Tag: HELR Vol. 38.1

An Interview with ELR Authors Coglianese & Nash

By Rachel Proctor May — June 16, 2014 at 10:25am

In ELR Volume 38.1, published earlier this year, Cary Coglianese and Jennifer Nash examined the track record of Performance Track, EPA’s flagship voluntary program for companies to commit to environmental regulation outside the legal process. That article, Performance Track’s Postmortem: Lessons from the Rise and Fall of EPA’s “Flagship” Voluntary Program, is available here. ELR’s Rachel Proctor May sat down with the authors to discuss the article.

ELR: Does the demise of Performance Track indicate a shift away from voluntary programs in environmental regulation? To what extent are voluntary programs still a part of the regulatory landscape?  

Jennifer Nash, Executive Director of the Regulatory Policy Program and Associate Director of the Mossavar-Rahmani Center for Business and Government at the Harvard Kennedy School
Jennifer Nash, Executive Director of the Regulatory Policy Program and Associate Director of the Mossavar-Rahmani Center for Business and Government at the Harvard Kennedy School

Coglianese & Nash: Wouldn’t it be great if government could protect the environment without imposing burdensome regulations on business? Imagine that, simply by recognizing and rewarding businesses for adopting positive environmental management practices, government could induce firms to make substantial progress protecting the air, water, and land. That’s the appeal of voluntary environmental programs, like the National Environmental Performance Track adopted by EPA in the 1990s. Performance Track, long considered EPA’s “flagship” voluntary program, offered positive publicity and modest regulatory relief to companies that the agency considered to be environmental leaders. At least in theory, voluntary programs like this have the potential to change the behavior of businesses without the need for passing legislation, promulgating regulations, and overseeing compliance – and without all the costs and conflicts associated with these traditional approaches to environmental policy.   In this sense, voluntary programs are the regulatory equivalent of Brigadoon. They hold captivating appeal. As a result, even though EPA ended Performance Track in 2009, voluntary programs remain an important part of the regulatory landscape and policy entrepreneurs will continue to advocate for them as an attractive alternative to regulatory business as usual. Not surprisingly, voluntary programs proliferate throughout government at the federal and state levels. EPA runs dozens of voluntary programs, about fifteen of which seek to address energy and climate change alone. And interest in voluntary programs extends well beyond EPA. The Department of Energy runs programs very similar to Performance Track, as does OSHA and many states.

ELR: Based on your analysis of Performance Track, is there a place for voluntary programs in environmental regulation? Are there certain sectors/regulatory targets in which they are particularly likely to be effective or ineffective?  

Cary Coglianese, Edward B. Shils Professor of Law and Professor of Political Science at the University of Pennsylvania; Director of the Penn Program on Regulation
Cary Coglianese, Edward B. Shils Professor of Law and Professor of Political Science at the University of Pennsylvania;
Director of the Penn Program on Regulation

C&N: Perhaps some kinds of voluntary programs might have value within the broad portfolio of environmental policy, but our research on Performance Track suggests that EPA and other agencies need to recognize the severe limits to this kind of voluntary program. Voluntary programs cannot, despite the claims of some of Performance Track’s proponents, provide a basis for revolutionizing environmental regulation. Advocates of such programs need to calibrate expectations and avoid making the kind of grandiose claims that EPA continued to make about Performance Track throughout its history. EPA and states repeatedly made statements about the “top performance” of those who joined voluntary programs. Indeed, the very name “Performance Track” implies that the program attracts members that are better performers than their peers. But Performance Track never really tracked facilities based on performance, nor could EPA ever demonstrate that the facilities that joined Performance Track did better in terms of reducing environmental impacts than facilities that did not join. On the contrary, evidence suggests that some Performance Track facilities were not even better than the average facility in the same industrial sector. When we compared facilities that participated in Performance Track and similar facilities that did not, we did not find the joiners to be any more responsible than the non-joiners. Instead, we found that what most distinguished joiners were their distinct preferences for engaging in community outreach. The joiners were, in effect, extroverts – not necessarily performance leaders.

