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About Signposts
Background
The Signposts for Australian Agriculture (Signposts) project is a partnership between Research and Development Corporations (RDCs), Governments and the National Land & Water Resources Audit (the Audit). It has continuing funding from the Department of Agriculture, Fisheries and Forestry to develop a consistent and credible framework for reporting on the contributions of Australia’s agricultural industries to our total quality of life. The project is designed to provide quick and reliable directions for government and industry policy makers to:
- demonstrate and communicate industry performance
- identify challenges and opportunities
- better target policy interventions, research and development and data collection.
Further information on Signposts is available on the National Land & Water Resources Audit website http://www.nlwra.gov.au/Natural_Resource_Topics/Signposts_for_Australian_Agriculture/index.aspx.
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The Signposts project commenced in April 2004.
Stage 1 (03/04) of the project developed in consultation with six RDCs:
- a pilot framework and associated outcome statements and indicators for measuring the contribution of agricultural industries to ESD, together with
- initial web based/CD profiles of selected agricultural industries, and
- a report on the current level of RDC reporting on sustainable agriculture, data availability and access conditions.
Stages 2.1 -2.4 (04/05) of the project used the results of the initial pilot to:
- obtain input from a broader range of RDCs and the states in the development of the framework, and
- expand the framework to incorporate a conceptual link between the achievement of ESD outcomes and intermediate outcomes such as changes in business or natural resource management practices, and the impact of participation in major policy initiatives on the adoption of management practices.
Stage 2.5 (04/05) of the project reviewed a component of the Signposts framework: the “human systems” and provided recommendations on alternative outcome statements and associated indicators for inclusion.Stage 3 (05/06) aims to promote the engagement and support of RDCs and State Agencies for:
- the expansion of three industry profiles developed in Stages 1 and 2 of Signposts
- a pilot report on one RDC based industry using the Signposts framework
- an indicative project proposal for a proposed Stage 4 Final Report likely to be conducted in the 06/07 financial year.
Stage 4 is intended be conducted in 2007/08 and use the agreed framework and profiles to underpin a 'Signposts for Australian Agriculture' report identifying agriculture’s contributions to ecologically sustainable development in Australia.
A number of related project activities are providing direct input into the Signposts framework:
- DAFF Rural Policy and Innovation Division have engaged the Audit to manage “Signposts for Australian Agriculture – National Data and Information Priorities on Business Management Practices”,
- Under the Socio-Economic Work Plan the Audit has commissioned “The development and pilot of a set of indicators, survey methodology and tools to assess land managers’ capacity to change and adopt sustainable management practices”,
The results of these two projects will identify key management practices associated with the achievement of ESD outcomes under the Signposts framework, existing data sources and provide practical advice on the future:
- design and content of a Nationally coordinated industry survey of land managers’ capacity to change and adopt sustainable management practices to be conducted by the Audit at the end of the 05/06 financial year,
- content of the Audit’s integrated assessments, including the Signposts for Australian Agriculture report.
- the Bureau of Rural Sciences (BRS) Keystone project: Measuring the contribution of portfolio industries to sustainable development, is based on the Signposts for Australian Agriculture Framework and will produce a profile of the grains industry in 2006 using the Signposts framework.
- the BRS Land Use and Management Information System (LUMIS is developing a classification system for the effective collection, management and distribution of information on land management practices.
- DAFF Food and Agriculture Division are exploring the suitability of the Signposts framework for reporting on whole of chain environmental sustainability performance with the food processing sector.
- content of the Audit’s integrated assessments, including the Signposts for Australian Agriculture report.
- the Bureau of Rural Sciences (BRS) Keystone project: Measuring the contribution of portfolio industries to sustainable development, is based on the Signposts for Australian Agriculture Framework and will produce a profile of the grains industry in 2006 using the Signposts framework.
- the BRS Land Use and Management Information System (LUMIS is developing a classification system for the effective collection, management and distribution of information on land management practices.
- DAFF Food and Agriculture Division are exploring the suitability of the Signposts framework for reporting on whole of chain environmental sustainability performance with the food processing sector.
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Conceptual framework
The Signposts framework has been designed to address the question:‘How does an agricultural industry contribute to ecologically sustainable development?’
Where ecologically sustainable development is defined as:
Using conserving and enhancing the community’s resources so that ecological processes, on which life depends, are maintained, and the total quality of life, now and in the future, can be increased (National Strategy for Ecologically Sustainable Development, Commonwealth of Australia 1992).
Signposts does not ask ‘Is an industry sustainable?’ because the question is ambiguous and a yes/no answer is unhelpful. Signposts asks ‘How does an industry contribute to sustainable development?’ because the question is immediately interpretable in terms of contributions to various capital assets, encourages evaluation of whether those contributions are acceptable and stimulates actions to increase positive contributions and reduce negative contributions.
