Polluted waters are muddied by morality

Policies for Cleaner Technology - International Toxic Risk Management

September 1, 2000

INTERNATIONAL TOXIC RISK MANAGEMENT- Ideals, Interests and Implementation.By Aynsley Kellow. Cambridge University Press. 222pp. Pounds 37.50 and Pounds 13.95. ISBN 0 521 65257 X and 65469 6

POLICIES FOR CLEANER TECHNOLOGY: A New Agenda for Government and Industry By Anthony Clayton, Graham Spinardi and Robin Williams. Earthscan. 310pp. Pounds 45.00 and Pounds 16.

95ISBN 1 85383 518 8 and 519 6

Aynsley Kellow draws attention to a curious feature of environmental policy making. At the national level industrial lobbies are well organised and will lobby vociferously for or against environmental legislation, using their own trade associations, paid consultants and professional lobbyists.

Much the same happens at the level of the European Union: the civil servants in Brussels are used to industrial lobbies and they are often very effective, as the case of the failed European tax on carbon dioxide emissions in the 1980s and 1990s shows. But at the international level, where environmental policy is increasingly determined, at least in the sense of setting the overall targets and goals, industry appears strangely ineffective. In International Toxic Risk Management, Kellow remarks on his own experience, where he frequently found organisations such as Greenpeace to be better organised and to have greater standing than industry associations. (This observation fits my own experience as someone who has chaired several international committees contributing to environmental negotiations.) Environmentalists may be heartened by these facts, yet Kellow warns that marginalising industrial interests simply reduces the effectiveness of agreements. In the language of modern economics, there is "asymmetric information". Industrialists possess the information needed to design efficient solutions, governments often do not. There may be moral satisfaction in excluding industry. After all, they appear to be the polluters, another curious feature of the modern debate that somehow exempts all consumers from responsibility for demanding the goods that industry provides. But this moral satisfaction is not constructive and simply serves to reinforce industrial lobbies at the national level.

The whole issue should not be exaggerated, of course. The information available to governments and non-governmental organisations is far better than it used to be. Industry has lobbied at the international level, in some cases successfully. And major parts of industry now lead in terms of environmental innovation rather than following government or pressure groups. The explanation here may be a purely rational effort to head off future regulation, but it may be just as likely that there has been a cultural shift within industry to adopt green credentials for their own sake. Nonetheless, Kellow has rightly raised an interesting issue.

He discusses two examples: the international regulation of chemicals and the international transport of hazardous waste. In so doing he targets the NGOs, and Greenpeace in particular, for their over-reliance on moral argument and for being, as they surely are, unelected and unaccountable. Kellow is right to stress the counter-production of moral arguments - if trading in hazardous waste is simply wrong, the problems of what to do with such inevitable by-products of industrial societies are simply magnified. Yet the moral view is crucial to the internal dynamics of the NGOs: without it, their own membership would decline since what they demand is not solutions to problems but "being right".

Kellow is pessimistic about the potential for international environmental agreements to solve global environmental problems, though far more optimistic about agreements focused on regional problems such as acid rain.He is probably right and he cites the Basle convention on hazardous waste trade as the ultimate in what goes wrong: over-use of moral argument, over-simplification of definitions and measures of risk, allowing a technical issue to be linked to developmental goals and interests and trying to solve at an international level what is best solved domestically.The substances to be regulated become "demonised" and no account is taken of the fact that they also generate economic benefits.

Oddly, Kellow does not seem to acknowledge that the sociologists whom he admiringly quotes as being against reductionism would also criticise economic comparisons of costs and benefits as being similarly reductionist.In this, Kellow's analysis, which is generally excellent, shares some of the failings of the sociological literature: it is not clear when one should or should not elevate problems to international agreements, and it is not clear how any such agreement should be negotiated once the supra-national level has been agreed. Kellow clearly wishes to minimise supra-national initiatives but he is weak in failing to offer much by way of guidance on these issues. Nonetheless, this is probably one of the best evaluative studies on international agreements to have emerged in recent years and is to be thoroughly recommended.

Anthony Clayton and his colleagues have produced a compendium of case studies on the potential for cleaner industrial technology and the incentives needed to secure its adoption. In recent years there has been far too ready an acceptance of the view that adopting environmentally clean technology is a win-win solution - the environment is improved and simultaneously the new technology reduces industrial costs. Win-win solutions are beloved of politicians since they preclude the need for awkward choices; one can have everything. The reality is different. There are some win-win contexts but by far the majority of situations involve better environmental quality at the cost of increased production costs. This is why the endless round of publications showing that if only everyone adopted clean technology we could reduce pollution by factors of four or ten is interesting but unhelpful for public policy.

The Clayton volume looks at case studies in various industries to identify the obstacles to cleaner technology. Unsurprisingly, the studies find that compliance with regulation explains a large amount of clean technology adoption. But the style of regulation also matters. Most emission standards tend to be set according to the "best available" environmental technology (BAT) and this encourages add-on equipment rather than organisation or management changes, fuel switches, energy conservation, etc. BAT is therefore overly expensive as a regulatory mode and it also tends to discourage innovation since the technology to be adopted is fairly precisely prescribed. Green taxes on emissions may well be a better option, as the authors note. Consumer and NGO pressure was not generally found to be important, but this probably reflects the nature of the industries studied (such as refining, brewing, chemicals and paper mills) rather than being a generalisable conclusion.

The authors also highlight contexts where the waste product itself has economic value, although here one would expect the workings of the market to induce waste reduction and information systems that demonstrate that waste is often worth recycling. Cultural factors intervene. Firms may not be used to thinking of waste as a resource. They may not have accounting systems that highlight material and energy costs, or have allocations of budgets that act as incentives for managers to economise on resources. Just as significant, while many firms now have environmental reports and some have environmental accounts, virtually none has any idea of the monetary value of their environmental impacts compared with the money value of profits made. Yet the techniques for making this comparison exist,an issue not raised by the authors. There are other incentive systems also largely ignored by the authors, probably because they are not in place in the industries in question. Public information about emissions, tradable pollution permits systems, negotiated agreements - each of these is now very important as a mechanism for stimulating cleaner technology. The Clayton volume is important, however, in providing concrete case studies of industries in various regulatory contexts. In other words, this book helps us understand why things are as they are, but is perhaps on weaker ground in telling us how to take things forward. However, explaining the status quo always has to be the first step in public-policy analysis.

David Pearce is professor of environmental economics, University College London.

Policies for Cleaner Technology: A New Agenda for Government and Industry

Author - Anthony Clayton, Graham Spinardi and Robin Williams
ISBN - 1 85383 518 8 and 519 6
Publisher - Earthscan
Price - £45.00 and £16.95
Pages - 310

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