The State of Food and Agriculture 2023

Chapter 3 Moving Towards Targeted True Cost Assessments for Informed Decisions


This chapter goes beyond the wider, national-level estimates presented in Chapter 2 and focuses on conducting targeted assessments to support decision-making to improve agrifood systems sustainability in the short and long term. It presents conceptual guidance on how to conduct TCA through the TEEBAgriFood Evaluation Framework to assess the impacts of agrifood policies and businesses. Thus, it helps to formulate recommendations to change agrifood systems activities, be they in business or government, so that agrifood systems transform towards sustainability.

In particular, the chapter emphasizes how targeted assessments need to be selected based on the priorities of policymakers in specific contexts. It shows the power and flexibility of TCA in its application to different scopes, from an entire agrifood system down to a single product. Regardless of analysis scope, TCA can be used to compare different policy and management choices. Scenario and policy analyses feed into TCA, examining a range of plausible futures, including the outcomes and effectiveness of various policy or management options. Depending on the data used in the scenario analysis, methods such as cost–benefit analysis, cost-effectiveness analysis and multicriteria analysis can be used to group results and propose reforms that can affect incentives, regulations, standards and investments.

To complement the role of TCA in better informing policymakers, the chapter also reviews its role in guiding sustainable agrifood businesses and investments. Specifically, it shows how TCA can help businesses and private investments to become sustainable and more resilient by improving strategic and operational management, leading to better supply-chain transparency. The chapter cites TCA initiatives and applications in the sector to illustrate how TCA can support businesses in monitoring and unlocking opportunities that can help improve their sustainability.

In conclusion, the chapter provides conceptual guidance for policymakers and agrifood businesses on undertaking targeted assessments. Based on the significant progress already made by existing resources, Chapter 4 presents how policymakers, academia and standard-setters play complementary roles in scaling up the adoption of TCA for agrifood policy and business analyses. The objective is to better inform decisions, so that action can be taken to address the key systemic hidden costs.

back to top