ELR: What are your recommendations for designing voluntary programs to make them as effective as possible? 

C&N: Government should be circumspect about the role of voluntary programs. Whatever claims agencies make about benefits from these programs should be backed up with careful research. EPA continually said that Performance Track produced results in the form of reductions in pollution and natural resource consumption. But EPA never collected data on trends in emissions and natural resource consumption of non-members, so the agency lacked support for statements about what change Performance Track may have caused. To its credit, EPA did seek to study why businesses joined Performance Track – including by funding some of our research – but it could never demonstrate that Performance Track led to any environmental improvements that companies would not have made anyway for other reasons. If EPA and other agencies are interested in exploring the potential of voluntary approaches to supplement traditional regulation, they should design voluntary programs with empirical evaluation in mind so that they can demonstrate their value. Only in that way will policymakers ever be able to understand how to make voluntary programs as effective as possible.

Automatically Green

PLANTS_clover_CA_alecharrisBy Caroline Stern — Nov. 18, 2013 at 5:16pm

Over the coming months, the ELR blog will be publishing a series of blog posts that preview articles that will appear in the forthcoming Volume 38.1. This blog is the first in that series.

In the forthcoming issue of the Harvard Environmental Law Review, Professors Cass Sunstein and Lucia Reisch offer an excellent resource for policymakers seeking ways to encourage consumers to choose green energy instead of environmentally unfriendly (“gray”) energy.  Their article, “Automatically Green: Behavioral Economics and Environmental Protection,” provides a “choice architecture” that analyzes the pros and cons of different possible approaches to encouraging green behavior.  At one end of the spectrum is imposing green mandates on consumers (legally banning gray options); at the other end is relying on consumers to make active choices to be green.  Between these two extremes is implementing green defaults—such as the automatic double-sided printer setting in offices and schools—which promote green options, but also permit consumers to deviate from them.

The article discusses in detail the economic and environmental costs and benefits associated with each approach.  In order to implement any one of these methods effectively, policymakers must also assess the political and social contexts surrounding their choices.  For example, employees would likely be receptive to green defaults in their offices because the impacts are limited to the physical place of work and do not affect their personal finances.  By contrast, the general consumer population may be less receptive to green defaults in their homes because such policies can directly affect their privacy and personal expenses.

The article notes a troubling example of why policymakers may need to be attuned to the politics of the targeted consumer population: at least one study has found that certain politically conservative households will actually increase their energy consumption when informed that their consumption levels exceed those of their peers.  It is important to note that the policy used in that study was a “social norms” approach—not green defaults—which seeks to change behavior by informing consumers about the greener habits of their peers.  However, it is possible that green defaults could provoke the same resistance if consumers viewed the default as an unwanted interference with their private choices.  This disheartening behavioral pattern illustrates that, in at least certain limited circumstances, consumers’ political and social views can foil environmentally friendly policies, despite the benefits of going green.

In some contexts, it may be difficult to predict the politics or social views of the likely consumer population when implementing a green policy.  In order to avoid the risk of backlash, it may be worthwhile to consider, as an alternative, a variation on the green default: “green design,” a facially neutral policy that has subtle yet meaningful impacts on consumer behavior.  A green design approach has already succeeded in experiments promoting healthy eating choices through subtle rearrangements of lunch buffets and supermarkets.

In the absence of contextual information about political or social attitudes, green design should appeal to policymakers because it may be more neutral in appearance than mandates or ordinary defaults.  Unlike defaults, which explicitly promote one option over another, green design reinforces the message that the consumer retains full control over his or her choices; its subtlety also means it may be less likely to provoke backlash.  Green defaults have proven to be an especially effective, low-cost approach, but green design could be a viable option for policymakers seeking alternative ways to facilitate green choices.