Term Definition Acronym Reference
Accrued (Executed) Budget Recognizes transactions when the activity (decision) generating revenue or consuming resources takes place    
Activity-Based Costing An approach to the costing and monitoring of activities that involves tracing resource consumption and costing final outputs. Resources are assigned to activities, and activities to cost objects based on consumption estimates. The latter utilize cost drivers to attach activity costs to outputs.   CIMA (2005)1
Actual Cost Cost accounting based on the most factual allocation of historical cost factors.   Merriam-Webster (n.d)2
Addis Ababa Action Agenda The ground-breaking agreement that provides a foundation for implementing the global sustainable development agenda.   UN (n.d)3
ARtificial Intelligence for Ecosystem Services ARIES (ARtificial Intelligence for Ecosystem Services) is a networked collaborative software designed for rapid ecosystem service assessment and valuation. ARIES AIRIES (n.d)4
Biodiversity (Biological Diversity) Biological diversity means the variability among living organisms from all sources including, inter alia, terrestrial, marine and other aquatic ecosystems and the ecological complexes of which they are part; this includes diversity within species, between species and of ecosystems.   CBD (n.d)5
Biosafety The prevention of large-scale loss of biological integrity, focusing on both ecological and human health. Set of measures or actions addressing the safety aspects related to the application of biotechnologies and to the release into the environment of transgenic plants and organisms, particularly microorganisms, that could negatively affect plant genetic resources, plant, animal or human health, or the environment.   UNEP Glossary (2007)6
Budget Execution After the government enacts the budget, this concerns how funds are actually spent to implement the policies, programmes, and projects outlined in the budget.   International Budget Partnership (n.d)7
Budget Formulation The first stage of the budget process takes place almost exclusively with the executive branch of government, though it can include a number of actors within the branch. At this point the parameters of the budget are set and decisions made about revenues and how these resources will be distributed across programmes and activities.   International Budget Partnership (n.d)
Budget Tagging A system for consistently identifying types of expenditures (e.g. on biodiversity) within budgeting systems.    
Cap and Trade A system where an upper limit on emissions/activity is fixed, and permits are either auctioned off or distributed for free according specific criteria. Polluters that reduce their emissions/activity more than they are obliged to can earn “credits” that they sell to others who need them to comply with regulations.   OECD (n.d)8
Capital Cost The acquisition of fixed capital assets, such as purchase of machinery and equipment, loans and purchase of securities, transfer resources for capital expenditure.    
Certified Budget The resources reserved for a specific acquisition or specific expense.    
Climate Finance Climate finance aims at reducing emissions, enhancing sinks of greenhouse gases and reducing vulnerability of, and maintaining and increasing the resilience of, human and ecological systems to negative climate change impacts.   UNFCCC (n.d)9
Committed Budget The total value of the expenditure committed for specific contracts for works, provision of goods, services, transfers or subsidies.    
Corporate Social Responsibility The responsibility of an organization for the impacts of its decisions and activities on society and the environment. CSR ISO 2600010
Cost-Benefit Analysis A decision-making tool that compares costs and benefits of a proposed policy or project in economic (as distinct from financial accounting) terms. CBA  
Cost Object A term used primarily in cost accounting to describe something to which costs are assigned. Cost objects may be a product, a department, a project, etc.    
Debt-for-Nature Swap A voluntary transaction in which an amount of hard-currency debt owed by a developing country government (debtor) is cancelled or reduced (discounted) by a creditor, in exchange for financial commitments to conservation—in local currency—by the debtor.   CBD (n.d.)11
Decentralization The dispersion or distribution of functions and powers, specifically the delegation of power from a central authority to regional and local authorities.   Merriam-Webster (n.d)
Depreciation An accounting method of allocating the cost of a tangible asset over its useful life. Businesses depreciate long-term assets for both tax and accounting purposes.    
Direct Capital Investment Also foreign direct investment (FDI), refers to an investment in a business enterprise in a country other than the investor's country designed to acquire a controlling interest in the foreign business enterprise. Direct investment provides capital funding in exchange for an equity interest without the purchase of regular shares of a company's stock.    
Direct Costs Costs that can be accurately traced and assigned to a cost object. Direct costs typically benefit a single cost object. The classification of any cost either as direct or indirect is done by taking the cost object into perspective.    
