Intensified Product-orientated Enviromental Initiative

Discussion paper

Contents

Preface Previous -->

English summary (Summary)

1 Summary
1.1 The great challenge
1.2 What is a product-orientated environmental initiative?
1.3 Framework and conditions for product initiatives
1.4 Proposals for specific initiatives

2 The environmental policy challenge of a global market with global growth
2.1 Introduction
2.2 National and global environmental problems
2.3 The environmental challenge
2.4 Basic prerequisites for a product-orientated initiative

3 Product-orientated environmental initiative - the process and goals
3.1 Introduction
3.2 Product initiatives as a process and a dialogue
3.3 Overall goals for product initiative

4 The products
4.1 Introduction
4.2 Products covered by the product initiative
4.3 Environmental properties of products in a life-cycle perspective
4.4 Evaluating environmental properties of products
4.5 The potential of environmental improvements of products
4.6 Environmental properties are not absolutely all

5 The market
5.1 Introduction
5.2 The environment as a competitive parameter
5.3 The global market
5.4 The Danish market as a starting point
5.5 The importance of public efforts
5.6 International environment and trade agreements

6 The stakeholders
6.1 Introduction
6.2 Prerequisites for product initiative contributions
6.3 Which stakeholders are central to the product initiative?
6.4 The consumers
6.5 The trade sector
6.6 Manufacturers of goods and services
6.7 Other stakeholders - consequences to the product initiative

7 Proposals for specific initiatives
7.1 Introduction
7.2 Background to the choice of instruments and areas of action
7.3 Presenting goals and behavioural expectations - the environmental agenda
7.4 Access to knowledge
7.5 Developing a stable market for environmentally sound products
7.6 Initiatives in three product areas
7.7 Product development support
7.8 Banning the use of selected chemical substances
7.9 National co-ordination
7.10 International efforts

8 References

Appendix 1

Appendix 2

Appendix 3

1 Summary

This discussion paper presents the Danish Environmental Protection Agency's proposal for an intensified product-orientated environmental initiative.

The paper has materialised as the outcome of a series of round-table discussions and ongoing contact with the organisations of trade and industry as well as with relevant authorities.

Discussion paper
The purpose of this paper is to contribute to public debate on the organisation of initiatives in the product field in years to come - in particular, this paper should be discussed by and with the stakeholders affected by such action. One of the proposals includes discussing the overall objectives, components of the effort and proposals for concrete initiatives. The groundwork is also being laid down for discussions on possible ways of collaborating on such intensified efforts.

The paper has been widely circulated for comments and, in addition, will be presented at a series of events in the next six months. The components and initiatives proposed will be deliberated in the light of this debate and comments received so that the product-orientated environmental initiative can be presented for political decision-making.

This approach involves viewing the problems in a long-term, holistic perspective. Efforts can thus not be realised only by initiating a series of concrete initiatives. The process is continuous and must, in a number of years, turn development and consumption in a more environmentally sound direction - in continuous and close co-operation with the stakeholders.

The global challenge
The UN estimates that the world's present population will have doubled in the next 35 years. Many countries of Eastern Europe, Asia and South America are undergoing rapid economic growth. The poorest countries are justified in their hopes of - and at the same time their entitlement to - improving their living standard in the years ahead. This development will entail a marked increase in global consumption. If the depletion of the world's resources and the permanent destruction of the environment for future generations caused by an explosion in consumption are to be avoided, intensified environmental initiatives will be needed, aiming at all aspects of our product consumption.

Product, market and stakeholders
In other words, the environmental impact associated with the production, use and disposal of products needs to be reduced. These efforts must ensure that products are developed with far better environmental properties than those we know today. But these efforts must also ensure that more environmentally sound products can compete with environmentally inferior products - and in sufficient volumes to bring about environmental improvements. The focus therefore needs to be on the market in which the products are competing as well as on the stakeholders influencing that market.

The national challenge
It is a challenge for environmental policy to intensify product-orientated environmental initiatives in such a way that they can contribute to solving some of the Danish environmental problems and hence result in specific environmental improvements.

This initiative will prove a great challenge to Danish trade and industry at the same time as it affords crucial economic and industrial policy opportunities. If it is to succeed, an intensified product-orientated environmental initiative can only be implemented by active interaction between the public sector and trade and industry. In return, such interaction will consolidate the competitiveness of the Danish trade and industry in future years.

The product initiative
The paper examines the general framework needed to promote the availability and sale of less environmentally degrading products on the market. It surveys ways in which such framework conditions can be established, suggesting initiatives to intensify efforts within both existing and new intersectorial areas of action. It is proposed to conduct pilot projects in three product areas where the conceptual basis of an intensified product-orientated environmental effort can be tested and developed in a hands-on context.

Continuous process and dialogue
Action in the product field should take the form of a continuous process involving ongoing dialogue between the parties. Together, they must identify new initiatives and obstacles in order to develop, manufacture, market and sell new and less environmentally degrading products.

Refining environmental initiatives
Part of the environmental initiative is already targeted at such products. Compared to the all-round effort described in the paper, the present initiative is, however, aimed mainly at specific elements of importance for the environmental impact caused by products. The intention is not to suggest that the former environmental effort should be superseded by a new one. An intensified product effort must be a supplement.

1.1 The great challenge

The environmental space
The Danish government's 1995 Nature and Environment Policy Report, highlights the necessity of a long-term trend towards keeping our total environmental impact within a reasonable proportion of the global environmental space. We must, then, respect the limits that nature sets to our consumption of material resources and to the degree of stress we can impose on the environment for the sake of posterity. In other words, we must respect the concept of sustainability.

Former regulation
Over the past 25 years, environmental regulations have resulted in substantially less pollution from industry, power stations, wastewater treatment plants and other so-called point sources.

Product use is an environmental problem
But there are still a number of environmental problems which have proved difficult to handle. They are typically associated with the environmental impact from more diffuse sources and with society's consumption of resources in general. A considerable part of these environmental problems are linked to the widespread use of the products in all functions of society.

A particular product may seem harmless enough on the face of it, viewed in a larger environmental perspective. But however harmless it may look, an individual product may assume great environmental importance owing to the volumes in which it is manufactured or the substances it contains.

For these reasons in particular, increased focus on products is needed if the environment is to enjoy greater protection.

Local and global environmental problems
We see local environmental problems such as pesticides in the groundwater, environmentally hazardous substances in sewage sludge and oxygen depletion in our local waters. We see regional and global problems such as the depletion of the ozone layer, the spread of non-degradable substances hazardous to health and the environment, and the degradation of nature through e.g. desertification and eradication of the rain forest. We are also witnessing various new problems of which we do not yet know the full extent and consequences, e.g. the spread of oestrogen-like substances, the reduction of biological diversity and contributions to the greenhouse effect.

The effects on the environment of such products can all be related to one or more of the following four serious global issues:

Global growth
The global problems are being intensified by the growth of the world's population. More people mean greater pressure on nature and the environment. At the same time, increase of the living standard of the poor countries is a prerequisite for limiting population growth. Or to put it another way: growth in the population creates greater pressure on nature and the environment. It can only be stopped by increasing consumption - creating even greater pressure on nature and the environment in the process. And regardless of the growth in the population, the peoples of the poorest countries have a justified expectation of some improvement in their standard of living.

Commercial challenges and opportunities
Especially on the short view, an intensified product-orientated environmental initiative can make demands on trade and industry but, on the longer view, it implies commercial possibilities that will enable Danish trade and industry to manage itself in the increasing international competition.

It is crucial to Denmark that our environmental effort should not destroy our existing competitiveness. Unless Danish companies are competitive, it will eventually mean production closures. That would benefit neither the environment nor the Danish economy.

Given the increase in both the population and the living standard, there will be a constantly growing demand for goods and services. That will generate a rise in the demand for resources, which in turn will cause rising prices. The increase in consumption will also result in the environmental problems becoming greater and increasingly recognised among consumers. All in all, these factors will lead to an increased demand for products with improved environmental properties. They may be products free of substances hazardous to health and the environment, for instance; products that are totally recyclable, products with a longer life and products with a lower consumption of raw materials or energy.

There is, therefore, a potentially great opportunity to orchestrate Danish product initiatives so that Danish companies are among the first to be able to supply a rapidly growing global market with products displaying improved environmental properties.

The specific onset of increased demand for products with improved environmental properties is difficult to predict for the various product groups. On the other hand, the competitive edge lies in being prepared to meet that demand when it comes.

Public/private development effort
Danish companies do have the potential. Individually, however, their resources and environmental know-how are barely sufficient to see such efforts through. Action is thus needed in close co-operation between the public sector, the companies and their organisations.

Danish lead in international efforts
There will be an independent Danish interest in creating a competitive lead on the market for more environmentally sound products. If, however, a product-orientated environmental initiative is to meet the global environmental challenges, this will require similar international efforts in which Denmark should be among the trend-setters.

More can be read about global growth and the environmental and commercial challenges in Chapter 2.

1.2 What is a product-orientated environmental initiative?

The nature of present environmental strategies
The present environmental efforts have been roughly modelled on four different basic approaches:

Sources
A source-orientated approach - in which efforts are aimed at reducing the discharges from the various sources impacting on the environment. Sources include e.g. industrial enterprises, wastewater treatment plants, waste incineration plants, farming, power stations and cars. Efforts include stipulations regarding purification or the use of cleaner technology.

Medium
The medium-orientated approach - aiming to ensure an acceptable quality of soil, air, sea, groundwater and fresh surface water. Among other things, the approach ensures that a policy stance is taken on the need, if any, for actions against discharges to the environment for reasons of environmental quality.

Substances
The substance-orientated approach - in which the properties and fate of chemical substances, resources or residual products in the environment underlie all action. These efforts also include hazard and risk assessment.

Products
The product-orientated approach - which is based on the concept that the overall environmental impact can only be understood - and efforts properly prioritised - if products are contemplated throughout their entire life-cycle from cradle to grave.

The present product-orientated efforts has mainly included the development of tools for analysing and assessing the environmental impact of products and the development of a public green procurement policy. Furthermore, efforts have been directed towards individual, selected components of the product life-cycles with a view to solving specific environmental problems.

What is the underlying idea of the product initiative?
The purpose of an intensified product-orientated environmental initiative is an increased development, manufacturing and marketing of environmentally sound products on the market in replacement of existing, more environmentally degrading products.

Sale
The present paper particularly focuses on the sale of more environmentally sound products. A product-orientated environmental initiative must stimulate the market to increase its marketing and sale of products with good environmental properties. A product-orientated environmental initiative therefore takes as its basis the highly complex interaction between products, stakeholders and market. Concrete supportive initiatives must ensure that, to a greater extent, this interaction results in the development and marketing of environmentally sound products.

Working on an intensified product initiative
A long-term holistic process
An intensified product initiative is a framework intended to unite existing and new actions. It is an attempt to treat environmental problems in a holistically oriented fashion. Such action cannot be implemented merely by starting a series of concrete initiatives; nor do the results of such action become quickly visible.

It is a continuous process which, in a number of years, must turn product development and consumption in a more environmentally sound direction - a never-ending process but a process in which stakeholders continuously improve products in close co-operation.

Stakeholder dialogue
A dialogue among the stakeholders is a key concept in this process. The dialogue is not just a means adopted as part of a product initiative - to a major extent, the dialogue is the product-orientated environmental initiative. It requires the participation and commitment of many parties with highly diverging interests.

Cyclical process
The process can be conceived as a cycle in which the different phases are repeatedly traversed. Efforts must constantly be improved on the basis of the results and experiences achieved. A product-orientated environmental initiative can be described as a process in five phases:

Circle illustrating the various phases of the product initiative (5Kb)

More can be read about the product initiative as a process and dialogue in Section 3.1.

What are the overall objectives of the product initiative?
Despite being an environmental initiative, commercial targets are largely in focus. The working premise is that more environmentally sound products will only be developed and sold if this policy agrees with business economics interests of the companies and with the other stakeholders' interests - if not on the altogether short view, then in any case on the slightly longer view.

Environmental objective
The environmental objective of such efforts is to contribute to the development, production and marketing of products with improved environmental properties in order to allow a reduction in the total impact from the production, use and disposal of products.

More specifically, the aim is to restrict the spread of environmentally and health hazardous substances, the increasing use of fossil fuels, the overexploitation of biological resources and the consumption of mineral resources that cannot be renewed.

Commercial objective
The commercial objective behind the initiative is to strengthen the competitiveness of the Danish business community by establishing a basis for the development, production and marketing of products with improved environmental properties.

Process objective
The overall objective of the product initiative is to involve all stakeholders in realising the environmental and commercial goals. At the same time, the aim of the work is for Denmark to influence its international business partners to take similar action.

More can be read about the overall objectives in Section 3.2.

1.3 Framework and conditions for product initiatives

The overall conditions
The framework and conditions of the product-orientated environmental initiative are the interactive area between the product, the stakeholders and the market. Within this area, the possibilities for developing and marketing products with improved environmental properties are determined.

If consumers and purchasers do not demand environmentally sound products, these products will never find their way onto the market. If environmentally sound products do not exist, the market will not be able to make them available to the consumers. If the market does not inform consumers of the environmental properties of the products, consumers will have no way of knowing whether they are buying the environmentally sound products, etc., etc.

Triangle illustrating the product initiative conditions (6Kb)

The analysis in this paper can only be general, owing to the great variation in conditions prevailing from one product to another. Any concrete action with regard to selected product groups must therefore analyse the conditions and interaction on a more product-specific basis.

The nature of the product-related framework and conditions
In principle, the product-orientated environmental initiative is directed towards all products manufactured or consumed in Denmark. The initiative therefore includes both import and export products.

What are products?
Products should be taken to mean both physical products and services which in some way generate an environmental impact - for example, cleaning and transport. In addition, products means both the products utilised by the end-user and the semimanufactures forming part of further manufacturing.

15,000 product groups
The Danish market boasts a very large number of products. The foreign statistics record trade in approx. 15,000 different product groups. Within these groups there are many different articles. To these must be added the services.

The product-orientated environmental initiative is especially directed towards the products that will be developed and marketed in the next few years. Since one generation of products is superseding the next one at an ever increasing rate, efforts must be expected to penetrate quickly.

Action priorities
It is proposed that action is targeted primarily at products which have a substantial impact on the environment and where such action stand a reasonable chance of bearing fruit. Specifically, this means that work on the product initiative should include prioritising products and the environmental properties calling most urgently for action will be selected in each individual case.

Overview of the environmental properties of products
Any effort to reduce the overall environmental impact of a product requires an overview of the environmental conditions governing all phases of the life-cycle of a product, from the extraction of raw materials to production, distribution, use and disposal. Such a precise overview of environmental properties is, however, only necessary in certain cases. Often, a more general evaluation will be sufficient and efforts to improve the environmental properties of the product will often focus on selected environmental properties or on selected parts of the life-cycle of the product.

More can be read about product conditions in Chapter 4.

The nature of market framework and conditions
Competing on price and quality
On the market, competition is based primarily on product price and quality and, only to a limited extent, on the environmental properties of products. If the product initiative is to succeed, the products developed and marketed must be able to compete on price and quality as well as on the environmental score. Therefore, it is vital, both nationally and internationally, to attach greater importance to an improvement of the competitive situation for products with good environmental properties.

Light-green consumers
On the Danish market, various surveys show that between 1/3 and 1/4 of consumers would be ready to show consideration for the environment in their choice of consumption.

Options and information in the shops
However, there are a number of conditions that have to be fulfilled before consumers can show such considerations. The more environmentally sound articles must be available in all shops, and they must be easy to find. There must be easy access to simple information on the environmental properties of the goods - primarily in the shops. In addition, the environmentally sound goods must not be appreciably more expensive than the alternatives.

A central aspect of the product-orientated environmental initiative is to ensure consumers easy access to adequate and simple product information.

The domestic market is important
For most Danish companies, the domestic market is essential to sales and earnings. In a number of cases, the domestic market via i.a. statutory environmental requirements also gauge of future environmental requirements on products on the international market.

For certain product groups, e.g. pesticides, there is great international awareness of the Danish regulation as new Danish environmental requirements are expected to rub off on the control measures in other countries.

A series of international surveys show that there is a positive correlation between a high level of protection and large-scale environmental initiative on the one hand, and the competitiveness of trade and industry on the other. But a balance is needed to ensure that the environmental requirements are devised to retain the international competitiveness of companies while the Danish market remains of interest to foreign companies.

Approx. 60% of Danish goods production are exported and, similarly, some 60% of the goods sold on the Danish market are imported. Denmark is thus strongly integrated in the global market - primarily with highly industrialised countries where the markets resemble the Danish market in many ways.

Action within the framework of international agreements
Intergovernmental control and international agreements governing trade relations, products and the environment are assuming ever greater importance for environmental efforts. On the one hand, the agreements provide a framework stipulating the extent of independent national environment policy. On the other hand, they allow the individual country to influence environmental considerations extending beyond its national frontiers. This primarily involves EU regulation and global trading controls within the framework of the WTO. Furthermore, the European and international standardisation work is of great practical importance for the requirements made of the design and manufacture of a product.

