Normative, systemic and procedural aspects: a review of indicator‐based sustainability assessments in agriculture

Several methods for assessing the sustainability of agricultural systems have been developed. These methods do not fully: (i) take into account the multi‐functionality of agriculture; (ii) include multidimensionality; (iii) utilize and implement the assessment knowledge; and (iv) identify conflicting goals and trade‐offs. This paper reviews seven recently developed multidisciplinary indicator‐based assessment methods with respect to their contribution to these shortcomings. All approaches include (1) normative aspects such as goal setting, (2) systemic aspects such as a specification of scale of analysis, (3) a reproducible structure of the approach. The approaches can be categorized into three typologies. The top‐down farm assessments focus on field or farm assessment. They have a clear procedure for measuring the indicators and assessing the sustainability of the system, which allows for benchmarking across farms. The degree of participation is low, potentially affecting the implementation of the results negatively. The top‐down regional assessment assesses the on‐farm and the regional effects. They include some participation to increase acceptance of the results. However, they miss the analysis of potential trade‐offs. The bottom‐up, integrated participatory or transdisciplinary approaches focus on a regional scale. Stakeholders are included throughout the whole process assuring the acceptance of the results and increasing the probability of implementation of developed measures. As they include the interaction between the indicators in their system representation, they allow for performing a trade‐off analysis. The bottom‐up, integrated participatory or transdisciplinary approaches seem to better overcome the four shortcomings mentioned above.

An objective, niche-based approach to indicator species selection

1. Species-based indices are frequently employed as surrogates for wider biodiversity health and measures of environmental condition. Species selection is crucial in determining an indicators metric value and hence the validity of the interpretation of ecosystem condition and function it provides, yet an objective process to identify appropriate indicator species is frequently lacking. 2. An effective indicator needs to (i) be representative, reflecting the status of wider biodiversity; (ii) be reactive, acting as early-warning systems for detrimental changes in environmental conditions; (iii) respond to change in a predictable way. We present an objective, niche-based approach for species' selection, founded on a coarse categorisation of species' niche space and key resource requirements, which ensures the resultant indicator has these key attributes. 3. We use UK farmland birds as a case study to demonstrate this approach, identifying an optimal indicator set containing 12 species. In contrast to the 19 species included in the farmland bird index (FBI), a key UK biodiversity indicator that contributes to one of the UK Government's headline indicators of sustainability, the niche space occupied by these species fully encompasses that occupied by the wider community of 62 species. 4. We demonstrate that the response of these 12 species to land-use change is a strong correlate to that of the wider farmland bird community. Furthermore, the temporal dynamics of the index based on their population trends closely matches the population dynamics of the wider community. However, in both analyses, the magnitude of the change in our indicator was significantly greater, allowing this indicator to act as an early-warning system. 5. Ecological indicators are embedded in environmental management, sustainable development and biodiversity conservation policy and practice where they act as metrics against which progress towards national, regional and global targets can be measured. Adopting this niche-based approach for objective selection of indicator species will facilitate the development of sensitive and representative indices for a range of taxonomic groups, habitats and spatial scales.

Normative, systemic and procedural aspects: a review of indicator-based sustainability assessments in agriculture

Methods for assessing the sustainability of agricultural systems do often not fully (i) take into account the multifunctionality of agriculture, (ii) include multidimensionality, (iii) utilize and implement the assessment knowledge and (iv) identify conflicting goals and trade-offs. This chapter reviews seven recently developed multidisciplinary indicator-based assessment methods with respect to their contribution to these shortcomings. All approaches include (1) normative aspects such as goal setting, (2) systemic aspects such as a specification of scale of analysis and (3) a reproducible structure of the approach. The approaches can be categorized into three typologies: first, top-down farm assessments, which focus on field or farm assessment; second, top-down regional assessments, which assess the on-farm and the regional effects; and third, bottom-up, integrated participatory or transdisciplinary approaches, which focus on a regional scale. Our analysis shows that the bottom-up, integrated participatory or transdisciplinary approaches seem to better overcome the four shortcomings mentioned above.

