3
Promoting Industry-Initiated Environmental Programs

The increase in industry-initiated environmental programs has been paralleled by an increase in programs that provide recognition, incentives, information, and technical support for industrial facilities and corporations in such efforts. Table 3.1 lists a variety of such programs. Appendix B presents additional descriptive information provided to the committee by individuals involved in the activities listed in the table.

Some of the same difficulties in evaluating industry-initiated environmental programs also are faced when attempting to evaluate programs that seek to encourage industry's voluntary efforts. EPA's 33/50 program is discussed below to illustrate the difficulties in evaluating effectiveness and assessing motivations of participants even when the program has quantifiable goals that were achieved.

Epa's 33/50 Program

The 33/50 program is a voluntary pollution-reduction initiative sponsored by EPA. The name stems from its goal of reducing environmental releases and off-site transfers of 17 high-priority toxic chemicals by 33% by 1992 and 50% by 1995. Incentives for industry participation in the 33/50 program include public recognition by EPA and special awards for outstanding achievements in pollution prevention. Unlike mandatory programs, this voluntary program allows firms the flexibility to make the emissions reductions reduc-



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--> 3 Promoting Industry-Initiated Environmental Programs The increase in industry-initiated environmental programs has been paralleled by an increase in programs that provide recognition, incentives, information, and technical support for industrial facilities and corporations in such efforts. Table 3.1 lists a variety of such programs. Appendix B presents additional descriptive information provided to the committee by individuals involved in the activities listed in the table. Some of the same difficulties in evaluating industry-initiated environmental programs also are faced when attempting to evaluate programs that seek to encourage industry's voluntary efforts. EPA's 33/50 program is discussed below to illustrate the difficulties in evaluating effectiveness and assessing motivations of participants even when the program has quantifiable goals that were achieved. Epa's 33/50 Program The 33/50 program is a voluntary pollution-reduction initiative sponsored by EPA. The name stems from its goal of reducing environmental releases and off-site transfers of 17 high-priority toxic chemicals by 33% by 1992 and 50% by 1995. Incentives for industry participation in the 33/50 program include public recognition by EPA and special awards for outstanding achievements in pollution prevention. Unlike mandatory programs, this voluntary program allows firms the flexibility to make the emissions reductions reduc-

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--> Table 3.1 Efforts to Promote Industry-Initiated Programs Type of Effort Intended Benefits Environmental management standards Provide a nonregulatory means to certify the approach that a company uses to pursue environmental goals. Environmental labelling of products Promote accurate environmental advertising. Encourage consumers to take environmental considerations into account. Provide a market-based incentive to manufacturers to achieve environmental goals. Industrial consortia Share environmental-management information among member companies and promote the use of effective tools for environmental management. Partnerships between industry and other organizations Help establish mutual environmental objectives and develop and implement consensus action plans. Federal programs Provide companies with technical support and information. Encourage flexible and cost-effective approaches to implementation of environmental activities. tions through ways that are most cost-effective for them. Moreover, EPA provides assistance by conducting regional pollution-

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--> prevention workshops and by providing access to the agency's Pollution Prevention Information Exchange System. The 1988 Toxics Release Inventory is the baseline against which success is being measured. According to that criterion, the 33/50 program achieved its 1992 goal one year early. By 1991, total releases and transfers of the 17 chemicals had already been reduced 33% from 1988 levels. Recent data suggest that the program also achieved its 1995 goal of a 50% reduction a year early. However, EPA's evaluation was unable to separate the effect of the 33/50 program from the effects of other activities. Any reductions that a company achieved between 1988 and 1990, regardless of the reason, contributed to the 33/50 program's goals. A company that substituted one chemical for another because of technologic advances would have been credited with reduced emissions for the original chemical. The U.S. Government Accounting Office found that among participating firms, emissions reductions had been initiated well before the 33/50 program began, suggesting that other forces were also at work (U.S. GAO, 1994). Trying to sort out the extent of emissions reductions due to participation in the 33/50 program rather than to the influence of other programs, regulations, or market trends would be a very difficult undertaking. An independent evaluation of the 33/50 program sought to distinguish the effects of participation in the 33/50 program from other factors that might have influenced reported reductions in releases and transfers of the 17 targeted chemicals (INFORM 1995). That evaluation concluded that companies were motivated by numerous factors, including the effect of regulations and economic costs, attitudes of communities in which companies are located, stories in the media, investor pressure, and positive incentives like the 33/50 program. However the ways in which participating firms differ from nonparticipating firms are not well understood. Arora and Cason (1994, 1995) noted substantial variation in

