Management-Based Strategies for Improving Private Sector Environmental Performance

Abstract:     
Improvements in environmental quality depend in large measure on changes in private sector management. In recognition of this fact, government and industry have begun in recent years to focus directly on shaping the internal management practices of private firms. New management-based strategies can take many forms, but unlike conventional regulatory approaches they are linked by their distinctive focus on management practices, rather than on environmental technologies or emissions targets. This article offers the first sustained analysis of both public and private sector initiatives designed specifically to improve firms' environmental management. Synthesizing the results of a conference of leading scholars and policymakers organized by the Regulatory Policy Program at Harvard University, we consider in this article whether management-based strategies can lead to improved environmental outcomes and, if so, how they should be designed to be most effective. We report research findings showing that management-based strategies can yield improvements in industry's environmental performance, indicating that anyone concerned about environmental quality should seriously consider the use of these strategies. Nevertheless, we urge caution about overstating what can be accomplished through management-based strategies, as they will not always lead to significant change in private sector firms' environmental performance. Although management-based strategies are unlikely to become the mainstay of society's approach to environmental protection, they deserve greater consideration because they can yield positive results.

Keywords: Environmental management, environmental law and policy, Business and Government Policy, Environment and Natural Resources, Law and Legal Institutions, Regulation

JEL Classifications: K32, K23

Working Paper Series