Figure 1 shows economic systems embedded within social systems which are in turn embedded within bio-physical systems. In the Signpost framework, development is interpreted as an overall increase in the value of our capital assets - the sum of various capitals such as produced capital, human capital, social capital and natural capital. Sustainable development is interpreted as the situation where the overall value of our capital assets continues to increase over time. This interpretation of sustainable development aligns with the concept of inclusive wealth in ecological economics (Arrow et al 2003, Dasgupta and Maler 2001).
Sustainable development and ESD are treated as equivalent terms although it could be argued that the definition of ESD places additional requirements on natural capital. The Signposts framework caters for either view.
Figure 1: Economic systems, social systems and bio-physical systems with their associated capital assets.
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An agricultural industry, or any other subject for that matter, contributes to sustainable development by adding to the value of some of our assets and reducing the value of others. The net result of the contributions across all industries and activities over time determines whether sustainable development is being achieved. A large amount of literature is devoted to how one might value different types of capital assets in order to make the ultimate calculation. However, it is possible to inform many decisions without having to do this. In particular, for an agricultural industry that typically provides a mix of positive and negative contributions, it is possible to measure impacts and identify actions that are expected to have a net positive result without necessarily reducing every impact to a common unit of measurement or using the same measurement on every occasion. Rather than aggregate to a single summary measurement, the aim of Signposts is to unpack the components of sustainable development to the point at which they connect with particular policy and management decisions.
The Signposts framework recognises that an industry ‘holds’ some capital assets as well as adding to and subtracting from the capital assets ‘held’ by others. The contributions of an industry to sustainable development can be measured in terms of the value of the industry’s assets (stocks) plus the value of the contributions it makes to assets held by others (flows). Everything that has been described so far can be applied to any subject - an agricultural industry, a mining industry, a business, a region, an individual. The next step, unpacking the contributions into their components, is tailored to the particular subject and its mix of stocks and flows.
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The Signposts framework has been developed initially for the primary production sector, that is, the set of activities carried out on the farm and referred to as dairy farming, grains growing, wool growing etc. While the sector is restricted to activities behind the farm gate, the contributions of those activities to sustainable development are not restricted in any way. They include positive and negative contributions to all bio-physical, social and economic systems at the farm, local, regional and national scale. For example, the impact of grains growing on global climate and consumption of fossil fuels is in scope. So too are the impacts of grains growing on the economies of local and regional communities. Sectors further along the supply chain, such as the baking industry and the retail sector, are not included as part of the primary production sector. Contributions of the baking industry include the contributions associated with the primary production of the grain plus additional contributions (positive and negative) associated with the baking process (other ingredients, transport, manufacturing, packaging, etc). Focussing initially on the primary production sector is appropriate because it will be a necessary part of any assessment further along the supply chain.
The contributions of an industry are first divided into three components: contributions to economic systems, contributions to social systems and contributions to bio-physical systems. Each of these is then divided into assets held by the industry (stocks) and contributions to assets held beyond the industry (flows) giving the ‘component tree’ shown in Figure 2. The components in the tree are then further sub-divided as required to cover all issues of interest relevant to the industry as shown in the full component tree.
Figure 2: Major components.
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The importance of distinguishing stocks from flows is that they involve different types of measurements. For stocks held by the industry, the contribution of the industry to ESD is measured by the value of the stock. For stocks not held by the industry, the contribution of the industry to ESD is measured by the industry-specific flow to or from that stock. For example, the atmosphere does not ‘belong’ to the dairy industry. Therefore, the contribution of the dairy industry to the atmosphere cannot be measured by the condition of the atmosphere. It has to be measured in terms of what the industry emits to or absorbs from the atmosphere.
Within bio-physical systems, the distinction between stocks and flows provides a means to link spatial resource condition data with industry performance. In the case of social systems, the distinction allows direct incorporation of characteristics of industry members and industry institutions. In particular, the ‘industry members’ component can incorporate the results of Nelson et al (2005). Within economic systems, the distinction corresponds to the concepts of the balance sheet and the profit/loss statement.
For a full account of the development of the Signposts conceptual framework see the Stage 1 and Stage 2 reports on the Audit website (http://www.nlwra.gov.au/Natural_Resource_Topics/Signposts_for_Australian_Agriculture/index.aspx).
References
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Arrow KJ, Dasgupta P and Maler K-G. (2003) Evaluating projects and assessing sustainable development in imperfect economies. Environmental Economics 26, pp. 647-685.
Dasgupta P and Maler K-M. (2001) Wealth as a criterion for sustainable development. Beijer Institute Discussion Paper No. 139.
Nelson, R Webb, T & Byron, I (2005), A conceptual framework for coordinating the integration of socio-economic and biophysical information for decision makers, report to the National Land & Water Resources Audit (Draft). Australian Bureau of Agricultural and Resource Economics, Canberra.
