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Press 
Published in the Press Enviro Tech
Environmental Management and Environmental Technologies
Troy Davis, Executive Director, published in
Environmental Technology from Northern Europe Executive Summary Environmental concerns in industry are here to stay. The demand for environmental goods and services will continue to grow in spite of a slight dip in recent years. Yet the
market is changing and being shaped and driven by several trends, such as new methods of measuring GDP that take into account environmental effects. Developed markets are reaching saturation point for end-of-pipe technologies, and
the fastest growing markets will be in Asia and Eastern Europe. After years of German domination of the market, the world 's top environmental export nations are battling for first place, and the number of local consultants and
companies in developing markets is growing appreciably. In general, integrated technologies everywhere are the trend of the future, and space-age spin-offs are helping to prevent environmental damage and to detect criminals as well
as to reduce clean-up costs: A major development pushing integrated technologies is the result of the coming of age of the integrated approach to environmental problems in business, or Environmental Management (EM). After a 20-year
incubation period, EM is now accepted as the leading operational concept for organizations aiming to improve their environmental performance and work towards goals such as eco-efficiency, sustainable production patterns and
sustainable development, etc. The mid-1990's are the turning point in the trend away from command and control towards more voluntary or market-based instruments. Voluntary schemes or standards of EM have emerged (EMAS ISO 14000
series) and are becoming the main engine of future improvement. Environmental Management and Environmental Technologies The environmental issue for business was, until recently, sometimes dismissed as just a fashion that would
be swept away by the next economic downturn. Yet the growth of environmental problems around the world (despite notable successes in certain countries in reducing mostly single-substance contamination such as lead and SO,) as well
as the growth rate and economic weight of the world environmental industry show that environmental concerns are here to stay. A remarkable fact is that developing countries are beginning to realize that it is in their own best
interest, to deal with environmental problems because further economic growth is being hampered by previously hidden costs of environmental degradation (e.g. in Thailand and China). Though environmental requirements can sometimes
be a hidden barrier to trade, market pressure from industrialized countries is usually an extremely effective way of improving the environmental performance of companies in developing countries. Similarly, some macro-economic
analyses based on economic models including more precise calculations of the effects of resource depletion show that the growth rate of certain countries has been "pumped" artificially higher by unsustainable depletion of
non-renewable resources and by forgetting to take into account the negative impact of such depletion (e.g. the impact on the fishing industry of silting due to deforestation). The efforts of the World Bank and the UN to develop
more accurate gauges of wealth creation by including previously neglected factors is a welcome step. The new methods of measuring wealth will foster the future growth of the environmental goods and services market as well as the
implementation of Environmental Management as an integrated strategy. The worldwide demand for environmental goods and services is growing less rapidly in developed markets today than it was 5 years ago, but it is still growing
strong and some see the industry nearly doubling to about US$ 800 billion by the year 2005 (see the article by Graham Vickery and Maria Iarrera of the OECD for more details). In industrialized countries, the market is slowly
reaching saturation point, especially for end-of-pipe technologies. From power stations to industrial processes, end-of-pipe add-ons are being replaced by integrated technologies designed to save water, raw materials and energy and
to reduce emissions. The largest market barely touched by this trend is the market for domestic wastewater treatment. Though the need for industrial wastewater treatment plants is still large, new water-saving or closed water loop
processes are gaining ground, especially in the chemical or metal-working industry. The best prospects for growth lie in the rapidly industrializing countries of Asia and certain countries in similar situations in Latin America
(e.g. Mexico, Brazil and Chile) and Eastern Europe. The markets in the former Soviet Union are still niche markets and very much dependent on concessionary foreign financing.
What other trends are there in the environmental export market? Much like the shift in the broadband field (where younger and bolder companies are toppling more established and traditional companies), the pecking order among the world's largest environmental exporters is changing. Just a few years ago, Germany was the clear leader and several percentage points
ahead of the USA and Japan (22.8%, 16.8% and 14.6% in 1991 respectively). Today, the three countries are fighting neck and neck for ca. 19% of total world exports of environmental services and technologies. How has this come about?
Part of the answer can be found in US and Japanese government policy. Japan has financed and built an international centre for the transfer of environmental technology under the aegis of the UN Environment Programme. It is also the
world's largest donor of official development assistance. Large and expensive projects (mostly end-of-pipe, such as wastewater treatment plants) financed by Japanese aid in developing countries use mainly Japanese companies.
Another factor is that of proximity. Because the market is growing fastest in Asia, Japanese companies have a natural, geographical advantage. Moreover, the large-scale shifting of Japanese manufacturing sites to Asia has had a
further pulling effect because Japanese manufacturers use Japanese environmental suppliers for their factories abroad. The growth of the Asian market has also had a positive effect on American sales, thanks to a conscious
"Pacific Rim Approach." The US Commerce Department has launched the US-Asia Environmental Partnership to promote the export of American environmental goods to Asia. The US-AEP has an impressive track record of initiating
contracts worth hundreds of millions of US$ - a large part of which has gone to medium-sized companies thanks to a network of local contacts and consultants and a fast intelligence system that puts the requests of local companies
on the desks of their potential US suppliers within 48 hours. For a time, German companies continued to rely on the standard system of trade representatives and German chambers of commerce abroad. However, the German government
has since created an international centre for the transfer of environmental technology (ITUT) together with business associations in order to help SME's improve their exports. Another important trend is that other countries are
putting more emphasis on this market sector, too - from companies in the developing markets themselves to the large water companies of France and the broad base of mainly medium-sized companies in Scandinavia and Northern Europe.