Active international control for the benefit of the environment
A Danish product initiative must be developed in accordance with the principles of the free movement of goods, as defined in the EU and WTO. The development of international regulations will assume great importance both for international and national environmental efforts, including the framework for a product-orientated initiative. Therefore, it is of great importance to work actively to ensure that environmental requirements are given greater clout in international agreements.

Compared to a Danish initiative, an EU regulation in the product field will, however, have a much wider impact.

There is need and scope for a Danish initiative
Both a need for and possibilities of an independent Danish product initiative are present. A Danish initiative must exploit all the possibilities afforded by international regulation and be capable of improving marketing conditions for more environmentally sound products on the Danish market. At the same time, Danish efforts must take place in active co-operation between public authorities and Danish companies in order to consolidate the competitiveness of the companies.

More can be read about the market conditions in Chapter 5.

The stakeholders' conditions
The stakeholders' active participation in the product-orientated environmental initiative is of vital importance for the achievement of the desired effect of the initiative. Individually and as a team, the stakeholders make absolutely vital decisions that are of importance to design, materials, production, transport, supply, demand, consumption conditions and waste management. Finally, these decisions determine the environmental impact caused by the individual product as well as by overall consumption.

Product development/design
The product developer's and designer's choice determines factors such as materials, product life, resource consumption during use and potential for recycling.

Production
The manufacturer engineers the production process and thus influence the environmental impact. The manufacturer should not be taken to mean solely the maker of the final product but also the maker of energy and raw materials, semimanufactures and consumables used in the manufacture of the end-product.

Distribution - transport and trade
Distributors like the importer, the forwarding agents, the conveyers, the wholesaler and the retailer are intermediaries in the product chain from manufacturer to consumer. Among other things, they thus influence what products can be bought and how the products are transported.

Consumption
The consumers' choice of products is, of course, the basis of the actual demand and is thus vital in the choice of products to be developed, manufactured and supplied on the market. Major public enterprises are a very important type of consumer in this context.

Other stakeholders
A number of stakeholders have only indirect bearing on the underlying conditions for products:

The financial sector furnishes financing and may in its own interest demand environmental information as well as eco-conscious behaviour.

Researchers and others who develop know-how on environmental conditions influence which environmental problems are discovered and for which solutions are found.

Those disseminating knowledge have a great bearing on the know-how available to other stakeholders.

Parliament, authorities, and national and international organisations establish the regulations and the "climate" that define the framework conditions of the environmental and industrial policy for the stakeholders. State and municipal regulations of waste handling are an example of this.

Special focus on product developers, dealers and consumers
There are three groups of stakeholders in particular who should be brought into sharper focus than they have been in the existing environmental efforts. They are the consumers, the dealers and the product developers. Product development is often, but not always, undertaken by the manufacturer. There was formerly a greater focus on the authorities and the manufacturers. Consumers, dealers and product developers are, however, essential to a product strategy since they largely determine the supply and demand openings for products with improved environmental properties. The paper therefore contains detailed descriptions of the three groups of stakeholders.

The stakeholders' conditions
It is necessary to understand the conditions on which the various stakeholders are willing and able to participate - including especially their motivation, their resources and the legal aspects of importance to the product initiative.

Motivation
Stakeholders' motivation is determined primarily by their ethics, their resources and the competitive situation entailed by any change in behaviour. Efforts in the product field must support the pioneers as well as increasing motivation among the more cautious stakeholders - i.a. by concentrating efforts on external constraints such as resource and competition factors.

Resources - know-how, time and money
It takes know-how, time and money to get started. Acquiring the knowledge needed as a basis for the various stakeholders' behavioural decisions is generally a problem. This applies to knowing what the essential environmental problems are, which environmental problems are associated with individual products, and what the individual stakeholder can do to help solve those problems.

All conversion processes cost resources to begin with, and any gains in the form of savings come only on the slightly longer view. Products with improved environmental properties will generally be more expensive and will remain so until a stable and reasonable demand for these products arise. Similarly, limited demand is a barrier to development and launching of more products with improved environmental properties onto the market. It is thus pivotal to consider the use of economically stimulating instruments as part of the product initiative.

Legal aspects
The legal aspects are important when the rules play a significant part in ensuring that products are not hazardous to health or the environment, or where such rules must ensure the availability of essential information.

More can be read about the conditions for the stakeholders in Chapter 6.

1.4 Proposals for specific initiatives

Analysis of framework and conditions leads to a number of proposals for specific initiatives. As already mentioned, this is the impetus needed to start a continuous process that will have to be repeated and adjusted concurrently with the development of products with improved environmental properties.

The proposal for an intensified product initiative invites action in a number of new areas while, at the same time, changes or reinforcements are made to efforts in various existing fields. This is reflected in the proposals for specific initiatives and areas of action.

The paper has been widely circulated for comments. No new overall paper will be drawn up on the basis of the hearing but the Danish Environmental Protection Agency will deliberate the proposals for specific initiatives in the light of the comments received and the debate before any initiatives are submitted for political consideration. The proposals are thus up for debate. The proposals are described in detail in Chapter 7.

Initiatives as the start up of the process
The following areas of action are proposed in the paper:

The specific proposals for action in the eight main areas are described below.

Long-term environmental goals and behavioural expectations
Declaration of priorities
The paper contains the Danish Environmental Protection Agency's initial suggestion for the environmental goals that should be assigned top priority.

Ambitions for the stakeholders
Environmental goals have been laid down for the problem areas to which special priority has been assigned by the central environmental authorities. They are long-term goals intended to provide guidelines for the work on product-orientated environmental initiative.

Expectations on the stakeholders' behaviour
The goals must primarily be attained by offering consultancy to developers, manufacturers and dealers. In continuation of the goals, a number of the behavioural patterns expected from the stakeholders by the authorities have thus been drawn up. Or to put it another way, the behavioural expectations describe the activities which the product-orientated environmental initiative wishes to promote in the individual stakeholder in order to achieve the long-term objective.

List of undesirable substances
The Danish Environmental Protection Agency has drawn up a draft list of undesirable substances which should be attempted to be replaced with other substances. The list is published in the Danish EPA's report on "Status and Perspectives for the Chemical Field".

Efforts to promote stakeholders' understanding and grasp of the environmental agenda should include the additional generation of data and development of priority-setting criteria as well as the further development and concretisation of the environmental goals in dialogue with the stakeholders.

Knowledge access
There is a pronounced need for the dissemination of simple and readily accessible knowledge on the environmental goals and the environmental properties of the products to the consumers, purchasers, dealers and other stakeholders. The knowledge standard and need for know-how will vary greatly for the different stakeholders.

Dissemination of information
The Danish EPA proposes discussions are opened with the stakeholders on ways of generating relevant knowledge on the environmental impact of the products and of passing it on from the manufacturers and importers to the consumers - a dissemination process that will often be effected via the wholesalers and retailers. These discussions should also include the question of imposing an actual duty to inform, for gradual introduction in selected product areas.

Environmental product declaration and instructions
The Danish EPA proposes that a concept of voluntary environmental product declaration and environmental instructions is developed for selected product groups. The concept could be based on, e.g. the use of criteria taken from eco-labelling schemes and purchasing guidelines.

Eco-labelling
The Danish EPA will work actively to disseminate eco-labelling. In order to speed up the introduction of eco-labelled Danish products, the Danish EPA will look into the possibilities of supporting company efforts on adapting products and preparing applications for eco-labelling.

The EDIP method
The Danish EPA proposes active promotion of the application of Environmental Design of Industrial Products (EDIP). EDIP is a tool for developing environmentally sound industrial products. It designed in close co-operation with a number of industrial companies. One way of doing this is to incorporate the method into a PC tool, ensuring the adaptation and further development of the method, developing databases and facilitating access to these databases.

Environmental management
The Danish EPA and other stakeholders should work - by influencing international forums and supporting a green procurement policy - to integrate life-cycle assessments and a green procurement policy on equal terms with the operational side of environmental management work. During the initial phase, this should take place in the public sector and in selected trades and industries. The Danish EPA will initiate discussions with the relevant stakeholders on this topic.

National resource centre
The Danish EPA proposes that further considerations are given to the need and possibility of establishing a resource centre dealing with the environmental properties of products.

Developing a stable market for environmentally sound products
A stable market for products with improved environmental properties may form the basis of increased development, production and marketing of these types of product on the market as a whole. This presupposes a better know-how available to purchasers and possibly a sizeable economic commitment for a period in order to create and support such a market.

Green taxes have been the object of in-depth analyses in other contexts. Such taxes are also a relevant instrument in this context. The use of taxes should be evaluated and compared to other instruments relating to the organisation of new efforts. Relevant stakeholders should participate in these considerations.

Public procurement
One of the intentions of a targeted, green public procurement policy is to create a stable market for products with improved environmental properties. A green public procurement policy is, however, still far from penetrating, which means that companies offering such products have had only a very limited degree of success with sales to the public sector.

One of the essential challenges for the product-orientated environmental initiative is thus to boost public demand for green products.

As part of the Danish Government's action plan for green public procurement, government agencies and companies were directed to draw up a green procurement policy and action plan in 1995. As this work is gradually being systematised and organised, there is a growing demand for information and other tools to enable public procurement to be made in a more environmentally sound manner.

In the autumn of 1996, it is estimated that 2/3 of the institutions have drawn up or are in the process of drawing up green procurement policies with accompanying action plans. Some public institutions have been active for several years, and companies such as Danish State Railways (DSB) and the Danish Armed Forces are good examples of pioneering companies. Also county and municipal authorities are increasingly organising environmentally sound procurement.

Active support for green procurement
In general, the Danish EPA will support the action plan for a green public procurement policy in the years to come by means of proposals for necessary initiatives.

The Danish EPA proposes that, as a starting point, public authorities should be obliged to invite tenders in a way that enables environmental considerations to be factored into the evaluation of bids. The EU Public Procurement Directives open up the possibilities of this.

The Danish EPA will continue to propose improvements in connection with the current revision of the EU Public Procurement Directives, thereby reinforcing possibilities of including environmental considerations in purchasing.

Moreover, co-operation with a number of large public purchasers must be intensified. These stakeholders may make requirements regarding, e.g., environmental management, environmental qualifications and choice of materials.

Purchasing guidelines
The Danish EPA will publish environmental guidelines for public purchasers for a number of product groups, some of which are also of relevance to private purchasers.

Goals for greening government procurement
1997 will see the start of a 2-year scheme registering public purchasing of less environmentally degrading products. If the registration provides the basis for doing so, the Danish EPA will propose that quantitative goals are set for government procurement of less environmentally degrading products within product groups selected.

Furthermore, the Danish EPA will consider the possibilities of providing support for specific activities in connection with green public procurement policy.

In practice, many counties and municipalities have a green procurement policy in one or more areas. Also in the years to come, the Danish EPA will continue its collaboration with counties and municipalities, including the National Association of Local Authorities and the Association of County Councils in Denmark.

Initiatives in three product areas
As a supplement to the various specific intersectorial initiatives, the Danish EPA proposes that pilot projects are initiated in selected product fields. These product-targeted efforts must be expected to yield a number of environmental improvements while the pilot projects will be of use in the more extensive work on the product-orientated environmental initiative.

Product area panel
As part of the specific pilot projects, the Danish EPA proposes that a panel is set up for each of the product areas. The stakeholders central to the particular product field should participate in this panel. An essential task for any product panel will be to draft action plans laying down commercial and environmental goals for the product field, describing the stakeholders' specific tasks, and proposing specific initiatives and instruments. The action plan should be in the nature of binding agreements between the stakeholders involved.

Three pilot areas
Initially, the Danish EPA proposes that efforts are instigated for three product areas which have already been analysed in such depth that a panel may be set up and an action plan drafted immediately. The three areas are:

These areas have been selected because they cause major, but different, environmental impacts, and function under very different commercial and market conditions. Together, they will reflect essential parts of the spectrum that may be included in an overall product initiative with regard to objectives, instruments and the involvement of different stakeholders. The areas have also been chosen because progress on environmental initiatives in general is advanced and/or because there are central stakeholders who are willing to spearhead a product initiative.

Analysis of the resource areas
In parallel with the above effort, the Danish EPA proposes that analyses are made within each of the resource areas of the Danish Ministry for Business and Industry, identifying some product areas in which the potential for an intensified product initiative can have great environmental and commercial impact. On this basis, efforts can be initiated in more areas than the above three areas.

Support to promotion of cleaner products
Four-part subsidy scheme
The Danish EPA is of the view that, for a period of time, economic support will be needed for a number of the initiatives proposed for intensifying the product initiative. This will mean e.g. subsidies for method development and knowledge building, for product development, for the launching of products with improved environmental properties and for the further development of waste treatment systems. Therefore, the Danish EPA will investigate the possibilities of having these activities covered by a subsidy scheme.

The organisation of a subsidy scheme targeted at cleaner products should be considered in connection with the expiry in 1997 of the existing action plans for cleaner technology and waste and recycling.

Environmental performance of small and medium-sized companies
There has been a great interest in appointing employees in smaller companies through the existing support programme for the environment and the working environment. The Danish EPA proposes to extend this opportunity so that companies can also applied for funding to appoint employees to work on the environmental impact of products - this applies to production companies, the wholesale and retail trade as well as to interest groups and NGOs occupying a central position in relation to the sale of products to the market.

Ban on the use of selected chemical substances
Use regulation
The Danish EPA will continue to assign high priority to regulating the use of substances known to have a hazardous effect on health or the environment. For substances with a known and major environmentally and health hazardous effect, the Danish EPA's aim is to prevent their general use - except where explicitly permitted. The main effort will be directed at influencing EU regulation in this field.

In addition, it will be attempted, to the largest extent possible, to direct efforts towards the chemical substances on the Danish EPA's list of undesirable substances while endeavouring to tie actions in with international work within this field and co-ordinating them with the use of other control instruments. In 1997, the Danish EPA expects to single out 20-40 of the substances on the list with a view to regulating their use.

Co-ordinating national initiatives
Co-operation with the other ministries
The Danish EPA proposes that discussions are initiated with relevant ministries on ways of supplementing intersectorial areas of action with better national co-ordination.

A large number of the control instruments being used today within the purview of the Ministry of Environment and Energy and other ministries affect more or less directly the development and use of products with improved environmental properties.

Even today there are many activities that make a positive contribution to the product initiative. An intensified product initiative should promote work on a more co-ordinated outcome of major public initiatives of importance to the environmental impact of products. Important ministries in this context are the Ministry of Labour, the Ministry of Housing and Building, the Ministry of Business and Industry, the Ministry of Research, the Ministry of Agriculture and Fisheries, the Ministry of Transport and the Ministry of Education.

International efforts
Efforts directed towards EU and standardisation work
A number of stakeholders should actively try to influence the international bodies to support the product initiatives taken. This is with special reference to the European Commission, which has shown great interest in the Danish initiatives in this field. Also within the framework of the Nordic Council of Ministers, product efforts will be intensified, the future Norwegian presidency having designated this a main area of action. Furthermore, efforts should be concentrated on influencing the international standardisation bodies with a view to ensuring the integration of environmental considerations in future product standards.

2 The environmental policy challenge of a global market with global growth

2.1 Introduction

Far from sustainable development
Both in Denmark and in other industrialised countries, existing environmental initiatives have been incapable of solving a number of central environmental problems. This has been described in the Danish Government's 1995 Nature and Environment Policy Report /1/, which ascertains that although considerable results have been accomplished within most sectors, we are still a long way off sustainable development in a number of essential areas. This should be seen particularly in the light of the fact that a pronounced increase is expected, globally, in both the population and the standard of living.

Bearing this in mind, we need to ask what characterises the national and global environmental problems facing us today. How can the current environmental initiative be intensified so as better to solve these problems? What framework and conditions are needed for a consolidated effort? What is the choice of specific initiatives to be initiated if we want to intensify the environmental efforts?

Combining a high standard of living, strong competitiveness and a better environment
In this proposal, the Danish Environmental Protection Agency (EPA) attempts to help answer these questions. The basic assumption is that it is feasible - a high standard of living and strong competitiveness can be combined with environmental efforts with a far greater capability for meeting the challenges facing us today.

2.2 National and global environmental problems

Resource consumption and products rather than point sources
Over the past 25 years, Danish efforts in the environmental field have brought the discharges from industry, power stations and wastewater treatment plants - the so-called point sources - largely under control. Indeed, both the Nature and Environment Policy Report and other analyses in the field have concluded that the present problems are not so much associated with point sources but are, to a far greater degree, linked with society's general resource consumption and the use of products in all functions of society.

Serious environmental problems
We see local problems like pesticides in the groundwater, environmentally hazardous substances in sewage sludge and oxygen depletion in our local waters. We see regional or global problems like the depleted ozone layer over the northern hemisphere, the spread of non-degradable substances hazardous to health and the environment, desertification and eradication of the rain forest. We are witnessing a series of new problems the full scope and consequences of which we do not yet know - e.g. the oestrogen-like substances, the greenhouse effect and the rapid reduction in biological diversity.