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--> willingness to participate among different industries and EPA regions. Among industries, the variation might be explained by levels of advertising as well as research-and-development expenditures, the strength and environmental commitment of trade and manufacturer associations, and each industry's market structure. Firms with numerous competitors were found to be more likely to participate than those without competitors. Arora and Cason speculated that recent trends in green marketing and in consumer awareness of environmental issues might be a reason for this. Among EPA regions, the authors speculated that the variation might be due to differences in the regions' environmental regulations or different levels of effectiveness of EPA regional coordinators in recruiting firms to join the program. In a survey conducted by the Manufacturers Alliance in 1994, the reason most frequently given for participating in the 33/50 program was to demonstrate support for voluntary reduction programs as alternatives to mandatory requirements. Participants also recognized the potential to save money by reducing materials loss and waste-handling costs. Next Steps Although it is difficult to evaluate the effectiveness of efforts that seek to promote industry-initiated environmental activities, the committee believes that such programs have value and should continue. Based upon its investigations, deliberations, and collective experience, the committee suggests next steps that government agencies and other organizations should consider to firmly establish approaches for promoting industrial initiatives. Such steps would help broaden the development and evaluation of industry-initiated efforts.

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--> Government agencies and other organizations should strive to develop and improve methods for evaluating the environmental effectiveness of industry-initiated approaches. Success of various programs remains largely speculative, and claims of industry successes often are met with skepticism. Methods for evaluating programs should provide a basis for agreement as to what is successful. By defining measurable goals and developing definitive and objective methods or a common set of principles, industry-initiated environmental programs could be encouraged further. A system for public reporting of environmental performance data by industry would provide all the stakeholders with information sufficient to allow conclusions to be drawn on the overall effectiveness of an activity or program. Such a system would need to take into account concerns about disclosure of confidential business information. In developing criteria for evaluations of industry-initiated efforts not involved with regulatory compliance, total net reductions of environmental waste or releases should not necessarily be considered paramount, because those can be greater for larger companies and for companies that have not previously operated efficiently. Rather, evaluation methods might include measures of efficiency, such as waste per unit of product. Different types of programs need different criteria for evaluation, because no one criterion can accommodate the broad diversity of programs and types of industrial activities. An overall environmental management program needs a different form of evaluation than a program that focuses on specific industrial activities. In addition, industries, and sometimes manufacturing processes within an industry, have different environmental issues to contend with and each type should be evaluated with respect to the relevant issues.

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--> Government agencies should strive to make regulatory compliance strategies more flexible and adaptable to opportunities for improvement. Many U.S. companies have initiated environmental-protection programs suited for a particular industry or facility. A common sentiment among industry is that environmental regulations should be flexible enough to permit and encourage such programs by moving towards performance-based regulations which specify performance standards without mandating the means of compliance. New environmental regulations also need to protect the gains made by ongoing projects from being undone. Industry initiatives could be encouraged and sustained by a flexible performance-based regulatory structure that took more fully into account the ability of corporate management to comply with regulations in ways that are effective and efficient for their particular enterprise. Other Considerations for Promoting Industrial Initiatives The committee is aware that efforts to recognize innovative programs, supply technical assistance, and disseminate information appear to be successful in some instances. Government agencies and other organizations are encouraged to explore innovative ways of using such techniques to promote industrial initiatives. Public awareness and public image are an important part of the motivation for companies to establish effective environmental programs. Organized and respected forums for recognition can encourage efforts in this area by providing recognition in the form of awards or publicity for innovative programs to improve environmental quality. This approach requires some framework for evaluation and selection by independent panels.

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--> Especially for small manufacturers and businesses, the costs of environmental improvements might be barriers to initiating a program. If technical assistance were available, the time and costs of researching options and developing a program would be lessened, and more small companies might initiate programs. If one company has developed an effective environmental management strategy, has overcome barriers, or has developed innovative technology, that information could be useful to other companies. Collection and dissemination of such information by government agencies and other organizations could encourage and assist other companies interested in improving their environmental performance. Conferences, other types of meetings, and electronic communications should be used regularly to disseminate such information and to encourage and assist other companies interested in improving their environmental performance. Those disseminating the information should be aware that some companies might be resistant to changing approaches, particularly those that were developed and tested within their own organizations.

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