From Vienna to Helsinki - SERI

Wissenschaftszentrum Nordrhein-Westfalen Institut Arbeit und Technik

Kulturwissenschaftliches Institut

Wuppertal Institut für Klima, Umwelt, Energie GmbH

The process of integration of environmental concerns in all policies of the European Union Study for the Federal Ministry for the Environment, Youth and Family Austria

«Many things are known but only in seperate heads.» Dr. Andreas Troge German Federal Protection Agency

Teilbericht 4

From Vienna to Helsinki

Benjamin Görlach Friedrich Hinterberger Philipp Schepelmann in collaboration with Heiko Duppel Wuppertal Institute for Climate, Environment and Energy

Science Centre North Rhine-Westphalia Institute of Work and Technology

Görlach, Hinterberger, Schepelmann

Institute for Culture Studies

Wuppertal Institute for Climate, Environment and Energy

From Vienna to Helsinki Environmental requirements in the process of integrating environmental issues into other policy areas of the European Union Study commissioned by the Austrian Federal Ministry of Environmental, Youth and Family Affairs

Benjamin Görlach Friedrich Hinterberger Philipp Schepelmann with contributions from Heiko Duppel Wuppertal Institute of Climate, Environment and Energy 1





Table of Contents TABLE OF CONTENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1 INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 2 SUSTAINABILITY AND THE EUROPEAN UNION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 2.1 THE AMSTERDAM TREATY ..................................................................................................................4 2.2 THE FIFTH ENVIRONMENTAL ACTION PROGRAMME.................................................................................5 2.3 THE IMPLEMENTATION OF THE INTEGRATION PRINCIPLE ...........................................................................6 ÒPartnership for IntegrationÓ..............................................................................................................6 Cardiff and Vienna.............................................................................................................................6 2.4 SUMMARY: THE CARDIFF PROCESS AND THE 5TH EAP ...............................................................................7 3 OBJECTIVES, TIMETABLES AND INDICATORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 0 3.1 VISIONS AND GUIDELINES................................................................................................................. 10 3.2 ECO-EFFICIENCY AND DEMATERIALISATION AS VISIONS ..........................................................................12 Reasons for the input approach ?........................................................................................................12 De-coupling of resource consumption and growth .................................................................................. 13 3.3 SELECTION OF SUITABLE INDICATORS ................................................................................................. 17 Economic and social indicators..........................................................................................................17 Ecological headlines ........................................................................................................................ 17 4 THE NEXT STEPS TOWARDS SUSTAINABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 0 4.1 ECOLOGICAL ECONOMIC POLICY: COMPETITIVENESS BY DEMATERIALISATION ............................................20 Competitiveness by innovations.........................................................................................................21 Competitiveness by cost reductions .................................................................................................... 22 Ecological economic policy in a European context ................................................................................ 24 4.2 LABOUR AND DEMATERIALISATION .................................................................................................... 24 4.3 IMPLEMENTATION IN INDIVIDUAL POLICY AREAS .................................................................................. 25 4.3.1 Transport ............................................................................................................................... 26 4.3.2 Energy ............................................................................................................................... ....27 4.3.3 Agriculture .............................................................................................................................28 4.3.4 Development........................................................................................................................... 28 4.3.5 Internal market........................................................................................................................ 29 4.3.6 Industry............................................................................................................................... ...29 5 CONCLUSIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3 2 5.1 INTEGRATION BY COMMON HEADLINES ............................................................................................... 32 5.2 INSTITUTIONAL ISSUES OF INTEGRATION.............................................................................................. 32 5.3 STRATEGIC OBJECTIVES OF THE ENVIRONMENTAL TROIKA IN THE HELSINKI PROCESS ...................................33 6 ANNEX. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3 5 PROPOSED DRAFT FOR THE CONCLUSIONS OF THE FINNISH PRESIDENCY ..........................................................35 EXCERPT FROM THE CONCLUSIONS OF THE EUROPEAN COUNCIL OF CARDIFF....................................................36 EXCERPT FROM THE CONCLUSIONS OF THE EUROPEAN COUNCIL OF VIENNA ....................................................37 7. LITERATURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3 9

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1 Introduction At the threshold to the 21st century, environmental policy faces major challenges in Europe. The demanding provisions of the Treaty of Amsterdam aiming at the integration of environmental, economic and social policies are to be implemented. If European environmental policy succeeds in reaching this objective by the turn of the millennium, it will thus develop into a policy of sustainability. Otherwise, environmental policy runs the risk of falling back to the status of a second-rate sectoral policy. This study attempts to ward off that risk. On the basis of a description of the status quo of environmental policy in the European Union (Chapter 2), possible objectives of further developed environmental or sustainability policy are then discussed. In this context, indicators capable of measuring the achievement of sustainability are of special importance (Chapter 3). Subsequently, conditions and opportunities for implementing ecological objectives at a European level are examined. For that purpose, the impact of ecological strategies on economic and social systems is outlined; then some potential measures and priorities for those sectors are proposed that were given priority in the integration of environmental issues by the decisions of the European Councils of Cardiff and Vienna (Chapter 4). Finally, strategic objectives are proposed for the European Council of Helsinki and a draft proposal for the conclusions of the Finnish Presidency is presented (Chapter 5) in order to promote the integration of environmental issues along the lines described in Chapters 3 and 4. For one year, the Wuppertal Institute of Climate, Environment and Energy has published ÒEuropean Union Policy PapersÓ in co-operation with the Austrian Institute of Sustainability and the Finnish Institute of Future Research1. This paper series, which is supported by the Austrian Federal Ministry of Environmental, Youth and Family Affairs, is to discuss the implications of the changes introduced by the Amsterdam Treaty on major policy areas of the European Union. The present study draws on various ideas contained in the existing Policy Papers and elaborates on them with regard to the continuation of the integration process.

1

see also http://www2.wupperinst.org/Publikationen/EU-Policy-Papers/

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2 Sustainability and the European Union At the level of the European Union, the policy of sustainability is mainly shaped by three developments: ·

the implementation of the Treaty of European Union (Amsterdam Treaty);

·

the Fifth Environmental Action Programme,

·

the implementation by Councils of Ministers and the EU Council Presidency.

These developments are in part complementary and are to be commented on in the following. 2.1 The Amsterdam Treaty European environmental policy is mainly shaped by Article 6 of the EU Treaty, which reads as follows: ÒEnvironmental protection requirements must be integrated into the definition and implementation of the Community policies and activities (...), in particular with a view to promoting sustainable development.Ó This new article provides for the so-called integration principle that is better known by the term Òcross-sectoral clauseÓ in the German-speaking area. In line with this principle, environmental protection is not considered to be a sectoral policy, but a maxim involving all sectors. This does not mean that environmental ministries are not needed any more, but rather that interfaces are required in other sectors. For ten years, such a cross-sectoral clause has been included in the Unique European Act (UEA), specifically in the last sentence of Article 130 r, para 2, sub-para 1 that has now become obsolete and was therefore deleted. Thus, Article 6 actually did not introduce a new provision into the European treaties, but rather a provision that Ð as the German Environmental Ministry put it Ð was taken Òout of the parenthesesÓ. Thereby the integration principle was upgraded in a similar way as the subsidiarity principle (Art. 5 EC Treaty). The latter was largely neglected up to the Maastricht revision when, in 1992, it was taken Òout of the parenthesesÓ and thus made one of the fundamental organisational principles of the European Union. Essentially, nothing speaks against the assumption that the integration principle also has to become a fundamental paradigm of the Union. The European Commission, in its function as the Òguardian of the treatiesÓ, was requested by the European Council to present implementation plans for the integration of environmental protection into all policy areas. Much depends on the seriousness of the efforts made by the Council and the Commission in the review of the Community policies with regard to environmental aspects. The EU presidencies and their conclusions also play a central role in this context (see 2.3). Even before the adoption of the new treaties, the European Commission made efforts to implement the integration principle of the old Article 130 r. Not least, this was one of the central demands of the Fifth Environmental Action Programme of the European Union. 4





2.2 The Fifth Environmental Action Programme For DG XI (Environment) of the European Commission, 1999 is a year of reflection and reorientation. In this year, the term of the Fifth Environmental Action Programme will end, elections to the European Parliament will be held and a new Commission will be appointed. This prompted DG XI to initiate a consultation process, in particular within the framework of the Global Assessment of the Fifth Environmental Action Programme. This consultation process involves not only the Member States and international governmental organisations, but also representatives of non-governmental entities. According to statements by Commission representatives, this is to define both the UnionÕs own position and the ÒlegacyÓ of the outgoing Commission. In this process, the successes and failures of the Fifth Environmental Action Programmes are to be evaluated, but also elements of the future environmental policy are to be developed. The Austrian Ministry of Environmental, Youth and Family Affairs prepared specific comments on the Fifth Environmental Action Programme so that the Global Assessment is only briefly discussed here. One of the key points criticised in the Environmental Action Programme was the lack of a generally understandable vision. Though objectives and timetables were identified and specified for individual sectors, one cannot say that the objectives were generally accepted and understood. A major factor contributing to this situation was the lacking comprehensibility of the objective of ÒsustainabilityÓ (cf. Chapter 3): Since no specific information is provided as to what sustainability might mean as an objective in the environmental field, it is difficult to relate the individual environmental targets to the broader sustainability objective. Likewise, it is impossible to derive environmental targets from the (blurred) sustainability objective. Due to the low acceptance of the Fifth Action Programme, the integration principle was essentially doomed to failure. This was, however, not only due to the lacking comprehensibility of the vision, but also due to the fact that objectives were defined by environmental policy makers without a genuine consultation process. Along these lines, the Fifth Environmental Action Programme was an environmental programme, but not a sustainability action programme even though it was called ÒTowards SustainabilityÓ. It is to be hoped that lessons will be learnt from these drawbacks so that the integration process called for by the amendment of the Treaty of European Union and the European Council will not fail due to insufficient communication capabilities of the environmental policy makers. Positive mention needs to be made of the work of the European Environment Agency (EEA) who contributed much to the visualisation and comprehensibility of the system of objectives included in the Fifth Environmental Action Programme. It is to be expected that the EEA will be able to provide even better reports based on an improved system of objectives.