Four central factors
Although the scope and nature of environmental problems vary globally, all of the most severe environmental damage can be traced back to one or more of these four factors:

Spread of substances hazardous to health and the environment
Not only are a number of environmentally and health hazardous substances used in production processes but a large number of these substances are also spread through our use of products. There is widespread use of xenobiotics in production and products, and our knowledge of their impact on the environment and health is often limited. Our knowledge is especially limited when it comes to the longer-term implications of their spread for our health and the environment.

Increasing use of fossil fuels
The increasing use of fossil fuels is depleting the resources of the earth and generating emissions of greenhouse and acidic gases, contributing substantially to the greenhouse effect and the acidification of water and soil.

Overexploitation of biological resources
The current exploitation of biological resources is so extensive that we are experiencing undesirable effects on our ecological systems - particularly in the form of a severe reduction in biodiversity and genetic stock. Some of the ancillary agents used for exploiting resources, especially for the production of foodstuffs and other industrial raw materials, also cause problems when spread to the environment.

Consumption of non-renewable mineral resources
Finally, the growing consumption of mineral resources, which cannot be renewed, affects both the environment and resources. So far, mineral resource deposits have generally been abundant but an increasing number of problems must be anticipated in ever more areas.

The problems described are all characterised by being very difficult to survey and, on the face of it, difficult to do anything about. They already present a number of serious perspectives as the situation appears today, but are further intensified by the growth in the population of world.

Global growth needed
Assuming there is no change in the standard of living, any increase in the global population will generate greater pressure on the environment and an increasing drain on resources. If indeed population growth is to be slowed down, the UN /2/ presupposes some growth in perceived wealth. According to UN population development experts, the only way to slow down population growth is to substantially raise the standard of living in countries with a low standard of living and high population growth. In a mean growth forecast, it is estimated that by 2030 the population will have stabilised at about 10 billion people enjoying a standard of living that is two to four times higher than today. Given these conditions, the global gross national product (GNP) may thus be expected to be four to eight times greater than today.

Growth on its way
The growth in the standard of living is on its way in many of the populous developing countries. Countries like China, Indonesia, a.o., are experiencing annual growth of 10-15% in their GNP. So, the essential question is not whether we want growth or not, but how we are going to meet the challenge posed by global growth.

Increased growth cause greater impact on the environment
Increased wealth will lead to a corresponding growth in the consumption of products and services with a resultant consumption of resources and an overall impact on the environment unless drastic action is taken to prevent such a development. The environmental perspective must be taken very seriously and, at first sight, must be considered rather difficult to handle - at least on the basis of the existing environmental initiatives in the industrialised world.

2.3 The environmental challenge

In its Nature and Environment Policy Report, the Danish Government declared that our long-term environmental policy must ensure that human activities do not have a negative impact on the cycle in Nature and that society only uses resources to an extent that leaves a sufficient quantity available to meet the needs of the global population and future generations. Denmark thus needs to work towards a balance, in which its population on average does not consume more natural and other resources than those available and does not create more pollution than the eco-cycles can handle.

The environmental space
The concept of the environmental space can be used for illustrating these points. In principle, the environmental space for any kind of impact on the environment can be computed as a total permissible quantity of consumption or pollution per person per year. The environmental space is related to natural environmental frameworks, not to specific social activities.

More products within the environmental space
There is thus every possibility that more products can be manufactured and more needs fulfilled within the framework of the environmental space. This must be done by adopting the continued development of cleaner, less resource-consuming and contaminating products. It must be done by increased recycling. It must be done by substituting particularly environmentally or health hazardous substances. It must be done by using products with longer life.

The Nature and Environment Policy Report demonstrates the current need to change consumption and production patterns if the environmental space is to be ensured. With the present level of technology and the above-mentioned expectations of population growth and the standard of living, resource consumption and pollution must be reduced by a factor of 4-8 in order to prevent the environmental impact exceeding its present level. In fields where the environmental impact is already too great, reduction must be even greater.

Problems from diffuse sources and the size of consumption
These problems can only be solved by efforts targeted at achieving a truly effective reduction in the environmental impact from production, use and disposal of all products used in society. Our current environmental problems are largely characterised partly by stemming from diffuse sources and partly being directly proportional to the size of consumption.

Possibly harmless on the face of it
A specific product may seem harmless enough on the face of it, seen in relation to the state of the environment in a larger perspective. Yet, however harmless it may look, an individual product may contain, e.g., one or more substances that can be damaging to the environment.

Environmental damage may occur if the product is used wrongly, falls to pieces, is not correctly disposed of or is used in such large quantities that vast amounts of hazardous substances are spread with it.

A global market
The environmental effects of products are closely linked to the global market, in which raw materials, products and services are constantly being traded in more or less open economies. The framework for special environmental efforts aimed at products is thus essentially different to the framework within which existing environmental initiatives have been developed.

Products
The product-orientated approach is based on the premise that the overall environmental impact can only be understood - and efforts properly prioritised - by considering products throughout their entire life-cycle from cradle to grave. The existing product-orientated initiative have mainly involved development of tools for analysing and evaluating the environmental impact of products and developing instruments to promote sales of less environmentally degrading products. In addition, efforts have embraced special initiatives that have proved capable of enhancing the environmental properties of selected products. Efforts have also been directed at individual, selected parts of product life-cycles with a view to solving specific environmental problems. Among other things, work has been done on developing less polluting production and on attempting to remove particularly hazardous substances from the products.

Product-orientated environmental initiative
The intensified product initiative is not intended to replace the existing environmental initiatives but rather to supplement them in fields in which such efforts have not been sufficient to solve the problems and in which the product approach may be expected to have more clout.

The environmental challenge
This proposal for intensifying product-orientated environmental initiatives is based on a reduction of the environmental impact caused by our present standard of living and current consumption. Hence, the proposal does not concern questions on reducing the standard of living and the overall size of products consumed - but it is indeed no obstacle to any such reduction, of course. Under any circumstances, there is a need for products that are less resource consuming and have considerably improved environmental properties than those already on the market. The proposal is also based on the existing objectives for the development of the environmental impact.

The environmental challenge
The environmental challenge is to help ensure that national and global affluence develop in such a way that resource consumption and the environmental impact from the production, use and disposal of products are reduced to a sustainable level.

2.4 Basic prerequisites for a product-orientated initiative

Openings for Danish trade and industry
For the Danish business community, the global environmental trend affords a series of opportunities and openings. Increased global prosperity will generate a constantly increasing demand for goods and services, and product development will come under constantly increasing pressure to create products with considerably improved environmental properties.

Greater environmental problems create a greater demand for environmentally sound products
This trend will develop as the gravity of the environmental problems becomes more obvious and more visible everywhere. Today, it is, however, not possible to predict very precisely how trends will evolve for any particular markets - geographically, technologically or product-wise. For individual companies, one very important aspect of this trend will be the ability to keep globally informed and to supply the right product on the right market at the right time.

Among other things, a demand can be expected to arise for products not containing or produced with the aid of environmentally or health hazardous substances, products that are entirely recyclable or products with lower energy consumption.

Other countries are intensifying their product-orientated environmental initiatives
In countries like Germany, Sweden and the Netherlands, work has been going on for some time now to intensify product-orientated environmental initiatives. Both these and a number of other western countries are seeing mounting interest in products with improved environmental properties. Danish companies have good opportunities for "getting a slice of the action" in an international market for products with improved environmental properties but this trend will not evolve of its own accord.

Danish companies do have the potential, though individually only very few have adequate resources and environmental know-how to see through such initiatives alone. Developmental initiatives are therefore needed in close co-operation between the authorities, the companies and their organisations.

Development not only gives Danish companies opportunities; it is actually crucial that Denmark remains an effective stakeholder on the international market, with plenty of sound and competitive companies if the product-orientated environmental initiative is to be consolidated.

The commercial prerequisite
The commercial prerequisite for a product-orientated environmental initiative is that such action should be instrumental in restructuring both the national and the international market to the production and sale of products with improved environmental properties while retaining or improving the international competitiveness of Danish trade and industry.

Change to a sustainable production and consumption pattern also depends on the understanding and active involvement of all groups of society. Consumers must, for instance, choose less environmentally degrading goods or other solutions to their requirements, companies must develop and market products with environmentally improved properties and dealers must include these products in their range. These efforts are only possible if they are not conflicting with the interests of the individual stakeholder. To this can be added that interaction must be created between rich and poor countries so as to support the potential of the poor countries for producing cleaner products.

All stakeholders must be involved
It is thus a prerequisite for a product-orientated environmental initiative that the effort, both nationally and globally, enables the stakeholder to lend their support and involvement to ensuring the production and use of less environmentally degrading products - while at the same time protecting their own interests.

3 Product-orientated environmental initiative - the process and goals

3.1 Introduction

Chapter structure
This chapter describes the Danish EPA's proposal for a process to sharpen the focus on the product-orientated approach to environmental problems - including possible short-term expectations from intensified product initiatives.

This proposal is basically structured along the same lines as the proposal for the continuing process. This correlation is also described below.

Overall objectives
The proposal for intensifying the product-orientated environmental initiative takes as its starting point the challenges outlined in the preceding chapter, as well as a series of proposals for overall objectives. The overall objective proposals are described at the end of the chapter.

3.2 Product initiatives as a process and a dialogue

The idea is to supplement the source, medium and chemical-orientated approaches to environmental efforts with a fourth and more general product approach. This suggestion for intensifying product efforts is a proposal for an incipient all-round initiative.

Setting the process in motion
The concrete initiatives, which will be suggested, are far from being sufficient to achieve the overall environmental goals. First and foremost, the ambition is to set in motion a process capable of inciting stakeholders to start changing their course.

The results of such efforts will depend on changes in many areas involving many stakeholders. It must therefore be expected to take years before the results manifest themselves in the form of established markets for less environmentally degrading products.

On the basis of i.a. the experience gained from the introduction of organic foods, it is judged that the proposed efforts will contribute to establishing new markets for less environmentally degrading products within a number of product groups within a period of approximately five years.

First results within a couple of years
The first results of the initiative, however, are expected to be recordable within just a couple of years, behavioural modifications becoming visible among a number of essential stakeholders in the form of increased production, supply and marketing of a number of less environmentally degrading products. This will reduce the environmental impact and resource consumption but any change to the state of the environment will not likely be recordable.

Proposal for a dialogue
The product initiative is a process based on acknowledging the usefulness and necessity of very actively involving the stakeholders concerned in developing the initiative. Both goals and analyses as well as proposals for specific initiatives should be discussed and adapted in the ongoing work. The dialogue and process involved in developing more environmentally sound products are not just means of achieving the product-orientated environmental initiative - to a great extent, the dialogue is the product-orientated environmental initiative.

The proposed process is cyclical, passing through the same phases at regular intervals and starting each new phase from the results currently achieved.

A repetitive process in five phases
As suggested in the drawing below, the product-orientated environmental initiative is operated in five phases: outlining of goals, analysis of framework and conditions, concrete proposals for initiatives, implementation and evaluation.

Circle illustrating the various phases of the product initiative (5Kb)

Figure 3.1
The various phases of the product initiative

Phase 1
1. Outlining of goals. First, both environmental and other goals should be laid down for the product initiative.

In Section 3.3, a series of overall goals are proposed.

Phase 2
2. Analysis of framework and conditions. A product-orientated environmental initiative must, of necessity, be based on the complex interaction between products, stakeholders and market. It is therefore central to analyse the framework and conditions for the product initiative on the specific basis of the products, the market and the stakeholders. These three points of view are evaluated together in order to cover an essential part of the general conditions for the initiative.

Chapter 4 analyses the conditions and framework for products. The product perspective is intended to shed light on the products at which the product initiative is targeted. What environmental properties and other aspects of the individual product should be improved? What are the possibilities of enhancing the environmental properties of the products?.

Triangle illustrating the product initiative conditions (6Kb)

Figure 3.2
The triangle of conditions

Chapter 5 analyses the conditions and framework for the market. The market perspective is intended to shed light on the conditions governing the production and marketing of less environmentally degrading products on the national and international market. What are the possibilities of influencing those conditions, taking into account the competitive situation of the Danish companies, and the agreements that Denmark has entered into?

Chapter 6 analyses the conditions and framework for the stakeholders. The stakeholder perspective is intended to illustrate which stakeholders are mainly influencing the development and marketing of less environmentally degrading products? What are the conditions on which they are willing and able to use that influence to reduce the overall environmental impact from products? What are the possibilities of improving these conditions?

Phase 3
3. Proposal for specific initiatives. Taking this analysis as a basis, some of the areas will be singled out in which intensified or new efforts may help to realise the goals laid down.

Some of the proposals for specific product initiatives are cross-cutting initiatives that broadly may be capable of achieving the conditions for products with improved environmental properties; others are for initiatives aimed at specific product areas that can bring about concrete results and experience in delimited areas. The proposal contains suggestions for both the content and the organisation of such initiatives as well as both existing and new initiatives.

Chapter 7 examines a series of proposals for specific initiatives which may intensify the product initiative.

Phase 4
4. Implementation of initiatives. Many of the initiatives will directly involve one or more stakeholders.

Phase 5
5. Evaluation and adaptation. The product initiative should be an ongoing process as it is being implemented in a society that is developing rapidly, and in some areas dramatically. The process should therefore be repeated at regular intervals. An evaluation must be made of current efforts and a review made of the process that leads to the adaptation of on-going initiatives as well as the initiation of new initiatives.

The basis of the product initiative proposal

Material on which the analysis has been based
The Danish EPA's proposal for an intensified product initiative is based on contributions from round-table discussions with a number of important stakeholders, discussions with environmental authorities in the Netherlands, Germany, Sweden and the European Commission, and the existing experience with product-orientated efforts in Denmark. In addition, the Danish Ministry for Business and Industry's work in the resource area and the Danish Government's 1995 report, Denmark's Nature and Environment Policy, have been taken as a basis.

The round-table discussions conducted were attended by representatives of the Confederation of Danish Industries and parties representing consumers and the retail trade, the financial sector, employees and the green organisations, as well as municipalities, counties and a number of sectorial ministries.

3.3 Overall goals for product initiative

Environmental, commercial and process goals
It is proposed that environmental goals as well as commercial and process goals are laid down. Therefore, a characteristic feature of the product initiative proposal is that it is based on various interdependent goals for the environment, industry and the stakeholders.

Despite being an environmental initiative, commercial and industrial goals are crucial as the assumption is that more environmentally sound products will only be developed and sold if the policy fits in with economic interests of companies and the interests of the other stakeholders - if not on the short view, at any rate perhaps on the slightly longer view.

The overall goals are examined in Table 3.1 below.

Table 3.1
Overall goals

4 The products

4.1 Introduction

Based on the environmental properties of products, an analysis is presented below of framework and conditions for the development and marketing of, and the demand for, less environmentally degrading products.

The consumption of products in Denmark has grown enormously during the past 20-30 years, and with it also the quantity of resources, chemical substances and other items used in the production and use of products.

Conclusions about the products
The analysis of the products resulted i.a. in the below list of conclusions:

Background to the analysis
The analysis in this chapter is based on experience gained in the environmental administrations, at companies and in the research and consultancy area over the past 5-10 years, during which the environmental properties of the products have been investigated.

Chapter structure
First, the chapter contains a description of the products covered by the initiative. The implications of the environmental impact of a product are then reviewed from a life-cycle perspective, together with ways of evaluating this impact. A number of examples illustrate how know-how on the environmental properties of products should be generated and used by the relevant stakeholders, as well as they illustrate the environmental improvements that product initiatives may entail. Finally, some deliberations are presented on the competitive features of environmentally improved products.

4.2 Products covered by the product initiative

Focus on all products
As a basic principle, the product-orientated environmental initiative should be targeted at all products manufactured and consumed in Denmark. In an open economy with extensive imports and exports of goods and services, this means that the spotlight must be on products made in Denmark, of which some are exported, as well as on products that are imported and used in Denmark.

Basically, the product initiative is targeted at physical products causing major environmental impact from a life-cycle perspective. Services are also included if they entail major consumption of physical products of importance to the environment. Cleaning and transport, for instance, are services relevant to the product initiative while marriage counselling is not. Given their turnover volume and environmental impact, foods are also essential to the product initiative while works of art will only be so as an exception.

Furthermore, the products include both products used by the end user, the so-called end products, and semimanufactures used in their production.

A huge number of products
The number of products on the Danish market is vast. Foreign affairs statistics record trade in approx. 15,000 different product groups. Each of these comprises a great many different articles. To these must be added the services. This diversity of products is emphasised by the fact that the product initiative is directed not only at products existing on the market today, but, in particular, at the products that will be developed and marketed in future years.

Short product life
The commercial life of new products has become increasingly shorter in recent years, and one generation of products is superseding the next at an ever increasing rate. This is positive in the sense that they enable new, less environmentally degrading products to penetrate the market more quickly but it increases the complexity of the product field at which any product initiative should be aimed.

Amid this multiplicity of products, initiatives must, as mentioned, be directed at those product groups causing the heaviest impact on the environment, and where such initiatives have a reasonable chance of bearing fruit. The possible success of such initiatives depends, i.a., on the market on which the products are traded, and on the stakeholders and instruments that can be activated in order to change the environmental impact of the products.

4.3 Environmental properties of products in a life-cycle perspective

The influence of the products on the environment depends on the environmental properties of the individual product and on the size of consumption. Environmental properties are comprised by the overall environmental impact associated with the entire life-cycle of the product (see Box 4.1). These properties can be mapped by use of a so-called life-cycle assessment (LCA).

