participants in the Scheme have often (partially) ECOSYSTEMS AND PEOPLE 11 reconciled their right to provide offsets with their Participants did not mention concerns about vision of the rights of nature. In contrast, many (but their right to participate in offsets being in contra- not all) non-participants often saw a contradiction diction with their right to transfer the land. In between their right to provide offsets and the rights contrast, non-participants often mentioned this of nature and those of society at large. This is due to point and had diverging opinions on the matter. their conception of nature as non-substitutable, or of Some perceived participating in the Scheme as the governance of the Scheme as not providing compatible with their right to transfer the land. enough protection for nature. The added advantage of a transfer on their own Our results indicate that participants often terms was seen as a mechanism to ensure that the placed emphasis on payment as incentive, with conservation work they undertook would be main- the exception of religious congregations. In con- tained. In contrast, other landholders perceived trast, many non-participants placed emphasis on participation in the Scheme as potentially interfer- payment as compensation. The latter category ing with their right to transfer the land. They felt often displayed limited interest in participating in participating in the Scheme would diminish the the Scheme. Landholders looking uniquely for land value or put unnecessary burden on the next compensation often had strong environmental landowner. motivations. They often did not have a positive view of the Scheme (for one or several of the 5.2. Policy reform reasons mentioned above) and often used other funding sources, such as grants provided by 5.2.1. Practical and regulatory improvements another government agency (i.e. Local Land Our findings indicate that a number of practical Services). barriers exist that could be resolved with a change A smaller group of non-participants put empha- of emphasis in the Scheme’s current implementation. sis on payment as incentive and were interested in First, the high cost of the mandatory ecological the Scheme but hesitated to participle as they were assessment could, for example be borne by other not convinced of its economic soundness. These stakeholders, notably the buyer of credits or the gov- landholders appeared to calculate the opportunity ernment agency managing the Scheme. The cost cost of their land based on its residential develop- could then potentially be deduced from the sale of ment value, i.e. what the land could be worth if it credits. Second, landholder uncertainties around the were to be rezoned from agricultural or rural use to practicalities of undertaking land and vegetation residential or urban use, and subdivided. This con- management could be addressed with (more) targeted trasted with other participants in the Scheme who information and technical support for landholders, based their opportunity cost on the farming value notably guidelines and training on how to undertake of the land. on-property conservation work. Third, landholder Rather than by landholders with regard to their concerns around the way offsets would impact land own situation, the right to manage the land was value could be mitigated by providing documented addressed by other stakeholders (consultants, records of selling prices of offset land and expected environmental association representative) when impacts on land values. Fourth, more (and systema- sharing their view on how the Scheme should tic) information could be provided on the environ- function. As such, the insights obtained do not mental and ecological outcomes on existing explain directly how the right to manage the biodiversity offset properties, so as to provide con- land influences landholders’ willingness to partici- servation-oriented landholders with insights on what pate in the Scheme. However, a general insight is can be achieved. A caveat here is that this assumes that conditioning landholders’ right to manage the that offsets bring positive outcomes, which may not land (by making it compulsory to hire a bush always be the case. Fifth, the availability of additional regenerator to carry out the work) may discourage funds could be envisioned in cases where landholders landholders who expect to derive an income from work on heavily degraded land or face the emergence offsets. of new weeds. Six, enforceable standards for ecologi- With regard to the responsibility to manage cal restoration on offset sites could be developed. As land, non-participants in the Scheme often is currently the case for assessors conducting the expressed concern about their ability to conduct initial ecological assessment, ecological restoration conservation activities. While some non- practitioners participating in the Scheme could be participants had full confidence in their ability accredited or licenced. Finally, a stable planning to carry out the work, other landholders cited environment, particularly land use zoning proce- (perceived or real) lack of skills, and ability to dures, may make the Scheme more attractive to manage the land if unforeseen events were to some landholders. As seen in Section 4, some land- occur (i.e. emergence of a new weed). holders appear to calculate the opportunity cost of 12 R. PLANT AND L.-E. RUOSO their land based on its potential residential value once administrators to expand their reasoning beyond rezoned residential. The Scheme will only be attrac- mainstream economic considerations. tive to these landholders if the planning environment remains stable and non-residential land is sure to remain zoned as non-residential in the future. 