Principles for fairness and efficiency in enhancing environmental services in Asia. Payments, compensation or co-investment?

Based on our action research in Asia in the Rewarding Upland Poor for Environmental Services they provide (RUPES) program since 2002, we examine three paradigms: “Commoditized ES (CES)”, “Compensation for Opportunities Skipped (COS)”, and “Co-Investment in (Environmental) Stewardship (CIS)”. Among the RUPES action research sites, there are several examples of CIS, i.e. co-investment in and shared responsibility for stewardship, with a focus on “assets” (natural + human + social capital) that can be expected to provide future flows of ES. CES, equivalent to a strict definition of PES, may
represent an abstraction rather than a current reality. COS is a challenge when the legality of opportunities to reduce ES is contested.


The term ‘payments for environmental services’ has rapidly gained popularity, with
its focus on market-based mechanisms for enhancing environmental services.
Current use of the term, however, covers a broad spectrum of interactions between
environmental services’ suppliers and beneficiaries.


A broader class of mechanisms pursues enhancement of environmental services
through compensation or rewards. Such mechanisms can be analysed on the basis of
how they meet four conditions: realistic, conditional, voluntary and pro-poor.


The Rewarding Upland Poor for Environmental Services (RUPES) program has been
examining such mechanisms throughout Asia since 2002.