The effectiveness of voluntary environmental initiatives

Abstract

Introduction Voluntary environmental initiatives (VEIs) by firms are increasingly being relied upon to address major environmental problems such as climate change, toxic release reduction, waste reduction, and forest management, as well as to improve compliance with existing environmental regulations in the USA. These mechanisms for encouraging private governance have emerged as the capacity of governments to establish mandatory regulations to provide environmental protection has become increasingly constrained (Young, Chapter 1, this volume). We refer to VEIs as including voluntary programs established by regulatory agencies, codes of conduct designed by trade associations and third parties, standards for certification of environmental management systems set by the International Standards Organization (ISO), as well as self-regulation by firms who set internal standards, goals, and policies for environmental performance improvements. These VEIs aim to encourage firms to voluntarily reduce pollution, increase energy efficiency, adopt environmental management practices, and make other efforts to improve their environmental performance beyond the requirements established by existing regulations. More than 150 such initiatives have been sponsored by government, industry, and independent third parties in the last two decades (Carmin, Darnall, and Mil-Homens 2003). Voluntary programs established by the US Environmental Protection Agency (US EPA) alone have increased from twenty-eight in 1996 to fifty-four in 1999 and to eighty-seven in 2005 (US EPA 2005). From the point of view of government agencies, environmental self-governance is more appealing than enacting mandatory regulations, because it reduces the administrative burden on regulatory agencies and avoids the delays inherent in enacting legislation, while encouraging a collaborative relationship between firms and regulators.

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