Disaster Risk Reduction The concept and practice of reducing disaster risks through systematic efforts to analyse and manage the causal factors of disasters, through methods including reduced exposure to hazards, lessened vulnerability of people and property, wise management of land and the environment, and improved preparedness for adverse events. DRR UNISDR (n.d.)12
Drivers, Pressures, State, Impact, Responses A causal framework for describing the interactions between society and the environment. DPSIR  
Economic Analysis The changes in costs and benefits of all types (i.e. changes in welfare to different parties) from a proposed action.    
Economic Valuation (Monetization) (of the environment) Assigning monetary value to changes in environmental factors (such as the quality of air and water, and damage caused by pollution).
“Environmental valuation” and “resource valuation” are used.
Ecosystem Services Benefits people receive from ecosystems. These include provisioning services such as food and water; regulating services such as flood and disease control; cultural services such as spiritual, recreational, and cultural benefits; and supporting services, such as nutrient cycling, that maintain the conditions for life on Earth.   Millennium Ecosystem Assessment (n.d)13
Ecosystems The complex of a community of organisms and its environment functioning as an ecological unit.   (Merriam-Webster undated)
Ecotourism Responsible travel to natural areas that conserves the environment and improves the well-being of local people.   The International Ecotourism Society14
Externalities Effects of a person's or firm's activities on others who are not compensated or included in decision-making; they can be either positive or negative.    
Fiscal Policy Government financial actions and norms including both revenues, such as taxes, and expenditures.    
Finance Solutions Described by a source(s) of finance, the lead agent or the intermediary(ies), the instrument(s) or mechanisms used and the desired finance result.   See Box 1.5
Food Security When all people, at all times, have physical, social and economic access to sufficient, safe and nutritious food that meets their dietary needs and food preferences for an active and healthy life.   FAO (n.d.)15
Genetic Diversity The variety of genes within a species. Each species is made up of individuals that have their own particular genetic composition.   WWF (n.d.)16
Geographic Information Systems A computer-based tool that analyses, stores, manipulates and visualizes geographic information on a map. GIS GIS Geogrpahy, (n.d.)17
Global Environment Facility A financial mechanism for several environmental Conventions. Through its strategic investments, the GEF works with partners to tackle the planet’s highest priority environmental issues. GEF GEF (2016)18
Green Bonds Bonds from which proceeds are invested in projects that generate environmental benefits.    
Green Economy An economy that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities. It is low-carbon, resource-efficient, and socially inclusive.   UNEP (2011)19
Green Finance The financing of public and private green investments (including preparatory and capital costs) in the following areas:
  • environmental goods and services (such as water management or protection of biodiversity and landscapes);
  • prevention, minimization and compensation of damages to the environment and to the climate (such as energy efficiency or dams);
  • the financing of public policies (including operational costs) that encourage the implementation of environmental and environmental damage mitigation or adaptation projects and initiatives (for example feed-in-tariffs for renewable energies);
  • components of the financial system that deal specifically with green investments, such as the Green Climate Fund or financial instruments for green investments (e.g. green bonds and structured green funds), including their specific legal, economic and institutional framework conditions
  Lindenberg (2014)20
Green Growth Fostering economic growth and development while ensuring that natural assets continue to provide the resources and environmental services on which our well-being relies.   OECD (n.d.)21
Green Infrastructure A strategically planned network of natural and semi-natural areas with other environmental features designed and managed to deliver a wide range of ecosystem services such as water purification, air quality, space for recreation and climate mitigation and adaptation.   EU (2016)22
Green Taxes A tax whose tax base is a physical unit (or a proxy of it) that has a proven specific negative impact on the environment. Four subsets of environmental (green) taxes are distinguished: energy taxes, transport taxes, pollution taxes and resources taxes   OECD (n.d.)23
Greenhouse Gas Those gaseous constituents of the atmosphere, both natural and anthropogenic, that absorb and emit radiation at specific wavelengths within the spectrum of infrared radiation emitted by the Earth’s surface, the atmosphere, and clouds. This property causes the greenhouse effect. GHG IPCC24
Gross Domestic Product An aggregate measure of production equal to the sum of the gross values added of all resident and institutional units engaged in production (plus any taxes, and minus any subsidies, on products not included in the value of their outputs). GDP OECD (n.d)25
Gross National Happiness A term coined by His Majesty the Fourth King of Bhutan, Jigme Singye Wangchuck, in the 1970s. The concept implies that sustainable development should take a holistic approach towards notions of progress and give equal importance to non-financial aspects of well-being. See also, National Happiness Index. GNH Centre For Bhutan Studies & GNH Research (n.d.)26
