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The Regulation Dilemma: Cooperation and Conflict in Environmental Governance

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Abstract

"Across the United States and around the world, businesses have joined voluntary environmental codes proposed by governments and nonstate actors. Many codes require firms to establish internal environmental management systems that seek to improve firms' environmental performance and compliance with mandatory regulations. At the same time, governments are also experimenting with programs that provide incentives for business to self-policies their regulatory compliance, and promptly report and correct regulatory violations. In light of these two trends, this paper examines how governments' approach to regulatory enforcement can influence firms' incentives to comply with mandatory environmental laws and to join voluntary codes that could take them beyond compliance. Our inquiry shows that cooperative regulatory enforcement, in which firms self-police their environmental operations and governments provide regulatory relief for voluntarily disclosed violations, yields optimal, 'win-win' outcomes only when both sides cooperate. If firms are likely to evade compliance, governments are better off adopting a deterrence approach. And, if governments insist on rigidly interpreting and strictly enforcing the law, firms may have strong incentives to evade regulations and/or not join voluntary codes. Cooperation, though not easy, is possible if both sides can credibly signal that they will forgo opportunism."

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... More recent research has challenged this assumption, recognizing that domestic institutions may affect the type of CSR programs businesses adopt (Jackson & Apostolakou, 2010;Kinderman, 2012;Knudsen, 2017;Knudsen, Moon, & Slager, 2015;Matten & Moon, 2008;Moon & Vogel, 2008;Steurer, 2010). Governments have an interest in promoting such programs, so that market failures can be mitigated with fewer monitoring and enforcement costs (Potoski & Prakash, 2004b) and so that firms become aware of the benefits and the logistics of complying with such programs (Delmas, 2002;Kollman & Prakash, 2002). ...
... They can promote it through specific policies, they can shape it indirectly through domestic institutions, or they can downplay the importance of particular programs by failing to support them. After all, regulatory authorities can benefit if voluntary regulation programs improve regulatory performance due to lower monitoring and enforcement costs, and improved compliance (Andrews et al., 2003;Potoski & Prakash, 2004b;Wall & Beardwood, 2001; but also see Clapp, 1998;Markowitz & Rosner, 2002). ...
... In these instances, governments may see the benefit of moving from simple "endorsement" policies to "facilitation" policies whereby governments provide tangible incentives for firms to join EMSs (Fox, Ward, & Howard, 2002;Knudsen et al., 2015). Potoski and Prakash (2004b) argue that relief from regulatory requirements, combined with good-faith self-policing on the part of firms can do a better job of achieving regulatory goals at a lower cost, assuming cooperation from both sides. They show that American states that offer incentives in the form of regulatory relief tend to have higher rates of ISO 14001 membership. ...
Article
en Governments play an active role in promoting corporate social responsibility and specifically environmental management system (EMS) programs, but few studies have examined the impact of such support on the decision of businesses to adopt EMS programs. We ask two questions in this paper: how does government support for EMS programs affect adoption of such programs? Second, what effect does this government support have on the pace of adoption of such programs? The answer to the first question can reveal how effective government programs are in boosting membership in EMS programs. The answer to the second reveals to what extent businesses within EU member states are converging upon particular EMS standards. We examine these questions in the context of the European Union’s Eco‐Management and Audit Scheme (EMAS), 2010–2014. There is significant variation in government support of EMAS across the EU and at the same time, EMAS competes for business attention with the more established ISO 14001. Our quantitative and qualitative analyses therefore reveal the effectiveness of government programs in boosting adoption, but also to the extent to which such programs cause convergence upon EMAS in the face of a competing standard such as ISO 14001. 政府对企业社会责任的推广:欧盟生态管理和审计计划得出的证据 zh 政府在推动企业社会责任( corporate social responsibility, CSR),特别是环境管理体系(environmental management system, EMS)计划时扮演着活跃的角色。但很少有研究检验政府支持对公司在采用EMS计划一事上的决定所产生的影响。笔者在本文中提出了两个疑问:政府对EMS计划的支持如何影响公司对该计划的采纳?政府支持对计划被采用的速度产生了何种效果?第一个问题的答案能表明政府计划在“增加参与EMS计划的成员数量”时的有效程度。第二个问题的答案则能表明欧盟成员国内的企业在多大程度上朝着特定EMS标准进行汇集。笔者在欧盟生态管理和审计计划(European Union’s Eco‐Management and Audit Scheme, EMAS, 2010‐2014)这一背景下检验了上述问题。欧盟各国之间关于EMAS的政府支持存在显著差异,同时就争取公司青睐一事上,EMAS与更为成熟的ISO 14001系列标准之间存在竞争。本文的定量和定性分析因此不仅揭示了政府计划在“推动采用EMS计划”一事上的有效性,还表明了面对例如ISO 14001这类竞争时,政府计划能在多达程度上使企业汇集于EMAS。 Promoción Gubernamental De La Responsabilidad Social De Las Empresas: Evidencia Del Esquema De AuditorÍa Y Gestión De La Ue es Los gobiernos desempeñan un papel activo en la promoción de la responsabilidad social empresarial (RSE) y específicamente los programas del sistema de gestión ambiental (SGA), pero pocos estudios han examinado el impacto de dicho apoyo en la decisión de las empresas de adoptar programas de SGA. Hacemos dos preguntas en este documento: ¿cómo la ayuda del gobierno para los programas de EMS afecta la adopción de tales programas? En segundo lugar, ¿qué efecto tiene este apoyo del gobierno sobre el ritmo de adopción de dichos programas? La respuesta a la primera pregunta puede revelar qué tan efectivos son los programas gubernamentales para aumentar la membresía en los programas EMS. La respuesta al segundo revela hasta qué punto las empresas dentro de los estados miembros de la UE convergen en estándares EMS particulares. Examinamos estas cuestiones en el contexto del Sistema de Ecogestión y Auditoría (EMAS) de la Unión Europea, 2010‐2014. Existe una variación significativa en el apoyo gubernamental al EMAS en toda la UE y, al mismo tiempo, EMAS compite por la atención comercial con ISO 14001 más establecida. Nuestros análisis cuantitativos y cualitativos revelan la efectividad de los programas del gobierno para impulsar la adopción, pero también medida en que dichos programas causan convergencia en EMAS frente a un estándar competitivo como ISO 14001.
... Zooming in on the relationships between the regulatory framework and implementation agents, research shows that the type of regulatory regime shapes the way private stakeholders, and in this case the implementers, behave. Potoski and Prakash (2004), for example, find that an institutional context which provides regulatory flexibility or relief makes it more likely for companies to join voluntary programs or selfpolice. This participation is then often unevenly distributed among firms depending on their capacity and willingness to contribute (May, 2005). ...
... To summarize, regulatory characteristics and incentives have an impact on company participation in environmental schemes (May, 2005;Potoski & Prakash, 2004). Those instruments can move along a spectrum of mandatory, command and control type tools to more voluntary or flexible initiatives and a combination of both (Sarkar 2008). ...
... The paper draws on research looking at implementation conditions for policy measures. More specifically, the relationship between the regulatory framework and private implementing agents (Coglianese & Nash, 2001;May, 2005;Potoski & Prakash, 2004). To illustrate this relationship between regulation and market structures, private companies and policy goals in the nudging context, the research analyzes European smart meter implementation. ...
Article
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Nudging is seen to complement or replace existing policy tools by altering people's choice architectures towards behaviors that align with government aims, but has fallen short in meeting those targets. Crucially, governments do not nudge citizens directly, but need private agents to nudge their consumers. Based on this notion, the paper takes on an institutional approach towards nudging. Rather than looking at the relationship between nudger and nudgee, the research analyses the regulatory and market structures that affect nudge implementation by private actors, captured by the ‘budge’ idea. Focusing on the European energy policy domain, the paper analyses the contextual factors of green nudges that are initiated by Member States, and implemented by energy companies. The findings show that in the smart meter context, there are regulatory measures that affect implementation of smart meters and that government has a central role to ‘budge’, due to the dependence on private agents.
