Economic

Finally, the U.S. and its regulatory structure evolved through interdependence with a capitalist economic system. Like all human systems, capitalism contains unique dynamics. One is the treadmill of production, or TOP [42,57], which drives industry to reduce prices and profit margins, expand markets, and increase output. Some predict that the TOP will inevitably overtax the supply of natural resources [42]. A similar dynamic is reflected in the "IPAT" equation: Impact z Population size + Affluence + Technology [29]. According to this formula, each factor can contribute to, or can ameliorate, the overall impact. Developed nations like the U.S., for example, might experience few problems with population growth due to the availability of family planning options. However, greater affluence may cause developed nations to consume too many goods and resources, thereby increasing their overall environmental impact. Unlike the TOP theory, the IPAT equation allows for mitigation of impact through the use of technology to develop less environmentally harmful means of production [28,29].

Corporate rights are a second key aspect of the U.S. economic system. While the corporation began as a vehicle sanctioned by law to encourage group investment, it has now assumed a status beyond a simple financial collective. Corporate status now entitles organizations to relief from taxation [64] and from legal liability [66]. Further, the scale of corporate activity and interest has grown, extending outside the jurisdiction of the legal entities that recognize them. This unchecked growth makes legal regulation of such entities extremely difficult, if not impossible, at a municipal, state, or national level [65] and has led to questions about whether the corporate status and rights in their current form are supported by the U.S. Constitution [66]. In the U.S., corporate legal and tax status continue to hamper government and individual efforts in environmental regulation [64,66-68].

Third, the functioning of any capitalist system hinges on the free market. Some see this market as having the power to transform the economy to a force for environmental good through informed consumer choice [13]. However, that effect is mitigated by: (1) the small percentage of products that are eco-friendly; (2) an infrastructure that doesn't always support "green" choices (e.g., city planning without public transit arrangements); (3) "green-washing" of products that have harmful effects on the environment, and (4) the disparity between individual attitudes/values and behavior [57,69]. Further, other experts argue that the so-called free market is a myth. Young [70] stated that while the U.S. government owns 1/3 of the land, 1/2 of the softwood, and regulates oil and gas exploration, it cannot present itself as a disinterested or uninvolved actor. Snidal [71] argues that, ideally, a centralized authority should involve itself by codifying helpful practices, providing useful information, and facilitating the smooth operation of the resulting conventions. This picture is quite different from the current environmental regulatory structure's role of monitoring and enforcement. To summarize, leaning on market forces alone seems an inadequate strategy for addressing current environmental concerns.

While unchecked economic expansion is a danger, even operating in our current mode is problematic [29], because the unchecked use of limited and of environmentally damaging materials has the potential to create a crisis of some sort [17,28]. As Hawken, Lovins, and Lovins [13] state, the environment is not a factor in production; it is the envelope that contains the entire economy. Therefore, whether capitalist, communist, or socialist, the means of production must utilize renewable, non-toxic resources in order to keep the environment— and itself—healthy and the financial infrastructure economically viable. According to McDonough and Braumgart [29], the challenge is to transform capital economic investment from a negative to a positive environmental force, focusing on economic development and diversification rather than unbalanced, unchecked expansion [72]. However, as Adams notes, the inertia and investment present in a corporate economic infrastructure (such as the oil industry's installed base of gas stations, refineries, pipelines and distribution vehicles)

can work against interventions at that level [73]. This next section of this chapter presents the use of EMSs as a possible vehicle for transformation of the U.S. regulatory approach.

14.3 Environmental Management Systems 14.3.1 Background

In order to protect our environment and ourselves from further damage, municipalities, states, and the federal government are pursuing creative approaches to environmental regulation. Some involve the reapplication of traditional "command and control" programs, which spell out specific goals and technological requirements, or the use of an assessment of environmental risk to determine the appropriate regulatory response. Still others focus not on reducing pollution, but on clean-up or recycling of waste. Finally, unregulated entities, such as small businesses and households, are being encouraged by institutions to control pollution and waste voluntarily.

Because the control of pollution, particularly hazardous substances (such as petrochemicals or nuclear waste) is sometimes insufficient to protect the public, other approaches seek to eliminate pollution at the source of production.

In addition to the potential for reducing environmental risk, new pollution prevention options are gaining attention, both because they are becoming more common and because of the potential cost savings to taxpayers [2,74,75]. One such organizationally-directed strategy is the environmental management system, or EMS [74,76-80] which state and local agencies have recently hailed as an important and useful component in their environmental approaches. An EMS is. "a formal set of procedures and policies that define—sometimes in great detail—how an organization will manage its potential impacts on the natural world and on the health and welfare of its workers and nearby citizens" [77].