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2.3 The implementation of the integration principle ÒPartnership for IntegrationÓ Upon the request of the European Council of Luxembourg, the European Commission submitted a strategy paper with guidelines on the implementation of integration to the European Council of Cardiff in 1998 (EUROPEAN COMMISSION 1998 a). The guidelines include: · Assessment of the environmental impact of all major policy initiatives and establishment of mechanisms that serve to integrate the results of these assessments in decision-making; · Definition of a policy strategy as well as indicators based on which the achievement of the objectives defined can be verified; · Definition of key areas in which this strategy is to be implemented; and · Regular review of the progress achieved. At a policy level, Agenda 2000 and the implementation of the Kyoto Protocol were proposed as touchstone for the application of the guidelines. The need for integrating environmental issues into other policy areas at all levels is highlighted several times; as a result, the Commission also proposes a partnership (of the Commission, Council and European Parliament) for integration. Cardiff and Vienna The European Council of Cardiff welcomed this draft strategy, but did not fully comply with its demands. The Transport, Energy and Agriculture Councils, which are of particular relevance to environmental policy, were invited to develop implementation strategies in their respective fields. In the Conclusions of the European Council of Vienna, the Development, Internal Market and Industry Councils were also invited to develop and report on integration strategies. The report of the Agriculture Council (Doc. 13091/98) mainly emphasises the progress made based on the existing Common Agricultural Policy (CAP). The agricultural sector is described as an environmentally friendly sector as such that already now, for example, rather promotes than endangers biodiversity. The examples given for concrete measures taken by the Council include set-aside regulations as well as the CommissionÕs initiative to promote less aggressive production methods. However, the comprehensive ecologisation of European agriculture towards an extensive approach is not addressed. Environmental problems caused by intensive agriculture are presented as isolated, exceptional cases. As a result, the Council of Ministers sees the main contribution of the agricultural sector to sustainable development in the elimination of such isolated cases of excessive utilisation. The continuation of the previous policy is considered to be sufficient. The development of suitable indicators and the regular evaluation of progress made on the basis of these indicators are identified as future measures for environmental integration. The report of the Energy Council (Doc. 13805/98) states that the energy sector is able to make a decisive contribution to the integration of environmental issues, for example, in the context of the commitments made in the Kyoto Protocol. It is, however, also stressed that environmental 6





protection already forms part of energy policy and is implemented in many fields; in this context, the existing programmes for increasing energy efficiency (SAVE) and for promoting renewable energy sources (ALTENER) are particularly highlighted. Accordingly, the further integration process is to primarily focus on the continuation and effective implementation of existing programmes. The taxation of energy as a control instrument is only mentioned indirectly Ð insofar as it is suggested in a proposal of the European Commission on integration in the field of energy (COM (98) 571). The report of the Council lags far behind the Commission proposal. In the Commission paper, the approach of solving the environmental problems faced by gradually adapting the existing policy is rejected as being insufficient. The need for, as well as the technical and economic feasibility of, energy-saving measures are highlighted. The definition of concrete target values is remarkable (e.g. 18% co-generation or 12% renewable energy sources by 2010). Reduction targets for absolute power consumption, however, are not identified. The report of the Energy Council, however, states that a detailed strategy paper integrating the Commission proposal will be presented in 1999. The report of the Transport Council (Doc. 13811/98) identifies an increase in the price on the use of nature as an important instrument that is to take into account the nature consumption by transport. As for the rest, the report of the transport ministers only recommends the reduction of environmental pollution by means of technical progress and optimal utilisation of all transport modes. The prevention of traffic or at least the restriction of its increase are not mentioned. The uncured growth of the traffic volume is referred to as a problem only in the field of aviation. Ecologically critical projects, such as the Trans-European Networks, are not fundamentally questioned, but only ecological procedures in project implementation are demanded. In general, the report is noncommittal and largely limited to declarations of intent. A common feature of all the reports is the demand for suitable indicators for assessing the success of (environmental) measures. The adoption of such indicators is on the agenda of the European Council of Helsinki. Therefore, the selection of indicators should be dealt with under the Finnish Presidency at any rate. In all three sectors, report mechanisms are being established that are to structure the further integration process. In the field of transport, the Transport and Environment Report Mechanism has already been developed. It comprises three steps: First, the most important objectives of integration are defined as main policy questions for the respective policy area, and then indicators are identified for assessing the achievement of the objectives. On the basis of these indicators, the progress made will be regularly documented. 2.4 Summary: The Cardiff process and the 5 th EAP The progress made in the integration of environmental issues on the basis of the Cardiff process and the 5th EAP can be summarised as follows: The European Council of Cardiff significantly upgraded and advanced the integration process by requesting the Agriculture, Energy and Transport Councils to present reports on the implementation of the integration principle in their respective fields. As outlined above, an analysis of these reports, however, shows that there are no clear ideas with regard to the 7

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substance and objectives of a sustainability policy that is to be achieved by means of environmental integration. This applies both to the type and scope of the measures to be taken as well as to the need of an ecological re-orientation. The reports remain vague and limited to stressing the success of previous policies. All reports consider the continuation of the previous policies Ð at best with slight modifications Ð to be sufficient. A fundamental structural change, such as the one demanded and outlined by the CommissionÕs proposal in the field of energy policy, is not mentioned in the reports of the Councils. A change can only be expected to a limited extent on the basis of the establishment of the report mechanisms for the individual fields. On the one hand, the setting of integration targets for each field will better clarify the purposes and objectives of integration in general and, hopefully, this will lead to more ambitious targets than before. On the other hand, the decision as to how farreaching the measures to be taken will be remains with the individual sectors. Thus, the orientation of the approaches in the individual sectors will only be consistent, if a cross-sectoral discussion of the objectives takes place. In order to prevent contradictory or conflicting objectives in the individual sectors, the co-ordination of this process should be institutionalised at a higher level (e.g. with the president of the Commission). In the continuation of the Cardiff process, more orientation will be needed on how to specify the ecological aspect of sustainability. This is also reflected by the CouncilsÕ demand for indicators suitable for measuring progress. Under the Fifth Environmental Action Programme of the European Union, a far-reaching, prevention-orientated approach was taken for the first time in European environmental policy. Additionally, the 5th EAP also called for an integration process as a prerequisite of more effective environmental policy. In the course of the implementation of the 5th EAP, several weak points were already identified that should also be considered in the further implementation of the integration principle within the framework of the European Council:

· inadequate vision: The integration of environmental issues will be significantly facilitated if a positive vision exists to which integration can be orientated. The vision of sustainability still is too vague since there is no common agreement on the operationalisation of sustainability in the sub-field of ecology.

· inadequate public awareness of the 5th EAP: The 5th EAP remained largely unknown in the public. For an effective environmental policy, however, public awareness and acceptance is indispensable at all levels of policy, economy and society, in particular when individual actors are to change their behaviour (cf. Chapter 4).

· inadequate success of EUÕs environmental policy: The 5th EAP specifies concrete reduction targets for various pollutants and climate-relevant emissions as well as timetables within which the targets should be reached. This makes sense and is to be welcomed because success can only be verified when quantified targets exist. In most areas where concrete, measurable targets exist, these will, however, not be reached. Only in the field of CFC reduction, a major success was recorded, while in most other areas, environmental pollution rather increased than decreased since the start of the 5th EAP (cf. EEA 1995). 8





It is to be noted that the 5th EAP and the Cardiff process are not fully consistent: Both the 5th EAP and the European Councils of Cardiff and Vienna identify key sectors in which the integration of environmental issues is to be given special priority. The 5th EAP lists the sectors of industry, transport, energy, agriculture and tourism. The European Council did not refer to tourism and, instead, the Development and Internal Market Councils are requested to report on the progress made in integration. This, however, should not constitute a serious problem in the further implementation of the integration principle (see 5.2).