6. Conclusions We find that landholders’ perceptions of their 5.2.2. Accommodating ethical and moral rights and responsibility with regard to providing perspectives offsets, receiving money for doing so, and mana- Where exercising ethical notions involves a more ging and transferring the land, elicit diverse rea- individual (self-)assessment of values as relatively sons for (non)participation in biodiversity offsets good or bad, morality is a more intersubjective com- in the Greater Sydney Metropolitan area. Some munity assessment of what is good, right or just for landholders consider themselves in alignment all (Walker and Lovat 2014). In our case study, moral with the current working rules of the scheme, objections were largely voiced around the Scheme’s others do not. The current working rules of the misalignment with landholder perceptions of the Scheme make entrepreneurial sellers, public land- rights of nature and those of society at large. A first holders, as well as religious congregations and possible policy implication is that the Scheme would some individual landholders (e.g. farmers) willing need to adopt a more transparent application of the to participate, and many individual landholders mitigation hierarchy, so that the necessity and legiti- (e.g. rural-residential landholders, farmers) macy of offsetting becomes clear to participants. Our unwilling to participate. findings show that several participants did not see Abductive enquiry may elicit reasons for indi- a need to destroy vegetation in the first place and vidual landholders or groups of landholders to therefore did not agree with the premises of offsetting undertake specific events. It can also elicit reasons it. A second implication is that a tightening of the for collective action, or policy action for public working rules of the Scheme also appears to be neces- policy outcomes. Landholders or developers will sary for some landholders to consider biodiversity off- not undertake policy reform. Rather, policy sets as effective. Some of the landholders interviewed makers will, and their actions can be informed considered the rules of the Scheme to be too loose to by landholders’ decision to participate or not in achieve positive ecological outcomes. Some of the fun- the Scheme. Our findings demonstrate that when damental rules of the Scheme, such as ‘like-for-like’ a broader institutional perspective on market- and ‘in perpetuity’ would need to be renegotiated for based biodiversity offsetting is adopted, abduction some landholders to consider participation. However, emerges as a compatible mode of enquiry to elicit for a certain category of landholders even these insti- how the ‘private’ reasons of offset buyers and tutional reforms would not reconcile fundamental dif- sellers (over and beyond the offset price signal) ferences in value framing (Sullivan and Hannis 2015). become the concern of policy makers and shape the case for public policy reform. Rather than call for either a wholesale dismissal of 5.2.3. Sufficient reason for policy change? offsetting, or proposing established economic measures Our abductive exploration yields the plausible to reduce market failure, our approach offers a broader conclusion, without positively verifying it, that perspective beyond the boundaries of traditional eco- changes in the working rules of the Scheme nomic analysis, into the formal and informal institu- would be warranted for our case study situation. tions (the working rules) of offsetting, with a view to In the sections above, we have outlined some emphasise and elicit the human dimension of private possible changes and what they would most likely land conservation in an economic setting. The broader achieve in terms of bringing a more diversely significance of our study resides in its potential to motivated group of landholders on board of the inform institutional design in jurisdictions where estab- Scheme. For the policy administrators, notions of lished schemes are under review, or may become sub- policy cost-effectiveness and allocative efficiency ject to review. will inherently play a role in deciding whether there is sufficient reason for policy reform. Indeed, these notions are the very raison d’être Notes of any market-based offsetting scheme. However, 1. Biodiversity offsets pilots were trialled in England the evolving rules and norms in which the scheme between 2012 and 2014 and a consultation process on operates – as measured, in our study, by land- biodiversity offsetting was conducted in 2013. However, holders’ perceptions of offsetting rights and offsetting was not rolled out more widely at that time. responsibilities – especially landholders’ ethical 2. We remind the reader that, following the mitigation and moral considerations, are a prompt for policy hierarchy, offsetting should always be considered ECOSYSTEMS AND PEOPLE 13 principles. Studies undertaken by the Institute for a last resort (Arlidge et al. 2018), after avoidance, Sustainable Futures have been approved in principle by minimisation and remediation on-site. the University of Technology Sydney, Human Research 3. Primmer et al. (2019) held several workshops on the Ethics Committee (project 18064). rights and responsibilities of each stakeholder group (e.g. developer, landowner, government authority, knowledge intermediaries, citizens) in an offset scheme, Disclosure statement if such a scheme was to be implemented in Finland. 4. Not all offsets schemes put a price on nature. Other No potential conflict of interest was reported by the Australian jurisdictions (e.g. Commonwealth, authors. Western Australia, Queensland) are based on envir- onmental outcomes regardless of price. 5. The latter option did not exist under the previous Funding scheme, as the BCT was created under the new legislation. The work was supported by the NSW Environmental Trust 6. 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Journal
Ecosystems and People
– Taylor & Francis
Published: Dec 31, 2023
Keywords: Eszter Kelemen; Institutions; biodiversity offsets; landholders; Australia; New South Wales; abduction; ethnography; Rights
