Intensified Product-orientated Environmental Initiative

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

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:

The spread of environmentally and health hazardous substances
The increasing consumption of fossil fuels
The overexploitation of biological resources
The consumption of non-renewable mineral resources
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 /1/ 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.

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