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3 Objectives, timetables and indicators In the Amsterdam Treaty, the European Union committed itself to the objective of sustainable development. According to the Treaty, this development is to be characterised by a high degree of employment and social security, by continued economic growth and the strengthening of the competitiveness of European industry, as well as by environmental protection and improved environmental quality. The improvement of the quality of life is indicated as an overall objective. With regard to economic development and the social field, these objectives are relatively easy to operationalise because well-proven indicators exist in both areas (for example, the gross domestic product and the unemployment rate). These indicators are to be raised (GDP) or reduced (unemployment rate). On the basis of the indicators and the objectives defined, measures can be designed that could be conducive to reaching the objectives. Moreover, experiences have already been made with many of these measures. The objectives in the environmental field, however, are much more difficult to operationalise. This is in part due to the complexity of the matter because environmental burdens materialise and can be measured in many ways. Additionally, considerably less experience exists in this comparatively new policy area that has only been given high priority in EUÕs policy for a relatively short period of time. In order to achieve an equal representation of economic, social and ecological aspects of the sustainability vision, simple, well-known and accepted indicators as well as comprehensible objectives that can be operationalised are also required for the environmental field (HINTERBERGER et al. 1998, DEUTSCHER BUNDESTAG 1998). This chapter will first deal with the importance of such objectives for the further integration process and the requirements they have to meet in order to become visions of social development (see 3.1). Then, two possible objectives, i.e. eco-efficiency and dematerialisation, are presented (see 3.2). In 3.3, a set of headlines is proposed that should serve as an orientation of the further integration process. From what has been said before it follows that environmental policy as a sub-field of sustainability policy also has to consider social and economic issues, i.e. it shall restrict the development conditions of social and economic systems as little as possible2. However, it cannot replace employment and competition policies in their own right, but has to complement them. 3.1 Visions and guard-rails As stated above, the integration of environmental policy at the EU level is adversely affected, inter alia, by the fact that a sufficiently clear understanding is lacking on what should be integrated and which objective integration should have. For individual aspects of European environmental policy, concrete requirements were formulated that result from commitments made and other objectives, e.g. the reduction targets for CO2 and CFCs laid down in international agreements. These reduction targets, however, largely remain a grey set of figures for the time being: they do not constitute an adequate basis for a European sustainability policy as yet because they themselves provide hardly any motivation and even less inspiration. A reduction 2

In that sense, sustainability policy comprises environmental policy taking into account economic and social issues, employment policy meeting ecological and economic requirements, as well as competition policy integrating ecological and social aspects.

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target implies a sacrifice (less of the same), while a vision is intended to initiate a change at whose end reduction is achieved as a side-effect. Thus, we need a vision that inspires imaginative, creative discussions, prompts autonomous actions and thinking ahead and, eventually, prepares the ground for innovation and competitiveness. Such a vision has to be convincing and understandable. It has to define an objective, but only outline the path towards its achievement in order to define the direction of social and technological development without restricting it by excessive regulations. For that purpose, so-called (ecological) guard-rails are derived from the vision. These quantify the (ecological) framework within which economic and social development takes place and gradually changes its orientation. In this way, vision and guard-rails complement one another (HINTERBERGER/LUKS/STEWEN 1996; HINTERBERGER 1998). As a result, the vision should be defined in as concrete terms as possible using a few indicators so that it can be ascertained whether different policy measures contribute to the visionÕs achievement or not. The vision must be capable of being operationalised, notably at all levels of political, economic and social actions. Of course, it is not possible to decree such a vision. One of the most important lessons learnt from the numerous local processes for Agenda 21 (e.g. Local Agenda 21) is the fact that the different social players not only have to be involved in the implementation, but already in the definition of the Agenda objectives. If this triggers manifold discussions on visions, as for example after the publication of the study on a Sustainable Germany,ÒZukunftsfŠhiges DeutschlandÓ (BUNDÊ/ Misereor 1996), an important first step is made towards broad social acceptance (around 200 reviews, articles, statements, investigations, etc. dealt with this study (LINZ 1998)). Again, policy can make the first move. The vision and the indicators used to measure it should be general and easily comprehensible so that they can be understood, applied and implemented by actors at all levels (KUHNDT / LIEDTKE 1999). These levels are:

· Micro-level: innovative actors (households and companies) bringing about economic change. Policy can support them by promoting and stimulating ecological innovation drives at the company level;

· Meso-level: institutions in the business environment and efficient network structures linking companies, consumers, governmental organisations and intermediary institutions facilitating a change in economic structures. Policy has the task to re-structure business-orientated institutions and stimulate re-orientation;

· Macro-level: a regulatory framework and ecological guidelines providing adequate incentives; and

· Meta-level: visions of competitive and future-orientated management enabling (individual and collective) actors to relate their actions to one another. These are the four levels at which the interrelated fields of competitiveness, environment and employment have to be discussed (HINTERBERGER/MESSNER 1998). Innovative dynamics orientated to the entire economy, employment and the environment can only be achieved by a policy that impacts all of these levels. If one of them is neglected in the implementation of 11





sustainability-orientated policy, frictional loss is inevitable, which endangers the success of individual policy measures. This necessity is also realised and addressed by the European Commission in various publications3. 3.2 Eco-efficiency and dematerialisation as visions In recent years, the Wuppertal Institute has had increasing success in the definition of visions and objectives that are motivated by environmental policy, but at the same time can be seen as a programme of economic policy. Concepts such as dematerialisation, regionalisation or deceleration are not only highly popular at an international level because they are good slogans for ecological speeches, but also because they are understood and implemented by economic decisionmakers. Concepts such as eco-efficiency4, industrial metabolism5 and total resource management6 are increasingly introduced in many small enterprises. Initiatives, such as the …koprofit programme in Graz, PREPARE and other cleaner-production programmes, indicated the potentials that can be exploited in such a way (LIEDTKE 1997, UNEP 1994, see Chapter 4). The transfer of these concepts could contribute to remedy the drawbacks of EUÕs previous environmental policy as they materialised in the implementation of the 5th EAP. After some explanatory remarks on the concepts, this will be demonstrated in the following. Reasons for the input approach ? The current report of the European Environment Agency (EEA) once again shows that, in their environmental policy, most EU Member States did not succeed in reducing the dangers of climate change, dying forests or rapidly decreasing biodiversity (EEA 1995). One of the principal causes of restricted leeway of conventional environmental policy is the neglect of the economic dimension related to material-flow movements. The economies of all highly industrialised countries trigger enormous material and energy flows that are relatively soon released back to the environment after short-term consumption (SCHMIDT-BLEEK 1994, BRINGEZU 1995). Each material set in motion leaves behind ecological effects throughout its life-cycle. This process can only be temporarily stopped or reversed by active countermeasures with the input of energy (which, in turn, generates waste) (SPANGENBERG 1996). Each human intervention, thus, results in changes in nature. If the changes exceed a certain scale, irreversible environmental damage may be caused.7 · Input-orientated environmental policy that aims to reduce these material flows, therefore, focuses on the causes of the environmental crisis rather than on its symptoms. It is to lead to ecological actions even before environmental hazards emerge, which is in contrast to conventional environmental policy that responds to already existing damage by alleviating its symptoms (DEUTSCHES UMWELTBUNDESAMT 1997, BRINGEZU 1997). 3

E.g. in the Commission proposal on ÓPartnership for IntegrationÓ or in the proposal on the integration of environmental issues into energy policy, see EUROPEAN COMMISSION 1998 a, b 4 Cf. Internet site of the Word Business Council for Sustainable Development http://www.wbcsd.ch/eedata/eecshome.htm 5 Cf. AYRES/SIMONIS 1994 6 Cf. YAMAMOTO 1998, see also: http://www.zeri.org

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· Additionally, such a policy allows for a comprehensive analysis of the ecological impact of human activities. Thereby, material flows that are not exploited by economy (e.g. dumps) are also assessed for their impact on the ecological balance. This also results in a greater transparency for the consumer and, thus, reduces uncertainty in decision-making (SCHMIDTBLEEK 1994b; BRINGEZU/SCH†TZ 1996; STILLER 1996).

· Input-orientated environmental policy is better adjusted to our limited ecological knowledge. The approach of input-orientated environmental policy takes into account this high degree of ecological ignorance since it defines potential consequences of economic activities as broadly as possible; hence, it is also compatible with the precautionary principle (HINTERBERGER/LUKS/STEWEN 1996; FUNTOWICZ/RAVETZ 1991; LUKS 1996).

· Furthermore, such a policy is more efficient than conventional environmental policy. A reduction of energy and material flows also results in a decrease in emissions and waste and, accordingly, in less disposal and monitoring efforts. This also reduces the risk that efforts made to prevent and control environmental damage eventually lead to environmental damage somewhere else. It is safe to assume that dematerialisation will also contribute to a detoxification of the substances used (SPANGENBERG 1994).

· Input-orientated environmental policy also creates new incentives for resource-saving technical progress. While conventional environmental policy creates innovation incentives by regulations mainly for the fields of end-of-pipe technologies, input-orientated environmental policy stimulates the development of new technical solutions over the entire life-cycle of a product: from design via individual production steps and utilisation to disposal or recycling.