... On the one hand, a vast array of arguments has been put forward in favor of using hard regulation to improve compliance and performance (Gray and Shimshack 2011;May 2005;Mukamel et al. 2012;Wilms 1982;Winter and May 2001). The deterrence-based approach, however, incurs high enforcement and compliance costs, and can lead to confrontation (Mukamel et al. 2011;Potoski and Prakash 2004). On the other hand, numerous studies suggest that soft regulation fosters normative and social motivations for compliance (May 2002(May , 2005Potoski and Prakash 2004;Stafford 2012;Winter and May 2001). ...
... The deterrence-based approach, however, incurs high enforcement and compliance costs, and can lead to confrontation (Mukamel et al. 2011;Potoski and Prakash 2004). On the other hand, numerous studies suggest that soft regulation fosters normative and social motivations for compliance (May 2002(May , 2005Potoski and Prakash 2004;Stafford 2012;Winter and May 2001). Despite its impact, soft regulation has its own limitations, including lower accountability (Girth 2014;May 2005). ...
... Recent trends in government regulation reflect changes from the emphasis on desired actions to desired outcomes; and from regulation administered by the government to indirect regulation relying on third-party entities, information, and self-regulation (Carpenter, Grimmer, and Lomazoff 2010;May 2002). More evidence is needed to evaluate these trends (May 2002;Potoski and Prakash 2004). Thus, there is a need systematically to study various regulatory tools across policy contexts to better understand what combination of mechanisms is effective given the nature of the market and service characteristics. ...
... The cooperative model stands in contrast to a "coercive" (or deterrence based) approach (cf. Earnhart et al., 2020;Earnhart and Glicksman, 2015;Potoski and Prakash, 2004) that relies on the threat of market exclusion regardless of differences in suppliers' ability to comply. ...
... It relaxes the assumption of perfect information and emphasizes education, innovation and selected enforcement based on specific circumstances of non-compliance (Earnhart and Glicksman, 2015). The most important element underpinning the feasibility of the cooperative model is the ability of regulators and suppliers to collaborate effectively (Clark, 2017;Pires, 2008;Potoski and Prakash, 2004), so that regulators can effectively assess suppliers' compliance and also distinguish their motivations from their abilities to comply (Wilhelm et al., 2016a). ...
... For effective and equitable enforcement to work, actors should be able to credibly signal their willingness to cooperate (Potoski and Prakash, 2004) across tiers, and the development of technologies that enable effective monitoring and dialogue across tiers are key to achieve this. The regulator must be able to interact with suppliers, to monitor suppliers' behavior, and to send credible signals about sanctions. ...
Preprint
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To address ongoing deforestation for global food commodities production, companies and governments have adopted a range of forest-focused supply chain policies. In the Brazilian Amazon, these policies take the form of market exclusion mechanisms that aim to disincentivize deforestation by excluding products originating from areas that don't meet legal forest requirements. Strict exclusionary policies are likely to result in negative livelihood effects and leakage if some farmers are not able to comply, and most supply chain implementation strategies fail to deal with farmers' heterogeneous compliance capacities in an equitable manner. A more cooperative model of enforcement that uses flexible and negotiated approaches to compliance management may in principle enable more marginal and disadvantaged farmers to achieve compliance, thereby improving both the effectiveness of supply chain policies and their equity. However, we show that even cooperative models of enforcement are prone to exhibit coercive tendencies in multi-tier supply chains, leading to severe equity shortcomings.
... The cooperative model stands in contrast to a "coercive" (or deterrence based) approach (cf. Earnhart et al., 2020;Earnhart and Glicksman, 2015;Potoski and Prakash, 2004) that relies on the threat of market exclusion regardless of differences in suppliers' ability to comply. ...
... It relaxes the assumption of perfect information and emphasizes education, innovation and selected enforcement based on specific circumstances of non-compliance (Earnhart and Glicksman, 2015). The most important element underpinning the feasibility of the cooperative model is the ability of regulators and suppliers to collaborate effectively (Clark, 2017;Pires, 2008;Potoski and Prakash, 2004), so that regulators can effectively assess suppliers' compliance and also distinguish their motivations from their abilities to comply (Wilhelm et al., 2016a). ...
... For effective and equitable enforcement to work, actors should be able to credibly signal their willingness to cooperate (Potoski and Prakash, 2004) across tiers, and the development of technologies that enable effective monitoring and dialogue across tiers are key to achieve this. The regulator must be able to interact with suppliers, to monitor suppliers' behavior, and to send credible signals about sanctions. ...
... This also includes integrating the principles of sustainable development into business strategies that affect the attitudes and behavior of the members of an organization and the community (Carballo & Castromán, 2014). This theoretical framework will help solve various problems derived from inaccurate measurement of the BOER such as certain business ethics dilemmas (Candau & Dienesch, 2016;Potoski & Prakash, 2004). It will also help identify current and future research opportunities and give structure and perspective to the interdisciplinary literature in the field. ...
... Organizations have developed an extensive series of practices to comply with the corresponding regulation that informs their environmental behavior. This development has promoted research that seeks to understand the effects and effectiveness of the regulation (Camisón, 2010;Clemens & Douglas, 2006;McCarthy & Zen, 2010;Potoski & Prakash, 2004;Wilson, Williams, & Kemp, 2012). ...
Article
Business‐oriented environmental regulation is expected to have a fundamental role in mitigating the adverse effects of human activity on the natural environment. However, its effectiveness and efficiency are not well established. A systematic literature review reveals validity and reliability problems in the measurement of business‐oriented environmental regulation. From a sustainable development perspective, we develop a theoretical framework that aims to enhance the measurement and assessment of this kind of regulation. Our theoretical framework proposes that the goals of business‐oriented environmental regulation must articulate a measurement system in a 3 × 3 matrix: three measurement levels (stringency, response, and outcome—in this cause–effect order) and three sustainability dimensions (environmental, social, and economic—in this constraint order). For each cell, we propose a combination of objective and subjective indicators. This theoretical framework expands existing approaches to business‐oriented environmental regulation measurement by integrating a sustainable development perspective into a measurement framework in a structured theory‐driven manner. Not only will this measurement system be useful for improving environmental policy, but it will also allow companies to improve their business strategy and come closer to complying with environmental regulations in order to effectively contribute to solutions for current environmental problems and help achieve a sustainable development.
... The literature has extensively studied the motivations, effectiveness, and respective strengths and weaknesses of each regulatory approach. With governments assuming the leadership, environmental regulatory instruments and the logic Potoski and Prakash (2004) behind them have evolved from mandatory regulations to voluntary programmes, from a centralized, top-down system to value co-creating cooperation with localized support. Table 1 lists the major environmental regulatory approaches discussed in the literature. ...
... Examining the effectiveness of international standards across contexts offers additional insights. For example, empirical investigations of the mostly examined ISO 14001certification were broadly evidenced in both developed and developing regimes (Boiral, 2007;Fryxell et al., 2004;Potoski & Prakash, 2004). ...
Article
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There has been growing complexity in the study of environmental regulatory governance. In terms of regulatory approaches, the focus of national styles has gradually shifted to the local level, down to street-level regulators. As for compliance strategies, regulated entities, particularly enterprises, have moved their strategies from the evasion-compliance dichotomy to more progressive ones that are beyond compliance. As environmental watchdogs on behalf of civil society, ENGOs, particularly those in developing and non-democratic political settings, have increasingly found more space for strategizing their active efforts to monitor enforcement agencies and polluting enterprises in the regulatory process. The spilling of regulatory regimes into developing countries has led to an urgent need for regulatory studies in such nations, with a call for new theoretical formulations that are capable of explaining regulatory governance in those countries. Research methodologies adopted have become increasingly sophisticated, moving from using a single method to using mixed methods by integrating qualitative and quantitative ones, with longitudinal studies and panel data analysis as the recent trends. This study aspires to perform a critical review of the existing body of literature on environmental regulatory governance in these major aspects as the basis for a research agenda setting.