The life-cycle perspective
There can be great differences in the significance of the various stages of the life-cycle of a product for the overall environmental impact of that product. Therefore, in the life-cycle perspective, it is different stakeholders that can make special efforts to improve the various environmental properties of the product.

For many products, it will be the choice of design in particular that determines a number of the environmental properties of the product - this applies, for example, to raw materials, production processes, function mechanisms, consumption during the utilisation phase and the scope for separating or stripping the products after use. In his or her choice of consumption and the subsequent use and disposal of the product, the consumer also has a decisive influence on the overall impact during the product life-cycle.

Need for extensive insight
As appears from the box, the environmental properties of a product are a highly complex parameter. Precise determination of the environmental properties of a product requires extensive insight - both all-round specialist insight and a knowledge of the life-cycle conditions of the specific product. Parts of this knowledge will normally be spread over different stakeholders involved in the product life-cycle. One of the challenges facing product-orientated environmental initiatives is to make that knowledge available in all relevant contexts.

Box 4.1
Environmental properties in a life-cycle perspective

Lack of life-cycle assessment data
In many cases, the source data for LCAs are generally characterised by substantial uncertainties and deficiencies. This is especially true of information about the effects that can be caused by the use and spread of chemical substances. It is equally true of information on the environmental impact of the many different processes, raw materials and materials used in the manufacture, use and disposal of products. There are also problems in operationalising an important area of action such as the preservation of biodiversity. The inventory of environmental properties of products is one of the initial elements of LCAs, which are treated in the next section.

4.4 Evaluating environmental properties of products

The vast majority of products can cause several different environmental problems. For this reason, it is rarely possible to immediately identify the - in overall terms - most important areas of action. That applies whether one is a manufacturer, dealer, authority, or a professional or private consumer. In addition to these data, there is thus a need for usable methods of comparison as well.

Methods for both professionals and others
Professionals must have both methods and tools as those described below, and tools need to be developed that can help make life-cycle considerations possible on the basis of the information available. This is exemplified at the end of this section.

Environmental assessment of products from cradle to grave started on a small scale, 25-30 years ago. Since the early 1990s, there has been an increasing focus on developing the methodological foundation in the field. The Society of Environmental Toxicology and Chemistry (SETAC) has been very active in this field throughout this period but still needs to operationalise its underlying methods for a number of the stages in their code of practice for LCAs.

ISO standard for LCAs
Since 1993, the International Organization for Standardization (ISO) has been developing standards for methods in this field. Before long, an ISO framework standard for LCA will probably be adopted, stipulating what an LCA must include in general terms (ISO 14040). Under this framework standard, three more detailed standards will be established for the ongoing parts of an LCA. Here, the inventory is equivalent to a life-cycle assessments, and the environmental assessment includes a number of activities enabling the different potential environmental properties of products to be balanced against each other following a fixed pattern.

The framework standard paves the way for the possibility of omitting the environmental assessment, so that the interpretation of LCA results is based solely on a separate inventory of the various contributions such as material consumption, energy consumption, emissions and waste.

The elaboration of ISO 14041 is currently being finalised and work on ISO 14043 is well under way. The drafting work on the impact assessment standard (ISO 14042) includes two difficult stages with regard to the last part of the impact assessment, on which no clarification has yet been obtained. One is the question of "normalisation" - i.e. whether, and if so how, estimated contributions to environmental effects and resource consumption should be related to overall impact and consumption. The other is the question of "weighting" - i.e. how the contributions to each of the effects and consumptions of individual resources are weighted relative to one another.

The outcome will probably be that the impact assessment standard leaves the user with a number of choices by providing instructions on different possible approaches to these steps.

ISO eco-labelling standard
ISO is also in the process of developing eco-labelling standards (the 14020 series). This will include a framework standard for eco-labelling and three underlying standards.

Discussions of standards
In connection with the standards for LCAs, discussions particularly revolve around the question of whether or not to include the total life-cycle of products and the question of how to evaluate the estimated effects in relation to one another. At the same time, this is of great importance to the potential of the standards. With regard to the eco-labelling standards, there are discussions as to who should be represented and what degree of consensus should be achieved in the laying-down of criteria.

EDIP - a Danish environmental assessment method
A current Danish example of an environmental assessment method for products has been developed in connection with the large EDIP [1] project, reported on in the spring of 1996 /3/. In general, the EDIP method is more detailed and has, in advance, made and justified more choices than are being proposed in the standards described above.

The EDIP method stipulates that environmental properties and resource consumption must be normalised so that they can be expressed in percentages of the annual impact from an average person - either in Denmark, if a local or regional effect is considered, or world-wide, if the effect is global.

The following weighting of the various environmental problems is based on Danish - politically adopted - objectives for reducing various kinds of environmental impact. In the case of non-renewable resources, the weighting is based on the known supply horizon.

The EDIP method forms part of an package tool which also includes guidelines on environmentally sound design, a database and a PC program that will be available in 1997. The package tool ensures that environmental considerations are included in the design of products. The tool has been developed in relation to - and has so far been applied to - five different products within the field of electromechanics. But the method and the database may also be used for environmental assessments of products in other contexts and for other purposes.

Knowledge of the environmental properties of products is relevant to all stakeholders involved throughout the product life-cycle. If this knowledge is not generated and disseminated, there is no basis on which to act. This topic is examined below. Here, it will be sufficient merely to present a number of examples of cases in which evaluations of the environmental properties of products are relevant to different stakeholders and examples of the knowledge that we in Denmark have in the field today.

In not nearly all cases, the use of such a relatively complicated environmental assessment method such as the EDIP method will be a feasible prospect though it will usually be possible to base the product evaluations on the same principles or on parts of the method.

Knowledge of products' environmental properties

Box 4.2
Generating and applying knowledge on the environmental properties of products

Main products from an energy and resource angle
On the basis of energy consumption and resource losses, an examination of industrial products in Denmark allocates top priority to products within the sectors of transport, agriculture and food, construction and textiles when the products are considered throughout their entire life cycle /4/. What now needs to be investigated is whether the priority-setting method employed can be expanded to include the content of the products of environmentally or health hazardous chemical substances.

The environmental impact of the family in a life-cycle perspective
Similarly, a survey of the environmental impact of a family's activities points out meals, transportation and residential heating as the most environmentally significant activities /5/. Each activity includes several product groups and resource consumption.

Public consumption
Public-sector consumption of products has been surveyed in various reports /6/. The purpose has been designate to product groups in which public procurement constitutes a substantial part of the market.

4.5 The potential of environmental improvements of products

No sense in specific goals
There are enormous variations in the dimensions of the relative or absolute environmental improvement that has been achieved through the current environmentally improved products familiar to us. Nor is there any sense in trying to draw up a specific goal for environmental improvements of products on the Danish market. The products vary far too much for that, and our knowledge of both the technical and the economic conditions needed to reduce the environmental impact of the products is much too insufficient.

Reductions in energy and resource consumption and in emissions of xenobiotics can be achieved by economising and using known or adapted technologies. Extra insulation on refrigerators or electronic control of the energy or water consumed by products are examples of this.

Technological leaps often needed
More radical changes in energy and resource consumption will often require actual leaps in technology, solving a task or fulfilling a need in an entirely new way. The use of information technology, semiconductor technology or enzymes in new contexts exemplifies this.

When the consumption of environmentally or health hazardous substances is concerned, there is no immediately visible limit to the improvements that are possible. Even today, many substances may be replaced by other environmentally acceptable substances or functions. Nor is there any reason to believe that such possibilities will be exhausted for the time being.

Tools cannot suggest alternatives
There are only a few tools today that can help the designer by indicating alternative solutions that are better for the environment. The EDIP method can compare solutions but cannot suggest alternatives. The Rentek database /7/ and the Danish EPA's reference lists for cleaner technology are examples of aids for identifying cleaner technology alternatives in the manufacturing phase. SUBTEC /8/ is a database tool for hazard assessment of products and for solvent substitution. Generally, though, there can be said to be a great need for developing design aids capable of actively suggesting alternative less environmentally degrading solutions.

4.6 Environmental properties are not absolutely all

Products are used for fulfilling a function or a particular need. Any initiative geared towards a product or product group must be based on the precondition that the need to be fulfilled can be fulfilled in a way that is environmentally and socially more ideal.

There will be different understandings of the function of a product or the alternative ways in which a need can be satisfied. As a rule, the manufacturer of a product will look at changes within his product field while a private consumer has far more wide-sweeping possibilities of choosing between basically different ways of fulfilling, e.g., an entertainment function.

Function and quality must be preserved when improving environmental properties
An environmentally improved fulfilment of a given need presupposes that the need is still fulfilled satisfactorily while reducing the environmental impact.

This is also a logical prerequisite if products are to be able to compete on a market on which products are bought primarily to fulfil a need, and, only secondarily, other factors such as environmental and working environment properties will be examined.

It is important, then, for product initiatives to contribute to the development of a practice in which all relevant stakeholders in all relevant decision-making situations simultaneously take into account:

Background to the analysis
Stakeholder analysis and descriptions are based on the round-table discussions conducted, the references listed, and other contacts and experience available when drawing up the proposal for a product-orientated environmental initiative.

Chapter structure
This chapter starts with a discussion of some general prerequisites for expecting stakeholders to be willing and able to contribute to product initiatives. It then describes the stakeholders in whom it is particularly essential to take an interest as well as their conditions and possibilities for contributing to product initiatives.

6.2 Prerequisites for product initiative contributions

Today, a great deal of the stakeholders regard environmental efforts as an important social task. The authorities cannot merely view them as passive or reluctant stakeholders that have to be supervised and controlled. They are a medley with independent knowledge and interest in the field of trade and industry and the environment.

Stakeholders' knowledge, resources and interests are fundamental
This does not mean that the other stakeholders always have the same interests or the same knowledge as the authorities. However, it does mean that the authorities' efforts can and must be organised on the basis of an understanding of the stakeholders' knowledge, resources and interests. The authorities must try to stimulate the other stakeholders - by pushing and pulling - in order to get them moving in the necessary direction. Interaction is both collaboration and counteraction.

Powerful interests
Reconverting production and consumption to products with radically improved environmental properties will influence the basic conditions of existence of trade and industry as it will entail changes to basic consumption patterns and choices. And that involves, of course, very powerful interests. The product initiative is based on the precondition that environmental behaviour must be changed. The challenge is to develop the necessary and adequate means with which to achieve that aim. These means must be used in collaboration with the stakeholders in order to achieve the greatest positive effect possible - both environmentally and commercially.

Motivation

Positive motivation
Positive motivation can spring from environmental initiatives being viewed as correct in their own right or can serve other interests to which a value is attached. It can be the belief that it makes it easier to recruit qualified employees or that the market wants and is willing to pay a higher price for more environmentally sound products. An instance of negative motivation is the wish to avoid being penalised.

Disincentives
It works as a disincentive if environmental efforts are considered unethical - e.g. in connection with violent actions - or if it clashes with interests to which the stakeholder attaches value. This may be, e.g., the expectation that the market will not pay the extra cost of the environmentally sound product. It may be the perception that there is cheating going on whereby others are achieving gains in the environmental field to which they are not entitled by their conduct. Or it may be an awareness that the stakeholder is having a harder time meeting environmental requirements than competitors because the environment as a parameter is not the stakeholder’s particular forte.

Positive attitudes - negative in terms of economy and competition
The manifestations during round-table discussions show that many of the stakeholders are positively motivated as regards attitude but the majority of stakeholders experienced mainly negative motivation in terms of economic and competition-related dimensions. This is understandable in light of the limited demand for products with improved environmental properties - cf. Chapter 5 on the market. If the initiative is to have any proper clout, a successful change in the motivation picture is a prerequisite. This calls for a change in the negative conditions and expectations from demand, costs and distortion of competition.

The pioneers and the sceptics
On the part of some manufacturers, trading companies and consumers, the current product-orientated environmental initiative is largely characterised by being propelled by "fiery souls", motivated by a mixture of their attitude towards and their faith in the long-term sense and necessity of such efforts.

It is essential that the product initiative is targeted at the many and varying degrees of sceptics in the various stakeholder groups and, at the same time, is able to support and co-operate with the pioneers.

Resources
The stakeholder's possibilities of contributing to the product-orientated environmental initiative depend on the internal resources available, and on the options open to the stakeholder for drawing on the resources of the world around him.

Internal resources
Internal resources include know-how, manpower and capital.

Know-how
The stakeholder needs know-how on environmental conditions in general and of the environmental problems which it is most important to influence - including a knowledge of the possibilities open to the stakeholder for doing something about these problems. For the consumer it will include e.g. a knowledge of the environmental impact of the goods and knowing which available goods to choose between while, for the product developer, it will include the entire gamut of knowledge needed for developing new products and for assessing the environmental consequences of the different choices during the design process.

Qualified labour and capital
Access to qualified labour and capital is a prerequisite if the stakeholder is to have the resources to carry out projects able to bring about a change in environmental impact. If, for example, a retailer is going to markedly increase the environmental information available to his customer, this will require that the organisation establishes a system capable of procuring this knowledge. It also presupposes that employees should be trained to disseminate that knowledge to the customers.

External resources
The external resources of importance to environmental initiatives include general framework conditions, access to labour and financing, and demand and infrastructure, as described in Chapter 5 on the market. In particular, they also include access to filling in gaps in the stakeholder's internal know-how from external sources - e.g. from the authorities or other stakeholders.

Scope

Dependence on others
Decisions made by the stakeholders with regard to product development or marketing take into account stakeholders' interaction with other stakeholders. A company responsible for an end product does not always have e.g. the power to implement all that it might like to in its dealings with raw material suppliers and subcontractors. If the stakeholder has to use e.g. a paint finish, for example, the market is dominated by a very small number of multinational suppliers. A medium-size Danish company is completely dependent on availability of finishing materials on the market. In a number of cases, the same goes for processing machinery, which may be altogether vital in making environmental improvements to production processes.

Different scope
The scope available to decision-makers is very different from one product group to another, and from one resource area to another. Within certain resource areas, the retail trade plays a dominant role in relation to the manufacturers while other resource areas are dominated by large international raw materials suppliers and subcontractors who constrict the options of the final manufacturer.

Targeted efforts
Product initiatives need to be targeted at specific resource or product areas. Within these individual areas, the central decision-makers must be identified so that the conditions and frameworks governing their decision-making can be changed.

The following review of the stakeholder groups examines the stakeholders' general features and the conclusions that can be drawn on this basis for any product initiative. Aspects specific to product areas are touched upon in the description of initiatives in selected product areas.

6.3 Which stakeholders are central to the product initiative?

A stakeholder's importance for a product initiative is determined by his ability to contribute to the development, production and sale of more environmentally sound products. The environmental properties of a product are a function of the actions and decisions taken by various stakeholders during different parts of the life-cycle of the product group and that of the individual products.

Properties determined in the development phase
During the development phase, the properties of each individual product are determined together with the principles for its manufacture, use and disposal. The development phase is thus crucial to the overall life-cycle impact. However, the individual developer is normally limited by the specialities and routines of his particular company. The willingness and ability of an individual company to innovate will often depend on its internal resources as well as on external conditions.

Good opportunities during the production phase
During the production phase, the manufacturer has the chance to influence the amount of environmental impact due to production - assuming environmental impact is not an invariable consequence of the properties of the products. For services, in particular, the very production process is entirely crucial to their environmental impact.

Marketing and distribution
A number of factors causing environmental impact can be traced directly to distribution in the form of pollution from e.g. packaging and transportation. In addition, the marketing and distribution determine which products are accessible to the other stakeholders and what information is available together with the products.

Customers, users and waste handlers
The number of customers choosing to purchase a given product determines the total use of that product - and hence, to some extent, also the total environmental impact of the product. Its use affects the environmental impact just as the way in which the user chooses to dispose of the product is important. With regard to disposal, the technologies used by the waste handlers will be of special importance.

Central stakeholders
The developers, manufacturers, distributors, customers, users and waste handlers are thus stakeholder groups whose choices and activities are of special importance to the environmental impact.

In this context, the manufacturer is not just the maker of the end product but also those manufacturers producing energy, raw materials, semimanufactures and ancillary agents used in the making of the end product. The distributors are the traders and carriers conveying the flow of products between the other stakeholders. The customers and the consumers are everyone - public and private customers alike - who purchases and uses the end products. The waste treaters handle the products after use. These stakeholders are both Danish and international.

Stakeholders who establish general frameworks
In addition, there are stakeholders who are instrumental in establishing various essential frameworks for the activities of the central stakeholders, including such conditions as financing, manpower, know-how and regulations:

Organisational stakeholders
The various stakeholder groups have built up organisations that act as spokesmen for these groups. There are great differences in the functioning of these organisations. As the organisations usually collaborate on environmental initiatives, it is essential to examine which organisations mediate the interests of the stakeholders. The organisation of civic interests, in particular, is complex as citizens organise themselves in different ways as consumers, employees and pro-environmentalists, on the basis of leisure activities, political interests, etc.