· Finally, such a policy is more adjusted to competition and, thus, stimulates innovation. Instead of making reference to the current state of the art, input-orientated environmental policy fosters the search for independent solutions. Hence, the economic actors have a wider choice of options, which will enhance competitiveness in the long term (cf. Chapter 4). De-coupling of resource consumption and growth The objective that is eventually pursued by input-orientated environmental policy is a substantial reduction of the total material requirement8. This reduction represents the ecological imperative9: the need for such a reduction results from the realisation that not individual pollutant emissions, but rather the sheer scale of human interventions into the natural environment in the form of material flows endangers the stability of ecological balances in the long term (SCHMIDT-BLEEK 1994). The European Union committed itself to the vision of sustainability, and the ecological aspects of that vision require an economy that preserves the earthÕs carrying-capacity in the long term. In order to reduce the material masses moved to a future-oriented level, while maintaining the existing welfare, the European economy has to be dematerialised. 7

Cf. HINTERBERGER / WELFENS 1996 with regard to the following statements. Explanation: The total material requirement (TMR) of a product covers the mass of all materials that have to be moved to produce the product. This also includes the masses to be moved for obtaining the required raw materials (the "ecological backpack" of the product). Cf. ADRIAANSE et al. 1998 9 As compared with the social (increase in employment) and economic imperative (continuous growth), see also STEWEN 1998 8

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Here, it is necessary to distinguish between objective and means: the problem of environmental degradation results from the absolute extent of material input, not from the way in which it is created. To put it in more drastic terms: nature does not care about how (eco-)efficiently it is destroyed. Therefore, sustainable environmental policy has to aim at reducing the absolute material input. This is expressed by the concept of dematerialisation (HAAKE et al. 1998). On principle, there are two options for achieving this: Either the overall level of economic activities is reduced while maintaining the previous economic practices. This is neither desirable, nor feasible in political terms. The other option is a change in the economic practices so that the creation of value added and the extent of material flows are de-coupled. Less material shall be input to create the same value added, i.e. resource productivity, being the ratio of the resources used to the value added, has to be raised. This corresponds to the concept of eco-efficiency (FUSSLER / JAMES 1996). Based on the MIPS (Material Intensity Per Service unit) value, an indicator exists that can be used to measure the eco-efficiency of goods, as well as production methods or enterprises. The principles outlined above give rise to a conflict between the economic objectives and the ecological requirements of sustainable development. After all, it is more than probable that savings in the resources consumed by individual companies will be swallowed up by overall economic growth. This is due to the fact that any growth of economic activities (GDP) offsets the potential dematerialisation resulting from increased resource productivity: if resource productivity increases by 5% and GDP by 3%, resource consumption decreases by 2% (SPANGENBERG 1995). From a purely ecological perspective, economic growth constitutes a burden on ecological objectives. This fact has been discussed in the context of the Òlimits of growthÓ since the 1970Õs (MEADOWS 1972). To demand restrictions on economic activities for that reason, however, would ill serve the basic idea of sustainability: the social and economic aspects of the sustainability vision demand that the conditions for continuous economic growth be ensured. Both demands can only be fulfilled if growth is not at the expense of the environment, but, on the contrary, relieves the pressure on the environment. Hence, growth has to focus on those supply and demand aspects that, at the same time, also raise the economyÕs eco-efficiency (LIEDTKE / HINTERBERGER / PASTOWSKI 1999). There is no agreement on the extent to which the pressure on the environment has to be relieved in order to be able to speak of sustainable development. Since this extent cannot be scientifically justified in exact terms, the decision will always be a normative one. However, the required reduction of the material input can be roughly estimated: The material flows moved by man world-wide have to be halved in order to achieve a development that, in the long term, will remain within the bounds set by nature. With regard to the relation of material input to income, a reduction by the factor four can be frequently reached in the short to medium term, which is illustrated by many concrete examples (WEIZS€CKER/LOVINS/LOVINS 1995; STAHEL 1995). With a view to the absolute volume of the material flows moved by man, dematerialisation by the factor 10 should be aimed at in the long term, i.e. within the next 50 years (see Boxes). An advantage of the concepts of dematerialisation and eco-efficiency in combination with the related targets of factor 10 and factor 4, respectively, is the fact that they can be interpreted in different ways: 14





· On the one hand, consumers can thus orientate their purchasing behaviour to ecology without giving up due to the enormous complexity of the ecological impact of human actions. The material input required for a product (including the Òecological rucksackÓ) is a simple and clear criterion for assessing the environmental relevance of purchasing decisions in a directionally safe way. Thus, ecologically correct behaviour can be put into simple rules (Òit is better to borrow, share and exchange than to buyÓ, Òdifferent materials involve a different use of natureÓ; ÒMaintain, repair, clean and use as long as possibleÓ). · On the other hand, guidelines can be derived from the two concepts for companies that wish to optimise their production in ecological terms (see Chapter 4). In co-operation with the Wuppertal Institute, an increasing number of companies develops ways and means for operationalising resource productivity as a management instrument. Claude Fussler, VicePresident of DOW Europe, uses it as one of the determinants of his eco-efficiency concept (FUSSLER / JAMES 1996). The medium-scale Kambium furniture factory introduced a costefficient and eco-efficient environmental management system on the basis of resource productivity (LIEDTKE et al. 1998) and, in chemical industry, it is applied in product development (HOECHST AG 1997). At the same time, all economic and social actors can relate their actions to one another. The manifold options of environmentally friendly behaviour would be replaced by a common objective that is orientated to the actions of both the individual consumers and producers. This counters the main cause of ecological fatalism that threatens to spread more and more given numerous scattered individual measures that, as a whole, do not yield sufficient success. In this way, the concepts of eco-efficiency and dematerialisation can function as visions. If their public awareness and acceptance could be raised, they could become established quantities that influence both the direction of technical progress and social development (HINTERBERGER / LUKS / STEWEN 1996).

The Factor Four Objective The factor four objective aims at Òdoubling welfare, while halving resource consumptionÓ. Thus, it focuses on the ratio of welfare to material input, i.e. eco-efficiency. The objective is based on the assumption that the total material requirement, in particular total energy consumption, has to be halved. A target period is not identified. (WEIZS€CKER/LOVINS/LOVINS 1995)

15





The Factor Ten Objective The factor ten objective aims at reducing the absolute volume of nature consumption to a certain extent, i.e. by the factor ten or 90%. On the one hand, it results from the demand to halve the total material requirement. On the other hand, it is based on the (ethical) demand that all people shall equally participate in the utilisation of global resources. Because the richest 20% of humankind consume 80% of the resources at present, these two demands result in the requirement to reduce the material input in Western industrialised countries by the factor ten within the next 40 to 50 years (FACTOR TEN CLUB 1997).

Meanwhile, the two concepts, which were developed at the Wuppertal Institute of Climate, Environment and Energy, are reflected in environmental strategies of an increasing number of European countries as well as international organisations: For example, the Austrian government also committed itself to the factor 10 objective in its National Environment Plan (…STERREICHISCHE BUNDESREGIERUNG 1996) and the same applies to the Upper Austrian provincial government (OBER…STERREICHISCHE UMWELTAKADEMIE 1995). In its 13th and 14th Report 1997, the Ecocycle Commission founded in 1993 by the Swedish government also refers to concrete increases in material and energy efficiency by the factor 10 within the next 25 to 50 years (KRETSLOPPSDELEGATIONENS RAPPORT 1997/13). Likewise, the Committee of Sustainable Development of the Finnish Environmental Ministry adopted the factor 4 and factor 10 objectives (YMP€RIST…MINISTERI… 1999). The Dutch Environmental Ministry also explicitly endorsed the objective, but demanded evidence of its feasibility. In sectoral terms, it is already included in the Dutch Environmental Plan NEPP 2 and in the recycling targets of the British government. Likewise, the Italian environmental minister referred to dematerialisation as a task of the future in an interview. Several strategic plans of international institutions also refer to the two concepts, for example the Draft Programme on the further implementation of Agenda 21 presented at the UN General Assembly in 1997 (UN General Assembly 1997). The Commission on Sustainable Development (CSD) took note of both concepts and considers them or similar approaches to be necessary to implement the Kyoto targets (CSD 1998). At the workshop ÒMaking Sustainability AccountableÓ held in October 1998, the European Environment Agency launched a discussion on both concepts. In the final report on the workshop, in which representatives of the economy, OECD, UN, institutes and non-governmental organisations participated, the two objectives are emphasised (EEA 1998). Hence, dematerialisation and eco-efficiency have become familiar terms in environmental discussions in Europe. The challenge now is to establish these concepts in European environmental policy and apply them to individual policy areas of the European Union on the way towards integration. In order to advance this process it seems to make sense to first identify the criteria by means of which the concepts can be quantified.

16





3.3 Selection of suitable indicators Objectives are only as good as the possibility of measuring or assessing their achievement. Clear timetables, binding indicators and regular reporting (done in an exemplary way by the European Environment Agency) are decisive in this context. The demand for a sustainability scenario that is easily and generally understood and applicable at all levels also results in the need for a few expressive indicators that can be used to define objectives and to measure progress. The dilemma faced in the selection of indicators is well known: by aggregating and reducing data, information is inevitably lost. However, comprehensibility is adversely affected if too many indicators are used. For example, the Commission on Sustainable Development of the United Nations proposes 130 indicators to describe sustainability from various perspectives (UN 1996)10. Given such a wealth of information, the general overview is lost, not to mention general comprehensibility. The dilemma is further aggravated by the fact that different indicators may, under certain conditions, result in contradictory results for specific measures. Economic and social indicators In the field of social and economic development, the gross domestic product (GDP) and the employment or unemployment rate are two wide-spread, generally known and accepted indicators. This also applies to the objectives to be achieved (continuous growth and a high level of employment). Both indicators are at least roughly directionally safe, i.e. they cannot give a comprehensive picture of their field (for example, economic growth alone does not permit any conclusions on the actual stability of an economy, and the employment rate is also inadequate for describing social cohesion in a country or a region). Nevertheless, the two indicators provide information as to whether certain measures bring about progress or setbacks with regard to their respective objectives. They are important criteria for measuring the success of policies, economy and administration. Ecological headlines A generally accepted, single measurement quantity does not exist in the field of ecology as yet. In political discussions, this constitutes a Òcompetitive disadvantageÓ of ecology vis-ˆ-vis economic and social policy since, in these areas, the impact of certain actions can be assessed and justified with considerably more ease by means of their indicators. Consequently, it is much easier to find arguments in favour of measures promoting economic growth or creating jobs. For want of a single measurement quantity of sustainability accepted all over the EU, the numerous existing environmental indicators have to be reduced to a few key ÒheadlinesÓ. These reduced set will, of course, not be capable of reflecting the response of the ecosphere in its entire complexity (and should not do so); such a reduction is not based on scientific, but on political reasons. At the same time, the indicators selected should at least meet the following criteria (SCHMIDTBLEEK 1994): 10

Further examples are: WORLD BANK 1997, EUROSTAT 1997, OECD 1997

17





1. They should be simple, but reflect important impacts on the environment, 2. They should be based on characteristics common to all processes, goods and services, 3. The characteristics selected have to be measured and calculated in a simple way, 4. The application of the indicators should be cost-efficient, 5. They should allow for a transparent and reproducible assessment of environmental impact potentials of any plans, processes, goods and services from the cradle to the grave, 6. Their application should always yield directionally safe results, 7. They should build a bridge to activities on the markets, and 8. They should be applicable at all levels: local, regional and global. How can we find headings that, on the one hand, permit a European-wide consensus and, on the other hand, result in indicators that meet the aforementioned criteria? In co-operation with the Austrian Ministry of Environmental, Youth and Family Affairs, the European Environment Agency organised a workshop in October 1998 that largely reached a consensus on the features of a core set of cross-sectoral headings for ecological sustainability. In the foreseeable future, another meeting will probably not be held with a comparable representation of indicator experts from the economy, OECD, Eurostat, the United Nations, institutes and non-governmental organisations. Therefore, it is safe to assume that the headings established at the EEA workshop constitute the smallest common denominator in indicator research for the foreseeable future. As a next phase of the Cardiff process, we therefore propose a political reduction of the indicators based on six headlines from which so-called headliners or headline indicators can be derived:

Input

Output

Material Requirment

Climatic Impact

Non-renewable Fuels

Land

Acid Load Economy

Waste

Fig. 1: Core set headlines

This core set of headlines (by definition) does not claim to be complete; it does, however, claim to provide a directionally safe orientation and is the basis for comparisons of individual sectors and 18





policy areas. Additionally, it should be supplemented by further, sector-specific indicators, such as the nitrogen input in agriculture. Within the framework of EEA workshop mentioned above, the Òenvironmental barometerÓ was presented, which is included in the programmatic declaration ÒSustainable development in Germany Ð Draft of an environmental key action programmeÓ of the German Environmental Ministry (BMU 1998). This draft describes relevant environmental objectives and indicators. They are orientated, on the one hand, to input-related resource flows of material, energy and area use, which are indicators of great importance in precautionary environmental policy. On the other hand, output-related reduction objectives are considered to be urgently needed for selected emissions whose detrimental impact is already proven or assessed as critical (CO2, SO2, NO2, NH3 and VOC). On the basis of the aforementioned workshop, the European Environment Agency prepared a proposal for a core set of headlines (EEA newsletter 17/98, GEE / MOLL 1998). That set contains the six headlines indicated above plus indicators of eco-toxicity and CFC emissions on the output side, as well as water consumption on the input side. This, however, involves the following problems: · At present, a global indicator of eco-toxicity is not yet known. This would require the aggregation of the toxic effects of various substances (e.g. lead and plutonium), which is impossible based on the current state of research. · The problem of CFC emissions is no longer an urgent environmental problem, at least in Europe (EEA 1995). · Water consumption can also be covered by the indicator for material input if it is defined appropriately. For these reasons, we believe that these indicators need not be considered, notably given the fact that each additional indicator impairs general comprehensibility. In the long term, the indicators are likely to be further condensed. Thus, the input indicators will probably be given more weight. A reduction of the set to input indicators seems to be justifiable since decreasing inputs are expected to result also in decreasing outputs of the economic cycles. This applies, of course, particularly to the correlation between material input and waste as well as between energy and climate relevance and acidification. Furthermore, a positive correlation can be assumed to exist between the indicators of material input and energy input. Moreover, as compared with land and energy, the factor of material input provides a more comprehensive representation of the impact of human activities on the ecosphere. Therefore, this indicator could be established as a key indicator within the core set in the long term (roughly comparable to the GDP in the ÒMagic RectangleÓ of economics). At the level of political strategies, this would correspond to a commitment to the objective of dematerialisation that was discussed in detail above. The following is to present how this objective can be translated into concrete steps and applied in various policy areas.

19





4 The next steps towards sustainability Dematerialisation is the ecological dimension of a sustainability policy that also includes social and economic policies. In particular, this means that a policy of dematerialisation also has to consider the social and economic consequences of its actions. Conflicts with the social and economic objectives of sustainable development will sometimes be inevitable. The purpose of integral sustainability policy will be to resolve these conflicts in the long term or weighing conflicts in a more transparent way. The conflicts will be less pronounced than generally feared: already today, social, economic and ecological objectives can be pursued as complementary objectives by means of appropriate policies. This is illustrated in 4.1 for ecological and economic aspects, and Chapter 4.2 briefly discusses the connection between ecological and social objectives. In order to make the strategy of dematerialisation an effective tool in the prevention of impending environmental damage, it needs to be applied to all policy areas and at all levels of economic, social and political activities, i.e. the integration process launched has to be continued (cf. 3.2). It is one of the strengths of the dematerialisation strategy that it is transferable to most diverse policy areas and to the different levels of activities. In Chapter 4.3, this will be illustrated for the fields identified by the European Councils of Cardiff and Vienna as priority areas for the development of integration strategies. These are the fields of transport, energy, agriculture, development, internal market and industry. 4.1 Ecological economic policy: competitiveness by dematerialisation In current discussions, competitiveness is very often only seen as an issue of relative costs. In recent years, however, different disciplines developed a number of concepts that attempt to define requirements to be met by companies as well as requirements regarding the institutional environment with a view to strengthening international competitiveness. Competitiveness does not emerge spontaneously by a change in the macro-economic framework nor due to entrepreneurship at a micro-economic level alone; it is rather the result of a pattern of complex and dynamic interactions between companies, the public sector, intermediary institutions and the organisational and learning capacities of a society (E§ER et al. 1994). In this context, it is essential that a competition-oriented system of incentives be established that forces companies to raise their efficiency. First of all, the competitiveness of the economy is based on targeted and interlinked measures at the three system levels (micro, macro and meso level). Thus, competitionoriented environmental policy has to address these levels11: · Micro-level: The role played by individual actors with regard to the competitiveness of a country (Europe) is decisively shaped by their opportunities, competencies and their will to create technical and organisational innovations Ð in the field of processes as well as in the field of products and, in particular, eco-efficient services (HINTERBERGER / LIEDTKE 1999). Employers are here of equal importance as employees. In this context, the cost situation, but

11

Cf. HINTERBERGER / MESSNER 1998 with regard to the following statements.

20





also education and training play a decisive role, and the communication structures between companies are of great importance. · Meso-level: Innovations (also including ecological innovations) are only possible if the environment of a company is flexible. This refers to the material infrastructure (transport, communication, supply and disposal systems) as well as to social institutions (in particular the education system). Moreover, regulations (laws, ordinances, DIN/ISO standards) are important. They can impede or promote innovations and, thus, increases in competitiveness. · At the macro-economic level, the three areas of monetary, fiscal and wage policy should be examined with regard to the implementation of sustainability demands. In the context of a turnover-oriented analysis of macro-level policies, the general question has to be raised as to which growth effect the definition of this aggregates has and which opportunities these instruments offer with a view to increasing resource efficiency. Only by means of fiscal policy (via revenue and spending policies, e.g. ecological tax reform), direct measures can be taken to bring about an ecologically orientated structural change. Monetary and wage policies can merely provide the framework for sustainable development. With a view to monetary policy, discussions should particularly focus on the issue of whether a fundamental change in strategy is a necessary requirement for an ecological structural change (cf. MAIER-RIGAUD 1998). The actions at these levels are, however, embedded in another level, the meta-level, that is to cover the definition of social visions. It includes aspects, such as changes in consumption patterns and the development of new life styles. The cultural model of industrialisation with the life styles related to it (involving intensive consumption) and its visions cannot be maintained nor implemented at a global or regional scale in the long term (BUND/Misereor 1996, BLEISCHWITZ 1998). An ecologically orientated economic policy, thus, faces the problem of controlling the developments in such a way that social security, quality of life and democracy are ensured also when the material production output is restricted. As was shown in Chapter 3.3, the model of sustainable development, at the ecological level defined by eco-efficiency and dematerialisation, can become a decisive factor in the future. Competitiveness by innovations For individual companies, the commitment to a strategy of dematerialisation often appears to be a disadvantage in competition. Here, it is, however, easily overlooked that competitiveness is not only a question of production costs, but rather is systemic in nature. If only the ability of producing at low costs was decisive in global competition, the European economies would not stand a chance on the world markets. The strength of the European economy is rather based on innovative companies, and on consumers who demand ever new innovations from the companies. The strategy of dematerialisation provides a simple, but general control parameter that can influence the direction of socio-economic and technical development (HINTERBERGER / MESSNER 1998). There is every reason to believe that, in the future, those companies will have a competitive edge that best succeed in developing goods and services that can be produced using considerably less material input. In other words, companies not focusing on resource efficiency in their production will not be able to survive on the market in the long term. In this context, European companies should see it as an encouragement that concepts such ÒTotal Resource 21





ManagementÓ are increasingly applied in many Japanese companies (YAMAMOTO 1998). An overview of the progress of resource-efficient production in Europe and other industrialised countries is provided by the Factor4 Fair in Klagenfurt. There are even more arguments supporting the assumption that a dematerialisation strategy would rather benefit than adversely impact the European economy and its competitiveness (BUND / Misereor 1996): If the full price had to be paid for transport, the transport intensity of consumption would generally decrease. Producers, wholesalers and retailers would shorten the distances to be covered by basic supplies. Thus, certain products would no longer be bought abroad since it would no longer be worthwhile. Dematerialisation will generally require and allow for stronger regionalisation. Production and consumption would again move closer to each other, which would result in less material and energy input. Dematerialisation favours services in the business process. If value is increasingly created by services (particularly in the form of local services) in Europe, this means that a sector of the economy is expanded that is not subject to international competition. Repairs, kindergartens or tool rental services cannot be imported since the service has to be rendered locally. In contrast, industrial products are examples for so-called tradables, for which the competitive pressure is highest (KLEMMER / HINTERBERGER 1999). At the cost level, arguments can also be identified that favour the dematerialisation of European economies. At present, they are forced to cover their raw material demand primarily by imports. In the long term, raw material prices are likely to rise in spite of their current record lows. In such a situation, those companies that already dematerialised their production processes will have a competitive edge due to relative cost savings. In terms of the national economy, this also means moreover that dependence on raw material imports will be reduced, which ensures a better protection against price shocks. Competitiveness by cost reductions In addition to innovations, production costs determine the competitiveness of individual companies Ð as well as of the entire economic system. At the level of individual companies, a dematerialisation strategy reduces costs even given the currently low raw material prices and, hence, results in competitive advantages in the latter sense (for an economic discussion, see BERNDT et al. 1999). At first glance, this appears to be surprising because environmental measures are often exclusively seen as raising costs at a company level. This is caused by the fact that corporate environmental protection is equalled to end-of-pipe environmental technologies. According to data of the Federal Statistical Office, both the investment costs and current expenditure on environmental protection by the manufacturing industry and the state quadrupled in the fields of air quality, water quality, waste disposal and noise reduction in Germany from 1975 to 1995 (StBA 1996). In total, companies in the old German LŠnder spent far more than half a trillion marks on follow-up environmental measures in the past 20Êyears. This figure does not include expenditure on 22





environmental protection measures integrated into production. These costs are genuine additional costs for the companies that do not result in value added or additional benefits. Therefore, the focus of corporate environmental protection increasingly shifts from the reduction of undesirable output (emissions, residues, waste) to the input side (material and energy). Environmental loads are basically caused whenever material is extracted from nature. This means that a reduction of material and energy flows caused by man results in relieving the pressure on the environment (SCHMIDT-BLEEK 1994). If all strategies of material savings are fully exploited, purchasing costs can be significantly reduced at the same time, i.e. preventive environmental protection aiming at a reduction of material and energy flows also improves the operational result (LIEDTKE / HINTERBERGER 1998; LIEDTKE 1997; GEGE 1997). Pilot projects have shown that, at present, up to 40% of all input materials do not enter the products manufactured, but become residues Òwithout creating value addedÓ (FISCHER 1997). Frequently, it is neglected that companies have to pay three times for these residues: firstly, when they are purchased, secondly in storage and production since future residues also pass through the production process, and thirdly for their disposal and/or treatment. The Òpurchasing costsÓ of the residues frequently exceed a multiple of the disposal costs. But these costs are assigned to the product as a costing unit and, thus, financed by the productÕs revenue. In this way, they are not related to the residues. Eventually, companies underestimate the savings potential of reduced residue volumes due to this situation and do not carry out investments that actually would be profitable. Thus, the insufficient transparency of corporate material and energy flows and of the related costs is currently one of the biggest obstacles to the systematic exploitation of savings potentials by companies with regard to improving their competitiveness while reducing their environmental load (ORBACH / LIEDTKE / DUPPEL 1998). The practical feasibility of combining increased competitiveness with reduced environmental impact has been shown several times by so-called cleaner production programmes. The primary objective of these programmes is the reduction of the environmental impact of the participating companies by means of preventive environmental protection. This should at least be cost-neutral and, ideally, it should reduce costs (SHEN 1995, VAN BERKEL 1996). In Austria, mention has to be made of the …koprofit programme that has already been implemented with great success in Graz and other Austrian cities since 1991. The main objective of this programme is the reduction of waste quantities and emissions. The optimal use of resources is achieved by process and product modifications, by a more careful handling of substances, by substituting raw materials in line with ecological criteria and by the recycling and re-use of waste. This is supported by appropriate changes in operational planning and organisation. The experiences made by the participating companies show that preventive environmental protection allows for the reduction of costs, in part to a substantial extent. Here, the improved image of the participating companies is not yet taken into account. In a similar way, the European-wide PREPARE initiative pursues the objective of a more economical use of material and energy resources at a corporate level. An essential aspect of this programme is the systematic recording of material and energy flows in the participating 23





companies (input-output analysis) and a subsequent analysis of weaknesses, both in organisational and technical terms. For the participating companies, also PREPARE soon resulted in savings based on the more efficient use of raw materials and, thus, impressively demonstrated that properly applied environmental protection permits cost savings. Ecological economic policy in a European context As stated within the framework of the Global Assessment of the 5th EAP by the Austrian Environmental Ministry with regard to the ecological tax reform, the implementation of ecological economic policy is hampered by the fact that the Member States and the organs of the European Union lay the responsibility for its implementation on each other. The Member States argue that, if implemented in a single-handed national effort, ecological economic policy would result in competitive disadvantages for the domestic economy. On the other hand, it was impossible for EU to become active on its own because there was no agreement on the type and extent of the ecological re-structuring. A solution to this deadlock most probably could be achieved by the Council taking a more active role, which will require more determined action than up to now. A necessary prerequisite to this effect is the extension of the majority principle to fiscal and economic decisions of the Councils. If an ecological economic policy could be implemented all over the European Union, this would also curb the frequently voiced objection that export industry faced competitive disadvantages, in particular during the transition phase (in the medium to long term, competitive advantages can be expected, which is illustrated in the following chapter). Since extra-Community trade only accounts for 18% of the CommunityÕs trade volume, the EU-wide conversion would alleviate a major part of the competitive pressure during the transition phase. 4.2 Labour and dematerialisation With regard to the interaction of dematerialisation and employment strategies, we can distinguish between effects directly resulting from policies and indirect effects Ð which are only expected at present. The direct effects include: · higher quality of life due to a cleaner environment and improved environmental quality; · more transparency of market processes; · reduction of the burden on the labour factor. The indirect effects include: · decreasing unemployment; · more time autonomy, leisure; · higher self-determination; · more equitable income distribution; · participation of the working population. 24





The extent to which these expected effects will actually materialise can only be assessed after indepth investigations in this field. At the Wuppertal Institute, the Labour & Ecology project, which is currently under way, also attempts to describe and assess these interactions12. The main objective of the project, in which three research institutes (Wuppertal Institute, Science Centre Berlin, German Institute of Economic Research) participate, is to study economic, social and labour aspects in their interaction with central elements of different sustainability concepts. This involves crosssectional analyses and the development of scenarios and clusters of strategic measures. The scenario of the Wuppertal Institute is the so-called ecological-social sustainability scenario that is based on the ecological criticism of prevailing policy patterns that are of relevance to the environment. In addition to the implementation of ecological objectives, the social element of future orientation is stressed, e.g. employment, income levels and distribution, participation of the working population, education and training concepts. The final report of this study will be presented at the end of 1999. In order to arrive at quantitative statements, this scenario is calculated using the integrated environmental-economic computer simulation model PANTA RHEI (dynamic input-output model) (MEYER et al. 1998 a, b). By specifying certain variables reflecting the ideas of the scenario, all quantities of national income accounting can be calculated up to the year 2050, including the development of unemployment. Thereby, the project will significantly contribute to the confirmation or re-definition of the social effects of an ecological-social (economic) policy (in which dematerialisation plays a key role). 4.3 Implementation in individual policy areas In the following a rough outline will be given on the ways in which the concepts presented could be applied to Community policies in line with the integration principle. The process of integration started in Cardiff is taken as a basis and continued. The Councils discussed here correspond to the ones identified in the Conclusions of the European Councils of Cardiff and Vienna. For that purpose, the criticism of the existing reports is used as a starting point (cf. Chapters 2.3 and 2.4), and the proposals and requirements of ecological sustainability policy described in Chapter 3 are implemented. The integration into all policy areas is to be orientated to the six headlines listed in Chapter 3.4: Òmaterial requirementÓ, Ònon-renewable fuelsÓ and ÒlandÓ (as input) as well as Òclimatic impactÓ, Òacid loadÓ and ÒwasteÓ (as output). The concepts and strategies presented below for the implementation of integration in these fields do not claim to be complete. They are only to serve as suggestions for the direction that should be taken by the policies in order to come closer to the requirements of sustainable development.

12

See also the information brochure on the Labour & Ecology projcet of the Hans Bšckler Foundation or the Internet site at: http://www.a-und-oe.de

25





4.3.1 Transport In the past, the environmental impact was mainly assessed using the emissions of different transport modes as a criterion. Moreover, the emissions were usually only calculated for the operation phase. On the basis of these data, the emission values were minimised. This approach is to be maintained, but has to be complemented by a more comprehensive consideration of the ecological impact of transport: Improved distribution of transport In the course of a re-orientation of environmental policy to the inputs into the economic cycle, other factors, in addition to the consumption of fossil energy sources, become more important: Thus, land use and resource consumption required to render transport services are of relevance. It must not only be calculated for the operation phase of the transport means, but also for the establishment and maintenance of the infrastructure as well as for the production and disposal of the transport means. A first analysis shows that a considerable amount of the resource consumption can be attributed, in particular, to infrastructures (STILLER 1996). Against this background, approaches aiming at improvements in the allocation of traffic flows to different traffic modes are of special relevance, since this increases the efficiency of existing infrastructure networks (HINTERBERGER / LIEDTKE 1999). The re-distribution of traffic flows will most likely be achieved by the stronger consideration of environmental loads in transport costs, as was stated in the report of the Council of Ministers. Furthermore, the extensive hidden subsidies currently still granted to car traffic should be abolished, e.g. in the field of parking (WELFENS et al. 1996). Within the framework of the change of the modal mix, it will be necessary to re-assess high-speed traffic, which is unrelentingly given high priority in EUÕs traffic plans. From an ecological perspective this is particularly questionable since higher speeds involve an disproportionately higher energy consumption. Due to higher infrastructure requirements (wider curve radius, lower inclination), the values of material and land use are also significantly higher than for conventional systems (GERS et al. 1997). Changed mobility concepts European transport policy faces the challenge not only to stabilise nature use by transport at a high level, but to reduce it significantly. To the extent required, this will probably be achieved neither by technical solutions nor by the optimal allocation of traffic to the different transport modes alone, even though these measures can contribute much to a reduction of nature use. Moreover, it is necessary to limit the growth of the traffic volume in the short term (UMWELTBUNDESAMT 1997). In order to achieve a sustainable reduction of the burden, however, a decrease of the traffic volume in absolute terms will become necessary in the medium term, i.e. in addition to efficiency increases, traffic avoidance should become a focus of transport policy. The effects of a successful dematerialisation strategy will tend to be reflected in a reduction of transport volumes. This results from the idea of dematerialisation: if less material is used to produce goods and services, less material needs to be transported. These reductions will, in part, 26





be offset by additional transports required for recycling structures in resource utilisation, but all in all a considerable reduction is to be expected. A further decrease will result from the regionalisation of economic structures outlined in Chapter 3. In this way, the number and volume of long-distance transports can be significantly reduced. In this context, the transport policy of the European Union has the task of accompanying and advancing this change by promoting new technical solutions as well as new mobility concepts. 4.3.2 Energy In the course of integration, special challenges are in store for the energy sector since a product of this sector, i.e. energy generated from fossil fuels, is an input that has to be minimised. Due to long years of discussions, however, numerous concepts were already developed in this sector, which indicates that a substantial increase in resource productivity is already feasible today (energy-saving lamps and passive-energy houses are only two examples out of many). Accordingly, the report of the Energy Council also stresses the feasibility of, and the need for, efficiency increases. The eco-efficient services mentioned in 4.1 could be of special importance in this context: actually, the consumers do not demand kilowatt-hours of electricity or cubic metres of heating fuel, but services such as lighted and heated rooms or hot water. If such services are traded instead of the energy itself, it is in the interest of the providers to render the services with the least energy input possible and, thus, as cost-efficiently as possible (WEIZS€CKER / LOVINS / LOVINS 1995). This method, called integrated resource planning (IRP), could be decisively promoted by the adoption of an IRP directive that provides for a mandatory investigation of savings potentials as an alternative to the construction of new power plants. Not only in electricity consumption, but also in its generation, remarkable efficiency increases are still possible. This becomes clear when the material volumes displaced for the purpose of energy generation are examined. In Germany and the Netherlands, around 25% of the entire material input are directly or indirectly related to energy generation. If hidden material flows (ecological rucksacks) are taken into account, these values even increase to 62% (D) and 20% (NL)13 (HINTERBERGER / STILLER 1998). A comparison of different energy sources shows that exorbitant amounts of material and water have to be displaced particularly in case of brown coal, but also in case of mineral coal (MANSTEIN 1996). If the energy mix is changed Ð increasing the share of natural gas, wind and hydroelectricity Ð and if the resources are used more efficiently (for example, increased closed-loop cooling or improved efficiency), significant savings are possible. Efficiency increases should absolutely be supported by a slow, but gradual and predictable increase in energy prices at a European level, which was also recommended by the Energy Council in its integration report. For the energy providers, it will be decisive whether they will actively participate in the process of raising efficiency in energy generation and consumption or whether they will be marginalised by the development and, thus, obstruct their own future.

13

The difference is due to the high material flows in the field of mining in Germany.

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4.3.3 Agriculture1 4 The special responsibility of agriculture for the protection and preservation of the environment is repeatedly stressed in the report of the agricultural ministers. The dematerialisation of agriculture will mainly be characterised by a more extensive utilisation of the arable area. The most evident option for achieving this is the de-coupling of direct payments from production quantities with a view to direct rewards for services in the field of environmental protection and the preservation of cultivated landscape. These payments could be based on the area, the farm or the number of persons working in a farm and could represent a transition from subject to object promotion. A long-term opportunity of agriculture exists in the field of renewable energy and raw materials. In the short term, however, intensified activities in this area are impeded by international agreements laid down in GATT as well as by the insufficient competitiveness of European agriculture. This is all the more painful since a deficit of protein and oil seed crops currently exists in Europe and since the gradual abandonment of the focus on fossil raw materials is of central importance for sustainable development. Also with a view to the enlargement of the European Union in Central and Eastern Europe, it is important to give these problems more attention. The potentials for the cultivation of renewable raw materials and energy sources are rather low, at least in densely populated Central Europe. The promotion of extensive agriculture and a gradual regionalisation of food industry clearly offer higher potentials for relieving the pressure on the environment than the increased cultivation of renewable energy sources. Priority should be given to the utilisation of existing residues and waste (biogas from manure, straw incineration, etc.) This applies, in particular, to forestry where, at present, considerable potentials are only inadequately exploited at least in some EU countries. Renewable raw materials, of course, also harbour ecological risks. Land use, erosion, pesticides and fertilisers, etc. are only a few examples in this context. Moreover, many studies demonstrated that the intensive production of renewable raw materials may induce more material flows and emissions than their inorganic substitutes. Therefore, the sustainable utilisation of renewable raw materials has to be examined on a case-by-case basis. The proposal contained in Agenda 2000 of abandoning the instrument of set-asides should give cause to introduce a general energy tax and a specific working stock tax in parallel. This could ensure a general extensivation and reduction of material inputs that are a burden on the ecosystem. Additionally, this could improve the competitiveness of renewable raw materials and energy sources (including wood as well as residues and waste) as compared with fossil resources. 4.3.4 Development At the latest since the UN Conference on Environment and Development held in Rio de Janeiro in 1992, the sustainability concept has been closely linked to development co-operation. Given the request of the European Council that the Development Council prepare an integration report, in a way, the wheel comes full circle. Thus, we are eagerly looking forward to seeing how the

14

The following section was taken from: HINTERBERGER et al. 1998

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Development Council fulfils the request of the Vienna Council Ð at least it should be able to bring to bear the longest experience in the discourse on sustainability. At a meta-level, it would make sense to critically question the development model of the EU since it is not transferable world-wide. This could be proven by means of all important sustainability indicators (land, energy, material, emissions and waste). In detail, this has already been shown at a macro-level. For example, the European UnionÕs net imports are based on an area that corresponds to the entire fertile land of Panama, Venezuela, Guyana, Colombia and Ecuador (SPANGENBERG 1995). Therefore, the impact of a dematerialisation strategy should be studied, for example, on trade relations and land use in Third World countries. The development co-operation of the European Union mainly concerns the meta and micro level in the ACP countries. In analogy with EUÕs internal regional policy, resource-saving and innovation-promoting structures should be established here with a view to future-oriented competitiveness. 4.3.5 Internal market With regard to the implementation of the ÒFour FreedomsÓ, the Internal Market Council faces the need for integrating environmental issues at least in the field of the movement of goods and persons. In this respect, the report could be compared with the one of the Transport Council. Additionally, it would be necessary to examine the issue of import restrictions in accordance with Article 95 EC Treaty, which states that free trade may be restricted in favour of environmental and health protection. Here, it could also be interesting to study the impact of sustainability strategies (e.g. dematerialisation) on trade (in particular, trade in so-called durable goods) and to analyse ways of promoting these strategies by a regulation of trade. 4.3.6 Industry a) Approaches in production As explained above, the inadequate transparency of corporate material and energy flows as well as of the related costs can be identified as one of the major obstacles to resource savings at a corporate level. Thus, wrong incentive structures maintain an opposition between ecology and economy that could be overcome at least in part. Up to now, the Industry Council, however, largely dealt with the strengthening of competitiveness of European industry and environmental integration as two separate issues: Only the recycling industry is given as an example for a successful integration of competitiveness and environmental issues; in other areas (business services), this aspect is lacking (EUROPEAN UNION / THE COUNCIL 1996 d). The biggest obstacles to the establishment of concepts such as cleaner production, eco-efficiency or dematerialised production are their insufficient publicity and acceptance. Thus, a first step of the Industry Council could be an increased offer of advice and information on these topics. Existing initiatives, such as the …koprofit and PREPARE programmes mentioned above, should be continued and expanded. In addition to a spatial expansion to other regions, an expansion with 29





