Global Environmental Health in the 21st Century: From Governmental Regulation to Corporate Social Responsibility: Workshop Summary (2007)

The workshop over the course of two days highlighted a number of issues related to environmental health and the role of governmental regulation and corporate social responsibility (CSR). The final discussion was an opportunity to focus on the research needs, alternative approaches, and limitations of current tools.

The Roundtable uses a broader definition of environmental health by discussing the human health impacts of the natural, built, and social environments. In the past 8 years, the Roundtable has used this perspective to guide the workshop topics and discussions. Carol Henry from the American Chemistry Association reiterated this by noting that environmental health is more than individual chemicals; it includes infectious diseases, safe water, physical (built) factors, and most importantly, the socioeconomic factors. In fact, participants further suggested that issues such as air quality, water quality, obesity, and chronic disease all have environmental health components. These issues are complex. For example, the topic of air quality includes asthma rates in Europe and the United States, different air quality issues between urban and rural sectors, and even issues between developed and developing countries. Not all these problems can be solved by governmental entities—a message that numerous participants noted during the workshop.

Addressing these issues requires implementing a public-private partnership by engaging multinational corporations to deliver capacity building, noted Peter Illig of International Society of Doctors for the Environment (now at Association Internationale pour l’Osteosynthese Dynamique). He noted that, for the developing country, the occupational setting is a healthier setting than the local community setting. The way to address many of the problems is to rebuild the linkages of health and the environment. The need to do this holds true for corporations as well as governments. There has been a defined separation between environment and health, and often environment officials and the health officials do not communicate with each other. There are significant cost benefits to be realized and improvements in efficiencies from recognizing those environmental sources of ill health that are often not only easy to identify but are cost-effective to address, noted Illig.

During the workshop, CSR was defined many ways, but in essence, according to Illig, the role of CSR is to balance and integrate the economic, social, and environmental responsibilities in order to minimize harm, optimize societal benefits, and provide or generate wealth. Webb suggested that CSR might be similar to a Trojan horse—it has been wheeled into the corporate and societal arena, and we are now trying to understand better what encompasses and what is inside it. He suggested that CSR is a concept about breaking down boundaries between governments, the private sector, and civil society organizations by recognizing there is a role for all three in addressing today’s societal problems. CSR can break down traditional boundaries, including the barriers between health and the environment.

Not all segments of industry are embracing CSR with equal vigor, noted Webb. However, currently, forestry, metal and mining sectors, and the chemistry industry have begun to deliver on CSR. Further, Webb suggested that governments, for the most part, have failed to recognize the importance of CSR for their region or its global implications. According to Webb, governments need to examine ways that CSR can be used as a competitive advantage for companies, but also as a way of addressing the problems of the 21st century.

The United States relies on a framework of national regulatory structures and laws to address many of the environmental health challenges facing this nation. However, ,there is no comparable regulatory structures and laws on an international level, thus we rely on treaties and agreements. Some participants noted that these agreements do not have the ability to solve the complexity of the environmental health programs. In fact, this may be one reason that focus has shifted to international or multinational businesses and organizations to help in the effort, noted Carol Henry of the American Chemistry Council (ACC). There is a need for organizations such as the International Council of Chemical Associations (ICCA), which was formally organized in June 1989 to coordinate policy and programs for the global chemical industry and has representatives world-wide. The ICCA is able to represent the global chemical industry before international government organizations, with the result that the ICCA leadership challenged the membership to think strategically and develop a global research strategy about the potential impacts of chemicals on health and the environment. As with most international initiatives, Henry noted that many challenges exist including working with individuals with diverse backgrounds, perspectives, and languages. However, a strategy was completed and is in the process of being implemented. The panelists considered the strategies and challenges for involving industry in addressing environmental health solutions.

The panelists discussed the idea that the private sector has a role in the world carrying capacity. Richard Wells of the Monterrey Institute of Technology and Advanced Studies stated that the private sector needs to be actively involved in improving society to remain profitable. He quoted Kofi Anan as saying that “The private sector cannot flourish if society fails.” We (the public, industry, academia, and so on) need to think about the challenges in the developing world, particularly poverty, which is both a consequence and a cause of environmental degradation. The two cannot be separated. To engage with society, the private sector needs stability; it needs prosperous societies to flourish. This will be important as William Blackburn of William Blackburn Consulting noted, because the majority of the population growth will be in developing countries. Thus a company’s future customers are going to be in these growing untapped markets. Wells noted that many multinational corporations recognize that by encouraging local small businesses, they can help to create markets for the future. Famously, Henry Ford said he paid his workers a living wage so they could purchase his products. Blackburn

