ENVIRONMENTAL PERFORMANCE AGREEMENTS

The environmental performance agreements allow establishing a compromise between three key actors in the fight for an eco-responsible society: citizen, government and business.

Author: Yves Garenne

The 21st century is somewhat unique since it brings to light several new elements regarding the environmental impact of our capitalist society. Science has confirmed the hypothesis that human activity harms the durability of ecosystems: 6^th massive extinction of biodiversity, greenhouse effect and climate change, rising of the oceans, melting of thousand-year-old glaciers, and massive disappearance of bees. Governments are looking for new legitimacies to answer to the interrogations of populations more and more educated on these issues, and very skeptical regarding the independency of political decision-makers. Entrepreneurs and leaders of organizations are starting to integrate environmental impacts in a very marginal way in their balance sheets and to grasp evaluation methods of these externalities. Paris Agreement (COP 21) has showed that an understanding is now possible on some elements.

This global vision can only be translated into a pragmatic implementation where each stakeholder has the possibility to implement what depends on its responsibility. The consumer becomes a consum’ actor asking more transparency on the products he buys. Governments realize that a massive increasing of legislation and regulation can stifle an important part of the economic fabric which has to struggle on surviving challenges. The most vigilant and visionary entrepreneurs understand that a lack of awareness regarding environmental issues harms the company’s development and the whole value chain.

This set of apparently contradictory issues leads to a more adequate appreciation of the progress required to reach increasing compromise with ratchet effect. To be more specifics, there seems to be a contractual policy arising among the 3 key actors: citizen, government and business. The first acceptable element of compromise is materialized by “mutual commitment agreements” between administration and entrepreneur or a network of companies.

There is now awareness about the need to favour companies committed to “environmental performance”

There is now awareness about the need to favour companies firmly committed to “environmental performance” rather than mobilizing precious expertise resources to penalize the less responsible firms.

However, psychological obstacles still exist. The administration has the habit to control rather than to accompany, and companies use to focus on the economic performance to the detriment of environmental performance.

The translation of these commitments into the normative and legal framework is being progressively implemented. The administration’s will is to accompany companies wishing to commit themselves more firmly to increased environmental performance. Thus, in the middle of the 2000s, a number of Environmental Performance Agreements (EPA) has been experimented.

In the case of Algeria, an evaluation of these first EPA took place in April 2016 in the framework of the PAPSE[1] programme, and has enabled confirming the interest of companies for such an approach. The 3 ministries concerned by the issue of environment (Ministry of Energy, Ministry of Industry, Ministry of Physical Planning and Environment) have also showed a high interest to progress in the way of contractualization.

A new version of a 2^nd generation Environmental Performance Agreements will be soon released. They are all based on the conclusion of mutual commitments between administration and business. All the EPA will have a common base withnormative compliance, especially for waste, and will include the development of a “dashboard of environmental performance” and an optional base related to issues such as energy, eco-design, biodiversity or water, greenhouse gas, and the connection health-environment. As a sign of good will, the administration will keep the first commitment she is responsible for to record the launch of the agreements.

It has also appeared as a necessity to offer the academic world the possibility to become a partner of the EPA.

Through these measures, the goals of the administration are to improve the normative compliance, to observe a reduction of environmental disturbance and therefore to reduce the costs associated for the community.

The interest for a company is to make easier the compliance, especially through auto-statements. Thus, they can be accompanied by public authorities’ expertise, innovate with the integration of environment, access more easily to ad hoc funds and integrate slowly the Social Corporative Responsibility.

A win/win relationship is possible.

This post has been published on the Blog http://www.newwayssustainability.org/

[1]Technical Assistance Support Staff (PSU) for the Programme to support the Environmental Sector in Algeria, whose technical assistance is implemented by a consortium led by the company Eptisa.