International stakeholders
Moreover, on the international negotiating stage, there are a number of stakeholders of significance to product initiatives. This applies to the large multinational companies, the different nation states and some of the international organisations that are mandated and resourced to represent independent viewpoints during the negotiations.

Joint understanding
Product initiatives must be based on an understanding of the individual stakeholders' conditions, resources and interests. Such an understanding is not static but must be built and developed in collaboration between the stakeholders as the product initiative evolves.

The three main stakeholders
The three main stakeholders in the product initiative are described below - the consumers, the goods manufacturers and the trade sector. Finally, a summary is given of the main consequences to the product initiative of the descriptions of the other stakeholders (see Appendix 1).

The descriptions are brief accounts of stakeholders based on aspects regarded as being essential to the product initiative. These descriptions are intended to constitute the discussion paper for the discussions with stakeholders on which the concretisation of this proposal will be based.

6.4 The consumers

Private consumption important to the environment
In 1994, Danish consumers' demand for goods totalled approx. DKK 500bn - corresponding to more than half the total demand in Denmark. In particular, the money was spent in the retail trade - where foodstuffs make up the largest single item - on the home, on transportation and on communications. Private consumption, calculated ad valorem, has more than doubled since 1950. A substantial part of the environmental impact from products can thus be attributed to private consumption. From the family's activities, a recently completed project has singled out meals, transportation and residential heating as being environmentally most significant /16/.

The population affects the environmental impact of products in a number of different capacities. As citizens, individuals are involved in ongoing social developments; and by voting and other political activities, they influence priority-setting in environmental and industrial policy-making. As consumers, we determine which of the available products that sell, how they are used and what happens to them during the initial stage of their disposal.

Highly organised
Compared with other countries, the Danes generally have a high degree of organisation. A sizeable proportion of the population is represented in trade unions and pension funds as wage earners and employees. In recent years, a number of trade unions have begun to view the external environment as part of their sphere of interest. For instance, in its programme manifesto /17/, the Danish General Workers' Union (SID) enters into a series of deliberations on the product dimension.

Many Danes are members of various leisure and special-interest organisations dealing with specific areas of interest and related political initiatives. In terms of the environment, for instance, hunts and angling associations are very active.

Environmental organisations
The organisations in the environmental field range from the highly practical, action-minded "Green Families" and "Green Lifestyle" through traditional grass-roots movements such as NOAH (- Friends of the Earth Denmark) and the Movement on Energy and Environment (OOA) to broad-based environmental movements, whose membership-driven funding allows them to have considerable specialist secretariats - e.g. the Danish Society for Nature Preservation. Various such organisations are affiliated to international movements such as Global Action Plan for the Earth, Friends of the Earth and Greenpeace.

Consumer organisations
In consumer issues, the interests of the population at large are safeguarded by a number of consumer organisations, some of which are linked with international organisations such as the European Environmental Bureau. They mainly focus is on issues such as consumer information, quality, health, the environment and prices. The way in which the individual associations prioritise different issues varies greatly. For instance, the Danish Consumer Council prioritises all issues of relevance to the consumer whereas the many buying groups and purchasing associations assign priority to obtaining cheap products.

In a product initiative, it is essential to involve the actual environmental organisations as well as the consumer organisations and trade unions in order to obtain real representation of interests and resources.

Motivation
Successful involvement of the population in a product initiative presupposes that the population is motivated and informed, and that it has adequate opportunities to modify its actions. There is considerable difference today between the proportion of the population stating that they wish to act and shop in an environmentally sound manner and the proportion actually buying environmentally sound products. A study from 1995 of the population's attitudes towards the environment and energy saving showed that e.g. approx. 75% of the respondents stated they are willing to pay 20% more for organic foods and kitchen hardware that economise on energy or water /18/.

Many less environmentally degrading products are more expensive than similar ordinary products today. The size in price difference, together with a number of other factors such as taste, availability and marketing, decides how great the demand for the product will be. The consumer panel at the Danish Consumer Council and the Council of Technology's consensus conference on future consumption and environment attached great importance to the price of goods encouraging environmentally sound consumer choices /19/.

There is experience to show that large parts of the population can be induced to take action on isolated environmental or health problems after an intensive media campaign. Participation is greatest in situations making extra demands on people. The change-over to unleaded petrol is almost complete now but it was also supported by the fact that it is easy and, at the same time, involved financial benefit for the consumer.

Close to the individual
It is a well-known fact that it is easiest to motivate to efforts that are closely related to the individual, rooted in the local community or, in some other way, impact directly on the consumer.

Easier access to simple information
The population at large currently needs easier access to information on the environment to enable it to act in line with its outlooks in the environmental field. Many are currently aware of a long string of aspects that can be included in evaluating the environmental impact of products. Yet, no overview is generally available of what can and should be taken into account in one's choice of consumption, or more detailed and comparable information on individual products.

At the same time, there is an overwhelming quantity of marketing messages that pretend to be factual environmental information but are actually misleading. As an example, a study of different clothing brands marketed as being environmentally sound by almost 40 different suppliers shows that only a few of the suppliers were in a position to supply precise documentation of the environmental properties of their clothing /20/. This misinformation leads to widespread scepticism with regard to environmental information.

The consumer panel at the consensus conference on consumption and the environment stressed that the consumer must be encouraged to make less environmentally degrading choices through information and dialogue. Of the concrete possibilities available for better information, the panel highlighted the "Swan Label" (the Nordic eco-label) and environmental product declarations.

Locally sourced knowledge
Consumers have a considerable need for easy access to relevant information on the environmental impact of products. Information to the consumer must be accessible at the right time in the right place. People especially want information from local sources such as retail outlets, local craftsmen and businessmen, fast-service counters, citizens advice bureaux and libraries. In addition, there is a need for knowledge about where to look for information on specific topics.

Limited access to environmentally sound products
There is still a limited selection of products identifiable through recognised labelling schemes, declarations or the use of data sheets as being less environmentally degrading. In order to keep up the population's interest, it is important to quickly boost this selection. Conversely, the rate at which the selection is increased, will largely depend on the reception that consumers give to the initial product selection. The consumer must thus be kept regularly informed about the presentation/identification of new, less environmentally degrading products.

6.5 The trade sector

Small Danish trading companies
The majority of Danish trading companies are small companies. More than half of them have an annual turnover of less than DKK 2.5m (1992) and almost 60% of the 36,000 VAT-registered wholesale companies have a turnover of less than DKK 1m (1993).

Turnover for the 44,000 VAT-registered retail companies averaged DKK 2.7m in 1991. The past decade has seen a structural trend towards larger company units and fewer shops/workplaces. Combined, the Danish Co-op (FDB) and Dansk Supermarked account for more than half of the turnover of the retail trade today.

42% of turnover in Denmark are effected in the trade sector, and 45% of Danish exports are effected by the trade sector /21/.

A pivotal role
The trade sector plays a pivotal role with regard to the product strategy as it has to function as a filter between manufacturers and purchasers. The sector is responsible for which of the approx. 200,000 different products available on the market that find their way onto the grocery shop shelves. It is not uncommon for a grocery store to stock between 1,000 and 3,000 different products.

Given that some 60% of goods are imported, it is important for the importer to pass on wishes and requirements to the foreign manufacturers with regard to the environmental properties of products. The trade sector plays an altogether pivotal role with regard to information as it can demand but also pass on information regarding the environmental properties of products.

Potential for interaction between trading companies and manufacturers
There is considerable potential for interaction between trading companies and manufacturing companies. Fruitful interaction may contribute to ensuring that:

Danish-based production preferred
On the face of it, the greatest potential for initiatives by the trade sector involves product groups in which production is based in Denmark. Such products give the authorities, the consumers, and the wholesale and retail trades the possibility of acting as a powerful, collective dialogue partner in dealings with the manufacturers - without their requirements leading to a market take-over by foreign manufacturers. Especially for Danish products with a sizeable home market and exports to markets with a high level of environmental awareness, product initiatives can be relevant.

Difficult for smaller trading companies
Smaller trading companies are often supplied by a large number of manufacturers and do not have the volume or professional competence to make requirements to the manufacturer or supplier. This fact has assumed increasing importance, given the increased competition accompanying the creation of the Single Market. Of their own accord, these companies are thus unlikely to demand documentation of environmental properties or refuse to trade in products with the most inferior environmental properties.

Opportunities for big chains
The big chains within the retail and wholesale trades are very powerful stakeholders, capable of building up their own specialised environmental competence and making requirements to the manufacturers. As they themselves control parts of the production, they also have their own facilities for product development.

The trade sector's views
During the round-table discussions, representatives of the trade sector expressed that:

6.6 Manufacturers of goods and services

The group of goods and services manufacturers includes all companies contributing to the development and manufacture of the products. These stakeholders are of crucial importance to the environmental properties of the product. They are also crucial in determining what know-how is generated and disseminated on the environmental properties of the products and how these properties may be improved.

Danish and foreign companies
Approx. 40% of the goods consumed in Denmark are Danish-produced, and virtually all services supplied in Denmark are produced here by Danish and foreign companies. Developing and manufacturing products with improved environmental properties presupposes active and creative initiatives from Danish as well as foreign manufacturers - and from manufacturers in charge of their own development initiatives as well as manufacturers who put others' ideas into production.

As a group of stakeholders, the manufacturers are decisive to product initiatives, and any product initiative is conditional on setting up constructive interaction with the manufacturers and obtaining an in-depth knowledge of their conditions within the various resource areas.

Description of manufacturers
The conditions of the manufacturer group vary greatly, depending on the product involved and on which market it is sold.

Goods manufacturers
Private production of goods contributes approx. 1/3 of the GNP and employs a corresponding share of the labour force, i.e. approx. 750,000 full-timers.

The goods manufacturer group comprises the following sectors: manufacturing, building and construction, and agriculture, of which the manufacturing sector is the most important of these in terms of economy and employment.

Both internally and mutually, the individual sectors are subject to widely different conditions of competition and development. However, one basic feature in common is that companies are increasingly being drawn into a global division of production, with the individual company processing a minor subcomponent of the finished end product.

Service producers
Producers of services include a large and very heterogeneous group of companies, including everything from international currency trading through forwarding agents to shoe resoling. The importance of service production in Danish society is rapidly growing. The Danish Ministry for Business and Industry's resource area analysis estimates that the service trades have an employment growth potential equivalent to 100-125,000 new jobs up to the year 2003.

Though intangible by definition, many services do cause an impact on the environment as a number of products are normally used for producing a service, e.g. detergents, machinery, spare parts, chemical substances, etc., just as they nearly always involve transporting goods and people.

The choice of products and organisation of work routines is decisive to the overall the environmental impact caused by the service. Furthermore, the service sector is important to the product initiative in so far as the services in themselves contribute to that initiative. This applies to e.g. the services of the financial sector and to those of the know-how suppliers and suchlike. These stakeholders are discussed independently in Appendix 1.

Limited knowledge of services and the environment
The knowledge available on environmental conditions in connection with the production of services is very limited. This is partly due to the limited extent to which the service sector has been the focus of current environmental initiatives. The following description has therefore been concentrated on the conditions of the goods manufacturers.

Corporate environmental behaviour
Most goods manufacturers today have a good grasp of the environmental impact from their production processes, many having accumulated a certain environmental know-how as a result /22/. Very few companies have dealt with the impact caused by other parts of the product life-cycle.

Pioneer companies
There are, however, a number of pioneer companies already making a goal-oriented effort to improve the environmental properties of their products. They are to be found in all categories of companies though, of course, mostly in those categories with the largest in-house development resources. The change in managerial attitude is the one single factor emphasised by the pioneer companies as being most significant to their change-over from being "wait-and-see sceptics" to being "active pioneers". This change of attitude is not immediately explicable on the basis of changing requirements from the outside world or other objective factors. Rather, it should be seen as a change in the understanding of these factors. Accumulating know-how regarding the causes of these changes in attitude and how they can be promoted is essential to the product initiative.

In the further work on the product-orientated environmental initiative, it is also important not only to support, but also to derive support from, the work being done at these pioneering companies. In particular, co-operation should be established with pioneer companies in the product fields in which pilot projects are initially being launched.

Product development
The development of products with improved environmental properties will need to be made as an integral part of the general development activities of the companies. It is thus interesting to look at the conditions for these activities in the case of Danish goods manufacturers. Taking product development as a basis, Danish manufacturing companies can be divided into four types:

Traditional small and medium-size companies
Companies with few resources to make product and process innovation. The product and process development of the companies is determined by input from machinery and materials suppliers as well as external resource and know-how centres. Product development collaboration - between the companies as well as with the public sector - is vital for product development in many such companies.

Large-scale operations
Companies focusing on process development, with large in-house capacity to undertake it. Dairies, sugar mills, etc.

Specialised machinery and equipment manufacturers
Flexible, often smallish, manufacturers with a high degree of product development that is customer specific. Manufacturers of industrial paints, sealants, etc.

Research-based companies
Companies based on the company's own R&D capacity carrying out continuous product development. The developmental force in these companies is based largely on in-house resources in relatively close co-operation with public R&D institutions. To a large extent, the process of consolidating the environmental dimension of the product development of these companies is done by incorporating environmental assessments as a permanent element of publicly subsidised R&D projects.

Table 6.1
Development activities in industry, broken down into company types

Source: 1995 Business Report

The various forms of developmental behaviour and competence require some differentiation of the means and instruments used in relation to specific company types.

Factors of importance to development
The following factors are essential to the developmental behaviour of the companies:

Customer requirements
Customer requirements are among the most important reasons altogether for companies making innovations in the product field. The ever increasing spread of environmental management systems within major international groups will largely result in requirements being made to subsuppliers with regard to substantiating the environmental properties of their subsupplies. Especially within the group of specialised machinery and equipment manufacturers, there will be a distinct need for subsuppliers able to document the environmental conditions of their products and their company.

In research-based companies and within the medical/health and telecommunications fields, the public sector often plays a crucial part as product purchasers. Public development contracts containing environmental requirements will be a good tool with regard to swaying product innovation towards the development of cleaner products.

Internal competence
Developing cleaner products calls for the company organisation to be able to pick up on signals in the environmental field. At the same time, the resources and competence must be available to respond to these signals. In relation to smaller companies, it is especially vital to enhance internal competence. The results of the programme "The Environment and Working Environment in Small Companies" show that a low level of developmental and environmental competence in-house is greatly strengthened by appointing competent employees to build up environmental and working environmental management in these types of company.

Quantity and quality of available environmental know-how
A main condition for including environmental considerations in product development is the presence of reliable and usable environmental know-how. At general level, the quantity and quality of environmental product know-how is still in the early stages of development.

Environmental regulation
The product innovation time frame stretches several years into the future for major companies belonging to the categories of large-scale and research-based companies. It is central in this regard that there should be some long-term indication as to the environmental problems that need to be prioritised, e.g. substances and materials that should be substituted. Such an indication will provide important guidelines for the often sizeable investments in development made by these companies.

Furthermore, there should be some regulation of individual substances and materials in a co-ordinated joint effort to develop new substitutional technologies.

Product standards
Much of the time, the bulk of corporate product development is elaborated on the basis of pre-determined product standards. In continuation of the work of creating the EU Single Market, product standards will play a sharply increasing role. To an even greater extent, compliance with particular standards will determine the sale of goods and semimanufactures.

Inclusion of environmental considerations - or, at least, of awareness of not preventing environmental consideration - in the individual product standards will thus be of great importance. Care must be taken that standards have a supportive effect and, more particularly, do not block the development of less environmentally degrading products.

Larger companies will be able to act as important allies by incorporating environmental criteria when negotiating international product standards.

6.7 Other stakeholders - consequences to the product initiative

Appendix 1 contains a description of know-how producers and brokers, the financial sector, counties and municipalities, government stakeholders and, to exemplify international stakeholders, a description of the multinational goods manufacturers, the nation states and the European Commission. The following is a summary of the main consequences to product initiatives that may be derived from these descriptions. The initiatives proposed in the next chapter are partly based on these analyses.

Know-how brokers
The know-how brokers and manufacturers must be involved in the discussions on organising the product initiative, partly in order to incorporate the know-how they represent and partly in order to ensure their active backing for further efforts. The know-how brokers generally need to be provided with greater know-how on the environment.

Public funding is crucial to producing publicly available knowledge and to producing know-how whose generation is without commercial interest.

The financial sector
For parts of the business community, particularly the small and medium-size companies, it is difficult to get credit to finance new projects such as product development. It is thus important for product initiatives to include financing options for companies wishing to develop and introduce products with improved environmental properties.

Product initiative backing by the financial sector presupposes the existence of a positive link between the product initiatives of the companies and their ability to honour their obligations to investors and lenders.

It is important to supply the financial sector with the necessary competence in the environmental field. This can be done primarily in the form of training and supplementary training efforts within the sector.

Counties and municipalities
It is important that counties and municipalities are actively involved in the product initiative. They are important not only as supply companies and environmental authorities but also as macroconsumers and promoters of business innovation and Agenda 21 activities.

Genuine activation of the potential of the local authorities will require political and financial backing.

Greater use of cleaner products within the supply and welfare services requires a generally higher level of know-how on the environmental impact of products.

