NCS Capacity Building Project. Business Planning Workshop. Session 3. The business planning process.
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1 NCS Capacity Building Project Business Planning Workshop Session 3 The business planning process jose@mentefactura.net
2 Our learning process Awareness Envisioning Architecturing
3 Financial sustainabiliy process in Ecuador Financial Needs Assessment (MoU) 2004 Financial Sustainability Strategy (MoU + SNAP-GEF) 2005 Financial Strategy Implementation (UNDP GEF) 2007 End of the Process 2013 Promoters group formed by 10 organizations in fourth year of operation Financial Needs Assessment finished Financial Sustainability Strategy finished GEF UNDP Project will finance the implementation of the Financial Sustainability Strategy until year 2013
4 Financial strategy Ecuador Mid term goal: 12 Mill. Long term goal: 38 Mill. Expenditure Revenues Management Efficiency Standardization Control Scale economies Site level National International Equity Financial reingenering Deconcentration of funds PA marketing
5 Intervention logic Three kind of activities Enabling environment agenda to secure long term sustainability Building capacity and empowerment Implementation of business plans Institutional coordination Integration Coherence Coordination Crosscutting (between sectors) Environ ment Finance Touris m Etc, Vertical (bet. Govern. levels) Executi ve Minister ie Municip alities P A Intertemporal (bet. administ. cicles) short term Mid term Long Term Scale Site level Cluster / group of PA System Short term Mid term Long term
6 Road map to financial planning Awareness Planning the process Finding the right partners Envisioning & Designing Financial Needs Assessment Engaging new partners/ political buying Financial Strategy to close gaps Communicate results Implementation and measurement
7 Awareness Do you recognize financial sustainability as a priority in your agenda? Is it reflected in your operative plans and budget? What about other stakeholders? Do you feel comfortable dealing with financial issues?
8 Planning the process Is there a plan to guide your financial planning process? Do you know how much you can engage for this task? How is it linked to your operative plans and other NCS projects? What kind of resources/skills/knowledge would you need to undertake this process?
9 Finding the right partners Consider forming a promoters group/ financial task force or similar figure to undertake the process Find a partner who will feed the process with technical financial expertise Ensure full participation from the government at different levels
10 Envisioning and design Start with the end in mind Take a look around the neighborhood Make sure you invest not only in the final products but in the process Start thinking about who will implement the financial strategy
11 Envisioning and design FINANCIAL GAP ANALYSIS BASIS FOR SUSTAINABLE FINANCING MENÚ DE ALTERNATIVAS DE FINANCIAMIENTO Legal Managerial Economic Political Portafolio opciones de adm. Análisis jurídico macro Estrategia de gestión Sist. manejo adm/ financiero Mapeo de actores Análisis tasas MAE Estrategia de mercado Valoración económica serv. ambiental, turismo, pobreza Estrategia de inserción Estrategia de comunicación Lineamientos para Plan Estratégico BUSINESS PLANS IMPLEMENTATION Tourism Goods and services Mainstreaming conservation into poverty reduction agenda
12 Envisioning & design Financial Needs Assessment (MoU) Financial Sustainability Strategy (MoU + SNAP-GEF) Financial Strategy Implementation (UNDP GEF) 2007 End of the Process
13 Envisioning and design Transversal (Between sectors) Vertical (Betw.Governmen tal levels) Intertemporal (Betw.Administrat ive cicles) Integration Medio Ambiente Ejecutivo Nacional Coyuntura Fiscal Hacienda Ministerios Coherence Coordination Obras Pública Agricultur a Ciencia y Tecnología Etc, Estados Provincias Cuencas hídricas Municipios Mediano plazo 5-7 Años Largo Plazo
14 Financial Needs Assessment Define the level of information that will fit your needs: Costing your management plan Costing activities under CBD Baseline for financial management Identify operative and investment costs Make sure the process is participative and that information would be updated periodically Prepare scenarios or financial alternatives Results should be accurate and solid
15 Engaging new partners Needs assessment is more like an internal exercise, financial strategy needs a broader stakeholders approach Make sure to renew political support Consider inviting new members to your Promoters Group Pursue the alignment of the process with other national development agendas
16 Financial Strategy Promote an enabling environment Financial autonomy / centralized management Who will implement the strategy? Participative definition of goals / target groups / responsibilities Prioritize high impact activities that can be developed in the short term
17 Financial Strategy FINANCIAL GAP ANALYSIS BASIS FOR SUSTAINABLE FINANCING MENÚ DE ALTERNATIVAS DE FINANCIAMIENTO Legal Managerial Economic Political Portafolio opciones de adm. Análisis jurídico macro Estrategia de gestión Sist. manejo adm/ financiero Mapeo de actores Análisis tasas MAE Estrategia de mercado Valoración económica serv. ambiental, turismo, pobreza Estrategia de inserción Estrategia de comunicación Lineamientos para Plan Estratégico BUSINESS PLANS IMPLEMENTATION Tourism Goods and services Mainstreaming conservation into poverty reduction agenda
18 A large menu of PA finance mechanisms Financial Strategy Public spending: Government budget allocations to domestic conservation agencies Earmarking tax revenue for conservation (e.g. taxes on energy, aviation, hotels) Tax breaks or subsidies for private conservation effort/investment Earmarking charges or penalties related to natural resource use (e.g. timber stumpage fees, park entry fees, pollution taxes) International development assistance (e.g. environmental aid, debt-for-nature swaps, contributions to GEF or trust funds) Public policy reform: Reform environmentally-harmful subsidies (e.g. agriculture, fisheries, water, energy) Public investment (e.g. infrastructure) Private charity and non-profit: Private foundations Community self-support groups Secular and faith-based charities and NGOs Dedicated fund-raising campaigns or events Social marketing, lotteries Biodiversity-friendly products and services Organic agriculture Sustainable non-timber forest products Certified forest and fisheries products Eco-tourism enterprise Markets for ecosystem services Bio-prospecting agreements Carbon sequestration in biomass Watershed protection incentives Tradable development rights (biodiversity offsets and easements) Other private for profit: Commercial banks Export credit agencies Direct foreign investment Venture &/or private capital Public-private-community partnerships Portfolio investors (e.g. green funds) Community-enterprise (formal / informal) Adapted from: Gutman, Pablo (ed.) From Good will to payments for Environmental Services: A survey of Financing Options for Sustainable Natural Resource Management in Developing Countries. WWF/MPO: Washington, D.C.
19 Communicating results
20 Implementation and measurement Remember that financial sustainability is a new concept for PA managers and stakeholders, make sure everyone speaks the same language Build capacity at local and national level to implement business plans? Link the process with Effective Management Monitoring and update of Management Plans
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