... While practically all companies that operate global value chains experience sustainability governance fragmentation as governance takers, only a small (but important) group of companies engages in active standard setting etc., thus being governance makers. What is more, however, the dual role of companies as takers and makers of sustainability governance received only scarce attention in the identified research, as merely five publications explicitly highlight both roles of companies as governance makers and takers (Abbott 2012a;Kalfagianni 2014;Potoski and Prakash 2004;. ...
Thesis
Companies are increasingly expected to take responsibility for negative effects related to their value creation activities. In this doctoral dissertation, the responsibility a business firm has for the harmful social, ecological and economic effects stemming from its value creation activities is subsumed under the notion of value chain responsibility (VCR). Taking value chain responsibility is already a challenging and continuous endeavor. Yet, to complicate matters further, the external environment in which companies are running their value creation activities and VCR efforts is complex and challenging. In more detail, this dissertation focuses on two phenomena in the firm’s environment which considerably affect its VCR activities: the fragmentation of sustainability governance and the changing VCR expectations of stakeholders. Fragmented sustainability governance describes how the regulatory environment in which firms operate their business and conduct VCR activities is increasingly shaped by multiple and different governance actors (such as NGOs and companies) and governance instruments (such as voluntary sustainability standards and schemes). This fragmentation of the ‘rules of the game’ for businesses can have ambivalent consequences for the company’s capability to take VCR. Changing VCR expectations of stakeholders describe how stakeholders draw attention to detrimental social, ecological and economic issues affiliated with the firm’s value chain operations and thus demand action from the firm to resolve precisely these issues. Both phenomena have in common that they a) require the firm to draw attention to changes in its external environment and b) potentially result in or call for internal changes within the firm, e.g. regarding the way a firm manages its business operations and addresses sustainability challenges. Against this background, the overall objective of this paper-based dissertation is to expand our understanding how companies can take value chain responsibility in environments shaped by complexity, fragmented sustainability governance and changing stakeholder expectations. The four individual papers of this dissertation provide distinct contributions for academia and corporate practice: Paper I provides a mapping of the scholarly literature on the phenomenon of fragmented sustainability governance, sheds light on different facets of this phenomenon and illustrates management practices to deal with fragmented sustainability governance. Paper II elaborates on explanatory factors that help us understand the fragmentation of sustainability governance in the empirical case of the global gold sector. Paper III explores how companies as potential governance makers and takers affect and are affected by fragmented sustainability governance. Paper IV sheds light on changing stakeholder expectations and how they might impact the internal structural and functional organization of the firm to take VCR.
... Legislation can support a more proactive approach to avoid crisis. The role played by central authorities in monitoring and enforcement may also be essential to build trust in the system (Singleton, 2000;Potoski and Prakash, 2004), especially in cases where there is no history of cooperation between sectors. ...
Article
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Marine and coastal activities are closely interrelated, and conflicts among different sectors can undermine management and conservation objectives. Governance systems for fisheries, power generation, irrigation, aquaculture, marine biodiversity conservation, and other coastal and maritime activities are typically organized to manage conflicts within sectors, rather than across them. Based on the discussions around eight case studies presented at a workshop held in Brest in June 2019, this paper explores institutional approaches to move beyond managing conflicts within a sector. We primarily focus on cases where the groups and sectors involved are heterogeneous in terms of: the jurisdiction they fall under; their objectives; and the way they value ecosystem services. The paper first presents a synthesis of frameworks for understanding and managing cross-sectoral governance conflicts, drawing from social and natural sciences. We highlight commonalities but also conceptual differences across disciplines to address these issues. We then propose a novel analytical framework which we used to evaluate the eight case studies. Based on the main lessons learned from case studies, we then discuss the feasibility and key determinants of stakeholder collaboration as well as compensation and incentive schemes. The discussion concludes with future research needs to support policy development and inform integrated institutional regimes that consider the diversity of stakeholder interests and the potential benefits of cross-sectoral coordination.
... Continuous environmental improvements can be created by stakeholders who have high proactiveness, and have relevance to the interests of stakeholders [12]. In developing countries including Indonesia, environmental leadership is not related to environmental regulations, but rather the role of voluntary cooperation between companies and governments is required [11]. ...
Article
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The rapid expansion of the artisanal and small-scale gold mining (ASGM) industry in developing countries has resulted in occupational exposure to mercury via the gold extraction process. The objective of this study was to assess the knowledge, interest, position, and power of stakeholders for the implementation of the mercury pollution reduction program. This study involved ten stakeholders as representatives from different backgrounds in the Bombana regency. The results of the analysis show that the health department, environmental agency, and village head are stakeholders who have a high level of knowledge and interest in the program. The assessment based on position and partnership indicates that the health department and local university have high-level power/leadership and become the great potential supporter. Stakeholders with the potential to become opponent are traditional land owners, mining companies, and local activists. The priority strategy recommended from this study is to initiate active communication to stakeholders and create a clear guidance on the implementation of the program. Also, an effective approach is needed to create the mutually beneficial cooperation agreement to avoid provocation and conflict.
... The four factors and the policy-making strategy together largely explain why California is at the environmental forefront nationally. The four factors and the policy strategy also help explain why the California experience runs counter to the conventional wisdom that states in a federal system will see it in their self-interest to avoid stringent environmental regulations lest they disadvantage themselves in the competition for economic development and investment, thereby creating a "race-to-the-bottom" in environmental protection (Potoski & Prakash, 2004). In terms of environmental protection, climate change, and energy policies, California is the most notable exception in the United States to this conventional reasoning (Bernstein, 2009;Karapin, 2016;Mazmanian, Nelson, & Jurewitz, 2013;Vogel, 1995). ...
Article
It is a long-held belief among scholars and practitioners that the State of California is a notable subnational leader in environmental and climate change policy. This article focuses primarily on four essential contextual factors that explain why and how within the United States’ federal system of government California has become such an important leader, performing far in excess of the national government and most other states. These essential factors are preferences, authority, capacity, and effectiveness. The article then moves to the multifaceted implementation strategy California policy makers have employed to realize their environmental goals. Finally, despite the history of strong leadership, the state continues to face a host of significant challenges in realizing its ambitious climate change goals for the coming decades.
... The previous literature has shown that relational motives play an important role in the decision to adopt ISO 14001. It has been found that, by implementing ISO 14001, firms seek to improve their relationships with stakeholders such as the government, civil society, nongovernmental organizations, multinational corporations, or professional associations (Delmas & Montes-Sancho, 2011;Delmas & Montiel, 2008;Delmas & Toffel, 2004;Kollman & Prakash, 2002;Neumayer & Perkins, 2004;Potoski & Prakash, 2004;Qi et al., 2011). Firms that adopt ISO 14001 for relational motives may perceive the standard as a means to achieve legitimacy rather than a management tool for controlling their environmental impact (Boiral, 2011). ...
Article
This study explores whether the association between the aggregate level of ISO 14001 adoption in a country and the reduction of its CO2 emissions differs across national settings. We analyze potential variations in three country features: intensity of competition, inclination of firms to behave ethically, and the importance that firms attach to relationships with stakeholders. Based on a sample of 53 countries for the period 2007–2017, our results show that the connection between the aggregate level of ISO 14001 adoption and lower levels of CO2 emissions is stronger in countries where firms tend to behave ethically but is weaker in countries where there is intense competition or where firms place high emphasis on relationships with stakeholders. These findings expand our understanding about the macrolevel consequences of ISO 14001 adoption.
... Over the years, the agency has developed other mechanisms of education, awareness, regulatory relief, and voluntary programs that have resulted in not only important benefit to human health and the environment, but also benefited the goal of mutual goodwill within communities that were often at odds. 23,58 The policy mechanisms for increasing the supply of innovation to realize systematic and sustainable solutions could include expansion of supplementary environmental projects; 59 60 Demand-side opportunities include standards and eco-labels, economic incentives, procurement and demonstration, as well as information-based programs. 60,61 This range of an "expanded toolbox" to achieve environmental prosperity is an important step in EPA's evolution. ...
