Intensified Product-orientated Environmental 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

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.