Some countries see environmental exports as a vital niche market that can help sustain their economy. For example, a recent study supported by the Finnish Foreign Trade Association concludes that the potential volume of
environmentally related exports is a third of. total exports and urges Finnish companies to pursue that market more aggressively. These examples show that Northern European companies are trying to get a bigger piece of the pie.
As for emerging markets, a notable success (though still too small) of foreign aid policy is the growing number of local consultants and engineers that are being trained by foreign companies as part of the requirements of publicly
financed contracts. This capacity-building creates local jobs, reduces the cost of advice for local companies and creates more competition for foreign companies generally. But it also enables smart companies to build partnerships
with local companies or hire qualified local people for their own representative offices. Another trend is that new technological developments, especially those involving radar, seismic and sound-wave technologies are making it
easier to locate contaminated areas and detect illegal acts in real time. These techniques are much more precise and cheaper than standard physical, chemical or biological practices and allow better detection of contaminants in
air, soil and water. They promise to greatly reduce the time and money spent on fighting pollution through their ability to determine the exact shape of a contaminated area, thus avoiding unnecessary and expensive clean-up measures
on uncontaminated land. Synthetic aperture radar (SAR), for example, is already used to determine the exact shape and extent of oil spills in difficult weather, thus enabling clean-up ships to zero in on the hardest hit areas.
Even more specific help can be had from systems using global satellite positioning systems (GSP) or radioactive markers. GSP is a military spin-off already used in satellite navigational systems on some luxury car models, and
inexpensive hand-held GSP systems can even be bought for personal use. The use of GSP in road vehicles is one of the major tools with which planners and car-makers hope to fight traffic congestion and its high environmental 'and
economic costs. Another potential use is for locating any truck or train transporting hazardous substances, so that any deviation from the planned route or accidents in remote areas can be tracked down immediately. Alternatively,
single containers can be equipped with individual GSP transmitters. Another promising technique for identifying pollution caused at sea, particularly by ships, involves the use of unique radioactive markers to identify the origin
of any substance, especially oil. In that way, any oil sample found at sea and matched with a central database would suffice to conclusively identify the ship responsible. Analogous tracking and identification systems using smart
card technology can be imagined. Such developments are all vital to the future growth of the environmental market, which experience shows to be very dependent on the strict enforcement of legislation. Therefore, any instrument
that enables better and real enforcement, i.e. that raises the chances and potential cost of getting caught, will increase demand. These developments illustrate a global trend that still needs to be accelerated: the trend to add
more intelligence content to everything we do, from organizational processes and production lines to detection and remedial action. The guiding principle is the one of closing the loop - not necessarily the loop of resources but,
more importantly, the feedback loop of information. It is only through a more conscious use of feedback loops to continuously correct and adjust our actions and processes that we will achieve optimum efficiency and thus be able to
combine human; economic and environmental concerns. Some will recognize here the use of basic principles of cybernetics, the vastly underutilized science of systems we need to apply to solve the problems of an increasingly complex
and polluted world. Applied to management, this trend is defined as Environmental Management: an integrated approach that has a built-in feedback loop for continual improvement and that deals with all aspects of a company's
operations. Sometimes, the solution to an environmental problem found in the production line lies in the marketing department, as the Indian organization affiliated to the International Network for Environmental Management (INEM)
discovered in the case of a small textile printing factory. Thus, the loop between management and technology is closed. Environmental Management increases the demand for environmental technologies and makes them more sustainable.
Efficient technologies become a tool in the hands of management rather than an instance of the tail wagging the dog, as seems the case nowadays when experts speak about the need for environmental technology transfer and Cleaner
Production. Environmental Management (EM) is the operational concept that uses tools such as Environmental Management Systems (EMS), environmental audits, environmental labelling and Cleaner Production, etc. The emergence of
several voluntary international standards for Environmental Management - e.g. the European Union's Environmental Management and Audit Scheme (EMAS) in 1993 and the ISO 14000 Series in 1996 - has confirmed that the management
approach is one of the most useful concepts for raising environmental performance. These new voluntary instruments mark a shift away from command-and-control policies towards more cost-efficient market-based instruments. In cases
where today's markets fail, new instruments may have to be created (e.g. tradable emissions credits) to further spur on the environmental market. Many large companies and most large business organizations, such as the ICC, have
actively contributed to these positive developments and are spreading the message to their members. One of the most active business organizations in this field has been the International Network for Environmental Management,
dedicated to assisting the member companies of its national affiliates around the world to improve their environmental performance on an optimum cost-performance basis. The world's largest business-based non-profit and
non-governmental organization of its kind, the Network is a partnership of independent non-profit business organizations for Environmental Management and Cleaner Production Centres in over 30 countries. Its mission is to spread the
concept of an integrated approach to environmental problems in business and promote the growth of the environmental goods and services market. As the Network grows and more and more companies are shown step by step that there is
nothing to be afraid of, more and more doors will be opened for providers of environmental goods and services.
International Network for Environmental Management (INEM)
Bollschweil, Germany, 1996
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