Habitat Banking A market where credits from actions with beneficial biodiversity outcomes can be purchased to offset the debit from environmental damage. Credits can be produced in advance of, and without ex ante links to, the debits they compensate for, and stored over time.   eftec, IEEP et. al (2010)27
Harmful Subsidy to Biodiversity A government policy that creates an incentive for or induces behaviour or activity that is harmful to biodiversity, often as unanticipated (and unintended) side effects of policies designed to attain other objectives.   CBD (2012)28
Impact Investment Investments made into companies, organizations, and funds to generate social and environmental impact alongside a financial return.   The GIIN (n.d.)29
Incremental Budgeting Approach Management accounting based on adding incremental amounts to existing budgets to arrive at the new budgeted numbers. IBA efinance management30
Indirect Costs Accounting costs not directly associated with a single activity, event, or other cost object. Such costs are frequently aggregated into an overhead cost pool and allocated to various activities, based on an allocation method that has a perceived or actual linkage between the indirect cost and the activity.   Accounting Tools31
Inflation The change in the prices of a basket of goods and services that are typically purchased by specific groups of households.   OECD (n.d.)32
Integrated Valuation of Ecosystem Services A suite of free, open-source software models used to map and value the goods and services from nature that sustain and fulfil human life. InVEST Natural Capital Project (n.d.)33
International Monetary Fund An organization of 189 countries aiming to secure stability of the international monetary system. IMF IMF (n.d.)34
Invasive Alien Species A species occurring in an area outside of its historically known natural range as a result of intentional or accidental dispersal by human activities that invades natural habitats.   UNEP (n.d.)35
Investment Cost Accounting cost used for asset formation such as expenses or costs of in investing in funds, public works, etc.    
Key Performance Indicators “SMART” indicators (specific, measurable, achievable, realistic, and timebound) used to gauge or compare results related to meeting strategic biodiversity goals, as well as financial performance in terms of costeffectiveness, efficiency, and economic impact. KPI  
Line Ministry/Agency A government ministry or agency responsible for implementing a programme or group of programmes through an institutional structure with central and localized branches, as opposed to one responsible for general planning and administration. For example, includes agriculture, social security, but excludes finance, planning   IIEP Learning Portal undated36
Macroeconomics The economics subdiscipline that studies how aggregates of households and communities behave. Macroeconomics examines price levels, business cycles, rates of growth, national income, aggregate savings and investment, multiplier effects of consumption and investment, gross domestic product and changes in employment, for example.    
Millennium Development Goals A set of eight goals and associated targets to achieve poverty alleviation by 2015. MDG UNEP (n.d.)
Mitigation Hierarchy A set of prioritized steps to alleviate environmental harm as far as possible through avoidance, minimization (or reduction) and restoration of detrimental impacts to biodiversity.   FFI (n.d.)37
National Biodiversity Strategies and Action Plans The principal instruments for implementing the Convention on Biological Diversity (CBD) at the national level (Article 6). The Convention requires countries to prepare a national biodiversity strategy (or equivalent instrument) and to ensure that this strategy is mainstreamed into the planning and activities of all those sectors whose activities can have an impact (positive and negative) on biodiversity. NBSAP CBD (n.d.)
Natural Capital Accounting A tool to measure the changes in the stock of natural capital at a variety of scales and to integrate the value of ecosystem services into accounting and reporting systems. NCA EU (n.d.)38
Natural Capital The stock of renewable and non-renewable natural resources (e.g., plants, animals, air, water, soils, minerals) that combine to yield a flow of benefits to people.   Natural Capital Protocol (2016)39
Natural Capital Protocol A framework designed to help generate trusted, credible, and actionable information for business managers regarding their effects on and management of natural capital. NCP Natural Capital Coalition (n.d.)
Official Development Assistance Those flows to countries and territories on the (Development Assistance Committee) list of ODA Recipients and to multilateral institutions that are:
  • provided by official agencies, including state and local governments, or by their executive agencies; and
  • each transaction of which:
    • is administered with the promotion of the economic development and welfare of developing countries as its main objective; and
    • is concessional in character and conveys a grant element of at least 25 percent (calculated at a rate of discount of 10 percent).
ODA OECD (n.d.)40
Organic Farming A method of crop and livestock production that involves choosing not to use pesticides, fertilizers, genetically modified organisms, antibiotics and growth hormones.