pointed out that reputation is also important. For example, some companies in the medical industry are creating health programs in sub-Saharan Africa as an opportunity to enhance their reputation and to be viewed as reputable later when this market is developed. Charles Bennett of the Conference Board noted that this was underscored earlier in the workshop by the ExxonMobil example, which created an opportunity for local businesses to be a part of the supply chain during the building of the Chad-Cameroon pipeline. According to Bennett, programs such as this one help to develop a larger market for a variety of businesses.

Panelists also emphasized the need for corporations to understand the challenges in the area where they are doing business. Poverty is one issue that will need a multifaceted approach to address. According to Wells, the poor are disproportionately affected by environmental health hazards, but he noted that getting out of poverty does not necessarily reduce environmental impacts. The world’s carrying capacity needs to be raised, and at the same time, we need radical improvements in technologies, innovation, and processes to improve the standard living. Wells noted that some companies, such as Cemex, send their executives to live in poor communities. Other multinational companies are reflecting the world in the workforce by hiring talented individuals from various countries and integrating them into the corporation, noted Henry. Webb noted that IBM’s policy of ensuring a diverse workforce requires that IBM hire individuals from the area in which they do business. This is not completely altruistic, noted Webb, because corporations use these opportunities to learn; they can gain a better understanding of the culture, challenges, and needs of that locale. One final point was made that during the period of unrest in Bolivia in the early 2000s, some individuals observed that certain businesses were spared from the violence because they had established local CSR. One panelist summed up by suggesting that CSR makes good business sense.

It is unlikely that change is going to occur at the global level unless partnerships are formed that cut across private and public sectors, noted some panelists. Primarily because of the use of treaties among governments, there is a real need to involve stakeholders if gains are to be made in all areas of the world. One way, noted Henry, will be through innovative partnerships and voluntary initiatives. Partnerships provide increased value through opportunities for leverage from scientific, intellectual, and financial perspectives, as well as increased understanding of respective goals and needs. As partnerships and voluntary initiatives have been developed with government, academia, and industry in regional venues, similar approaches need to be considered and implemented on a global scale. There is a need for organizations such as the International Council of Chemical Associations, which was formally organized in June 1989 to coordinate policy and programs for the global industry. This group represents the global chemical

industry and has representatives from all parts of the world where the chemical industry exists. The leadership of the group challenged the membership to think strategically about priorities and the impacts of chemicals on health. Henry noted that they are working to develop a research plan to address the existence of manmade chemicals in the environment. As with most initiatives, she noted that many challenges exist, including working with individuals in numerous time zones; however, there is a real need for further collaborations in many sectors.

Environmental management systems (EMSs) have been implemented in thousands of companies and provide an opportunity to look holistically at impacts. These systems are designed for continuous improvements and have procedures that address issues in a systematic manner. However, the EMSs do not create an environment to think about problems creatively and sometimes, we need disruptive innovation, while EMSs promote gradual, continual improvement, noted Wells. Societal issues such as the poverty/environment nexus are not going to be addressed with management systems and will need other strategies for the market growth. Addressing this problem will allow for further market growth, thus a new generation of management systems is needed.

During the workshop and in the final panel discussion, the limitations and problems of EMSs were discussed. Blackburn noted that some companies that have management systems in place are performing well, while others with such systems are not. The reason may be in large measure embedded in why management systems are instituted. For example, he noted that some companies institute ISO systems simply because their customers require it, or they want some level of recognition. There isn’t a commitment to institute the management systems to make fundamental improvements. In fact, during the meeting, various speakers and participants noted that commitment from top leadership was one of the major factors in determining the success of an EMS. Blackburn further noted that when a company implements a management system only because their customers require it, they may be inclined to pick a route with the least amount of effort. They may set objectives that will not really challenge themselves.

Evaluation is another problem because the outside auditors spend the majority of the time on documentation and not enough time on whether the system is providing results. Various panel members suggested the need for transparency of the data and the need for accountability. Webb echoed these comments and suggested there is a role for nongovernmental organizations (NGOs) in assuring accountability. He suggested the value in a code of conduct on accountability that would be applied, making it easier for businesses and governments to work with known accountable organizations. He further noted that standards organizations need to be more transparent and open, and they need to engage in continual improvement.

