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--> 12 A Framework for Action Over the past several decades, public concerns about risks to human and ecosystem health have driven individuals and organizations to act in a more environmentally conscious manner (Council on Environmental Quality, 1995; United States Environmental Protection Agency [EPA], 1992, 1998). The committee believes that this trend will continue as scientific understanding of environmental systems improves and society's demands for environmental improvement persist. As public attitudes continue to "raise the bar" with respect to environmental performance, each economic sector (e.g., agriculture, industry, municipalities) will choose the methods by which it will meet these challenges. If a particular sector's performance in the environmental arena is seen as inadequate, and if social pressure is maintained, government intervention—usually in the form of regulation—is likely. In the case of industry, past experiences with this prescriptive process have been viewed as particularly intrusive and inefficient. Limiting future regulatory actions will require skillfully harnessing performance improvements with both environmental and economic benefits while formulating innovative strategies to efficiently address environmental concerns that lack obvious connections to the bottom line. The committee is convinced that environmental performance metrics will play an important role in these efforts, providing a valuable tool to industry as it strives to do its part to lower human impacts on the environment. The committee observes that concerns over compliance have driven the majority of environmental performance improvements. More recently, the private sector has discovered rewards in a more proactive approach to environmental stewardship. Companies and industry associations are becoming increasingly

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--> interested in, and capable of, contributing solutions to environmental challenges. As the private sector continues to demonstrate a greater capacity to drive environmental improvement, the government's role should begin to shift from that of a regulator to that of a "facilitator." In the future, partnerships between government, industry, and citizens' groups are likely to yield more creative and efficient solutions to environmental problems. This is not to say that government should abdicate all leadership on environmental issues. Environmental quality is a public good and, as such, the government must maintain a significant (if declining) role. While acknowledging this, the committee emphasizes that better results and greater efficiency have generally been obtained from companies that have voluntarily undertaken serious attempts at environmental improvement (Dow, 1996). Establishing a Baseline: Best Practices Analysis of the metrics in use by the more progressive organizations engaged in this study revealed a number of similarities in terms of the types of measurements tracked (Table 8-1). The committee feels that these environmental performance metrics represent a broadly accepted set of "best practices." However, best practices are far from common practices. Therefore, before suggesting ways of improving the current set of metrics, the committee wishes to provide some guidance to those organizations that have yet to establish a comprehensive framework of environmental metrics. RECOMMENDATION 1: Companies should investigate and implement to the greatest degree practicable environmental metrics representative of current best practices. Based on the four sector studies and the experience of its members, the committee urges firms to develop metrics in the 15 categories described in Table 12-1. These metrics categories fulfill several requirements. First, reliable and relatively unambiguous measurements may be derived in each of them based on present knowledge and technology. Second, many of the categories relate directly to core business concerns (e.g., cost cutting, improved efficiency), regulatory requirements, or the maintenance of good relationships with local communities or regulators. Lastly, the metrics require information that is already collected by most companies for regulatory compliance, inventory tracking, or waste management. That is not to say that resources will not be required to assemble the information into a usable form, but the means for obtaining many of these data is presently in place. While the relevance of individual categories may vary by industry (the paper industry will, for instance, have greater interest in land-use metrics than the electronics industry), most have broad applicability. This recommendation thus provides guidance to the many companies that have yet to undertake a compre-

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--> TABLE 12-1 Recommended Categories for Environmental Performance Metrics in Manufacturing and Product Use Category Brief Description and Examples Manufacturing Related   Pollutant releases Includes: Air—Some data collected to meet regulatory reporting requirements (i.e., Toxic Release Inventory [TRI]). Separated into hazardous/nonhazardous. a Water—Some data collected to meet reporting requirements. Similar to above. Solid—Some data collected to meet reporting requirements. Similar to above. Materials use/efficiency Separated into hazardous/nonhazardous.a Energy use/efficiency Broken down by resource (e.g., petroleum, natural gas, coal, renewable). Some companies have also begun to assess in terms of global warming potential (e.g., CO2 equivalents). Water use/efficiency May track process water and cooling water separately. Greenhouse gas emissions Separated by gas (e.g., CO2, CH4, N2O). Can be expressed in CO2 warming potential equivalents. Percent reuse/recycle/disposal Useful for assessing the use of individual process inputs as well as the final disposition of some intermediate products. Packaging Measured on either an absolute or per-product basis. Land use Separated into percent of land preserved, land developed, land restored, and inactive or abandoned developed land. Environmental incidents Classified by regulatory violations, fines, permit exceedances, accidents, etc. Health and safety Incidence of employee illness and injury and hours of training taken in safety, hazardous waste handling, etc. Product-Use Related   Pollutant releases Includes: Air—Separated into hazardous/nonhazardousa (e.g., emission standards for automobiles). Water—Same as above (e.g., output water quality of a washing machine or dishwasher). Solid—Same as above (e.g., toner cartridge for printer or copier). Materials use/efficiency Materials required for product use (e.g., detergent in cleaning appliances, fluids in automobiles). Energy use/efficiency Energy requirements for product use (e.g., corporate average fuel economy [CAFE] in auto industry, power use in electronic devices [EPA's Green Lights program], cooking efficiency [Electrolux]). Water use/efficiency Water requirements for product use (e.g., appliances, toilets). Greenhouse gas emissions Primarily a function of energy use. Can be expressed in terms of CO2 (or CO2 equivalents). End-of-life disposition Units or amounts of product reused, recycled, or disposed (may be further separated by method of disposal). a All references to a hazardous/nonhazardous distinction are made with respect to existing regulatory definitions in the United States. NOTE: In many cases the usefulness of metrics will be enhanced by appropriate normalization (e.g., per unit product, per unit sales, per product use, per product lifetime).

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--> hensive program of environmental performance measurement, and it provides a cheek for those companies with programs already in place. At the level of the individual facility or firm, the committee strongly recommends that senior business leaders work with environmental managers to begin emphasizing the measurement and improvement of environmental performance in the areas cited in Table 12-1. The committee finds that environmental parameters have not been fully integrated into most business processes. These metrics should be built into approval procedures for new projects and products, and integrated into employee evaluation criteria. The committee feels that, collectively, these categories of metrics represent an instructive and broad assessment of the present state of an organization's environmental performance and one that may be reasonably achieved. Although many further improvements to environmental performance measurement and reporting are needed, the widespread implementation of these metrics will be a significant and meaningful first step. Goals for Improving Industrial Environmental Performance To assist industry improve its stewardship of the environment, the committee has identified five goals and associated recommendations for enhancing the development and use of industrial environmental performance metrics: adopt quantitative environmental goals, improve methods of ranking and prioritizing environmental impacts, improve the comparability and standardization of metrics, expand the development and use of metrics, and develop metrics that keep pace with new understanding of sustainability. In pursuing these goals, both government and the private sector have important roles to play. The unique ability of government to mobilize and assemble the wide range of individuals and groups with the required environmental expertise will be invaluable. Although government participation will be crucial to the success of many of the recommended actions, these steps should be based on scientific merit, not political expediency. Industry contributions to this "partnership" will be just as critical, as it is industrial firms that have the greatest expertise in evaluating and mitigating the environmental burdens imposed by their products and processes. The committee's recommendations are based on an investigation of U.S. experience in improving environmental performance. While many of the proposed actions have broad, even global, applicability, they do reflect a U.S. perspective. Public attitudes toward the environment and regulatory frameworks

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--> will vary from country to country and may result in somewhat different approaches to improving industrial environmental performance. Goal 1: Adopt Quantitative Environmental Goals The usefulness of a metric in driving environmental improvement is greatly enhanced by setting and tracking progress toward a quantitative goal. This is true at both the national and the corporate scales. Although in the case of emerging concepts such as sustainability numerical goals may not presently be feasible, setting firm goals with respect to many things that are now measured (e.g., mass of emissions, energy use, materials use) is an important exercise that has not yet been undertaken by many organizations. At the level of the firm, management and employees need a strong grasp of exactly what is expected of them and the criteria by which they will be evaluated. Without this understanding, attention to environmental issues will be less focused and motivation will wane. A goal of 75 percent fewer TRI emissions or 50 percent more postconsumer recycle material, for example, represents objectives toward which an employee, department, or company can strive. Goals set at the national level should also be quantifiable. Such goals provide policy makers and government officials with clearly articulated objectives (e.g., 100 percent of cities must meet National Ambient Air Quality Standards) on which to focus throughout the sometimes convoluted political process. They also provide industry with a greater degree of certainty about the future regulatory environment, which is an asset to corporate planning activities. RECOMMENDATION 2: The U.S. government should strengthen its role in setting and reporting progress toward national environmental goals. The absence of clear priorities can lead to misallocation of resources. The federal government has a singular role to play in bringing together the technical expertise needed to prioritize the myriad environmental issues of national concern and to periodically update these assessments. The committee suggests that the process of developing quantitative national goals could be led effectively by the Council on Environmental Quality (CEQ) with heavy involvement from industry, citizen groups, and other stakeholders (e.g., EPA). Subsequently, a neutral body such as the National Research Council (NRC) could have a role reviewing these recommendations. Previous exercises of this type have been attempted (e.g., by the President's Council on Sustainable Development), but rarely have they articulated an explicit ranking of environmental priorities or established quantitative benchmarks. A more definitive rendering of environmental priorities will allow industry and other parts of society to direct their improvement efforts in a more efficient manner.

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--> Quantitative goals, developed through a scientifically based consensus process involving government, industry, and environmental interest groups, have proved effective in addressing specific issues. Goals set as part of the Montreal Protocol, which led to the phasing out of compounds responsible for stratospheric ozone depletion, are a notable example of such cooperative efforts. Another example is the EPA Science Advisory Board's pioneering report, Reducing Risk (United States Environmental Protection Agency, 1990), and its predecessor, Unfinished Business (United States Environmental Protection Agency, 1987). The committee recommends that efforts of this kind be expanded and updated periodically to reflect improved knowledge and understanding of environmental systems. RECOMMENDATION 3: Individual companies and industry sectors should set quantitative environmental goals and track and report their progress in meeting these goals. Individual companies and industry sectors should take the initiative in setting, tracking, and reporting on their progress in meeting quantitative environmental performance goals. The committee observes that while broad statements of policy such as those found in a corporate mission statement can provide some direction, they are often insufficient to catalyze continual and substantive environmental improvement. Companies that set quantitative environmental goals and commit to tracking and reporting progress toward them often realize rapid improvements in environmental performance. The committee also notes that while senior managers in most companies recognize a responsibility for safety and quality, far fewer have internalized a similar commitment to environmental concerns. If improvement in environmental performance is to be an effective and continuous process, all levels of corporate management must begin to bear some responsibility. Furthermore, while national environmental goals may not always be directly applicable to industry- or region-specific circumstances, related measures should be incorporated into corporate planning to the degree practicable. The committee recognizes that important issues associated with ecosystem health, biodiversity, and sustainability still largely defy attempts at quantification. Eventually, alternative (i.e., nonquantitative) methods of assessment may reach an acceptable level of development to warrant widespread application. In the near term, however, the establishment of quantitative goals should be a primary objective. Goal 2: Improve Methods of Ranking and Prioritizing Environmental Impacts Efforts must be undertaken to develop an acceptable system for prioritizing

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--> the issues of greatest environmental concern. Doing this will require moving from the measurement of environmental loads (e.g., air emissions, water emissions, resource use, land use) to the measurement of environmental impacts (e.g., human health impacts, ecosystem impacts). With such a system, goals and metrics can be established so that scarce public and private resources are directed toward reduction of environmental impacts in the most effective manner. Companies often invest in a variety of voluntary environmental initiatives. Some of these efforts result in cost-effective lowering of environmental impacts and some do not. Such a framework would be valuable to industry and government as they continually seek to reassess and update their environmental goals. (See Recommendations 2 and 3.) RECOMMENDATION 4: Develop categorization systems to prioritize and target opportunities for reducing environmental impact. The U.S. government should facilitate a process with academia, industry, state agencies, and nongovernmental organizations to develop improved methods of ranking, categorizing, and prioritizing the relative impact of industrial environmental loads. This process should begin by focusing on human health risks and extend to issues of ecosystem health and long-term sustainability as knowledge and understanding of environmental systems evolve. Present knowledge may not allow for explicit numerical scoring of all impacts under all circumstances, but the committee feels that sufficient knowledge does exist to begin to prioritize categories of environmental loads (e.g., air emissions, water emissions, resource use, land use) relative to one another. The need for prioritization applies both within and across respective categories. Within the category of hazardous emissions, a number of efforts have been undertaken to rank substances with respect to their impacts on human health. Emissions may, therefore, provide a useful starting point. Data collected under TRI, as well as hazardous waste generation and disposal data collected under the Resource Conservation and Recovery Act (RCRA), may not fully represent a facility's environmental impact, but they do provide two of the only examples of consistent cross-industry metrics. Methodologies must also be designed to compare the relative environmental impacts of hazardous emissions against other categories of environmental loads, such as materials use, land use, or waste disposal. The review of metrics used in the chemical sector (Chapter 5) notes the success of Imperial Chemical Industries' (ICI) implementation of its environmental burden system to identify and rank the impact of environmental releases within a number of categories (e.g., ecotoxicity, aquatic oxygen demand, hazardous emissions). While the ICI system does not establish a strict ranking of impacts across categories or prioritize the categories with respect to one another, it remains a useful tool. As society's knowledge and understanding of the

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--> complex interactions between environmental pollutants and long-term human or ecosystem health continue to become more sophisticated, efforts must be made to integrate this information into improved environmental metrics. Because many of these topics are beyond the province of industrial research, government should assume a leadership role in bringing together industry leaders, academics, and public stakeholders to investigate metrics and goals that reflect cumulative and long-term environmental impacts. As a first step, CEQ, EPA, and the National Institutes of Health should jointly organize an effort to develop and introduce an agreed-upon system of ranking the substances already reported under TRI and RCRA with respect to environmental impact. Researchers and state and federal agencies have developed such systems in the past. All that may be needed, therefore, is to come to agreement on the most acceptable. While the committee suggests this as a logical beginning given the ubiquity of TRI and RCRA, hazardous waste and air emissions account for only a portion of an industry's environmental load. Efforts must be made to begin to prioritize the broad range of potential categories of environmental loads. Given the diversity of manufacturing activities, such efforts would likely be most effective if performed at the industry-sector level. A program along the lines of the EPA Office of Compliance's sector notebook project, organized by EPA and involving experts from industry, academia, and public stakeholder groups, could begin to rank the environmental loads of greatest concern in various industrial sectors. Goal 3: Improve the Comparability or Standardization of Metrics If environmental metrics are to become broadly useful across companies, industrial sectors, the investment community, and countries, great strides must be made in standardization. Corporate management desires greater uniformity in environmental metrics, both to support better internal decision making and to benchmark against competitors. Equally important, reporting standards will lend public credibility to industry efforts to improve environmental performance. While industrial reporting of such things as waste generation and emissions has become more comparable, reporting in other areas such as energy use and natural resource consumption has lagged behind. Different companies and industries engage in a wide range of activities that can significantly complicate standardization efforts; however, sufficient similarities presently exist within several core ecoefficiency areas (e.g., materials efficiency, energy efficiency, water use) to begin devising comparable metrics. Established standards will simplify corporate efforts to develop and implement metrics while also providing credible evidence of improved environmental performance to external stakeholders. RECOMMENDATION 5: The U.S. government should facilitate a process of establishing consistent, standardized industrial environmental

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--> metrics through the involvement of experts from industry, nongovernmental organizations, and federal agencies. The absence of standard metrics impedes benchmarking and reduces the value of public reporting of environmental performance. While reporting of standardized metrics is voluntary, a company claiming to have reduced its environmental burden should be judged by objective criteria (not unlike the formal definitions of terms like ''low fat'' or "nonfat" recently instituted in the food-processing industry). It is also possible that peer pressure may begin to push companies to report environmental data as more of their competitors choose to do so. The committee is convinced that developing a set of standard metrics is absolutely critical to establishing a pattern of continual improvement in industrial environmental stewardship. While government participation is prudent in any process that seeks to set national standards, industry should play an integral role in the development, implementation, and promotion of standardized environmental performance metrics. This effort includes not only the establishment of standard measures but also the identification of units of normalization that achieve the broadest applicability (e.g., units per dollar of operating income or per-dollar value to society). Individual industrial sectors must help determine the relative value and practicality of specific environmental metrics while also working to encourage the adoption of standardized metrics across the corporate world through avenues such as the supply chain and trade associations. The committee recognizes a number of commendable efforts to define and establish a simple, robust set of environmental metrics. However, these attempts have been largely uncoordinated. Some organizations with significant market power have successfully insisted that their suppliers meet and report on environmentally derived standards. Industrial associations have likewise played a role in the promotion of standard practices, but such efforts have often been hampered by the wide range of constituents these organizations must consult before advocating new positions. Government and nongovernmental organizations have also contributed to broadening the knowledge base. The World Business Council for Sustainable Development, for example, has made efforts to establish ecoefficiency metrics and has provided critiques of current environmental reporting methods. EPA has also provided valuable information through its Pollution Prevention and Green Accounting initiatives. Another recent development is the Global Reporting Initiative, an effort to identify and design standard metrics being conducted by the Coalition for Economically Responsible Economies with the participation of organizations ranging from General Motors to the United Nations Environment Programme. The committee notes that CEQ and the NRC are both capable of providing leadership in efforts to define and standardize environmental metrics. Industry expertise and the EPA Science Advisory Board should be engaged in all phases

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--> of this work. The National Institute of Standards and Technology, which has a long history of conducting standardization programs, should be heavily involved in the effort. RECOMMENDATION 6: The U.S. government should promote standardized industrial environmental performance metrics in international forums. The world is becoming increasingly interconnected, and the environmental performance of a U.S. corporation is often judged by much more than local or national standards. The same applies to foreign multinationals operating in the United States. Some method of comparing environmental performance across countries is required. In today's global economy, corporate operations are not limited by national boundaries but depend on extensive global supplier chains and distribution networks. Establishing international industrial environmental performance standards will not be easy. However, establishing a framework for objectively measuring and comparing different nations' environmental performance will provide incentive for organizations to improve their operations in countries with varied commitments to environmental protection and enforcement. The committee suggests that U.S. aid and trade agencies might begin this process through their technology transfer and exchange programs. Another course of action might involve collaboration among the Office of the U.S. Trade Representative, the U.S. Agency for International Development, and the U.S. Department of Commerce (DOC)—coordinated by the U.S. Department of State—to initiate an international process to bolster the comparability of environmental metrics. Accepted standard environmental measures of industrial processes, products, and marketing might also be promoted for use by international organizations. One excellent example of such interaction is the leadership provided by the U.S. government in the development of the Organization of Economic Cooperation and Development's Pollutant Release and Transfer Registers. The 1997 Kyoto Protocol on climate change provides a superb opportunity to test the international community's ability to develop standardized environmental metrics. Goal 4: Expand the Development and Use of Metrics The four industry studies in this report reveal that some companies, primarily large manufacturers, have made great strides in measuring and improving their environmental performance. The time is right to expand the use of environmental performance metrics over more of the product life cycle and to disseminate knowledge of best practices to a wider audience. In recent years some of the largest manufacturers have been providing more detailed quantitative information on the environmental dimensions of their opera

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--> tions. Environmental measures in the manufacturing stage are important, but attention must now shift to other life-cycle areas such as raw material extraction and refining; product use; and product disposal, reuse, and recycling. Some industries have already begun to use metrics in these areas for either competitive or regulatory reasons. Many paper and forestry products companies maintain their own raw material reservoirs and thus have a vested interest in metrics related to rates of harvest and sustainable land management practices. In the case of automobile manufacturers, a number of product-use metrics such as vehicle emissions and average fuel economy are closely tracked as a matter of regulatory compliance. Growing interest in sustainability has led to the consideration of product take-back legislation in many countries and resulted in increasing emphasis on improved metrics to assess product end-of-life characteristics. As these examples indicate, life-cycle metrics exist, but they are still far from commonplace. One challenge is encouraging the development of metrics within the manufacturer's supply chain. Even in cases where suppliers can be encouraged to measure, collect, and report environmental information, compiling comparable data from a range of suppliers can be difficult. There are also limits to the depth to which life-cycle attributes (and the supply chain) can reasonably be investigated. Despite these challenges, the potential environmental benefits of viewing the product life cycle more holistically demand that the corporate boundaries of environmental performance metrics be enlarged. RECOMMENDATION 7: Industry should integrate environmental performance metrics more fully throughout the product life cycle. Few companies or industries control their product from cradle to grave, and many exercise direct influence over only a fraction of product life cycle. Industrial executives, managers, and engineers should begin to extend the application of environmental performance metrics both up (e.g., to account for product use and end of life) and down (e.g., to account for raw materials acquisition and processing) the supply chain. The committee recommends that companies and industrial sectors take the lead in more fully assessing the life-cycle impacts of their products. This process may include conducting surveys or studies in partnership with suppliers to determine which metrics are most useful and feasible. In large corporations, some of which contract with hundreds or even thousands of suppliers, this task may appear overwhelming. However, these larger companies also maintain substantial leverage over their suppliers in terms of dictating product characteristics. Attempts should be made to begin investigating the potential for robust supply chain metrics, even if only in connection with a lesser number of larger vendors. The committee believes that an invaluable contribution to this effort would be the establishment of a consistent, cost-effective methodology for providing estimates

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--> of relative life-cycle impacts. Comprehensive life-cycle analyses often become intractable as the level of investigation becomes ever deeper and more detailed. A system of quick yet consistent assessment needs to be developed, standardized, and promoted. A systems approach will be required, if suppliers, manufacturers, consumers, and those responsible for the end of product life can reasonably assess their role in lessening the overall environmental impact of their activities. Corporate supply chains are vast, but there are many small and medium-sized companies that have little contact with these large interconnected networks. Smaller enterprises could benefit from greater exposure to the more advanced environmental practices of larger corporations. In addition, although some larger companies are at the leading edge of environmental metrics development, advancement has been far from uniform. While companies cannot be expected to release proprietary information or methods, greater efforts must be made to transfer the corporate practices more common to large manufacturers to other levels of industry. RECOMMENDATION 8: The U.S. government, acting in concert with industry, should gather and disseminate information on best practices in industrial environmental performance measurement. Improved efforts must be made to transfer the knowledge and technology of these methods across industries and sectors, particularly to small and medium-sized enterprises. Approaches to measuring and improving environmental performance are proliferating throughout the world. Some system needs to be devised that more effectively communicates these techniques to small and medium-sized companies as well as to larger companies that have yet to develop environmental measures. The Internet allows for the creation of a widely accessible clearinghouse of environmental metrics information. An appropriate government agency (e.g., EPA, DOC) should engage expertise from the private and public sectors to assemble and periodically update an online library of industry-specific metrics and case studies. Other avenues of dissemination might include state agencies and industry associations. The committee recommends several different approaches to providing widespread access to information on environmental performance metrics. EPA should assume responsibility for assembling an industry-and category-specific (e.g., energy use, material use) database. Industry input will be critical to the success of such a database, in terms of identifying best practices and providing periodic updates. Furthermore, the U.S. Small Business Administration, which has offices in all 50 states, could work to increase awareness and use of environmental metrics among small and medium-sized companies.

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--> Goal 5: Develop Metrics that Keep Pace with New Understanding of Sustainability Society's understanding of and commitment to the concept of sustainability is increasing. As this interest grows, all sectors of the economy must begin to investigate methods of assessing and improving the sustainability of their activities. Opportunities for cost savings, new markets, and novel methods of product differentiation are among the advantages that proactive companies might enjoy as a result of more sustainable practices. These potential benefits notwithstanding, considerable confusion still exists regarding how a company might develop and apply reasonable measures of sustainability to its activities. While many companies have made headway in the application of ecoefficiency metrics and programs, this represent only a first step toward sustainability. As society begins to come to grips with the theoretical and technical underpinnings of sustainable development, companies will be challenged to maintain the pace of improved performance as they seek to evaluate their activities against an often changing set of criteria. Several sustainability issues with more immediate environmental relevance include the declining natural resource base (e.g., energy and materials), alteration of global bio- and geochemical cycles (e.g., carbon, hydrologic), and threats to the world's biological base (both plant and animal). Evidence of these concerns can be seen in the goals and metrics established by certain companies. Sectors exercising some degree of control over their own resource base (e.g., paper and forestry products, fisheries, agriculture) have long recognized the value of monitoring and maintaining sustainable rates of stock growth and harvest. The potential for global warming is largely attributed to changes in the carbon cycle, prompting some companies to place a higher priority on cutting greenhouse gas emissions (and costs). Some industries have even begun to consider ways in which they might offset greenhouse emissions through the sequestration of carbon dioxide (e.g., in forests and by reinjection into spent oil and gas reservoirs). Finally, the realization that a declining biological base and the loss of genetic diversity may greatly affect advances of great importance to human beings (e.g., the cancer treatment drug taxol derived from the bark of the Pacific yew) has heightened the concerns of some companies over species loss. All of these examples are useful and directly link the profit-maximizing role of a firm with environmental improvement. Such efforts represent an important phase of society's transition to more sustainable practices. Further advances should be researched and encouraged. RECOMMENDATION 9: The U.S. government and industry should assure that adequate research attention is directed toward furthering understanding of the complex environmental interactions associated with sustainability.

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--> Industry's role will be driven primarily by competitive pressures as customers, investors, and regulators demand better environmental attributes from products and processes. Government's role will be to examine ways in which industrial operations and products affect the various aspects of sustainability. This may involve investigating the implications of long-term industrial activity on the environment, including such issues as materials flows and energy use. Corporate funding may be appropriate for investigating readily defined, shorter-term topics or in cases where there is a convergence of sustainability and business objectives (e.g., the shifting emphasis of many chemical companies to biotechnology). Issues of broader scope and longer time span, however, will likely require government research support. Examples might include assessment of the implications of continued heavy dependence on landfills for hazardous and nonhazardous solid waste disposal and the resulting adverse environmental impacts on a local, regional, national, or global scale. While the concept of sustainable development has widespread appeal, there is as yet no scientific consensus on a definition of the concept or indices by which it may be measured at the macro, or societal, level. Our knowledge of life support systems, ecosystem services, carrying capacities, eco- and social system health and integrity, and other fundamental aspects of sustainability is in its infancy. Assessing a given industrial product, process, technology, or facility with regard to sustainability will require the development of systems approaches for which very few relationships have yet been developed. Finally, while attention to purely environmental issues is important, it should be noted that economic and social concerns are integral to the concept of sustainability. Presently, however, it is difficult to directly relate a firm's contribution to many broad economic and social measures (e.g., per-capita income, average education level). The committee recommends that the National Science Foundation (NSF), in conjunction with EPA and CEQ, initiate research programs focused on sustainable industrial enterprises. Universities will likely lead those research activities, but efforts should be made to encourage close working relationships with industry, similar to the programs under way at a number of the NSF's Engineering Research Centers (ERCs). These centers have had considerable success in working with industry, and in many cases industry has supplemented government grants with corporate funding for specific projects. RECOMMENDATION 10: Conduct research on methods of integrating socioeconomic criteria into sustainability measures. Research is needed to help solve the analytic, relational, and informational challenges associated with sustainability. These challenges involve not only single-issue complexities (e.g., related to the environment) but also those involving multiple behaviors and impacts (e.g., economic-environmental, social-environmental) and varying scales (e.g., local, regional, global).

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--> Researchers must begin to examine methods of analysis and metrics that address society's ability to link environmental, economic, and social activities in a manner that can guide progress toward sustainability. It should be noted that the degree of complexity involved in these analyses may mean that useful sustainability metrics will be very difficult to devise and in some cases perhaps even impractical. Many of these metrics and the trends they identify will be far beyond industry's sphere of influence. Nonetheless, as a strong force within society, industry must begin to investigate its role in moving toward sustainability. Companies, particularly large multinationals, should begin by evaluating their products in terms of their potential for improving the physical status (e.g., related to environmental degradation), economic status (e.g., related to widespread poverty), and social status (e.g., related to urban migration) of the communities in which they operate. Although industry should play an active role, the long-term and exploratory nature of much of this research makes it more practical that nongovernmental organizations, government researchers, and the academic community take the lead in pursuing methods of quantifying these complex and interrelated aspects of sustainability. As world population continues to rise and the Earth's carrying capacity becomes increasingly strained, sustainability issues will begin to directly impact industries and companies. If the global trend toward decentralization continues, industry will take on a more prominent role in economic and social decision making. As this responsibility and society's understanding of sustainability grow, improved methods of measuring and tracking progress toward environmentally sustainable development will become valuable tools. The committee suggests that research into these complex interrelated topics could be most effectively overseen by the NSF. Broader and more multi-disciplinary models than the successful NSF ERCs may be required to respond to this need. Concluding Remarks Environmental metrics are at the heart of how industry and its many stake-holders define environmental performance and determine whether progress is being made. This report documents how the use of environmental metrics has focused the attention of companies, public agencies, and a variety of other interested parties on key areas of industrial performance. U.S. industries have integrated some metrics, especially for pollution releases and hazardous waste generation, into routine management decisions and external reporting. Many U.S. firms also track their consumption of energy and water as a basic element of cost control. Some firms have even begun developing metrics for other areas, created tools to prioritize these indicators, and experimented with more qualitative issues related to human health, ecosystem health, and broader social dimensions. With new knowledge and changing public expectations, fresh environmental

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--> challenges are arising that are not addressed by contemporary environmental metrics. Ecosystem impacts, effects on human health, habitat loss, and global climate change are among a few of the emerging issues for which metrics are needed. To realize the full potential of environmental metrics will require changes by all the parties involved. Industry, government, and communities all have important roles to play, not only in improving industrial practices but also in extending the lessons learned in that sector to the vast array of other societal activities that impact the environment. Much work remains, but as society works to achieve a pattern of sustainable development, environmental metrics will provide a valuable tool for influencing environmental decision making and driving innovation. References Council on Environmental Quality. 1995. 25th Anniversary Report of the Council on Environmental Quality (1994–1995). Available online at http://ceq.eh.doe.gov./reports/reports.htm. [February 3, 1999] Dow. 1996. Goals for 2005. In 1996 Environment, Health, and Safety Report. Available online at http://www.dow.com/cgi-bin/frameup.cgi? http://www.dow.com/environment/goal2005.html. [February 3, 1999] United States Environmental Protection Agency (USEPA). 1987. Unfinished Business. Office of Policy Analysis. Washington, D.C.: USEPA. United States Environmental Protection Agency (USEPA). 1990. Reducing Risk. Science Advisory Board. Washington, D.C.: USEPA. United States Environmental Protection Agency (USEPA). 1992. National Air Quality and Emissions Trends. EPA-450-R-92-001. Office of Air Quality Planning and Standards. Research Triangle Park, N.C.: USEPA. United States Environmental Protection Agency (USEPA). 1998. Environmental Quality, Status, and Trends. Available online at http://www.epa.gov/ceis. [February 3, 1999]