Article
The people of the United States and the world owe the United States Environmental Protection Agency (U.S. EPA) a debt of gratitude for preserving, protecting, and defending human health and the environment for the past half century. As we celebrate the 50th anniversary of the founding of the U.S. EPA, there are two truths about the agency that are difficult to deny: (1) U.S. EPA and its people constitute a renowned agency that has greatly improved both environmental and public health in the United States, and has served as the leading model for nations around the world; and (2) the approaches, tools, structures, and legal frameworks that created the achievements of the U.S. EPA must evolve—and grow—to deal with the issues facing the country and the planet in the next 50 years. Building on the creativity, innovation, and brilliance of individuals and groups working at the U.S. EPA over the course of the last half century, we present 10 recommendations organized in three areas: organization, paradigms, and strategies and tools. Underlying these recommendations are the frameworks of sustainability and systems thinking and guiding these recommendations is the goal of evolving the Environmental Protection Agency to the Environmental Prosperity Agency.
... This means that biomass supply greatly depends upon the highly decentralized decision making of heterogeneous and adaptive actors. In situations such as these, policymakers often use VIPs to encourage actors to adopt their preferred management practice, and to achieve coordinated regional outcomes [96]. In our proof-of-concept example, we compare the sustainability impacts of no-VIP incentivization to two alternative VIP incentivization mechanisms: individual-based rewards or an agglomeration bonus. ...
Thesis
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This dissertation examines the application of agent-based modeling (ABM) to complex systems with the intent of developing a means of overcoming limitations present in existing tools. This is done though the development of two ABMs intended to address complex systems present in the fields of sustainability studies and chemistry. After introductory information, Chapters 2 - 4 of this dissertation address the limitations of tools intended to project the environmental, economic, and social impacts of woody biomass based biofuels. Chapter 2 begins by discussing the limitations in tools to study timber harvest decision making and its impact upon the landscape, and develops an ABM platform to address this gap. Next, Chapter 3 presents a life cycle assessment (LCA) of a proposed biorefinery in Ontonagon, Michigan is conducted. This study acts as a benchmark benchmark for the case study presented in Chapter 4, where an argument for the integration of ABM and life cycle sustainability assessment (agent-based LCSA) is presented. The argument is followed by a case study demonstrating the applicability of the technique. The case study finds that while Ontonagon is a promising site for a biorefinery, there are concerns regarding the quantity of woody biomass that may be delivered as a feedstock and potential impacts upon regional wetlands. Chapter 5 of this dissertation addresses the limitations of models of advanced oxidation processes (AOPs) using ordinary differential equations (ODEs). We argue that these limitations can be addressed by modeling the AOP as a complex system, including the complete elementary reaction pathway using ABM. To demonstrate the applicability of this novel approach, an ABM is developed and two in silico studies of acetone degradation induced by hydroxyl radicals are performed. We found that when using a comprehensive list of elementary reaction pathways, the ABM was able to replicate concentration curves for major chemical species in our laboratory study. As a novel application of ABM to AOPs we conclude that the technique shows considerable promise.
... But there is an additional reason for this conspicuous avoidance of clear-cut advice: The decision-maker is generally absent from the model (Purshouse et al 2014). In real world situations, environmental and economic players are subject to the final decision of an upper instance, generally not included in the model 1 , which ultimately takes the decision (government, administrative agencies, etc.) or, at least, accept agreements reached at lower instances (Adger et al 2003, Potoski & Prakash 2004 2 . The direct consequence of the decision-maker's absence from these models is that its own beliefs, viewpoints and management style cannot be modeled, despite their importance for the conflict outcome. ...
Article
The characteristics of decision-makers are generally not included in models of environmental-economic conflicts. These models can be classified in two classes according to their goal: Multi Objective models include several conflicting objective functions that should be optimized simultaneously, and Game Theory models that result in a single solution analyzing the interactions among the players. Despite their applicability and usefulness these models have several limitations. The most severe is that, generally, the decision-maker is absent from both classes of models. We suggest an operational model for environmental-economic conflict resolution from the point of view of the decision-makers which addresses these concerns. The first step is building the Pareto frontier. Then the focus moves to the decision-maker characteristics: The appropriate game theoretic tool used to solve the conflict is chosen according to those characteristics. The result of this tailor-made game is a single Pareto optimal response which reflects both the decision-maker characteristics, the real-word relations of power between her and the players and among the players themselves. Introducing explicitly the decision-maker preferences in the model, results in more efficient solutions, and allow for a clear explanation about why the chosen solution is better than any other one, subject to the initial decision-maker characterization.
... While practically all companies that operate global value chains experience sustainability governance fragmentation as governance takers, only a small (but important) group of companies engages in active standard setting etc., thus being governance makers. What is more, however, the dual role of companies as takers and makers of sustainability governance received only scarce attention in the identified research, as merely five publications explicitly highlight both roles of companies as governance makers and takers (Abbott 2012a;Fransen 2015;Kalfagianni 2014;Potoski and Prakash 2004;Thauer 2015). ...
Article
To address global sustainability challenges, adequate governance solutions are needed. Yet, sustainability governance is typically fragmented. This fragmentation poses a key challenge for practitioners and researchers and receives growing scholarly attention in different academic disciplines. So far, however, these research streams are missing a comprehensive mapping of the scholarly work on fragmented sustainability governance. While this lack of knowledge consolidation inhibits further academic learning, it also fails to provide corporate actors with practical guidance about the interplay between firms and fragmented sustainability governance. To address these gaps, we apply a mixed-method approach consisting of a systematic literature review and a citation network analysis to derive the following contributions. First, we elaborate on the composition and development of the research field on fragmented sustainability governance, including a citation network analysis. Second, we introduce a conceptual framework of overarching types of fragmentation regarding the ends, means, context, and outcomes of sustainability governance. Third, we introduce three types of managing fragmentation: coordination, convergence and integration, and meta governance. Fourth, we derive implications for future research regarding the role of business in fragmented sustainability governance.
... An alternative to a tightening of regulation is the granting of regulatory relief if companies agree to subscribe to a certain CSR standard or initiative. If governments and companies are cooperative, such an approach constitutes a win-win outcome for both governments and involved companies (Potoski & Prakash, 2004). In the case of non-cooperation, however, regulatory relief is likely to lead to outcomes that are inferior to hard regulation. ...
Article
The extent to which state authorities can regulate the externalities and the behaviour of multinational corporations (MNCs) is limited. This is especially true when MNCs operate in or do business with fragile states that lack the willingness and/or resources to effectively and legitimately regulate businesses. However, MNCs often engage in private regulation to remedy some of the problems that unregulated business behaviour creates. In this article we examine what limits the effectiveness and legitimacy of the contributions made by MNCs to global governance. We explore the mechanisms that state authorities in functioning states can use to overcome these barriers as well as the boundary conditions of these mechanisms at both company and government levels. We provide a framework for governmental CSR policies and describe the ways in which functioning states engage in governance beyond the ‘shadow of hierarchy’ and directly or indirectly influence business conduct beyond the territory in which their legal regulations can be enforced.
... The desirability of this policy trend, reflected in literatures around such notions as 'co-', 'new' and 'experimentalist' governance continues to generate much debate. 13 Underlying this debate are fundamentally different assumptions regarding what motivates corporate compliance. Critics of the new 'regulatory orthodoxy' hold essentially pessimistic views of these motivations, emphasising the search for profitability and competitive advantage while de-emphasising quests for corporate legitimacy. ...