The U.S. EPA definition adds that an EMS is "a continual cycle of planning, implementing, reviewing, and improving the processes and actions that an organization undertakes to meet its business and environmental goals." The North Carolina Division of the Pollution Prevention and Environmental Assistance [81] states that an EMS serves as a tool to improve environmental performance; provide a systematic way of managing an organization's environmental affairs; give order and consistency to address environmental concerns through the allocation of resources, assignment of responsibility and ongoing evaluation of practices, procedures, and processes; and focus on continued improvement of the system.

At its core, an EMS is a formal set of procedures and policies that that are created by individual organizations. The organization implements these procedures to manage potential environmental impact through changes in daily operations and self-monitoring. This is quite different from traditional "command-and-control" regulation, in that the organizations that might otherwise pollute design their own EMS, rather than external regulators imposing their own systems. Further, the organization implements controls prior to, during, and at the point of production, rather than after pollutants have been generated. Finally, each organization determines the acceptable evidence of impact, resulting in greater variety in external reporting. In some cases, regulators consider the existence of an EMS alone as an end point, regardless of the particulars of its external reports.

It is this focus on continual improvement of the entire business process, rather than just one aspect of it, that sets EMSs apart from other self-regulated approaches. For example, one state's compliance certification program for dry cleaners—known as the Massachusetts Environmental Results Program (ERP)—focuses only on controlling the discharge of the hazardous substance tetrachloroethylene, known as "PERC." Used in many dry cleaning facilities, this substance is highly toxic and a known carcinogen [82]. A shortcoming of the traditional approach is that it cannot find and monitor all dry cleaners, and is especially ineffective in regulating small operations, which make up a large percentage of U.S. dry cleaners. Many view the self-certification process, which enlists owner and employee assistance in self-regulation, as an improvement over traditional regulation, which requires onsite inspection and monitoring of large polluters by regulatory staff. In contrast to both the self-certification and traditional approaches, an EMS would require dry cleaners to focus on all aspects of the business, including materials and services from their providers, as well as PERC used on site, to realize greater environmental performance.

First adopted by manufacturing industries, EMSs are now being used throughout the private sector, and increasingly, by public agencies. The U.S. EPA itself has developed a management policy for its own facilities to meet environmental goals [83]. Massachusetts has adopted EMSs as part of its State Sustainability Program [78,84]. In addition, several state agencies are participating in the development of the National Database on EMSs (NDEMS), including: Arizona, California, Illinois, Indiana, New Hampshire, North Carolina, Oregon, Pennsylvania, Vermont, and Wisconsin [85].

Three key assumptions underlie the EMS approach. First, like many continuous improvement processes, bottom-up implementation is viewed as more effective. Therefore, management of environmental controls is often shifted to those on the shop floor. Second, proactive interventions are assumed to produce better environmental impacts than "end of pipe" approaches, by promoting cost control through prevention and internal waste management, rather than cleanup. Finally, regulators often see adoption of an EMS as a sign that the organization will fulfill its "social contract" through self-regulation. Faith in the ability and willingness of organizations to do so is sometimes based on their past performance [81]. In other cases, judges frequently order EMSs for injunctive relief [86]. Injunctive relief is defined as a court-ordered act or prohibition against an act or condition requested via petition to the court. Such an act by the court usually employs a hearing rather than a trial and is not a judgment for money. Instead, organizations are ordered to implement and to document the use of an EMS [87]. In such cases, the decision is not made based on faith in the organization, but on a desire for a cost-effective and expedient solution to a regulatory problem.

In the U.S., the most common EMS structure is the International Organization for Standardization's ISO 14000-certification framework, developed through consultation with business, governmental, and NGO representatives in response to the Earth Summit [57,88]. In the European Union, the parallel Eco-Management and Audit Scheme (EMAS) is the favored model [89]. Some organizations are attempting to surpass even these standards, moving toward development of common elements for a sustainability management system, or SMS [74]. While there are data to indicate that external certification per se does not determine the success of a pollution control system [89], industry still considers the ISO 14000 EMS the gold standard, in part for its use of external third-party verification and standard development. This model is also increasingly prevalent internationally: in 1998, there were 1542 ISO EMSs in Japan, 1100 in Germany, and 210 in the U.S. [43].

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