III. Charting the Alternative Path: A Cleaner, Cheaper Way for the Next Century

Designing a Parallel System for Environmental Protection

The Alternative Path is founded on a new, more cooperative relationship between regulators, regulated companies and communities, and affected constituencies-stakeholders who are impacted by the decisions and outcomes. At the heart of this relationship is a mutually beneficial approach-allowing more flexible and efficient compliance methods in return for achieving superior environmental performance and involving stakeholders more directly in the information sharing and decision making process.

This new approach can achieve many things:

• increased environmental gains
• increased economic and social gains
• increased company and community flexibility
• greater community and stakeholder participation
• a better informed public
• decisions that are based on better, clearer information
• more efficient decision making
• increased innovation
• integration of pollution prevention and continuous improvement into core decisions, and
• increased technological advances.

Implicit in the Alternative Path concept is the assumption that good stewardship of the environment is everyone's responsibility. Participants feel that allowing companies and communities flexibility to work with stakeholders to design tailored approaches will create tremendous opportunities for improvement.

Any environmental protection and enhancement system suitable for the 21st century should in the near term and perhaps beyond include two parallel environmental management tracks-the current system and an Alternative Path, both modified as lessons are learned and improved methods are developed. Both parallel tracks should encourage "continuous improvement"-that is, environmental management systems that make the pursuit of environmental excellence, technological advancement, improved systems, pollution prevention, and increased efficiencies a standard practice. Both systems should also strive to achieve the Series goal of a sustainable society.

The group believes the only way that sustainable environmental outcomes can be achieved is through approaches that are both cleaner and less costly. The Alternative Path discussed in this paper is one such approach. At the same time, the group recognizes there is a need to bring additional efficiency to the system. That may mean we need to find ways under the existing system to deliver benefits more efficiently as well as to gain more from what is spent.

The Alternative Path supplements the current regulatory system rather than replacing it. The current system is needed to serve as a benchmark for performance as new methods are tested. Also, the Alternative Path approach will not be appropriate for all activities. For instance, many environmental problems relate to small businesses, to non-point sources of pollution, and to actions of individuals as consumers. However, the Alternative Path as initially outlined may be an appropriate approach for improved environmental protection and enhancement for some of these situations.

The group devoted some time to considering models and programs for small business to achieve environmental gains. Several ideas emerged. First, there could be tremendous gains from improving the current regulatory system as it applies to small business, which often has difficulty understanding and complying with existing regulations. Second, sector-wide approaches for the current system and for the Alternative Path might work well, for example for printers or cleaners. Also, there may be merit to approaches in which large companies partner with their vendors to achieve environmental gains. While all these ideas should be pursued as part of a new environmental management system, they were not further refined in the Series since many segments of the small business sector were not present, and the Series decided to focus first on defining the Alternative Path for large organizations or communities.

During the course of the Aspen sessions the group also discussed several innovative techniques that are being tested in various venues. Some of these techniques include economic incentives, trading, voluntary initiatives, pollution prevention programs, public-private partnerships on pro-active programs and innovations. The group felt that these innovations should be encouraged, and collected and observed, so that these and other "alternative paths" might be developed over time by applying these concepts in new ways. One early outcome of discussions at the Aspen Series and elsewhere was that the idea of the Alternative Path gained currency in a broader policy arena. President Clinton mentioned it in his March 16, 1995, speech on reinventing regulation; Members of Congress incorporated it into draft legislation; and the Environmental Protection Agency launched Project XL, a voluntary demonstration of the Alternative Path concept.

The Aspen participants then decided that their most valuable contribution to furthering development of improved environmental protection and enhancement systems would be to provide clear and specific guidance on critical aspects of the Alternative Path. In addition to lower costs for regulated entities, four concepts are at the heart of the Alternative Path:

• superior environmental performance,
• principles for stakeholder involvement,
• pollution prevention and continuous improvement, and
• the changing role of regulators.

The Series discussed each in some detail.

Entering the Alternative Path
To justify the investment of resources in developing an Alternative Path agreement, candidates will be screened. Commitment and ability to manage for environmental excellence should be considered in affording entities an opportunity to operate on the Alternative Path or to expand their participation.

Examples of measures which could demonstrate this commitment or ability are: pursuit of a proactive corporate environmental policy; a strong public record of environmental leadership, innovation, and achievement; responsiveness to community and worker health concerns; and incorporating pollution prevention, life-cycle product stewardship, and design-for-environment applications into core business practices. Commensurate demonstrations of commitment and ability to succeed on the Alternative Path may substitute for a prior record of environmental leadership.