In terms of local use of products containing environmentally problematic substances that cause problems to waste and wastewater treatment plants, the municipality can play an active informative role in reducing the local use of such substances.

The official sector
The official sector has activities in a number of fields of importance to the product initiative.

The extent, to which environmental assessments are carried out, is insufficient when various forms of private-sector product development are being publicly funded.

Many ministries are already making environmental requirements in administrating their subsidy and loan schemes. In particular, the Danish Ministry for Housing and Building and the Ministry of Agriculture and Fisheries have incorporated environmental considerations in their product-orientated subsidy schemes. There has not been the same degree of development in relation to the Ministry for Business and Industry's grant and loan-financing schemes. What is needed is a more systematic environmental assessment of company projects eligible for financing by, e.g., the Danish Fund for Industrial Growth. Easy-to-use tools are also desired with which to screen these types of projects from an environmental angle.

The main responsibility for a large number of product and performance standards rests with the sectorial ministries. Furthermore, they are the main negotiators on EU directives within their areas of jurisdiction. As a fixed procedure of standardisation activities, sectorial ministries should contribute to ensuring that environmental assessments are directly involved in the standardisation process. In the context of EU legislation, sectorial ministries should ensure that environmental considerations are embodied in the actual directive work and that environmental assessments are included as a requirement in any mandates made of CEN.

Government procurement of food and beverages, medicine, health care articles and office supplies as well as fuels such as oil, electricity and gas form an essential part of the total Danish turnover on the relevant product groups. For this very reason, it is essential to have a consistent public and eco-conscious procurement policy in these and other areas in order to establish a stable market for less environmentally degrading products.

Know-how and information on the environmental properties of products are part of the basic instruments used in the product-orientated environmental strategy. The Danish EPA's co-operation with the National Consumer Agency of Denmark should be strengthened and campaigns co-ordinated in terms of the areas of action on the energy front.

International stakeholders
The initiatives from the European Commission within the environment, trade and standardisation are of crucial importance to conditions for manufacturing and selling less environmentally degrading products. In particular, it is possible to influence the elaboration of these initiatives at an early stage of the process.

The European Commission is planning to elaborate a product-orientated environmental strategy. Neither here nor in any of our neighbouring countries that are working on a product-orientated environmental initiative has particularly much progress been made, however.

The Netherlands
The Netherlands have learned that a purely information-based effort targeted at consumers is not sufficient. Also, other kinds of market influence are needed. Since the mid-eighties, the Netherlands have had an official list of undesirable substances. The experience gained from this list is that it has very largely been appreciated and used as an instrument in the product development work of the companies.

Germany
Germany's experience with manufacturers' liability for packaging waste (the Grüner Punkt) shows that it is possible to achieve considerable waste reductions in this way, but that the cost of doing so has also been very high. Work is continued to extend manufacturers' liability to all parts of the product life-cycle.

Sweden and Norway
Also Sweden and Norway are working on initiatives targeted at all parts of the product life-cycle though no experience has yet been collected on the impact of such efforts. Here again, work is being done to increase manufacturers' liability for all parts of the product life-cycle.

In terms of interaction with other countries, it should be realised that the long-term prospects of a growing market for environmentally sound products mean that this interaction is not a "zero-sum game". In a growing market, one man's gain needs not mean another man's loss.

7 Proposals for specific initiatives

7.1 Introduction

Chapter structure
This chapter presents the Danish EPA's proposals for the organisation of an intensified product initiative in the years ahead. First, the chapter contains a brief summary of the conclusions that can be drawn from the analytical chapters. As an introduction to discussions on future initiatives, a number of specific proposals for initiatives follow.

7.2 Background to the choice of instruments and areas of action

The proposed initiatives are based on concrete experience and results of current initiatives in the field. The conclusions concerning product descriptions, market and stakeholders, as presented in the preceding chapters, have also been used as a basis.

The need for action

Main conclusions of the analyses
The analyses in Chapters 4-6 led to the following main conclusions regarding the need for action:

Choice of instruments

Instruments
As regards what shape the initiative should take, the analyses partly indicate a need for interaction between different instruments and partly a need for instruments to build up stakeholder resources, as well as a need for instruments to provide stakeholders with options.

Interaction of instruments
The behavioural changes that product initiatives aim to achieve cannot be brought about with one instrument or by one isolated stakeholder. The problems involved are too great and complex for that. Furthermore, the resource areas are so varied in structure and dynamics that each individually will require a special combination of instruments. The challenge in the product-orientated environmental initiative is to create interaction between relevant instruments and relevant stakeholders.

Stimulating instruments
Instruments such as the supply of know-how or financial resources to stakeholders help build up resources on the part of the individual stakeholder. They can thus be expected to make a contribution both to their environmental behaviour and to increased competitiveness.

Stimulating instruments are suited to areas in which it is important to influence many stakeholders but the individual's behaviour is not decisive. Stimulating instruments achieve their effect by creating an interaction between the behaviour desired and that which is in the stakeholders' own interest - and which they thus work to achieve.

As the success of any product-orientated environmental initiative is entirely dependent on a productive wave of behavioural changes in the environmental field - and is thus dependent on Danish and European companies retaining their competitiveness on the global market, prescriptive behavioural regulation needs to be supplemented with behaviour-stimulating action. Direct behavioural regulation or the threat of such may have a stimulating effect on creativity but it cannot specify creativity.

In areas where the desired conduct is not known, direct behavioural regulations are neither desirable nor possible. This applies to e.g. innovative processes. Creativity cannot be ordered on command. Nor indeed can competitiveness. But it is possible to actively stimulate.

Instruments such as taxes and penalties may provide some motivation for environmental initiative but do not in themselves contribute to building up the resources of the organisations. Particularly when they hit Danish companies harder than their foreign competitors, these instruments may injure their competitiveness and hence the environmental initiative. This is the reason why e.g. compensation is awarded in connection with a series of the present environmental taxes.

Behaviour-specifying instruments
Directly behaviour-specifying instruments are suitable in areas in which the desired behaviour is known and in which it is essential for everyone or nearly everyone to fulfil the behavioural requirements. Elimination of substances hazardous to health or the environment from the most common products is a suitable candidate for direct behavioural regulation, for instance.

Direct behavioural regulation is covered by the international agreement systems of which Denmark form part. The development of direct behavioural regulations thus presupposes initiatives in the relevant international forums. International negotiations occasionally proceed more slowly than might be desirable from a Danish point of view. There may therefore be a need for supplementing these with other instruments/regulations.

From an enforcement perspective, behaviour-regulating instruments have a greater chance of being effective if they are backed up by soft instruments so as to give stakeholders a feeling of conformance between their "duties" and their overall interests.

Stakeholders' comments on the choice of instruments
A number of the above conclusions have been confirmed at the round-table discussions held /23/.

Need for motivational instruments
The stakeholders express a desire for positively motivational economic instruments like subsidies and support for the necessary activities.

Focus on competitiveness
Taxes and charges are recognised as being effective instruments but taxes on CO₂and SO₂ are criticised especially by the trade and industry for reducing the competitiveness of Danish companies in relation to foreign companies.

Need to regulate the use of environmentally hazardous substances
When the phasing-out of environmentally hazardous substances is concerned, there is broad consensus that direct behavioural regulations are probably the most expedient method.

Need for co-ordinated public efforts
A certain amount of public regulation is characterised as being uncoordinated and unclear. There is a wish for co-ordination of public efforts related to products; e.g. within trade and business promotion, training, sectorial development programmes, etc.

Need for international efforts
Time and again, efforts to influence the elaboration of international rules are stressed as being altogether crucial.

Proposals for areas of action

Danish EPA's proposals for areas of action
The Danish EPA proposes that specific initiatives are initiated within the following areas of action:

The proposed initiatives above are amplified in the following sections.

7.3 Presenting goals and behavioural expectations - the environmental agenda

Long-term environmental goals and behavioural expectations
This section presents the Danish EPA's proposal for the long-term environmental goals on which the product initiative will need to focus for a series of prioritised problems. In connection with these goals, the section outlines a series of changes in stakeholders' behaviour which are currently considered necessary if the environmental goals laid down are to be achieved. In Appendix 2, the long-term environmental goals, the goals stipulated in practice and behavioural expectations are described in detail.

The presentation of this environmental agenda is intended as a support to all stakeholders who are themselves taking initiatives to reduce the environmental impact of products. A knowledge of the agenda will make it easier to predict the conditions under which the environmental field will operate in future years and hence make it easier to act. At the same time, a knowledge of the agenda is intended to create a uniform understanding among the stakeholders of the goals and behaviour on which the product initiative should be focused.

The issues remain unchanged
With regard to the long-term environmental goals, there is reason to assume that these will not change greatly in the next decades. The vast majority of basic environmental problems which it was decided to tackle in 1974 when the Danish Environmental Protection Act was passed, are still extremely important today. More have been added and more are presumably to come.

If, in their long-term environmental work, the stakeholders contribute to solving the fundamental environmental problems, they will be well equipped to participate on an environmental-orientated market.

The political declarations

Politically stipulated goals must reflect many different aspects
For most basic environmental problems, political goals are regularly set for a foreseeable number of years together with more or less detailed directions explaining how these goals are expected to be reached. These goals and behavioural expectations are usually fixed on the basis of both technical environmental and health-related evaluations, taking into account social, industrial-policy and international factors.

For this reason, relevant goals and behavioural expectations are also discussed regularly, i.a. with the stakeholders at whom they are directed. Reaching stipulated goals, acquiring fresh knowledge in the field or achieving new political initiatives can thus lead to changes in the concrete goals and behavioural wishes set out in the action plans.

Great difference in action plans
There is a great difference in the degree of concretisation and specification with which environmental goals are proclaimed. In general, however, politically adopted plans do provide a good basis for evaluating which environmental problems are relevant to the stakeholders. They also contain the goals which it has been politically possible to lay down on the medium view. There is, however, greater variation in the guidelines that define what is a satisfactory level for the individual stakeholder or product group, how that level is achieved using different instruments and how the impact of such efforts is to be measured.

In many instances, this entails the individual stakeholder himself having to decide how to put the planned objectives into concrete practice whether it is in isolation or in context.

Stakeholders' involvement in establishing goals and efforts
That is also how things will be in future. It is a difficult task that can only be solved in close dialogue between the authorities and the stakeholders in the field. Yet the alternative - having the authorities make highly detailed objectives and initiatives tailored to the conditions of individual stakeholders - would be an impossible task for the authorities in terms of professional and labour resources. At the same time, it would have a paralysing effect on the stakeholders.

Table 7.1 summarises the long-term environmental goals in the various prioritised problem areas and the expectations linked to the stakeholders' behaviour. The prioritised problem areas all refer to one or more of the four global issues briefly described in Chapter 2.

In the field of chemical substances, the Danish EPA has just designated approx. 100 problematic substances and substance groups. The substances have been included in the Danish EPA's draft "List of Undesirable Substances", which is included in the EPA's discussion paper "Chemical substances - Status and Perspectives" /24/. These approx. 100 substances and substance groups have been singled out on the basis of a particular systematics (see Section 7.7), and there may be other relevant substances, which have not been identified by the procedure outlined.

Appendix 2 provides an in-depth review of the individual elements on the environmental agenda.

Table 7.1
Long-term goals for the impact on the environment and resources as well as goals for stakeholders' behaviour in prioritised problem areas

The terms used are defined as follows:
Resource efficiency: Consumption of resources per product or function fulfilled. Substitution: Replacement of an environmentally degrading property with a less environmentally degrading one. Resource loss: Reduction in the volume of resources available for social exploitation in a given area at a given cost level. Supply horizon: Period during which a given resource will be available to a particular extent using practically accessible process technology. Substances with an unknown effect: Substances whose impact on the environment and health have not been scientifically studied. Sustainable operation: Production of biological resources while maintaining the biological productivity of the area and at the same time respecting other ecosystems and local social considerations.

Efforts to concretise the environmental agenda
An independent objective of the product initiative is to help stakeholders better understand and embrace the environmental agenda. By means also including dialogue with the authorities, stakeholders should become more capable of relating their own situation to this agenda and able to better see their own possibilities of complying with the agenda.

The environmental agenda
The authorities must promote this understanding i.a. by:

7.4 Access to knowledge

Action requires knowledge
The stakeholders can only include considerations of environmental properties for the products, which they manufacture, buy, sell or dispose of, if they have access to the necessary information. At present, no systematic information is available on the environmental properties of products. Neither the consumers nor the professional stakeholders have easy access to credible, necessary or adequate environmental information.

Existing knowledge inadequate
There exist only a few mandatory declaration systems for the contents of particular chemical substances, but there is no general obligation to pass on environmental data. The voluntary disclosure of environmental information is unsystematic and virtually chaotic. Individual stakeholders generally pass on only what is in their own interest. There are very few frameworks for the scope and quality of the information to be disclosed. However, the Danish Consumer Ombudsman's rules for environmental praises do constitute an initial step in this direction.

In this light, the Danish EPA has proposed that the generation and dissemination of knowledge about the environmental properties of products are centrally represented in the Danish product initiative.

Stakeholders should contribute their know-how
Any stakeholder involved in the life-cycle of products should produce and pass on such environmental information as is needed by the other stakeholders, the stakeholder in question being the party best equipped to generate and pass it on. The long-term goal should be to develop a coherent "self-declaratory" system in which relevant knowledge of the environmental properties of products is passed on by everyone obtaining and gathering it. At the same time, anyone purchasing raw materials, semimanufactures or products should require information on their environmental properties.

Prioritised environmental and resource problems are the basic areas in which knowledge should be disseminated. However, this does not establish the degree of detail needed for the information.

Information must be adapted
The various stakeholders do not have the same need of information; nor do they have the same facilities for generating, disseminating and understanding the environmental information involved. A consumer who takes an article off the supermarket shelf does not normally need to understand every detail of the environmental properties of the article while a purchaser for a nation-wide grocery store chain, which stocks the item on its shelves, should be more qualified. In the same way, the product developer must have access to highly detailed environmental information. It is therefore necessary to develop a differentiated information strategy that takes these differences into account.

Information should be in demand
On a day-to-day basis, the individual stakeholder is confronted with an enormous flood of information - including information on environmental problems. It only makes sense to contribute additional environmental information if the stakeholder requires or can be made to require such additional information. If the information is not wanted, it will drown in the flood of data or will be actively weeded out.

Manufacturers and importers responsible for product knowledge
Basically, responsibility for direct information on the environmental impact of products during production, use and disposal should rest with the manufacturers and importers. But subsequent links in the chain must also assume responsibility for receiving and passing on that information. Much environmental information is not available in any systematic form today and can be expensive to provide.

It is proposed gradually setting up a proper duty to inform in close co-operation with the market stakeholders, giving reasonable warning and allowing for confidential information or information sensitive to competition.

Existing and new instruments
Existing instruments which it is proposed to adjust and consolidate: Voluntary, publicly accredited labelling schemes, product comparisons with environmental information, environmental guidelines for public purchasers, methods and tools for use in developing less environmentally degrading products and environmental management.

New instruments to be considered: Voluntary environmental product declarations and environmental user instructions, establishing an organisation to accumulate knowledge in the field and establish a duty on the part of manufacturers and importers to inform the consumer - e.g. through wholesalers and traders.

Table 7.2
Overview of who is to provide what types of information to whom

The following descriptions of the information outlined in the above table have been arranged according to the stakeholder who they are targeted, in the sequence: private and professional consumers, distributors, manufacturers and authorities. Within each group, mention is first made of instruments based on voluntariness, then instruments which it should be considered making mandatory.

Voluntary, publicly accredited eco-labels

Unambiguous information on the best products
A voluntary, publicly accredited eco-label must be a label allocated, on application, to products in a product group meeting publicly approved criteria - and thus having improved environmental properties. Consumers thus receive unambiguous information on which comparable products are the least environmentally degrading.

Effect of the label
To the degree that such labelling influences the choice of consumption, it will not only directly reduce the environmental impact but will also act as an incentive for producers to develop and manufacture products with less environmental impact. The fundamental prerequisites for success are: 1. The manufacturers see the advantage of applying for the label. 2. The consumers have faith in the labels and demand eco-labelled products. 3. The scheme is so dynamic that it creates serious pressure for changes.

Eco-labelled products in essential product groups
The long-term vision for eco-labelling is to have eco-labelled products on the market within all essential product groups. The Danish EPA will carry on the work of promoting eco-labels on a number of different fronts.

Revising the EU eco-labelling scheme
The Danish EPA is taking an active part in the revision of the EU eco-labelling regulation, and Denmark is working to organise its criterion development work more effectively. The scheme should also be made more attractive by creating a better link to the environmental activities of the companies generally. Here, Denmark has proposed that the manufacturers should be able to benefit from being certified under an international environmental management system such as EMAS or ISO. However, it must be expected to take several years before this label gains wider acceptance.

A larger number of eco-labelled goods
The number of eco-labelled goods on the Danish market should be increased as quickly as possible. On the short view, this can only be done by Denmark acknowledging one or more of the existing national or regional labels. As recommended by the consumer organisations and the green organisations, a.o., Denmark should therefore join the Nordic eco-label, the Swan.