(Precise definitions and acceptable practices vary by country.)
  Canada Organic41
Payments for Ecosystem Services A voluntary transaction whereby a well-defined ecosystem service, or a land use likely to secure that service, is being bought by at least one buyer from at least one provider, if, and only if, the provider secures the provision of the service. PES Vakrou (2010)42
Poverty-Environment Initiative A global Initiative of the United Nations Development Programme (UNDP) and the United Nations Environment Programme (UNEP) that supports country-led efforts to put pro-poor, pro-environment objectives into the heart of government by mainstreaming poverty-environment objectives into national and subnational development planning, from policymaking to budgeting, implementation and monitoring. PEI UNPEI (n.d.)43
Protected Areas Physical preservation and/or conservation of important stocks of natural, cultural and social capital, yielding flows of economically valuable goods and services that benefit society, secure livelihoods, and contribute to sustainable development. PA CBD (n.d.)44
Public Expenditure General government spending—generally consists of central, state and local governments, and social security funds   OECD (n.d.)45
Public Good A good or service that one individual can consume without reducing its availability to another individual, and from which no one is excluded.    
Replacement Cost The cost to replace an asset of a company at the same or equal value. It uses cost of artificial substitutes for environmental goods or services. RC TEEB (2013)46
Results-Based Budgeting Budgeting process which revolves around a set of predefined objectives and expected results, which in turn justify the resource requirements linked to outputs, and where actual performance is measured using objectively verifiable indicators. RBB  
Results-Based Costing An expansion of activity-based costing where all costs are associated with specific medium- to long-term results so that the “outcome” of the activity is the budgeting focus and not the activity or short-term outputs RBC  
Results-Based Management A strategy by which all actors contributing directly or indirectly to achieving a set of results ensure that their processes, products and services contribute to the achievement of desired results (outputs, outcomes and higher-level goals or impact). RBM UNDG (2011)47
Subsidies Current unrequited payments that government units, including nonresident government units, make to enterprises on the basis of the levels of their production activities or the quantities or values of the goods or services which they produce, sell or import   OECD (n.d.)48
Subsistence Agriculture Farming or a system of farming that provides all or almost all the goods required by the farm family, usually without any significant surplus for sale.   Merriam-Webster (n.d.)
Sustainable Development Goals Also the “Global Goals”—a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity. These 17 Goals build on the successes of the Millennium Development Goals, while including new areas such as climate change, economic inequality, innovation, sustainable consumption, and peace and. The goals are interconnected; often the key to success in one involves tackling issues more commonly associated with another. SDG UNDP (n.d.)49
Sustainable Livelihood A livelihood is sustainable when it can cope with and recover from stresses and shocks, and maintain or enhance its capabilities and assets both now and in the future without undermining the natural resource base and opportunity set of future generations.   FAO (n.d.)50
System of Environmental Economic Accounting The internationally agreed standard concepts, definitions, classifications, accounting rules and tables for producing internationally comparable statistics on the environment and its relationship with the economy SEEA UN SEEA (n.d.)51
Targeted Scenario Analysis An analytical approach developed by UNDP that captures and presents the value of ecosystem services within decision-making, through the description and comparison of “business as usual” and “sustainable ecosystem management” scenarios to help make the business case for sustainable policy and investment choices. See also "Cost-Benefit Analysis". TSA UNDP (2013)52
Variable Costs Costs that vary depending on the production volume; they rise as production increases and fall as production decreases. Variable costs differ from fixed costs such as rent, advertising, insurance and office supplies, which tend to remain the same regardless of production output.    
Water Security The capacity of a population to safeguard sustainable access to adequate quantities of acceptable quality water for sustaining livelihoods, human well-being, and socio-economic development, for ensuring protection against water-borne pollution and water-related disasters, and for preserving ecosystems in a climate of peace and political stability   UN-Water (n.d.)53
World Trade Organization The organization responsible for regulation of trade between participating countries by providing a framework for negotiating trade agreements and a dispute resolution process aimed at enforcing participants' adherence to WTO agreements, which are signed by representatives of member governments. WTO  
  1. CIMA (2005). CIMA Official Terminology.


  3. Link to the FfD Addis Ababa Action Agenda:


  5. Article 2 in the Convention on Biological Diversity. See























  27. Eftec and others (2010). The use of market-based instruments for biodiversity protection – The case of habitat banking – Summary Report. Available from: