Developing indicators for environmental policy: data-driven and theory-driven approaches examined by example

This paper investigates the issues involved with environmental indicator development for policy by looking at three recent examples from data and theory-driven approaches. The “Environmental Sustainability Index 2001” report from World Economic Forum, YCELP and CIESIN is taken as an example of the data-driven approach, whereby data availability is the central criterion for indicator development and data is provided for all selected indicators. The other two examples are theory-driven, whereby, the focus is on selecting the best possible indicators from a theoretical point of view and data availability is considered only one of the aspects involved. These examples are the Heinz Center’s1999 report on the “State of the Nation’s Ecosystems” and the US National Research Council (NRC) report on “Ecological Indicators for the Nation”. The reports and approaches are discussed and compared in order to determine their strengths and weaknesses. From this lessons are drawn for future environmental indicator work as a basis for policymaking. In the conclusions four important issues are addressed: (1) data availability; (2) ecosystem specificity of indicators; (3) spatial and conceptual aggregation of indicators and (4) baseline or reference values for indicators. For each of these issues recommendations are made.