Collaboration with national eco-labelling schemes
The Danish EPA will take the initiative to co-operate with some of the national eco-labelling schemes. The already existing co-operation between half of the national labelling schemes can be used as a basis. Above all, this co-operation can be used for enhancing the influence of the EU regulation though it might be expanded to include a greater degree of teamwork on criteria development and possible accreditation of the labels in Denmark.

In this connection, however, it is very important to avoid confusion arising among consumers as to which eco-labels they are to base their choice of product on. Similarly, work should be done to co-ordinate the other labels offering information on the environmental and energy credentials of products so as not to send conflicting or confusing signals onto the market.

Support to initial applicants
The Danish EPA will consider the possibility of supporting companies applying for the label. Alternatively, a kind of prize scheme may be set up awarding the first applicants within each particular product group.

Prioritising the establishment of an ISO eco-labelling standard
Finally, high priority should continuously be given to the work of establishing an ISO standard for eco-labelling. The Third World and the USA regard eco-labelling as a technical barrier to trade and are thus demanding full consensus between all parties involved in developing the criteria. If this attitude is victorious, product eco-labelling will no longer be a practicable prospect. Given that, under the WTO agreement, the ISO standard will also need to be adopted in Europe, this is a very important area of action.

Environmental product declarations and consumer instructions

Environmental product declarations are an extension of the eco-label
Environmental product declarations for the consumer are an extension of the eco-label. In simple and plain form, it will be capable of describing the most essential and relevant environmental information. It may, for instance, take the form of an index and include, e.g., energy consumption during the operating phase, disposal problems and the content of xenobiotics included on the List of Undesirable Substances.

The present compulsory energy labelling of kitchen hardware is an example of a simple index that provides simple information on one of the most significant environmental properties of the product. The declaration can supplement the eco-label and enable interested consumers to weigh up the various environmental properties.

Environmental user instructions
The concrete use, maintenance and disposal of a product can mean great differences in environmental impact. It may therefore be essential to inform the consumer about the correct or least environmentally degrading form of behaviour.

For durable goods, which are often accompanied by technical instructions, information should be provided on the most environmentally sound way of using the product. In some areas, a broader public information campaign in the form of e.g. teaching materials or TV spots may yield good results. Such initiatives can be free-standing or form a supplement to environmental user instructions.

For selected product groups, it is proposed to develop concepts for environmental product declarations and environmental user instructions, respectively.

Product comparisons

The environmental parameter must be evaluated alongside other parameters
Implementing and publishing product comparisons, in which environmental properties are assessed alongside other factors, may create a greater demand for less environmentally degrading products.

Product comparisons and tests can also contribute to piercing any myths that may exist about the inferior quality and poor usage characteristics of environmentally sound products. Finally, such product comparisons can ensure that the environmental parameters of products are brought into focus with the manufacturers on the same level as parameters such as quality and price. Great efforts in this field are already under way by both the Danish Consumer Council and the National Consumer Agency of Denmark so there is no need for new institutions in the field. However, the problem of ranking and formulating environmental properties more firmly in comparative contexts should be examined.

Compulsory consumer information

Consumers entitled to information
One of the baseline references for product initiative should be the consumer's entitlement to whatever information he or she finds relevant and necessary in choosing and using a product. Consideration should be given to supplementing voluntary information with compulsory labelling in fields in which voluntary information cannot be made to function satisfactorily.

Compulsory labelling
In general, compulsory product labelling could be used for ensuring consumers access to information on product properties and any use requiring special alertness.

One starting point for the compulsory labelling of products in any product initiative might be the "List of Undesirable Substances", for example, as well as the other environmental and resource problems described in Section 7.2. Examples of labelling requirements might be the content of heavy metals or hormone-like substances, or information on the quantity and nature of recently extracted resources used in the product.

Any action taken to widen the field of compulsory labelling will need to conform to the EU regulation on hazard labelling, restrictions on use and the approval schemes for a series of product groups.

Labelling only if relevant in recipient country
Owing to the WTO rules, compulsory labelling can only cover environmental factors of relevance to the recipient country. With the present WTO rules, this presumably means that information on resource consumption and impact during manufacturing cannot be made compulsory requirements.

Conversely, it will be possible to make requirements concerning information on the properties of the actual product, both when being used and when being disposed of. In selecting compulsory parameters, the emphasis should thus be on the needs arising from specific environmental problems in Denmark, such as xenobiotics in sewage sludge, groundwater contamination and problems related to disposal.

Some general legal provision may be needed
Consideration should be given to introducing general legal provision in the Danish Environmental Protection Act to impose a duty on market stakeholders to produce and pass on essential information on the environmental properties of products.

Environmental guidelines for purchasers
In co-operation with a number of stakeholders, the Danish EPA is in the process of elaborating environmental guidelines for professional purchasers - so-called purchasing guidelines. These describe relevant factors to take into consideration and inquire about when buying environmentally significant products.

Help to ask the right questions
The intention of the guidelines is to have them act as a tool for guiding professional purchasers to ask the right questions and in that way influence suppliers to generate the requisite information. The guidelines must provide a better decision-making basis for the purchasers and at the same time influence suppliers to evaluate the environmental problems associated with their products.

Help to adapt to future product requirements
The purchasing guidelines are expected to have the positive side-effect of letting suppliers know beforehand what requirements may be made, enabling them to adapt to the new requirements in advance.

The active input of environmental information by manufacturers and importers can be instrumental in rendering the work of developing such guidelines considerably more effective. As a first step, negotiations will be ushered in with the relevant stakeholders, the aim being to create co-operation on the development and dissemination of guidelines for professional purchasers.

The guidelines will be further developed and systematised to ensure that specific information is present in a form that the purchaser can use for comparative purposes. It will probably be necessary to make different standards for different product groups as the environmental properties of the product groups vary.

Environmental data and assessment tools for product developers etc.

Data for use in product information and development
Manufacturers need to get access to environmental data or have such data developed for the substances and resources used in their products. The data are going to be used partly for informing stakeholders in the later stages of the product life-cycle about the environmental properties of the products, and partly in connection with product development.

Manufacturers also need tools that can use these data for estimating or calculating the central parameters describing the environmental properties of individual products.

Setting up a know-how centre
For many small and medium-size companies without great technical expertise, the task of establishing and maintaining such an underlying dataset is completely impossible. As most processes in a product life cycle are generic, it is neither necessary nor expedient to have the individual company set up its own underlying dataset. It will therefore be more sensible and rational to set up know-how centres and develop tools and databases for the use of manufacturers who have to establish the environmental properties of their products.

The EDIP method
As described in Section 4.3, the EDIP method has been developed in co-operation between the Confederation of Danish Industries, the Technical University of Denmark (DTU), five Danish companies and the Danish EPA. It involves a general method for supporting the integration of environmental considerations in product development. The provisional experience of the finished tool, which will initially be able to be used in the electromechanical industry, is promising.

Work is currently in progress to develop a PC tool that will make the method accessible to those companies that have some environmental know-how as well as some expertise in product development.

More, quality-assured data
To a far greater extent, initiatives should be taken to gather and quality-assure data on the environmental credentials of products. In this connection, it must be ensured that, whenever possible, companies and others report data from environmental assessments of products in the same format as EDIP data.

In addition, a series of environmental assessment projects should be initiated within various product groups - including textiles, foods and construction/dwellings. This will enable data in EDIP format to be collected for these product groups, and new areas of action to be designated. These may be particularly significant product characteristics or product types, semimanufactures or materials used in, e.g., different trades etc.

Commitment to ISO standard
Efforts should be made to monitor and influence the standardisation work of ISO. Standards should provide an opportunity to study the environmental assessments in depth, and work should be done to make sure that they can accommodate the existing EDIP method.

Simple environmental assessment tools
Finally, there is a general need to continue developing and adapting methods for the environmental assessment of products. Not least, simpler tools need to be developed on the basis of the EDIP method, which can be used for screening the environmental properties of products.

Methods that can propose alternatives
Few tools today can help the designer by pointing out alternative solutions that are better for the environment. Generally, there can be said to be a great need for developing design aids capable of actively proposing less environmentally degrading alternative solutions.

Environmental management

Environmental product management
Most environmental management systems today focus primarily on the direct environmental impact of the activities of the companies and only to a lesser extent on the environmental impact of their products. Such environmental management systems thus need to be further developed. Considerably more prominence should be given to life-cycle assessments of the products of the companies and to the systematic environmental requirements made of suppliers.

Methodological development and international efforts
Efforts should be aimed at influencing the international forums that draft the environmental management standards, i.e. primarily ISO and the European Commission. In addition, independent methodological development is needed in relation to life-cycle assessments and supplier management systems within the framework of such standards. Consultants and verifiers should receive further training in order to enable them to include such product aspects to a greater extent.

Organising knowledge-building and information exchange

Overlapping data requirements and methods
The data and methodological approach needed to develop products, environmental product declarations, eco-labelling criteria and eco-label usage evaluation are fundamentally the same. Consideration should therefore be given to establishing a common organisation capable of overseeing the entire development of the information aspect together with the collection and systematisation of data - including EDIP database maintenance.

Independence and presentation of interests
It is important that public authorities safeguard the independence of the organisation as well as ensure that there is no commercialisation of the field. It is equally important that broad-based representation of interests is linked to the organisation, not least to cement consumers' faith in the work.

Further, the organisation must function as a linkage between the various stakeholders. It must be ensured that stakeholders who can supply information actually do so, and that stakeholders who need information actually have their needs met. If the organisational set-up is that of an independent unit, the financing can be a mixture of a basic government subsidy, income from the eco-labelling scheme and fees for data used by companies and purchasers.

Disseminating information to the environmental authorities of other countries

International agreements
It is essential for the national environmental authorities to support one another with knowledge relating to international product regulation. A number of international agreements currently exist, restricting trade in hazardous products and wastes. The main purpose of these agreements is to protect the developing countries. These include exports of certain chemical substances and the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal. Accordingly, Denmark is the first country in the world to have introduced an environmental information procedure for the export of used industrial plants.

The work of expanding international information on the environmental properties of products should form an integral element of the product-orientated environmental initiative.

7.5 Developing a stable market for environmentally sound products

Efforts to create greater and more stable demand for environmentally sounder products must concentrate in particular on promoting consideration for the environment in public purchasing. Another instrument in this context is green taxes.

Eco-conscious procurement policy in the public sector

An important customer and stable demand
Today, the public sector in Denmark constitutes a very considerable and fairly homogenous clientele in a number of product areas. The public sector spends more than DKK 90bn a year.

The long-term goal is to have the public sector take all areas of the environment and energy into consideration in its purchases of goods and services, alongside other determinants like price, function, quality, working environment and terms of delivery. In this connection, long-term procurement policies are important signals to manufacturers wishing to supply a stable future market for environmentally sound products.

Interacting with eco- and energy-labelling schemes
Environmentally conscious purchasing in the public sector is also of great importance to other initiatives described in this proposal. Industrial interest in positive eco-labelling can be strengthened by the demand from public-sector purchasers for products conforming to the criteria for accredited eco-labelling. Likewise, the effect of the energy-labelling scheme within the EU could be strengthened by public-sector purchasers demanding products in the best categories.

Barriers to eco-conscious public-sector purchasing
The most important barriers to a pronounced improvement in eco-conscious public-sector purchasing are lack of knowledge and tight budgets. Moreover, the EU procurement regulations may constitute a barrier in the long term. The prerequisites for the public sector's general acceptance of environmental considerations are, on the one hand, continued and extended dissemination of environmental knowledge to the purchasers and, on the other hand, genuine motivation on the part of the purchasers to make environmentally sound purchases.

The greatest obstacle to this motivation is that genuine environmental considerations will in most areas result in greater expense - at least until there is a solid market for the new products and the organisational running-in period has been completed.

Subsidising the introduction of less environmentally degrading products
It is therefore felt that the best way to promote a satisfactory volume of eco-conscious purchasing in the public sector would be to subsidise the introduction of new less environmentally degrading products. This might take the form of a new subsidy on cleaner products, e.g..

Criteria for including the environment in purchasing and procurement
EU rules on public procurement allow a national commitment to be made to soliciting bids exclusively in a manner that allows environmental considerations to be included when evaluating incoming bids. Consideration should be given to how this possibility can be utilised, and to what extent.

Moreover, Denmark is working to expand and specify the possibilities for including environmental and energy conservation considerations throughout the product life-cycle by tendering with reference to the EU Public Procurement Directive.

Action plan for public-sector green procurement policy
The Danish EPA will follow up the action plan for a green public procurement policy with active support in years to come. Provided it receives some backing from the results of the two-year registration scheme for public-sector purchases of environmentally less degrading products (to be implemented in 1997), the Danish EPA will suggest laying down goals for governmental purchases of less environmentally degrading products within selected product groups.

Moreover, the Danish EPA will discuss the possibilities of registering local authorities' purchases of less environmentally degrading products with the relevant organisations.

Eco-conscious EU procurement policy
Efforts in Denmark must be supplemented with major international initiatives in order to put eco- and energy-conscious purchasing policies onto the agenda of the EU and other member countries. The objective should be to get the European Commission to implement an eco-conscious procurement policy and to get member states to draw up action plans, objectives and initiatives that commit them to eco- and energy-conscious purchasing in the public sector.

Green taxes
The analyses and round-table discussions point to green taxes as an important instrument in enhancing the conditions of competition for products with improved environmental properties. Green taxes interact with other means to control the market for less environmentally degrading products, assuming that they are appropriately designed by including input from the relevant stakeholders. The work of elaborating useful green taxes should therefore be continued.

It is important to make sure that there is no deterioration in the international competitiveness of Danish producers, that taxes are reasonably manageable, and that taxes provide a real incentive to demand or produce less of the taxed product. The effect depends not only on the size of the taxes but also on a series of other factors such as the scope for finding alternative, cheaper solutions.

The question of the impact of green taxes has not been treated in-depth for the purposes of this proposal as it is given thorough treatment in other contexts, for example /25/.

Green taxes on products
The catalogue of Danish environmental taxes includes examples of taxes on raw materials, products, environmentally hazardous substances and waste products. In a limited market, specific product taxes or taxes on products containing environmentally or health hazardous substances can have a relatively effective impact on consumer choices - without distorting competition.

Taxes on products and on environmentally and health hazardous substances have been introduced to limit the amount of waste through increased recycling or to avoid nasty substances in the waste flow. In the case of taxes imposed on resources or raw materials, problems may arise to a far greater extent if taxes do not exist on all significant markets or there is no appropriate recycling of the tax money involved.

The design of the taxes must fall within the parameters of the WTO and EU regulations. As a rule, this will mean that it is not permitted to discriminate against imported goods except when the aim is to protect the environment of the country in question.

New taxes in interaction with other instruments
No specific new taxes are suggested in connection with this proposal. However, given the need for financial motivation in connection with any product initiative, the possibility of using new taxes together with other means must be evaluated not only in more general terms but also in relation to the concrete new initiatives towards selected products, materials or chemical substances.

7.6 Initiatives in three product areas

Basis of product-specific initiatives
Initiatives within certain product areas must take as their point of departure the specific business and environmental conditions associated with the product areas in question.

Each product area is characterised by different business conditions, existing competence and organisational relations. Similarly, the role and contribution of the various stakeholders will differ from one product area to another. The Danish Ministry for Business and Industry's resource area analyses throw light on a long series of such interrelations. Different stakeholders will be central to, and different control instruments more effective in, initiatives in different product areas.

Value of efforts in specific product areas
The cross-cutting initiatives described in the preceding sections must therefore interact with initiatives in selected product areas. In this way, real results and experiences can be created.

Selecting three product areas
The Danish EPA proposes that initiatives should initially be implemented in three product areas: textiles, electronics and transportation of goods. These areas have been selected for their relative profusion of documentation, the considerable amount of related production and demand in Denmark, and because they represent a series of important aspects of relevance to the product initiative.

Subsequent selection of additional product areas
It is intended to implement further initiatives in selected product areas within a couple of years. The areas in question might be, for example, graphics products, construction materials such as windows and floors, or pork.

Taking the experience already gathered as a basis, the long-term intention is to implement similar initiatives in the most important product areas. The relevant product areas must be selected, i.a., on the basis of analyses of the environmental and market conditions governing the various sub-areas under the Ministry for Business and Industry's resource areas. As described in Chapter 5, these resource areas represent a division of Danish trade and industry along the lines of cognate product groups, cutting across traditional sectors. The action to be taken in the three product areas selected is detailed in Appendix 3.

Organising initiatives within product areas

Entire life-cycle and all stakeholders
The action taken within each product area must be based on all initiatives in the area, both past and present. As a point of departure, all phases of the life-cycle of a product must be included. It is proposed having all relevant stakeholders participate in a binding form of collaboration.

Product-area panel
It is suggested that the liaison work and hands-on management for initiatives within each particular product area be carried out by a "product-area panel," consisting of all relevant stakeholders in the area. Each panel must be constituted as a project organisation. Appropriate secretarial support facilities should be attached to each panel, to be overseen by the Danish EPA. Leadership should be placed in the hands of one of the significant stakeholders in the area. It should be possible to adjust the make-up of each particular product-area panel to each specific task by involving new stakeholders.

Participating stakeholders
As a basic starting point, the following stakeholders ought to be represented:

Active participation required
The active participation of all groups is a prerequisite for success. Supporting the participation of financially weak stakeholders in the work will therefore be considered under the Danish EPA's proposal for a new subsidy scheme.

Mapping out significant conditions
The first part of the work consists in mapping out conditions of major significance to product activities. Among other things, this survey must clarify what points need to be tackled from an environmental and market parameter angle, who are the most important stakeholders, what market factors are decisive, and which particular initiatives are possible in relation to the product group in question.

Drawing up an action plan
The survey must contribute to the drafting of an action plan for the product area, defining environmental and market objectives for that area. Following on from these objectives, the action plan must outline each particular initiative and the tasks of the individual stakeholders. The action plan can also be instrumental in translating the proposals into initiatives such as labelling, eco-conscious purchasing and usage controls.

Plan should be binding
It should be endeavoured to make the action plan binding in nature, by a series of obligating agreements between the participating stakeholders. This will provide greater assurance of the various initiatives being carried out.

Characterising the three product areas

Proposals and initiatives for textiles, electronics and transportation of goods
The three areas have significant but different degrees of impact on the environment, and function under highly disparate trade and marketing conditions.

Together, they are thus reflective of much of the diversity that will generally have to be included in the product initiatives with reference to objectives, instruments and the significance of different groups of stakeholders. Moreover, these product areas have been selected because of the progress made on such environmental activities and/or because they have central stakeholders who are felt to be willing to take a front-seat position where such action is concerned.

The tables below illustrate the difference between the product areas selected in terms of both their priority environmental problems and their financial importance.

Table 7.3
Global environmental problems of relevance to the proposed product areas

Table 7.4
Key financial figures for Danish manufacturing companies in the product areas

Source: 1996 Statistical Yearbook
1) Textiles and clothing
2) Computers, electrical motors and telecommunications equipment
3) Hauliers

7.7 Product development support

The initiatives, which it is proposed implementing in connection with intensified product initiatives, will require both financial and other resources. In many cases, the cost of these acts as an actual barrier to product initiatives. It is therefore proposed to establish a subsidy scheme for the development and marketing of products with environmentally improved properties.

The scheme must be able to support activities within all main areas of the product initiatives - including knowledge-building and dissemination, product development, marketing of products with environmentally improved properties, and the development of systems for disposal and recycling. The support scheme will conceivably be co-ordinated with the financing facilities available under the Danish Ministry for Environment and Energy and other ministries.

Objective of the subsidy scheme
The new subsidy scheme ought to be able to operate with the same objectives as the three existing subsidy schemes for the development of cleaner technology, environmental and working environment management in small businesses, and disposal and recycling.

In the view of the Danish EPA, however, the new subsidy scheme should place greater emphasis on support initiatives focusing on the environmentally significant areas of product life-cycles. One innovative proposal suggests that support be offered to initiatives promoting the market launch of new products less degrading to the environment.

The overall objective of the subsidy scheme for cleaner products ought thus to be to promote the development, production, marketing and use of less environmentally damaging products. The programme must focus primarily on a general framework for stimulating market stakeholders to devote ongoing consideration to the environment.

Use of subsidy funds
On the one hand, this can be accomplished by subsidising improvements in the conditions of the companies for developing new, less environmentally degrading products. On the other hand, it can be done through grants to generate a qualified demand for cleaner products. By concentrating on development and marketing alike, a co-ordinated push-and-pull effect should be attainable, with regard to both businesses and the market.

The product impact must be considered for the entire life-cycle. From a life-cycle perspective, therefore, subsidy funds must be prioritised with an eye to achieving the greatest possible environmental benefit. As a starting point for specific projects, an analysis of the product or substance in question is needed in order to ascertain that the proposed project targets a significant environmental or resource problem, seen in the light of the entire life-cycle.

Similarly, the subsidy programme must function in concerted co-operation with future initiatives in the area of waste. This must be brought about by supporting waste reduction, ensuring product recyclability and reducing the impact of waste on the environment. As an extension of this, it must in future be possible to subsidise the ongoing development of broadly targeted disposal and recycling systems.

Division into four subprogrammes
It is proposed dividing the programme into four subprogrammes, corresponding to the following four dimensions:

It should also be possible to use the subsidy scheme for cleaner products to lend support to all phases of the product life-cycle and, in principle, support should be granted to all significant stakeholders in the market system. The subsidy scheme should function over a period of five years to make it sufficiently supportive of the kind of activities in question.

7.8 Banning the use of selected chemical substances

Environmental problems associated with the production, use and disposal of products have aspects that fall within as well as outside of the area suited to specific behavioural regulation. The development of new environmentally sound products and the consumer's choice of products are areas that typically fall outside. The use of certain hazardous substances in products and the disposal of such products after use fall within.

Regulation prioritised and supplemented with voluntary initiatives
If the use of substances hazardous to health and the environment is to be limited, there needs to be a voluntary effort, performed by relevant stakeholders out of an interest in showing consideration for the environment, coupled with mandatory environmental controls regarding what substances may or may not be utilised. Direct regulation of use is and must continue to be assigned top priority in the case of substances known to have a damaging effect on health or the environment.

Objectives
Long-term objectives for regulating the use of chemical substances and products include minimising the impact of chemical substances on humans and the environment during their life-cycle by reducing concentrations of such chemical substances in the environment as well as human exposure to them. At the same time, substances with a known and significantly deleterious effect on health or the environment must be prohibited unless it is deemed fit to permit certain uses of the substance.

Emphasis on international efforts
Public controls in the form of executive orders governing the use of such substances will largely be based on international efforts in the area, especially within the EU.

In the EU and other relevant international forums, Denmark will continue to promote regulations governing the use of the most problematic chemical substances and products. In this context, Danish industry will be able to play a significant role if it can demonstrate by example that problematic substances and products are dispensable.

Focus on product use and disposal
In conjunction with future product initiatives, the scene is set for improved regulation in areas where controls are the most effective and possibly only way of reducing the impact on the environment. The use of chemical substances that generate a major impact on the environment, either through the use of products or through their disposal, is one such area.

List of Undesirable Substances
The Danish EPA's draft "List of Undesirable Substances," mentioned in Section 7.2, shows those substances presently targeted for action or listed on the policy agendas of Denmark and the EU.

Moreover, a number of substances currently in large-scale use and considered to have particularly alarming effects on health and the environment will be blacklisted. Whether the use of such substances will be subject to regulations depends not only on the additional information produced on their properties and diffusion in the environment as well as EU evaluations and initiatives in the area but also on the possibilities for exploiting the Danish market.

Regulated use of 20-40 new substances
In the course of 1997, the Danish EPA expects to point out 20 or 40 of the substances on the list as special-priority chemical substances and subject them to closer scrutiny with a view to implementing regulation of their use.

There are presently three new Danish executive orders in the pipeline to significantly reduce the use of lead and lead compounds, ban the import and use of wood treated with arsenic, and prohibit the use of nonylphenol ethoxylates in detergents.

7.9 National co-ordination

Within the government sector, a number of instruments are being utilised with direct or indirect consequences for the development and use of products with improved environmental properties. This is true of the Danish Ministry for Environment and Energy's area of jurisdiction as well as that of other ministries.

Government activities must contribute to product initiatives
Many of these government activities make a constructive contribution to product initiatives. But there is far greater potential if only the environmental properties of the products concerned were to be consciously taken into consideration. Work should therefore focus on co-ordinating the effect of all public initiatives of relevance to the product area so as to bring them into line with the proposed product action.

Environmental assessment of subsidised projects
The Danish EPA therefore proposes that the initiative be taken to introduce a more systematic environmental assessment of product development and corporate projects subsidised through various government schemes. The same is true in respect of grants associated with various research programmes. Where the necessary resources or know-now for such assessments are lacking, these must be earmarked.

Subsidy conditional on substitution
Moreover, state subsidies for private activities such as urban renewal must be made conditional on the avoidance of certain substances or materials when alternatives exist. This enforced demand will ensure substitution in an area where functionally satisfactory and environmentally superior alternatives exist.

Including the environment in standardisation work
In defining product and performance standards, procedures need to be established to ensure that various sectorial ministries include environmental considerations in their regulatory initiatives. Concurrently, environmental assessments should be included as required terms of reference for any standardisation work carried out under CEN.

Co-ordinating consumer information
Public-sector collaboration on consumer information - including labelling schemes - must also be strengthened. This can be done by means including co-ordinated campaigns in collaboration between the National Consumer Agency, the Danish Energy Agency and the Danish EPA.

Decentralised environmental authorities
With regard to the decentralised administrative bodies at local authority level, the focus needs to be particularly on the role of administrative authorities as macroproducers of services and on their scope for influencing product behaviour through purchasing, pricing, etc.

7.10 International efforts

Many relevant issues treated internationally
International relations are of quite major significance to the development of product-orientated environmental initiatives, both because a series of international agreements and regulations are in force in Denmark and because Denmark is involved in extensive international trade. Efforts to influence different international bodies and negotiating platforms are important, therefore.

Attempts should also be made to influence whatever product-initiative barriers either exist in international trade and standardisation agreements or are being considered.

In areas in which it leads the field in such efforts - e.g. in the product area - Denmark can provide a source of inspiration and act as an initiator.

Danish participation in the early phases of EU efforts
The EU has recently played an increasingly important part in international environmental collaboration. Attention should therefore be focused on EU institutions especially. Here, Denmark needs to co-ordinate its initiatives with like-minded European countries. It is important to be involved even from the outset of such efforts before ideas turn into proposals. The most important areas, in which ongoing action should be targeted at the Commission, are described under the various initiatives outlined earlier in this chapter. They are as follows:

Environment and trade
Environment and trade should be prioritised, not only because of the opportunities for continued development of product initiatives but also to ensure fair treatment of Third World countries in global trade.

Influencing conditions for standardisation efforts
Part of the standardisation work that is crucial if environmental considerations are to be included in future product development is the systematic lobbying of the 10,000 or so upcoming standards from the CEN with a view to implementing the Single Market. This will also affect the possibilities for introducing eco-labelling. A significant part of this effort will involve influencing the Commission with regard to its definition of demands and conditions governing standardisation efforts.

EU procurement policies
The EU Procurement Directive and internal procurement policy must be lobbied in order to make more room for environmental considerations in public purchasing.

Regulation of use
Regulations governing the use of substances hazardous to health and the environment have been fully harmonised. A consensus will therefore need to be reached with the Commission, both as regards joint regulations and possibly also special national regulations.

Nordic collaboration
At the initiative of Denmark and Norway, the Nordic Council of Ministers has set up a project group under Danish leadership to work on product initiatives. The group is to contribute to strengthening Nordic lobbying power in the halls of the EU, the international standardisation organisations and the WTO. Its first activities will be to influence the European Commission's work on green public procurement and the wording of a product-orientated environmental strategy for the whole of the EU. Furthermore, a seminar will be organised in 1997 on the correlation between environmental and trade policy in association with the Council of Ministers' committees of senior officials for consumer and trade affairs.

8 References

1. Regeringens Natur- og Miljøpolitiske Redegørelse ["The Danish Government's Nature and Environment Policy"], Danish Ministry for Environment and Energy, 1995.

2. World Commission on Environment and Development: Vores fælles fremtid ["Our Common Future"], Danish United Nations Association and Danish EPA, 1987.

3. Danish Institute for Product Development, DTU, Danish Ministry for Environment and Energy, Danish EPA and Confederation of Danish Industries. Environment. EDIP. Miljødimensionen i produktet - en introduktion til virksomhedens ledelse. Miljøvurdering af produkter. Baggrund for miljøvurdering af produkter. Miljørigtig konstruktion. Miljøvurdering i produktudviklingen - 5 eksempler. ["The Environmental Dimension of the Product - An Introduction to Corporate Management. Environmental Product Assessment. Background to the Environmental Assessment of Products. Environmentally Sound Design. Environmental Assessment in Product Development - 5 Examples"], 1996.

4. Danish EPA. Prioritering af industriprodukter ["Setting Priorities for Industrial Products"]. Environmental Project No. 281, 1995.

5. National Consumer Agency of Denmark. Familiens miljøbelastning ["The Environmental Load from the Family"], 1996.

6. Danish EPA: Grøn statslig ["Public Green Procurement Policy"]. Working Report No. 12, 1992. Danish EPA: Grønne indkøb i amter og kommuner ["Green Procurement in Local Authorities"]. Environmental Project No. 197, 1992. Danish EPA: Grøn indkøbspolitik i amter og kommuner ["Green Procurement Policy in Local Authorities"]. Environmental Project No. 263, 1994.

7. Danish EPA's Information System for Cleaner Technology: A PC-based Database System containing Environmental Evaluations of the Processes in Six Sectors.

8. SUBTEC is edited and updated by the Danish National Institute of Occupational Health.

9. Danish EPA. Status for handlingsplan for offentlig, "grøn" indkøbspolitik ["Status Report on Action Plan for 'Green' Public Procurement Policy"], 1996.

10. COWI. Produktorienteret miljøpolitik, baggrundsnotat om initiativer i andre lande ["Product-orientated Environmental Policy. A Background Paper on Initiatives in Other Countries"], 1996.

11. Porter, Michael E., the Competitive Advantage of Nations.

12. Danish Ministry for Business and Industry. Business Report, 1995. Danish Ministry for Business and Industry, 1995.

13. Memorandum from Danish EPA sent to Environmental and Regional Planning Committee of the Danish Parliament (FMPU) on issues of environmental deterioration and improvements in Denmark due to EU provisions.

14. Danish EPA. Bedre miljø gennem indkøb. Håndbog til miljø- og energibevidst indkøbspolitik i det offentlige ["Better Environment through Purchasing. Handbook for Eco-conscious and Energy-conscious Procurement Policy in the Public Sector"]. Association of County Councils in Denmark, Danish Energy Agency, Indkøbs Service A/S, National Association of Local Authorities in Denmark and Danish EPA, 1995.

15. Directive 83/189/EEC on "An Information Procedure with regard to Technical Standards and Regulations".

16. I/S Økoanalyse. Miljøbelastningen ved familiers aktiviteter ["The Environmental Load from Family Activities"]. National Consumer Agency of Denmark, 1996.

17. Den miljøpolitiske udfordring. Oplæg til LO's miljøforum ["The Environmental Policy Challenge. Proposal for the Danish Confederation of Trade Unions' Environmental Forum"]. 2 October 1995.

18. Energispareudvalgets undersøgelse af befolkningens miljømæssige og energisparemæssige holdninger og adfærd ["The Danish Energy Conservation Committee's Survey of the Population's Attitudes and Behaviour with regard to the Environment and Energy Economies"]. Scan Test Research International, 1995.

19. Danish Council of Technology and the Consumer Council. Fremtidens forbrug og miljø ["The Consumption and Environment of the Future"]. Provisional final document from the consensus conference on 1-4 November 1996.

20. Danish EPA. Miljømærkning og miljømarkedsføring af tøj i Danmark ["Eco-labelling and Environmental Marketing of Clothing in Denmark"]. Danish EPA, Working Report No. 48, 1996.

21. Danish Agency for Development of Trade and Industry. Serviceydelser, en erhvervsøkonomisk analyse ["Services. A Business Economics Analysis"]. Danish Agency for Development of Trade and Industry, 1994.

22. "Danish Nature and Environment Policy", 1996.

23. Danish EPA. Working papers, minuting round-table discussios held in early 1996.

24. Danish EPA. Status og perspektiver på kemikalieområdet ["Status and Perspectives in the Chemicals Field"]. Danish EPA, 1996.

25. Danish Ministry of Finance. Grønne afgifter og erhvervene ["Green Taxes and the Trade and Industry"]. Danish Ministry of Finance, 1994.

Appendix 1

Appendix to Chapter 6: Stakeholder descriptions

The stakeholder analysis in Chapter 6 6 is supplemented with further background material in the form of the following elaborative descriptions of a series of other stakeholder groups significant in terms of product-orientated environmental initiatives.

The aspects emphasised within each particular group of stakeholders are modelled along the following lines:

The following national and international stakeholders will be treated:

A. Know-how suppliers
B. The financial sector
C. Counties and municipalities
D. The government sector
E. Multinational manufacturers
F. Other nation states
G. The European Commission

A. Know-how suppliers

Knowledge is decisive to several aspects of the various stakeholders' potential to contribute to the development and marketing of products with improved environmental properties. All stakeholders who work on the environmental properties of products accumulate knowledge of significance to such efforts.

Given the limited internal knowledge-building resources available to manufacturers, businesses and consumers, the knowledge generated in the environment surrounding the stakeholders and the dissemination of that knowledge are prerequisites to their ability to take adequate action in terms of their own interests in product-orientated environmental initiatives.

The groups of stakeholders considered under the heading of know-how suppliers are those whose chief importance to product initiatives is their development and procurement of the knowledge disseminated to professional as well as private knowledge-users. It is thus a highly varied group, spanning universities to daily newspapers, and one that cannot possibly be treated as a single entity with an eye to reaching an in-depth understanding of its conditions and activities. This section discusses the most important suppliers and disseminators of knowledge whereas Chapter 7 will describe specific knowledge dissemination efforts, present and future.

The group of know-how suppliers includes: