Reinventing Environmental Regulation

Under Project XL, businesses promised better performance in exchange for a regulatory approach focused more on results than means, with the Environmental Protection Agency (EPA) measuring pollution reduction across rather than at individual sources within a facility. Reinventing Environmental Regulation is a compelling account of the breakdown in negotiations to implement Project XL at a tape manufacturing plant of 3M, a company widely recognized as environmentally progressive. Authors Marcus, Geffen, and Sexton discuss the conflicting goals of participants, the influences of personality and organizational culture, and complications caused by changes in 3M's external business environment. They compare the 3M case with EPA negotiations involving Intel, Merck, and Weyerhaeuser, finding similarly contentious, though less fatal disagreements about the meaning of "superior environmental performance." Project XL (eXcellence and Leadership) was the flagship effort by the Clinton administration for "cleaner, cheaper, and smarter" regulation. Other recent proposals also emphasize flexibility and voluntary efforts. Marcus and his coauthors demonstrate the difficulty of putting these ideas into practice, while stressing the need for continued innovation. They suggest more successful outcomes through clearer definitions and expectations, better communication, and negotiations that keep pace with changes in the world beyond.

Alfred A. Marcus is a professor in the Strategic Management and Organization Department of Carlson School of Management at the University of Minnesota.