Excerpt: A historical recap of environmental policy integration

 

Excerpt from:

Morand Frédéric and Marco Barzman, 2006; European sustainable development policy (1972-2005): fostering a two-dimensional integration for more effective institutions (WP1); IDARI Working Paper,  Eco Innovation / Humboldt University of Berlin - RTD project QLRT-2002-02718, (www.eco-innovation.net/integrating-institutions), 34 p.

^{The views expressed in this section are the sole responsibility of the authors and do not necessarily reflect the views of Eco Innovation.}

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Environmental concerns take on an increasingly central role in EU policy: a short look back

Outline

• The long road towards the integration of environmental concerns
• Environmental integration is made more explicit, first in agriculture
• Environmental integration is consolidated in all policy sectors in the 1990s
• The Cardiff process and the Lisbon strategy mainstream environmental integration
• Subsequent policy developments: RDR, 6th EAP, CAP reform, Lisbon II, ETAP
• Eco-innovation becomes a policy keyword

Environmental concerns, absent from the Rome Treaty and throughout the first decade following the creation of the European Community, have gradually been raised to the status of third pillar in the Lisbon agenda in 2001. It is instructive to take a look back at this evolution.

The long road towards the integration of environmental concerns

Reference to the environment emerges among European policy circles in the 1970s, echoing a number of environmental alerts such as Carson’s [1962] and Meadows’ [Meadows et al. 1972] influential best-sellers. At the Paris Summit of July 1972 in particular, European Heads of State and Government mention the ‘non-material values’ reconciling development and the environment in Europe and set off the Community environmental policy [CEC 1972: 9 ff].

Carlo Scarascia-Mugnozza, the first Commissioner for the environment is appointed in 1973. In the 1973-76 interval the First Action Programme in the area of European environment policy is launched. This programme and its sequels support regulatory development, starting with nature conservation, noise, and waste policies [1]. In its assessment of the 2nd Environmental Action Programme, the European Commission stresses the need for ‘greater consistency between the exigencies of environmental policy and those of other policies’ [CEC 1980: 8].

Environmental integration is made more explicit, first in agriculture

Isolated yet significant landmarks take place in the 1980s and the early 1990s in the farm sector:

• A law passed in France in July 1980 (loi d’orientation agricole du 4 juillet 1980) confers official recognition to organic agriculture labels and standards.
• The Green Paper on the Perspectives of CAP [CEC 1985] makes explicit one of the first official agri-environmental concerns at the European level. The Green Paper seeks to bring supply and demand into balance, to introduce new ways of reducing production in problem sectors and, generally, to analyse alternative solutions for the future of the CAP.
• The Council Regulation (EEC) No. 797/85 on improving the efficiency of agricultural structures, pushes further the initiatives introduced by structural Directives of the 1970s. It intends to promote the ‘permanent conservation of the natural resources of agriculture’ (Article 1), and allows Member States to support environmentally sensitive areas and the maintenance or adoption of environmentally-friendly farming practices. However this Regulation does not provide financial support for those practices [Pezaros 2001: 10-11].

The McSharry reform of 1992 introduces agri-environment in the CAP. Regulation 2078/92, in particular, calls for the implementation of agri-environmental aid schemes across Member States. It aims to encourage ‘agricultural production methods compatible with the requirements of the protection of the environment and the maintenance of the countryside’ [Council of the European Union 1992]. For the first time after three decades of commodity production-linked support policy, agri-environmental services are publicly rewarded. The preamble of Regulation 2078/92 contains the first explicit reference to the integration principle encapsulated in a formal regulation or directive [Dhondt 2003: 484]. The agri-environmental measures however are implemented on a voluntary basis.

Environmental integration is consolidated in all policy sectors in the 1990s

In February 1993, the 5th Environmental Action Programme insists on the necessary integration of the environmental dimension in all major policy areas. It specifies that environmental protection can only be achieved by involving those policy areas causing environmental deterioration. In 1996, the Conference on Rural Development in Cork establishes a 10-point program that calls for an integrated approach, diversification, and sustainability. The Cork Declaration urges Europe’s policymakers to place ‘sustainable rural development at the top of the EU policy agenda, and makes it the fundamental principle underpinning all rural policy’ [The European Conference on Rural Development 1996, Point 1].

In 1997, the Treaty of Amsterdam seeks to provide stronger guarantees than given by the Single Act and the EU Treaty [2] by inserting explicit commitments to the principle of sustainable development. In particular, the promotion of sustainable development is established as a Community objective in the Article 2 of the Treaty [European Council 2002 (1957)], and the Article 6 of the consolidated EC Treaty (ex Art. 130r) is devoted to the ‘Integration Principle’ (see Box 1).