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Workers are defaulted to being non-union in employment relationships across the world. A non-union default likely has substantial negative effects, consistent with the empirical literature reviewed, on union membership levels, because of switching costs, inertia, social norms and loss aversion. A union default would likely have positive effects on union membership, and has the additional virtues of partially internalising the public goods externalities of unions, improving the freedom to associate (the right to join a union) and preserving the freedom not to associate (the right not to join a union). A union default would also strengthen the extent and effectiveness of union representation.
... This raises a further question regarding whether corporate voluntary initiatives, such as the SBTi, displace or discourage direct government action towards achieving national mitigation targets. Literature exploring voluntary environmental initiatives has questioned the extent that firms pre-empt government regulation with less-costly voluntary action, aiming to discourage government action [41]. The limitations of the SBTi highlighted in this paper should prompt further research exploring how the SBTi interacts with government policy making to mitigate corporate GHG emissions. ...
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Companies are increasingly seeking to align their actions with the goals of the Paris Agreement. Over 1000 such companies have committed to the science-based targets initiative which seeks to align corporate carbon reduction targets with global decarbonisation trajectories. These ‘science-based targets’ are developed using a common set of resources and target-setting methodologies, then independently assessed and approved by a technical advisory group. Despite the initiative’s rapid rise to public prominence, it has received little attention to date in the academic literature. This paper discusses development of the initiative based upon a quantitative assessment of progress against each component of the science-based targets set by 81 early adopters, using information gathered from company annual reports, corporate social responsibility websites and Carbon Disclosure Project (CDP) responses. The analysis reveals a mixed picture of progress. Though the majority of targets assessed were on track and, in some cases, had already been achieved, just under half of the companies assessed were falling behind on one or more of their targets. Progress varied significantly by target scope, with more limited progress against targets focused on Scope 3 emissions. Company reporting practices were highly variable and often of poor quality. This paper concludes with a range of recommendations to improve the transparency, consistency and comparability of targets within this key agenda-setting initiative.
... This was the case for the American Chemistry Council (ACC) which, following the Bhopal disaster, launched the Community Awareness and Emergency Response program in 1985 (Belke and Dietrich 2005) and adopted the Responsible Care program in 1988, a voluntary self-regulation program, aimed to improve its members' safety record and the public image of the chemical industry. By demonstrating to the legislators that an industry can police its own, the participants in a voluntary self-regulation program may be rewarded with less frequent government inspections and more flexible mandatory regulations (Potoski and Prakash 2004). Li and Khanna (forthcoming) find strong casual evidence that OSHA conducted fewer planned inspections at RC participating facilities compared to other chemical facilities. ...
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We explore whether the introduction of mandatory third party certification in 2005 under the Responsible Care program has reduced the probability and severity of accidents in participating facilities in the U.S. chemical industry. Using a sample of 10,315 observations from 1136 facilities owned by 566 RC and non-RC firms between 1996 and 2010, we estimate the average treatment effect of third party certification. We find that the difference-in-difference estimate of the average treatment effect is statistically insignificant. This result is robust to various model specifications including the potential endogeniety of third party certification due to a firm’s self-selection into RC.
... Broadly, studies show that regulatory arbitrage can be reduced through formal governmental regulations or voluntary, self-regulatory action by firms. Potoski and Prakash argued across a series of papers (see for example, Potoski & Prakash, 2013, Potoski & Prakash, 2004, Prakash & Potoski, 2007, Prakash & Potoski, 2006 that the diffusion of ISO environmental standards has challenged the pollution haven hypothesis. Private regulatory arrangements have attracted considerable academic and policymaking interest, as a wide range of company-sponsored regulatory arrangements have proliferated (Mayer & Gereffi, 2010). ...
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Multinational enterprises operating global value chains are being increasingly pressured to source from suppliers that adopt green private standards. Likewise, public policymakers are also pressured to reduce national pollution levels to contribute to sustainable development initiatives. In this context, while there is extensive debate on how domestic, country-specific environmental regulations interact with private standards (adopted by firms) in reducing national pollution levels, less is known about the role of international trade policies, which have recently embraced an array of sustainability issues. Our paper seeks to extend our understanding of the extent to which ISO environmental certifications affect a country's level of emissions of greenhouse gases and air pollutants, and whether the European Union's environmental protection (EP) standards-as mediated through trade agreements-condition this response. Prior research provides mixed evidence on the impact of the adoption of ISO-14001 on pollution reduction. Based on prior literature and using institutional theory and environmental stewardship perspectives, we expect that membership of trade agreements with EP provisions would complement the effect of ISO-14001 uptakes in reducing national pollution levels. Our arguments and results emphasize the complexity between private and public regulations on pollution reduction.
... Broadly, studies show that regulatory arbitrage can be reduced through formal governmental regulations or voluntary, self-regulatory action by firms. Potoski and Prakash argued across a series of papers (see for example, Potoski & Prakash, 2013, Potoski & Prakash, 2004, Prakash & Potoski, 2007, Prakash & Potoski, 2006 that the diffusion of ISO environmental standards has challenged the pollution haven hypothesis. Private regulatory arrangements have attracted considerable academic and policymaking interest, as a wide range of company-sponsored regulatory arrangements have proliferated (Mayer & Gereffi, 2010). ...
Article
Full-text available
Multinational enterprises operating global value chains are being increasingly pressured to source from suppliers that adopt green private standards. Likewise, public policymakers are also pressured to reduce national pollution levels to contribute to sustainable development initiatives. In this context, while there is extensive debate on how domestic, country-specific environmental regulations interact with private standards (adopted by firms) in reducing national pollution levels, less is known about the role of international trade policies, which have recently embraced an array of sustainability issues. Our paper seeks to extend our understanding of the extent to which ISO environmental certifications affect a country’s level of emissions of greenhouse gases and air pollutants, and whether the European Union’s environmental protection (EP) standards – as mediated through trade agreements – condition this response. Prior research provides mixed evidence on the impact of the adoption of ISO-14001 on pollution reduction. Based on prior literature and using institutional theory and environmental stewardship perspectives, we expect that membership of trade agreements with EP provisions would complement the effect of ISO-14001 uptakes in reducing national pollution levels. Our arguments and results emphasize the complexity between private and public regulations on pollution reduction.
... The weak effectiveness of traditional global intergovernmental environmental regulations together with the globalisation of world markets became drivers of the development of voluntary market-based mechanisms of environmental regulation and responsibility, also known as "Non-state Market-Driven (NSMD) Governance Systems" (Cashore, 2002), "voluntary environmental programs (VEPs)" (Potoski, Prakash, 2004, 2011, "transnational private regulation" (Bartley, 2007) and "Market-based voluntary sustainability standards (VSS)" (Meeting Sustainability Goals, 2016), that are an important core part of "global environmental governance" (Auld et al., 2018). Many of the above-mentioned terms have been used to refer to a range of market-based, institutional instruments used to manage environmental and social impacts of production processes. ...
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This article examines the current state and drivers of environmental transparency in the Russian Mining and Metals sector. The study is based upon 2016–19 successive annual rankings calculated transparently, using publicly available information and a third-party-verified ranking system. Ranking results reveal a definite in-crease in the transparency level of one of the most closed industries in Russia. The findings from the study show that a company’s presence in the stock markets has a positive impact on its openness in environmental matters. However, a company’s listing on an international stock exchange does not guarantee high environmental transparency. Some evidence of a correlation between ranking positions and participation of diversified financial-industrial groups in the share capital was also found. Overall, our analyses suggest that ESG (envi-ronmental, social and governance) management in the Russian mining and metals sector is only in the process of development. To overcome this, the environmental transparency ranking of mining and metals companies in Russia creates a new mechanism for raising public awareness and dialogue between the public and one of the most closed industries. The ranking initiated calculation of industry-average quantitative impact indicators that, as the sample grows, will transform into an important benchmark for corporate self-assessment when comparing Russian practices with those of the largest international and foreign mining and metal companies across the globe
... Incentivized regulation rather than coercive rigidity can lead to more cooperative and voluntary policy enforcement [33][34][35]. Coercive state mandates, especially those that omit vertical consistency, can push local actors to deviate from the principal's policy goals [36,37]. Following this logic, we assert that states with supportive policies that align with local interests and encourage cost-effective energy efficiency strategies can motivate municipalities to commit to programs that rely on vertical consistency. ...
