How Can the Eco‐efficiency of a Region be Measured and Monitored?

Summary The concept of eco‐efficiency is commonly referred to as a business link to sustainable development. In this article, ecoefficiency is examined at a regional level as an approach to promoting the competitiveness of economic activities in the Finnish Kymenlaakso region and mitigating their harmful impacts on the environment. The aim is to develop appropriate indicators for monitoring changes in the eco‐efficiency of the region. A starting point is to produce indicators for the environmental and economic dimensions of regional development and use them for measuring regional eco‐efficiency. The environmental impact indicators are based on a life‐cycle assessment method, producing different types of environmental impact indicators: pressure indicators (e.g., emissions of CO 2 ), impact category indicators (e.g., CO 2 equivalents in the case of climate change), and a total impact indicator (aggregating different impact category indicator results into a single value). Environmental impact indicators based on direct material input, total material input, and total material requirement of the Kymenlaakso region are also assessed. The economic indicators used are the gross domestic product, the value added, and the output of the main economic sectors of Kymenlaakso. In the eco‐efficiency assessment, the economic and environmental impact indicators are monitored in the same graph. In a few cases eco‐efficiency ratios can also be calculated (the economic indicators are divided by the environmental indicators). Output (= value added + intermediate consumption) is used as an economic indicator related to the environmental impact indicators, which also cover the upstream processes of the region's activities. In the article, we also discuss the strengths and weaknesses of using the different environmental impact indicators.