Box 1. Article 6 EC formulates the ‘Integration Principle’

Art. 6 of the Treaty of the European Community, consolidated in Amsterdam in 1997, stipulates that: ‘Environmental protection requirements must be integrated into the definition and implementation of the Community policies and activities referred to in Article 3, in particular with a view to promoting sustainable development’ [European Council 2002 (1957)]. Art. 6 EC is reproduced identically as Article III-4 in the draft Treaty establishing a European Constitution  [European Convention 2003], among the general clauses.

 

The Cardiff process and the Lisbon strategy mainstream environmental integration

Following the insertion of a new integration clause in the Amsterdam Treaty, the European Council requests the Commission to submit a strategy for promoting sustainable development. In June 1998 at the subsequent Cardiff European meeting, this strategy develops into the ‘Cardiff Process’, which aimed at tackling the ‘current pattern of economic development [which] too often entails conflicts between
development and environment’ [CEC 1998: 5].

The Commission’s strategy highlights key guidelines including the identification of priority actions and systematic monitoring of the environmental integration [3]. In 2001 the Gothenburg European Council adopts the Commission’s Sustainable Development Strategy, which calls for further development, and rapid implementation, of environmental integration [CEC 2001a]. The Gothenburg Council also adds a third, environmental pillar to the Lisbon Strategy, which further consolidates the Integration Principle, and strengthens the review process to which environmental policy is subjected [4].

Subsequent policy developments: RDR, 6th EAP, CAP reform, Lisbon II, ETAP

Subsequent policy developments add substance to environmental integration. The Agenda 2000 reforms, agreed upon in March 1999, result in a new Rural Development Regulation (RDR), the ‘second pillar’ of the CAP and the basis for the pre-accession instrument SAPARD [5]. The objective of RDR is to introduce a sustainable and integrated rural development policy governed by a single legal instrument to ensure better coherence between rural development and the prices and market policy of the common agricultural policy. It makes integration of rural development in other policy areas mandatory [Council of the European Union 1999] [6].

The Commission’s 6th Environment Action Programme enters into force in 2002 [European Parliament and Council of the European Union 2002]. This programme is meant to make the goals of the European Sustainable Development Strategy operational. It reiterates the need to integrate environmental considerations into other policies, and fosters cross-cutting strategies that require joint action from a wide array of policy sectors. Its priority issues are climate change, nature and biodiversity, resource management, and environment and health.

Commissioner Fischler’s 2003 CAP reform is adopted in June 2003 and enters into force in January 2005. Although important aspects, such as decoupling aid from production, do not go without controversy [7], the reform does condition all agricultural payments (Single Farm Payment) on compliance with environmental, food safety and animal welfare standards.

In its mid-term assessment of the Lisbon strategy, the Kok Report calls for reinforcing the integration of environmental considerations, and making it ‘part of Europe’s competitive advantage’ [CEC 2004b: 35]. Reacting to the Kok Report, President Barroso in his communication to the Spring European Council points out that the Lisbon strategy fully endorses the Integration principle, since the strategy can make Europe ‘a beacon of economic, social and environmental progress to the rest of the world’ [CEC 2005: 3].

 

Eco-innovation becomes a policy keyword

A strategy privileged by the Kok Report is the promotion of eco-efficient innovations, or eco-innovations (Ibid: 36). Environmentally-friendly technologies represent a concrete example of the integration of environmental concerns in economic development policy. The Commission’s services for Research and for Environment jointly delivered the Action Plan for Environmental Technologies in 2004 (ETAP, see CEC [2004f]). The plan (Ibid: 3) seeks to:

1. remove the obstacles so as to tap the full potential of environmental technologies for protecting the environment while contributing to competitiveness and economic growth;
   
2. ensure that over the coming years the EU takes a leading role in developing and applying environmental technologies; and
   
3. mobilise all stakeholders in support of these objectives.

In its 2007 ETAP Report, the Commission requires nothing less than making ‘eco-innovation pervasive across all industries' [CEC 2007: 3]. Eco-innovation should become ‘the mainstream of Europe's innovations and the required norm across the whole economy' (Ibid, p. 5).

In conclusion, persistent efforts have been devoted to the integration of environmental concerns into European law since the 1970s. Starting from a context devoid of any legal references to the environment, these efforts have resulted in a policy framework in which environmental integration is legally binding and applicable to all sectors. Eco-efficient innovation (eco-innovation) appears to offer a concept for integrating environmental concerns into other sectors of activity.

 

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Notes:

[1] For more details on the progressive integration of the environment into EU law, see e.g., Dhondt [2003] or CEC [2004g]. For simplicity’s sake, the line followed here is chronological.
[2] The 1992 EU Treaty, known as the Treaty of the European Union [European Council 2002 (1992)], or Treaty of Maastricht, mentions the ‘principle of sustainable development’ once, in rather general terms.
[3] Focussing on nine policy sectors: energy, transport, agriculture, industry, internal market, development, fisheries, general affairs and economic and financial affairs. Since 2003 the whole Cardiff process is reviewed annually (e.g., see CEC [2004d]).
[4] The first review of this environmental pillar is carried out in 2003 [CEC 2004a].
[5] Special Accession Programme for Agriculture and Rural Development. SAPARD offers applicant countries a menu of measures eligible for funding.
[6] Brought further, among others, by Council Regulation 1698/2005.
[7] For an overview of the reactions to the 2003 reform, see, e.g., Environment News Service [2003].

References:

Carson Rachel, 1962; Silent Spring, Houghton Mifflin Company: New York, 297 p.

CEC, 1972; Meetings of the Heads of State of Government. Paris, 19-21 Oct. 1972. The First Summit Conference of the Enlarged Community; Bulletin of the European Communities  (10), 21 p.

CEC, 1980; Progress made in connection with the Environment Action Programme and assessment of the work done to implement it;  Communication from the Commission to the Council,  (30 May),  Commission of European Communities.

CEC, 1985; Perspectives for the Common Agricultural Policy - Green Paper,  COM (85) 333 (15 July), Commission of the European Communities, (http://aei.pitt.edu/archive/00000931/); Brussels, 103 p.

CEC, 1998; Partnership for Integration. A Strategy for integrating Environment into European Union Policies; Commission Communication to the Cardiff European Council, (June), Commission of European Communities, 10 p.

CEC, 2001a; A Sustainable Europe for a BetterWorld: A European Union Strategy for Sustainable Development (Commission's proposal to the Gothenburg European Council),  COM(2002)264 final (15 May),  Commission of the European Communities, 17 p.

CEC, 2004a; 2003 Environment Policy Review. Consolidating the environmental pillar of sustainable development;  Communication from the Commission to the Council and the European Parliament,  COM(2003) 745 final (2 Feb.),  Commission of European Communities; Brussels, 60 p.

CEC, 2004b; Facing the challenge. The Lisbon strategy for growth and employment (Kok Report),  (1 Nov.),  Commission of European Communities; Luxembourg, 51 p.

CEC, 2004d; Integrating environmental considerations into other policy areas - a stocktaking of the Cardiff process;  Commission working document,  COM(2004) 394 final (01 June),  Commission of the European Communities; Brussels, 38 p.

CEC, 2004f; Stimulating Technologies for Sustainable Development: An Environmental Technologies Action Plan for the European Union. Communication from the Commission to the Council and the European Parliament,  COM(2004) 38 final (28 January),  Commission of the European Communities; Brussels, 49 p.

CEC, 2004g; The Amsterdam Treaty: A Comprehensive Guide. The Union and the citizens / Environment, http://europa.eu.int/scadplus/printversion/en/lvb/a15000.htm (accessed 12 Feb. 2004).

CEC, 2005; Working together for growth and jobs. A new start for the Lisbon Strategy;  Communication from President Barroso to the Spring European Council,  COM (2005) 24 (02 Feb.),  Commission of the European Communities, (www.eu.int/growthandjobs/pdf/COM2005_024_en.pdf); Brussels, 32 p.

CEC, 2007; Report of the Environmental Technology Action Plan (2005-2006); Communication from the Commission to the Council, the European Parliament, The European Economic and Social Committee and the Committee of the Regions,  COM(2007) 162 final (02 May), Commission of the European Communities; Brussels, 13 p. Press release, Full report.

Council of the European Union, 1992; Council Regulation 2078/92 of 30 June 1992 on Agricultural Production Methods Compatible with the Requirements of the Protection of the Environment and the Maintenance of the Countryside;  Official Journal of the European Communities (L215) 85:90.

Council of the European Union, 1999; Council Regulation (EC) No 1257/1999 (17 May 1999) on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF) and amending and repealing certain Regulations;  Official Journal of the European Communities (L 160) 80:102.

Dhondt Nele, 2003; Integration of Environmental Protection into other EC Policies; Legal Theory and Practice; The Avocetta Series, Europa Law Publishing: Groningen (The Netherlands), xviii + 532 p.

Environment News Service, 2003; European Farm Policy Reform Slashes Subsidies (30 June), http://www.ens-newswire.com.

European Convention, 2003; Draft Treaty establishing a Constitution for Europe;  submitted to the European Council in Rome,  CONV 850/03 (18 July); Brussels, 265 p.

European Council, 2002 (1957); Consolidated version of the Treaty establishing the European Community;  Official Journal of the European Communities, 24 Dec.,  152 p.

European Council, 2002 (1992); Consolidated version of the Treaty on European Union;  Official Journal of the European Communities, 24 Dec.,  47 p.

European Parliament and Council of the European Union, 2002; Decision No 1600/2002/EC laying down the Sixth Community Environment Action Programme;  Official Journal of the European Communities (L 242, 10.9.2002), 22 July,  15 p.

Meadows Donella H., Dennis L. Meadows, Jorgen Randers and William Behrens, 1972; The Limits to Growth: a Report for the Club of Rome's Project on the Predicament of Mankind, Universe Books: New York, 205 p.

Pezaros Pavlos D., 2001; The Environmental Dimension of the Common Agricultural Policy - An Overview; Seminar 'The CAP and the Environmental Challenge - New Tasks for Public Administrations?'  European Institute of Public Administration, Maastricht (NL) (14-15 May), 32 p.

The European Conference on Rural Development, 1996; The Cork Declaration. A living countryside,  Cork (7-9 November), 3 p.

 

Follow up and updates

Please contribute any ideas, news, or links on this topic

EEA publishes its 4th assessment on Europe's environment, from the Health and Environment Alliance (16 Oct. 2007) 

Revised EU Treaty approved in Lisbon: environment and health considerations, from the Health and Environment Alliance (05 Nov. 2007)

 

The French régulation theory

Like the French conventionalists, régulationists think economics through organisational issues. They consider collective objects with regard to their proper being, which goes beyond representations of individual actors : institutional forms cannot be reduced to the rational behaviour of individuals maximising their expected utility [O. Favereau, 1993, p. 1].

The régulation theory, inspired by Marxism and Keynesianism, emphasises the dynamism and the strong historicity of institutional forms, in order to explain their important role in the 20th century macro-economic adjustments in Occident (see for example R. Boyer [1978], and J-P Benassy, R. Boyer and R-M. Gelpi [1979], or Boyer and Saillard eds [2001]). Régulationists pay attention to the dynamics of capitalist societies, and particularly to their crisis. Each period of capitalism can be caracterized by a specific regime of capital accumulation, which is stabilised by a mode of regulation linked to particular institutional forms, likely to come into crisis.

Occidental societies (Western Europe, USA) have encountered major crisis that have transformed substantially and durably the relations that the régulation theory consider as central in a capitalist economy:

• the wage regime: management of wages, link between income and wage.
• the competition regime: influence of competition on prices.
• the monetary regime: constraints on currency emission.

The competitive regulation from before 1914, and the inter-war period

Elements of the competitive regulation are settled before the First World War: prices and salaries, heavily dependent on markets and business cycles, are subject to high variability (declining face value of wages). The Gold Exchange Standard, otherwise, guaranties the parity between issued currency and gold supply.

The inter-war period gives birth to new but nevertheless unachieved institutional forms. First, the forced monetary rate, which replaces the legal rate, makes it possible to pay for the explosion of public debt: the monetary regime of this deficit economy doesn't rely on the gold constraint any more, but on credit money.

Labor systems, meanwhile, are strongly influenced by taylorist methods (specialisation, fragmentation of duties), which lead during the 1920s to productivity gains and sustained growth. On the competition side, cartels and monopolies appear.

Such institutional innovations foreshadow the soon-to-come monopolist mode of regulation, but their development comes up against an inadequate wage regime. The huge profits resulting from productivity gains primarily feed capital accumulation, while wage determination remains too competitive to generate a demand suited to mass production. During the 1930s, these institutional forms regress and the crisis occurs. Social critics targets Ford's assembly lines.

 

The fordist mode of regulation of the post-war decades

The maturation of a whole set of institutional innovations leads to the constitution of a monopolist or fordist mode of regulation.

• Mass consumption. Rising labor unions and sustained industrial concentration make wage negotiation easier, and wages, becoming more independant from markets, are set upon living standards and produtivity rates: the demand meets the supply. Increasing indirect income counterbalances the declining face value of wage.

• Tamed competitiveness. Financial concentration makes business less risky, and more regular profits go along with a higher stability of prices.

• Inflationist credit economy. The central bank validates commercial debts, feeding inflationist mechanisms. Different inflation rates between countries are adjusted through continuous devaluation.

The institutional forms of the Fordist regulation are linked to profound changes in individual representations of socialisation, the role of the State, social politics, indirect wage, currency.

By the end of the 1960s, however, the components of this regulation become unappropriate, and the Fordist regulation enters into crisis. In the late Fordist economy of the plenty, quality is being questionned.

 

Frédéric Morand, adapted from a lecture by André Orléan (DEA Economie des institutions, 1994-95, Paris)
references to come

Association Recherche & Régulation