Analysis and modeling of active occupancy of the residential sector in Spain: an indicator of residential electricity consumption

The growing energy consumption in the residential sector represents about 30% of global demand. This calls for Demand Side Management solutions propelling change in behaviors of end consumers, with the aim to reduce overall consumption as well as shift it to periods in which demand is lower and where the cost of generating energy is lower. Demand Side Management solutions require detailed knowledge about the patterns of energy consumption. The profile of electricity demand in the residential sector is highly correlated with the time of active occupancy of the dwellings; therefore in this study the occupancy patterns in Spanish properties was determined using the 2009–2010 Time Use Survey (TUS), conducted by the National Statistical Institute of Spain. The survey identifies three peaks in active occupancy, which coincide with morning, noon and evening. This information has been used to input into a stochastic model which generates active occupancy profiles of dwellings, with the aim to simulate domestic electricity consumption. TUS data were also used to identify which appliance-related activities could be considered for Demand Side Management solutions during the three peaks of occupancy.

Broker use and the cost of liquidity in commercial real estate investment

Purpose – Commercial real estate is a highly specific asset: heterogeneous, indivisible and with less information transparency than most other commonly held investment assets. These attributes encourage the use of intermediaries during asset acquisition and disposal. However, there are few attempts to explain the use of different brokerage models (with differing costs) in different markets. This study aims to address this gap. Design/methodology/approach – The study analyses 9,338 real estate transactions in London and New York City from 2001 to 2011. Data are provided by Real Capital Analytics and cover over $450 billion of investments in this period. Brokerage trends in the two cities are compared and probit regressions are used to test whether the decision to transact with broker representation varies with investor or asset characteristics. Findings – Results indicate greater use of brokerage in London, especially by purchasers. This persists when data are disaggregated by sector, time or investor type, pointing to the role of local market culture and institutions in shaping brokerage models and transaction costs. Within each city, the nature of the investors involved seems to be a more significant influence on broker use than the characteristics of the assets being traded. Originality/value – Brokerage costs are the single largest non-tax charge to an investor when trading commercial real estate, yet there is little research in this area. This study examines the role of brokers and provides empirical evidence on factors that influence the use and mode of brokerage in two major investment destinations.

A niche-based framework to assess current monitoring of European forest birds and guide indicator species' selection

Concern that European forest biodiversity is depleted and declining has provoked widespread efforts to improve management practices. To gauge the success of these actions, appropriate monitoring of forest ecosystems is paramount. Multi-species indicators are frequently used to assess the state of biodiversity and its response to implemented management, but generally applicable and objective methodologies for species' selection are lacking. Here we use a niche-based approach, underpinned by coarse quantification of species' resource use, to objectively select species for inclusion in a pan-European forest bird indicator. We identify both the minimum number of species required to deliver full resource coverage and the most sensitive species' combination, and explore the trade-off between two key characteristics, sensitivity and redundancy, associated with indicators comprising different numbers of species. We compare our indicator to an existing forest bird indicator selected on the basis of expert opinion and show it is more representative of the wider community. We also present alternative indicators for regional and forest type specific monitoring and show that species' choice can have a significant impact on the indicator and consequent projections about the state of the biodiversity it represents. Furthermore, by comparing indicator sets drawn from currently monitored species and the full forest bird community, we identify gaps in the coverage of the current monitoring scheme. We believe that adopting this niche-based framework for species' selection supports the objective development of multi-species indicators and that it has good potential to be extended to a range of habitats and taxa.

Indicators to monitor protected area sustainability: the INNOVA indicator handbook

The Mediterranean is an important eco-region, however, it suffers from the lack of common procedures for the management and monitoring of its protected areas sustainability. The INNOVA project addresses this issue by developing a procedure namely PASEMP as well as tools which can assist Protected Areas Managers and responsible authorities to develop and implement a monitoring strategy for their areas. This handbook is proposed as a flexible tool, or a reference text which should be used in combination with the PASEMP guidelines to identify indicators, but also contains guidance on how to implement and report the monitoring strategy results.

The impact of liquidity on senior credit index spreads during the subprime crisis

This paper examines the effects of liquidity during the 2007–09 crisis, focussing on the Senior Tranche of the CDX.NA.IG Index and on Moody's AAA Corporate Bond Index. It aims to understand whether the sharp increase in the credit spreads of these AAA-rated credit indices can be explained by worse credit fundamentals alone or whether it also reflects a lack of depth in the relevant markets, the scarcity of risk-capital, and the liquidity preference exhibited by investors. Using cointegration analysis and error correction models, the paper shows that during the crisis lower market and funding liquidity are important drivers of the increase in the credit spread of the AAA-rated structured product, whilst they are less significant in explaining credit spread changes for a portfolio of unstructured credit instruments. Looking at the experience of the subprime crisis, the study shows that when the conditions under which securitisation can work properly (liquidity, transparency and tradability) suddenly disappear, investors are left highly exposed to systemic risk.

Liquidity effects and FFA returns in the international shipping derivatives market

The study examines the impact of liquidity risk on freight derivatives returns. The Amihud liquidity ratio and bid–ask spreads are utilized to assess the existence of liquidity risk in the freight derivatives market. Other macroeconomic variables are used to control for market risk. Results indicate that liquidity risk is priced and both liquidity measures have a significant role in determining freight derivatives returns. Consistent with expectations, both liquidity measures are found to have positive and significant effects on the returns of freight derivatives. The results have important implications for modeling freight derivatives, and consequently, for trading and risk management purposes.

The EU societal awareness of landscape indicator: a review of its meaning, utility and performance across different scales

There is increasing recognition that agricultural landscapes meet multiple societal needs and demands beyond provision of economic and environmental goods and services. Accordingly, there have been significant calls for the inclusion of societal, amenity and cultural values in agri-environmental landscape indicators to assist policy makers in monitoring the wider impacts of land-based policies. However, capturing the amenity and cultural values that rural agrarian areas provide, by use of such indicators, presents significant challenges. The EU social awareness of landscape indicator represents a new class of generalized social indicator using a top-down methodology to capture the social dimensions of landscape without reference to the specific structural and cultural characteristics of individual landscapes. This paper reviews this indicator in the context of existing agri-environmental indicators and their differing design concepts. Using a stakeholder consultation approach in five case study regions, the potential and limitations of the indicator are evaluated, with a particular focus on its perceived meaning, utility and performance in the context of different user groups and at different geographical scales. This analysis supplements previous EU-wide assessments, through regional scale assessment of the limitations and potentialities of the indicator and the need for further data collection. The evaluation finds that the perceived meaning of the indicator does not vary with scale, but in common with all mapped indicators, the usefulness of the indicator, to different user groups, does change with scale of presentation. This indicator is viewed as most useful when presented at the scale of governance at which end users operate. The relevance of the different sub-components of the indicator are also found to vary across regions.

Assessing the ability of rural agrarian areas to provide Cultural Ecosystem Services (CES): a Multi Scale Social Indicator Framework (MSIF)

Assessing the ways in which rural agrarian areas provide Cultural Ecosystem Services (CES) is proving difficult to achieve. This research has developed an innovative methodological approach named as Multi Scale Indicator Framework (MSIF) for capturing the CES embedded into the rural agrarian areas. This framework reconciles a literature review with a trans-disciplinary participatory workshop. Both of these sources reveal that societal preferences diverge upon judgemental criteria which in turn relate to different visual concepts that can be drawn from analysing attributes, elements, features and characteristics of rural areas. We contend that it is now possible to list a group of possible multi scale indicators for stewardship, diversity and aesthetics. These results might also be of use for improving any existing European indicators frameworks by also including CES. This research carries major implications for policy at different levels of governance, as it makes possible to target and monitor policy instruments to the physical rural settings so that cultural dimensions are adequately considered. There is still work to be developed on regional specific values and thresholds for each criteria and its indicator set. In practical terms, by developing the conceptual design within a common framework as described in this paper, a considerable step forward towards the inclusion of the cultural dimension in European wide assessments can be made.

Liquidity and the drivers of search, due diligence and transaction times for UK commercial real estate investments

Trading commercial real estate involves a process of exchange that is costly and which occurs over an extended and uncertain period of time. This has consequences for the performance and risk of real estate investments. Most research on transaction times has occurred for residential rather than commercial real estate. We study the time taken to transact commercial real estate assets in the UK using a sample of 578 transactions over the period 2004 to 2013. We measure average time to transact from a buyer and seller perspective, distinguishing the search and due diligence phases of the process, and we conduct econometric analysis to explain variation in due diligence times between assets. The median time for purchase of real estate from introduction to completion was 104 days and the median time for sale from marketing to completion was 135 days. There is considerable variation around these times and results suggest that some of this variation is related to market state, type and quality of asset, and type of participants involved in the transaction. Our findings shed light on the drivers of liquidity at an individual asset level and can inform models that quantify the impact of uncertain time on market on real estate investment risk.