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The state and local governments throughout the United States interact within a complex system of multilevel governance to advance sustainability. However, we know little about what this hierarchical system of exchanges means for municipalities as they work to achieve energy efficient government operations. Drawing on a perspective of “contested federalism”, we examine how the transaction costs of state–local government relations affect the efforts of U.S. cities to lead by example and promote sustainability within their internal processes. We apply a Bayesian item response theory approach to assess the effects of state-level fiscal and policy interventions on municipal commitments to energy efficiency programs within their internal operations. Our findings suggest that increased fiscal support for state energy programs enhances municipal commitments to government focused energy efficiency. We also find a positive connection between state energy efficiency standards and municipal efforts to enhance energy efficiency within their internal operations. The alignment of state resources and policy efforts with municipal actions can reduce commitment and agency costs that obstruct policy outcomes. The findings speak to the importance of multilevel governance exchanges in municipal efforts to become leaders in sustainability.
... But there is an additional reason for this conspicuous avoidance of clear-cut advice: The decision-maker is generally absent from the model (Purshouse et al 2014). In real world situations, environmental and economic players are subject to the final decision of an upper instance, generally not included in the model 1 , which ultimately takes the decision (government, administrative agencies, etc.) or, at least, accept agreements reached at lower instances (Adger et al 2003, Potoski & Prakash 2004 2 . The direct consequence of the decision-maker's absence from these models is that its own beliefs, viewpoints and management style cannot be modeled, despite their importance for the conflict outcome. ...
... Our rationale is that firms which follow ESG reporting guidelines are obligated to follow a reporting template, which provides a clearer understanding of what information firms should disclose. The template also encourages greater reporting around specific sustainability indicators codified in the guidelines (Potoski & Prakash, 2004). While ESG guidelines do not specify the number of pages or words that should be contained in a firm's sustainability report, firms are expected to fulfill the elaborated expectations of guidelines by disclosing specific information about their ESG actions, performance goals, impacts, and leadership. ...
Article
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Environment, social, and governance (ESG) reporting guidelines are institutional rules that can enhance the credibility of firms' publicly disclosed information related to ESG. Reporting is often voluntary and global ESG reporting guidelines typically rely on process‐focused third party verification. However, in developing its reporting guidelines, the Japanese government gave firms the unusual option of pursuing either process‐ or content‐focused verification. This paper draws on the unique Japanese setting to examine whether firms that use ESG reporting guidelines increase their quantity of disclosed sustainability information. Furthermore, it assesses whether, given the option, (1) firms tend to pursue process‐ or content‐focused verification, and (2) which type of verification leads to greater information disclosure. We show that firms that follow ESG guidelines disclose 39% more sustainability information compared to firms that publish sustainability reports but do not follow ESG reporting guidelines. Content‐focused verification leads to greater information disclosure than process‐focused verification in that firms publish 23% more text in their sustainability reports. Moreover, given the option, firms prefer to use content‐ over process‐focused verification. However, most global ESG reporting guidelines endorse process‐focused verification and this verification is less effective than content‐focused verification at encouraging firms' information disclosure. Our findings raise a timely and relevant question about the movement by global ESG standard developers to promote process‐ rather than content‐focused verification. They also suggest that firms that wish to create sustainability distinction by way of ESG reporting may benefit by advocating for more robust forms of verification.
... Firms act to moderate their political environments to improve or defend their competitive advantage (Potoski & Prakash, 2004). For example, in countries without an established legal framework or with little effective law enforcement, circumvention of laws or regulations may be considered a viable strategy. ...
Article
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The success of a firm’s supply chain strategy depends on resources in the political environment and the supply network in which it operates. If the political environment is not conducive to a firm’s supply chain strategy, a firm can either change its supply chain strategy or seek a political environment that is more favorable to its supply chain. This paper examines this second alternative. The structure‐conduct‐performance (SCP) paradigm and the competitive dynamics literature are used to explore the relationships between political actions that leverage supply network resources, supply chain strategies, and firm performance. We extend a well‐known typology of political actions from the strategic management literature and suggest that beyond influencing or complying with the political environment, firms may choose to moderate the political environment (circumvent or submit) or stay neutral (free ride). An integrated model is developed to explore the relationships between political actions and supply chain strategy, along with a series of propositions outlining how political actions can facilitate supply chain risk management strategies. Finally, suggestions are provided for future research.
... Our rationale is that firms which follow ESG reporting guidelines are obligated to follow a reporting template, which provides a clearer understanding of what information firms should disclose. The template also encourages greater reporting around specific sustainability indicators codified in the guidelines (Potoski & Prakash, 2004). While ESG guidelines do not specify the number of pages or words that should be contained in a firm's sustainability report, firms are expected to fulfill the elaborated expectations of guidelines by disclosing specific information about their ESG actions, performance goals, impacts, and leadership. ...
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ESG reporting guidelines are institutional rules that can enhance the credibility of firms’ publicly disclosed information related to environment, social, and governance (ESG). Reporting is often voluntary and global ESG reporting guidelines typically rely on process-focused third party verification. However, in developing its reporting guidelines, the Japanese government gave firms the unusual option of pursuing either process- or content-focused verification. This paper draws on the unique Japanese setting to examine whether firms that use ESG reporting guidelines increase their quantity of disclosed sustainability information. Further, it assesses whether, given the option, firms tend to pursue process- or content-focused verification, and which type of verification leads to greater information disclosure. We show that firms that follow ESG guidelines disclose 39 percent more sustainability information compared to firms that publish sustainability reports but do not follow ESG reporting guidelines. Content-focused verification leads to greater information disclosure than process-focused verification in that firms publish 23 percent more text in their sustainability reports. Moreover, given the option, firms prefer to use content- over process-focused verification. However, most global ESG reporting guidelines endorse process-focused verification and this verification is less effective than content-focused verification at encouraging firms’ information disclosure. Our findings raise a timely and relevant question about the movement by global ESG standard developers to promote process- rather than content-focused verification. They also suggest that firms that wish to create sustainability distinction by way of ESG reporting may benefit by advocating for more robust forms of verification.
Chapter
Traditionally, internal views from UK businesses expect the maximisation of profits and delivery of value for the customer; the external view expects realistic profits and provision of employment. However, this view is changing, with customers increasingly demanding products and services that also demonstrate environmental responsibility and minimise climate impacts. Although the cause–effect relationship between business operations, negative environmental impacts and climate change is well established, there is now an enhanced appreciation that environmental challenges are systemic, interlinked and cannot be addressed in isolation. Despite the proliferation of ‘low-cost’ or ‘no-cost’ technological and behavioural opportunities, businesses struggle to realise opportunities that address these interlinked challenges, demonstrate environmental responsibility and minimise climate impacts, as they are embedded in economic systems in which improvement equals investment. Environmental improvement interventions have become synonymous with cost consumption rather than cost saving—frequently at odds with corporate financial strategies. In an attempt to change this view, support the mitigation of climate change through the reduction in environmental impacts and develop successful employment-ready graduates skilled in effective environmental improvement techniques, an innovative Environmental Strategy Module engaging postgraduate students in environmental management strategy design is taught at Coventry University. This offers students a more financially accessible approach to environmental improvement: a self-funding environmental management strategy created through the Environmental Value for Money Framework. This paper presents a conceptual study of the Environmental Value for Money Framework and its engagement of students as future employees in creating self-funded, economically viable environmental management strategies. It also offers this framework as a mechanism to encourage businesses to engage in carefully planned and economically viable strategic environmental improvements.
