Ideas in Development

The ironic twist on this state of affairs is that increasingly many environmental advocates, policy makers and technical experts are coming around to the point of view that further significant success in cutting air and water pollution and carbon emissions will require much more collaborative partnerships with the private sector. 

These changes are being propelled by a number of trends and factors.  For instance, how do you deal with nonpoint sources of pollution?¹  How do you protect habitat, while encouraging more environmentally compatible development and job creation?  Above all, imposing a single regulatory standard and solution on the vast variety of polluting firms, according to Professor Fioriino of Johns Hopkins University, “impedes innovation; it is legalistic, inflexible and fragmented; it is expensive; it is increasingly irrelevant and thus ineffective for many issues; and it faces an implementation deficit.”  Moreover, the complexity of ecosystems, the advent of ecologically-minded businesses, the increased availability of helpful data, and the global sources and effects of pollution are spurring a movement away from “one-size-fits-all-regulation.”

This change does not mean in any way that environmental activists are backtracking.  They still believe that regulations are essential for protecting businesses, public health, workers and the overall quality of life from unacceptable effects of private markets.  At the same time, they argue that states need to lead the way in thoughtful regulatory reform that meets legitimate purposes while minimizing burdens on business.  They should

• Carry out comprehensive reviews of their key regulatory programs to improve their effectiveness and lower their compliance costs.
• Give industry a single point-of-contact on compliance issues.
• Develop more market-based tools both to reduce the need for regulation and increase voluntary compliance.
• With regard to environmental regulation, foster ways to prevent pollution which can improve productivity and profitability, and provide new business opportunities.  (Pollution prevention is defined by the Oklahoma Department of  Environmental Quality as “a strategy of material use, processing and management that eliminates the creation of pollutants and waste at the source—prior to  recycling, treatment or disposal.”)
• Appropriate regulation, procurement and incentive strategies can promote new, profitable “green industries, products and services.”

Past CFED project work with the Indiana Economic Development Council and Environmental Defense, with funding by the Joyce Foundation, explored how environmental and economic development agencies, organizations and programs can better integrate their respective agendas, goals and services.  The resulting programs and policies have the opportunity to become “double-green”—more lucrative in business, while enhancing environmental quality.

Extensive meetings with experts from both fields, interviews of business management, site visits and focus groups brought us to the following conclusions:

• Large manufacturing firms are making innovative strides in pollution prevention (P2) adoption and environmental accounting.  This is not true for small and mid-sized companies.
• Current economic development finance and technical assistance efforts do little to foster P2 on the federal and state levels.
• Efforts to show the costs and benefits of P2 are not widely known or widely marketed.
• P2, as a term, does not turn on industry.  They prefer words, such as “resource efficiency,” “waste minimization” and “materials management.”
• Many factors motivate a firm to adopt P2—modernization, branding and PR, more efficiency and so on.  P2 promoters must listen and be flexible in their sales presentations and always have solid pay-back numbers available.
• Firms fear cooperating with and exploring P2 solutions with environmental agencies, because of their enforcement and sanction roles.  This is true even if they are dealing with an entirely different office within the main agency.
• Industry prefers pursuing its own compliance solutions to having a single approach and technology imposed on them, no matter how it might affect their product and bottom-line.  Industry may need technical assistance to discover which solution is right for them.
• In all states, business assistance programs are fragmented and more than a bit confusing to the private sector.
• Eco-industrial parks and other holistic design and tech-based solutions are rare.
• There are many firms that could be allowed to identify and execute its own P2 approaches within the required standards.  Such flexibility will cost less in money and ill will, as well as often establish a precedent setting innovation.

Addressing these challenges requires creative efforts to increase P2 awareness and explore new partnerships with economic organizations.  (Indeed, widespread adoption of P2 strategies can make all firms and sectors “green industries.”)  One possibility is to allow modernization programs to take the lead.  (Universities, environmental agencies and private expertise would be on-call.)    The focus would be on small and mid-sized enterprises and be extremely performance-based.  New accounting and diagnostic tools will need to be adapted.  Special attention to mainstreaming programs in synch with private consultants and making the entire system as integrated and as customer friendly as possible is the highest priority.

Thus, becoming more “double-green” is just uncommon sense.