Blackburn noted that during the workshop, speakers and participants discussed management systems and then spoke of health. However, there needs to be a discussion of how one goes from a management system to health—the connection needs to be made. He noted that management systems are there to help implement operational goals, whether one is discussing limits, standards, or some operational objective. One example might be ambient levels of pollutants that have been linked to certain exposures to individuals, which in turn may be affected by certain behaviors. From this, one can draw connections between management systems and disease or health effects. But, he noted, the connection has to be made, and that requires research. It has to be done in a context of other confounding issues like poverty, corruption, culture, and technology, he observed. In many cases, it has to be done on a global basis, because, after all, many problems are global, the exposures are often global, companies are global, and stakeholders are global. Finally, he concluded, it has to be done in the context of the governance mechanisms and structures that can help or hurt the health effects.

This workshop highlighted a number of diverse and complex issues that fall under environmental health, noted Bennett. While one can agree that these are important issues, the overall challenge is taking the information back down to a level that is important for businesses. There is a need to try to understand the importance of environmental health in the overall management equation to determine which systems at which points can be implemented to address the

issue, concluded Bennett. To do this, we need a common language and a shared understanding around what the problem is in order to pursue the dialogue.

According to many speakers, sharing best practices as they relate to CSR, both within and across industries and sectors, is another challenge. Henry noted that there are a number of sensitive issues, including cost and competitive advantage. Within their supply chain and stakeholders, corporations can use their best practices to help guide their operations. However, across industries, this was less likely to occur. Bennett noted that many business executives meet throughout the year to benchmark their practices. Often these practices include management or problem-solving approaches as opposed to the specific solutions, which are often proprietary and competitive. Thus he noted that to the extent that the approach is widely relevant, there is a lot of interest in it; however, when it reveals trade secrets, there are barriers to sharing. The panel noted that there is a need to create a dialogue on the issue of best practices, both within and outside of industry sectors. Blackburn suggested the use of accolades that acknowledge the individual accomplishments of corporations could encourage more discussion and sharing of best practices.

Research will clearly be important, but Wells cautioned about the potential problem of certifying best practices. He questioned whether there would be any incentive to improve beyond current practices. Management systems tend to ratify common practices rather than promote innovation. Jim Bus noted that when we talk about best practices, largely these are looking toward the future science and research that will frame the practices. Thus, programs such as the Long-Range Research Initiative provide opportunities for clusters of industry to gather with government, academia, and others to address a common research problem. He suggested that, although we recognize that we have a problem today, the emphasis should be on how science might frame a solution to the problem in the future. Thus there is an opportunity for the frameworks of best practices to research in this area that will make a difference for the future.

During the course of the workshop, there were numerous calls for research on chemicals by various individuals, including the tools for hazard assessment testing for all the chemicals that are covered by the REACH program, the tools for risk assessment, and the tools to provide the metrics by which the various programs operate under CSR. Henry noted that government has to do part of it and industry has to do part of it. Bennett echoed many of these points by noting that today one sees more companies and NGOs involved in activities that were formerly undertaken by government. Research, he noted, was no exception.

Blackburn further noted that the research can occur in many places and does not have to be a large, centralized research program. He suggested creating incentives for research in small, medium-size, and large companies so that “we have a thousand flowers blooming here.” One industry program that was mentioned was the Long Range Research Initiative (LRI) established by the ACC. The research priorities of the LRI are (1) to improve methods that help build a foundation to evaluate risks of chemical products to public health and environment, (2) to develop susceptibility factors to evaluate whether children or other vulnerable groups are adequately protected, and (3) determine where chemicals in the environment are to increase understanding of pathways from sources to humans and wildlife. Henry noted that it is important to think about these issues globally as chemicals do not recognize geographic boundaries. Thus the research programs need to reflect this and partnerships and collaborative approaches with government and academia are necessary to making progress in the field. One of the hallmarks of the program is the recognition that the perception of industry-sponsored research is not always favorable. To overcome this problem, the program established open and transparent practices, using third-party, independent investigators, who determine the experimental approaches and select the chemicals for use in the research. In addition, the researchers own their data and have control over when the results will be published without the right of prior review by the ACC. Transparency and credibility are important elements of the program and are necessary for its success. Research sponsored by the LRI is leveraged and coordinated internationally through the ICCA, thereby meeting the need of the global chemical industry to increase knowledge on the health, safety, and environmental impacts of chemicals.