Article
en Cities are taking a leadership role in addressing global climate change and reducing greenhouse gas (GHG) emissions, but policy innovations are needed to help cities move from goals to outcomes. Pilot projects are one means by which cities are experimenting with new ways of governing and financing climate change mitigation. In this paper, we develop a framework for understanding the role of pilot projects in urban policy innovation: their emergence and rationale, and the means by which they ultimately scale up and out to reduce GHG emissions. We use this framework to evaluate a pilot project for retrofitting social housing buildings in Toronto. We find the initial pilot project helped address the challenges of pursuing deep retrofits of social housing. Scaling these lessons up to the city level required overcoming challenges to financing and coordinating a larger project; scaling out to the provincial level revealed institutional and political obstacles to pursuing the co‐benefits of deep building retrofits in social housing. Bridging agents play an important role in both scaling processes. The analysis reveals the additive nature of urban policy innovation and the dynamic interplay of change agents and institutional and political context in innovation processes. Abstract zh 城市在应对全球气候变化和减少温室气体(GHG)排放方面发挥着领导作用,但城市需要政策创新来帮助其将目标转化为结果。试点项目是城市用于试验减缓气候变化的新的管理和融资方式的一种手段。在本文中,我们建立了一个框架,用于理解试点项目在城市政策创新中的作用:它们的出现和基本原理,以及它们为减少温室气体排放而采取的纵向和横向的扩展方法。我们使用这个框架来评估多伦多社会住房建筑改造的试点项目。我们发现最初的试点项目有助于解决社会住房深入改造所面临的挑战。将这些经验在城市一级进行纵向扩展,需要克服融资和协调更大项目的挑战;横向扩展到省级,则显示出在社会住房深层建筑改造时追求共同利益所面临的制度和政治阻碍。“中间人”(bridging agents)在两种扩展过程中都起着重要作用。我们的分析揭示了城市政策创新的渐进性质以及在创新过程中变革推动者与制度和政治背景的动态相互作用。
Article
Chinese provincial governments choose to become active and leading participants in standardization projects rather than opt out of them. As most extant literatures focus on the effect of standardization without government intervention, a research question then arises whether standardization with government's lead could increase the output of innovation product like patent within a region. By investigating the case of China's standardization at provincial level, this study attempts to explore the association between standardization led by government and regional innovation performance. A series of panel data analyses shows the following. (1) Increasing the supply of local standards by provincial government significantly promotes the innovation performances of the cities in this province. (2) Policy of provincial governments to disclose standard content freely also benefit the cities' innovation performances in these particular provinces. (3) The fiscal investment of city government in science and technology positively moderates the effect of provincial government's lead in local standardization on the city's innovation performance. These results suggest that besides financial sponsorship, government could also directly contribute to innovation in a non-financial way by leading standardization. Our study adds to the discussion about government's possible roles in innovation.
Chapter
Enforcement style analysis has been crucial in the study and practice of regulatory enforcement. By capturing how the legal regulations are enforced, it can be used to review, compare and analyze enforcement practices, and examine its impact on enforcement outcomes. In this chapter, we first review the regulation and public administration literature to show the development of enforcement style analysis, which generally moved toward quantitative and sophisticated approaches. We then trace the changes in enforcement styles in the practice of environmental regulation in urban China over time, using surveys conducted in Guangzhou city in 2000, 2006 and 2013. We further explore the institutional and organizational explanations of such dynamics, and conclude by highlighting challenges and a future agenda in enforcement style research.
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How do patterns of interactions among policy actors shape their ability to contribute to climate change adaptation decision-making processes in fragmented regional governance settings? We address this question through statistical models of adaptation policy actors’ assessments of access to scientific/technical information as well as their perceptions of cooperation and procedural fairness across numerous adaptation decision-making processes operating in the Lake Victoria region, East Africa. We measured actors’ collaborative interactions as well as their participation in task forces, steering committees, and other policy forums that have emerged in response to the challenges of building adaptive capacity to the effects of climate change in the region. Because information access, cooperation, and procedural fairness are shaped by social processes, we tested how the performance of policy forums varied according to different measures of social capital. Specifically, we distinguished between bridging social capital (the value of relationships that span or broker between distinct subgroups) and bonding social capital (which results from frequent interaction or from clustered relationships within subgroups). We found that measures of bridging social capital had a positive effect on actors’ assessments of their access to information in policy forums, but a negative effect on their perceptions of cooperation and procedural fairness in forums. In contrast, measures of bonding social capital had a positive effect on cooperation and procedural fairness, but no effect on information access. Taken together, our results suggest that different forms of social capital have separate—and potentially opposing—effects on distinct measures of the performance of adaptation policy forums. The relative importance of each performance measure, which may vary from one policy forum to another, should guide efforts to encourage different forms of social capital across the numerous decision-making processes that comprise regional climate change adaptation governance systems.
Chapter
Crucial to understanding environmental policy on the front-lines is investigating how environmental policy is implemented. This chapter turns to the regulatory environment and begins by discussing the nature of command and control regulations and how they endeavor to implement environmental policy. In particular, we draw connections from earlier chapters as we discuss the governing and economic contexts that shape the implementation of environmental policy. In this chapter, we highlight the role of environmental inspectors, particularly those inspectors at the state level. These inspectors are the governmental officials who are responsible for the implementation of environmental regulation every day. We look at who these individuals are, what their experiences are like, and their challenges. This discussion helps illustrate the individuals who are responsible from protecting the environment on a daily basis.
Article
The literature on interlocal sustainability has acknowledged that the resources and authority of state governments influence the collaborative sustainability policy actions of local governments. However, there is an absence of empirical evidence that shows how this influence varies across the environmental protection, economic development, and social equity pillars of sustainability. This study uses data from a 2015 national survey of U.S. cities to shed light on the connection between state-level interventions and regional partnerships across the three primary sustainability policy dimensions. With an understanding gleaned from the concept of contested federalism, this analysis employed Bayesian techniques to examine how state fiscal support for sustainability, along with fiscal and functional decentralization in state systems, affect municipal collaborative policy efforts. The findings suggest a positive link between supportive state-level endeavors and local-level collaborations. However, state influences can have different implications across the three pillars of sustainability.
Article
Can governments use grades to induce businesses to improve their compliance with regulations? Does public disclosure of compliance with food safety regulations matter for restaurants? Ultimately, this depends on whether grades matter for the bottom line. Based on 28 months of data on more than 15,000 restaurants in New York City, this article explores the impact of public restaurant grades on economic activity and public resources using rigorous panel data methods, including fixed‐effects models with controls for underlying food safety compliance. Results show that A grades reduce the probability of restaurant closure and increase revenues while increasing sales taxes remitted and decreasing fines relative to B grades. Conversely, C grades increase the probability of restaurant closure and decrease revenues while decreasing sales taxes remitted relative to B grades. These findings suggest that policy makers can incorporate public information into regulations to more strongly incentivize compliance.
Article
State and local governments engage each other in a broad set of complicated interdependent relationships. Yet, there is limited research on what these multilevel governance relationships mean for community-focused sustainability. This study applies a transaction cost federalism framework to examine the hierarchical influences of state fiscal support and policy actions on municipal commitments to sustainability at the community-level. An analysis of U.S. cities reveals that state investments in energy programs encourage municipal efforts for incentivized energy efficiency initiatives for local taxpayers. Larger percentages of state funding directed to energy programs lead to stronger municipal commitments to incentivized sustainability programs such as individual grants, direct loans and tax incentives. The results suggest that stable and supportive multilevel governance systems are key for reducing political transaction costs inherent within vertical systems driven by coercive authority. These findings produce theoretical and practical implications for understanding community-level sustainability within the face of “contested federalism.”
Article
This article extends the study of regulatory compliance motivations from “traditional” regulatory settings to a government‐sponsored voluntary one. We argue that the rationale(s) which motivate participants to engage a voluntary program likely shape which motivations drive them toward (or away from) program compliance. Our study examines the possible influence of program participation rationales alongside that of regulatory agents' enforcement styles and strategies. Leveraging a national survey of certified United States Department of Agriculture organic producers, we find that the more a producer pursues organic certification to increase profits, the more likely they are to report deterrent fears as an important compliance motivation. In contrast, the more a producer becomes certified to support the organic movement, the more heavily they weigh a personal sense of duty to comply. We discuss the implications of these, and other, study findings for compliance motivations theory and voluntary program integrity.
Article
This study investigates the impact of China’s new Environmental Protection Law on the green innovation behaviour of listed companies in high-polluting industries. The implementation of China’s strict and new Environmental Protection Law provides a quasi-natural experimental setting for examining the causal effect of environmental regulation on corporate green innovation. Based on data of the application for environmental patents of high-polluting firms listed in Shanghai and Shenzhen Stock Exchanges from 2010 to 2017, this study analyses the change in the green innovation behaviour of firms after the implementation of China’s new and stringent Environmental Protection Law using the PSM-DID approach. We find that firms tend to file more applications for environmental patents, including patents for inventions and utility models after the implementation of the new Environmental Protection Law. Further analysis shows that while this effect is stronger for state-owned enterprises, it is weaker for firms headquartered in cities where economies depend more on the secondary industry. Firms in concentrated industries have more incentive to file applications for green invention patents than those in competitive industries. The study has important implications for policy makers on better implementing the environmental protection law in developing countries.
Chapter
Environmental harms and crimes that affect non-human nature (including animals) have the potential for greater societal impact than the ‘everyday’ crimes that are the subject of mainstream criminal justice and much criminological study. Yet such crimes are often dealt with outside of the mainstream of criminal law and criminal justice. Instead of falling within the remit of the criminal law, some environmental harms are engaged with specifically through the prism of environmental law and within a civil and administrative framework rather than a distinctly criminal justice one.
Article
To address ongoing deforestation for global food commodities production, companies and governments have adopted a range of forest-focused supply chain policies. In the Brazilian Amazon, these policies take the form of market exclusion mechanisms, i.e., immediately dropping suppliers who have cleared their land after a specific cut-off date. Theory suggests that strict exclusionary policies such as these are likely to result in both negative livelihood effects and reduce effectiveness of the policy if some farmers are not able to comply. It is proposed that a more cooperative model of enforcement that uses flexible and negotiated approaches to compliance management may enable more marginal and disadvantaged farmers to achieve compliance, thereby improving both the effectiveness of supply chain policies and their equity. Through our case study of cattle in the Brazilian Amazon, we examine the degree to which a purportedly cooperative supply chain policy exhibits coercive tendencies at different tiers and the degree to which these tendencies influence effectiveness and equity outcomes of the policy. We show that, surprisingly, even cooperative models of enforcement are prone to exhibit coercive tendencies in multi-tier supply chains, leading to severe equity shortcomings. We provide recommendations and a research agenda to mitigate effectiveness-equity tradeoffs in multi-tier, forest-focused supply chain policies in the aim to improve the design, adoption, and implementation of such policies.
Book
Cambridge Core - European Government, Politics and Policy - Private Governance and Public Authority - by Stefan Renckens
Article
The growing reliance on non-state environmental governance (EG) coupled with the current U.S. political environment portends an increasing salience of governing efforts from non-state actors. Among non-state actors, corporations play a substantial role given their market and societal power, their corresponding social responsibilities, and their organizational and institutional adaptability in developing and performing EG solutions. This article proposes a corporate-led environmental governance (CLEG) model. An important distinction between previous iterations of corporate social responsibility (CSR) and corporate governance and the CLEG model proposed here is the active assertion of corporate environmental leadership as state leadership is subject to retrenchment in the United States.
Chapter
Over the past three decades, the relationship between ecology and public policy has changed because of the increasing role of scientific uncertainty in environmental policy making. While earlier policy questions might have been solved simply by looking at the scientific technicalities of the issues, the increased role of scientific uncertainty in environmental policy making requires that we re-examine the methods used in decision-making. Previously, policymakers use scientific data to support their decision-making disciplinary boundaries are less useful because uncertain environmental policy problems span the natural sciences, engineering, economics, politics, and ethics. The chapter serves as a bridge integrating environmental ecosystem, media, and justice into policy for public health and safety. The chapter attempts to demonstrate the linkage between the environmental policy from a holistic perspective with the interaction of air, water, land, and human on public health and safety.
Article
In the United States, environmental federalism largely relies on a system for policy implementation that allows the federal government to delegate primary program authority (or primacy) to state agencies. Although it is an ingrained feature of several major federal environmental policies, such as the Clean Water Act (CWA), there is little evidence to indicate what impact delegating authorities has on programs. In order to examine this, the authors use a synthetic control technique to determine how actual CWA program outcomes in five states compare to expected outcomes if EPA retained primary authority. Findings indicate that while there were no significant differences in Texas and Oklahoma, state primacy led to improved program outcomes in Florida, but worse outcomes in Maine and South Dakota. Conclusions suggest that primacy has asymmetrical impacts that largely depend on state implementation systems, which carries important implications for environmental federalism.
Chapter
During the last century, many radical changes and innovations have taken place. In particular, during the last five decades, there have been unprecedented advances in development and industrialisation with dramatic economic and technological changes. Such changes have resulted in positive impacts (increase of economic activities, improvements in agriculture, access to energy, and rise of individual average income) but also negative ones (fast population growth, overconsumption, loss of biodiversity, greenhouse gas emissions, and climate change). A number of milestones have been reached since the first definition of sustainability appeared in 1713 by Hans Carl von Carlowitz to reach the current state of sustainable development (SD), e.g. Our Common Future, the Rio Conference, the Johannesburg Conference, and the Sustainable Development Goals (SDGs). As we trace this journey, a number of sustainability perspectives can be found: (1) central focus, (2) substitutability of natural capital, (3) constituency, (4) trends, and (5) scope. These perspectives show that SD is a broad, complex, controversial, open-ended, and challenging notion that is open to different, and in many cases mutually exclusive, definitions and interpretations. This has created much controversy, especially since such characteristics makes sustainability difficult to implement or be of practical value. In many cases, SD is considered to address only the environmental dimension. In other cases, it focuses on the three “pillars” (economic, environmental, and social). For the purposes of this book, SD encompasses four dimensions (economic, environmental, social, and time), as well as their interrelations. SD and sustainability have been used interchangeably, but they are inherently different. SD is the process by which we achieve sustainability, and sustainability is an ideal dynamic state. The terms are also contextual; at the institutional and governmental levels SD is preferred, whereas in the organisational level, sustainability is more widely used.
Article
This study focuses on de facto environmental enforcement and tests whether the practice of environmental enforcement discriminates against foreign-invested firms in a developing country. Using original firm-level enforcement data in the Jiangsu province of China, 2012–2014, this article examines the effect of foreign ownership on the enforcement of three regulatory instruments: economic incentives, command-and-control, and naming-and-shaming. After controlling for firms’ environmental performance, I find that firms with foreign ownership 1) pay fewer pollution fees, 2) are less likely to be punished, and 3) are more likely to obtain the highest score in the environmental credit rating system than domestic firms.
Article
What are the forces that drive increasing adoption of voluntary agreements in the policy field? This paper attempts to answer the question by analyzing the mechanism behind the adoption by 877 entities of the voluntary energy efficiency and GHG reduction agreement (VA) that was in place between 1999 and 2010 in South Korea. We argue that in South Korea's distinct regulatory context, participation in a public voluntary program (PVP), a VA, is a manifestation of participant entities' varied motivations as well as regulatory and social-normative pressures that arise from the institutionalization of the VA program. In addition, aligning the PVP with other policy programs such as eco-labelling program was found to have provided additional incentives for adoption while public ownership, socioeconomic status and environmental management capacity of targeted entities were significant factors. Thus, this study analyzes changes in the motives of participant entities over the course of the program's maturation and demonstrates how government and industries adopt and manage a PVP for policy learning and strategic regulation in the area of energy efficiency management and GHG reduction.
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