regard to the contents is also necessary: besides the aspect of cost reductions, the aspect of competitiveness based on innovations should also be stressed in the future. This can be done by increasingly focusing on issues of ecologically optimised product design in addition to the existing orientation to the production process. Another way to strengthen competitiveness by more ecological practices is the Eco-Audit Directive: In this context, the six indicators identified in Chapter 3.4 should be established as mandatory criteria for assessing the environmental impact of companies (of course, a sectorspecific differentiation on the basis of additional indicators also makes sense and is necessary). Likewise, the input orientation of environmental policy should be reflected in the criteria used in the eco-audit. For this purpose, for example, the systematic recording and reduction of corporate material flows should be introduced as a part of the audit (see also LIEDTKE et al. 1994). b) Approaches to product design A highly effective tool providing concrete support to dematerialisation efforts in product design are normative regulations and standards. There are already numerous examples for a far-reaching reduction in resource consumption in production, use and disposal on the basis of improved product design. (WEIZS€CKER, LOVINS, LOVINS 1995). In order to promote the development and introduction of such products, existing normative regulations and standards will have to be reviewed in order to prevent that innovations towards a more sustainable product policy fail because the goods produced do not comply with existing standards. It is understood that the requirements of safety and consumer protection need to be taken into account in such a review. In addition to improved product design, resources can also be saved by changed utilisation forms. Concepts, such as eco-efficient services, aim at meeting needs not by selling goods, but only the services to be rendered by those goods (SCHMIDT-BLEEK 1998; TISCHNER/SCHMIDT-BLEEK 1995). By extending the manufacturersÕ product liability, the producers would be interested in ensuring that their products have a longer life, which implies that their resource intensity would decrease. To promote such concepts, the revision of warranty regulations would be of extraordinary help. c) Approaches at the structural (meso) level1 5 At a meso-level, the primary focus of industrial policy includes the development and reorientation of institutions in the field of educational, research and technology policies as well as other location and innovation policies supporting industry. For dematerialisation to be successful and advantageous in economic terms, industrial policy has to aim at the targeted co-operation of public, private and intermediary institutions (e.g. companies, associations, science, trade unions and governmental institutions). The Òsoft control instrumentsÓ (KRUMBEIN 1991) available to policy in this respect include the improvement of the information flow among the institutions and the integration of interests. The cleaner production programmes mentioned above, in which experiences and information are exchanged among the participating companies and associations, point to the right direction. Other approaches have the objective of networking material flows in different companies so that, wherever possible, the residues of one company can be used as raw 15

The following paragraph in accordance with HINTERBERGER / MESSNER 1998

30





materials in another company. Future location policy has the task and faces the challenge of promoting such co-operation. An effective tool of industrial policy at the meso-level (in part, also at the micro-level) is the definition of the regional policy of the European Union. Regional policy, including the Structural Funds, the Cohesion Fund and the accession aids, accounts for more than 30% of the EUÕs budget. These funds are mainly used for creating industrial infrastructures and supporting SMEs at the regional level. Even though almost 60% of the entire direct environmental spending of EU is effected in the context of regional policy, indicators are lacking for evaluating the ecological application of these funds.

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5 Conclusions 5.1 Integration by common headlines As illustrated, integration has to take place at all levels of the economy (systemic competitiveness); moreover, it has to be inter-sectoral. In this context, it is not a major problem that the sectors of the Fifth Environmental Action Programme are not identical to the sectors covered by the reports submitted to the European Council. The contents (ÒheadlinesÓ) covered in integration are of decisive importance. Only an integration agenda with common contents can ensure a purposeful and target-oriented discussion and review of the Community policies. Otherwise, the individual sectors could side-step at their own discretion to any (marginal) areas of the sustainability discussion that will not question the existing policies. First signs of this sidestepping and dilution of the integration agenda already surfaced in the Council reports. The European Environment Agency will propose ÒheadlinesÓ for the next EPRG meeting and its annual indicator reports. It would be an important breakthrough if the ÒheadlinesÓ proposed would be reflected, at least in part, in the Conclusions of Helsinki. These headlines should form the basis for revising the integration reports already submitted by the Councils. The report review process could be the first task of a new institutional structure that, in the future, should coordinate the inter-sectoral integration efforts of the Community (see following chapter). 5.2 Institutional issues of integration The sectoral integration of environmental issues into other policy areas is currently based on two mechanisms at a European governmental level: on the one hand, within the framework of the Environmental Action Programme and, on the other hand, within the framework of reporting to the European Council. In addition to these official processes within the European Union, there are numerous national and international integration efforts (UN CSD, OECD, etc.). Finally, these official governmental processes are supported by community-based processes (e.g. Local Agenda 21) and sectoral integration approaches (e.g. for industry in the World Business Council for Sustainable Development, etc.). In this context, it does not matter that these processes are not networked at an institutional level for the time being. It would, however, be important that these processes converge in terms of contents. With a view to the co-ordination of the contents, consultations and concerted actions of the EU Member States would be essential since the individual governments are involved in all these processes in a more or less decisive function. In the context of co-ordination within the Community, existing governmental networks (EPRG, 6+1) play a central role. Thought should be given to an institutional support and co-ordination of these governmental networks, because agreement among the environmental ministries vis-ˆ-vis the other sectors is an important prerequisite for the success of integration efforts. Thus, the need for harmonisation among the environmental ministries will rather increase within the Community. The Environmental Action Programme of the Commission should continue to form the programmatic framework of the intrasectoral integration of environmental issues.

32





Various models are under discussion for inter-sectoral integration. On the one hand, a conservative approach is advocated that demands that integration should continue to be a task of environmental policy makers. On the other hand, opinions were raised that are in favour of anchoring integration with the organs that have the competence to issue directives (Council and president of the Commission). Arguments in favour of maintaining the competency of the environmental policy makers are their expertise in environmental issues and the progress made by them since the successful ÒGreening of the TreatyÓ in Amsterdam. Arguments against it are the facts that they do not cover the social and economic dimension of sustainability and, above all, that they are not competent to issue directives. Another con is the ineffectiveness of the Fifth Action Programme with regard to integration as compared with the Cardiff process. Though the environmental policy makers demonstrated in the Fifth Environmental Action Programme that they want to show the way of the Union towards sustainability, but this competence was never appropriately acknowledged by other sectors at least with regard to the social and economic dimension of sustainability. However, the issue of the institutional anchoring of the integration competency should not be discussed as narrowly as previously. The question is not whether the environmental sector has to pass on competencies, for example to the Council or the Commission president. From the perspective of the other sectors, the environmental policy makers never had that competencies anyway. Rather, they should continue to be responsible for the environmental dimension of integration and ensure that this is also reflected in the following action programmes. The point is to complement this environmental competence by social and economic competence for integration at a higher level! · Similarly to the consideration of the integration idea in the Environmental Action Programme, social and economic programmes should also be complemented; · The integration unit existing within DG XI should also be paralleled in other DGs; · Within the framework of an integration strategy, the co-ordination of the individual sectors (e.g. transport, energy, environment, agriculture) should be anchored with the European Council for the Member States and with the President for the Commission. The Finnish Commission of Sustainable Development could serve as a model for institutional integration on the basis of co-ordination and the competency to issue directives. This Commission is chaired by the prime minister who is supported by a secretariat in which all ministries are represented (see Annex). An initiative of the Finnish Council Presidency could be the examination of the transferability of such a model to the EU organs. 5.3 Strategic objectives of the environmental troika in the Helsinki process The criticism voiced by the Austrian government in connection with the Fifth Action Programme should be taken into account by taking steps towards the operationalisation of sustainability in Helsinki. The reports submitted so far by the Agriculture, Transport and Energy Councils confirmed that there are still highly different ideas on what sustainable development means and 33





how progress towards it can be measured (if at all the Councils understood that sustainability can be measured). The definition of the objectives of sustainability primarily is a normative task. It is true that progress has to be measured in an objective way using scientific measures, but the definition of the objectives can only be scientifically derived and assessed on the basis of political objectives. This requires political leadership. Because the sustainability concept requires the integration of social, economic and ecological objectives, these objectives should not be defined by a single council (e.g. the Environment Council) for other sectors, but at a higher level, by the European Council or, with regard to the implementation, by the President of the European Commission. If a high-level co-ordination or a dialogue-orientated process cannot be institutionalised, there is the risk that each council defines the objectives of sustainability separately. Such a disintegrated definition of objectives would involve a high probability of inconsistencies and contradictions. Already today, there are signs in the reports submitted that the individual sectors tend to assess their existing policies as already being sustainable so that the need for structural changes actually cannot be realised. This would result in the absolute opposite of integration. Up to now, it was not possible to say that there was general consensus on the meaning of sustainability and on the indicators to be used for measuring it. In co-operation with the Austrian Ministry of Environmental, Youth and Family Affairs, the European Environment Agency organised the workshop ÒMaking Sustainability AccountableÓ in October 1998 that largely reached a consensus on the features of a core set of cross-sectoral headings for ecological sustainability. In the foreseeable future, another meeting will probably not be held with a comparable representation of indicator experts from the economy, OECD, Eurostat, the United Nations, institutes and non-governmental organisations. Therefore, it is safe to assume that the headings established at the EEA workshop constitute the smallest common denominator in indicator research for the foreseeable future. Thus, policy cannot use disagreement among the experts as a pretext for refraining from taking action. The Conclusions of the Finnish Presidency of the European Council of Helsinki therefore should at least define the headlines for the implementation of the integration process in the coming years. This would not adversely affect scientific research and the optimisation process at various national and international levels. Moreover, a harmonised (instead of arbitrary) integration of environmental issues into other policies could be initiated.

34





6 Annex Proposed draft for the Conclusions of the Finnish Presidency The European Council re-affirms its commitment made in Luxembourg, Cardiff, Vienna and Cologne to integrate environmental issues into all Community policies in accordance with the Amsterdam Treaty with a view to sustainable development. The Council welcomes the reports presented on this topic by the Transport, Energy, Agriculture, Internal Market, Development and Industry Councils. The Council requests the President of the Commission to co-ordinate the consistent and parallel integration of social, economic and ecological policies aiming at a sustainable development of the Union.

The Council thanks the Commission for the previous implementation of the decision taken in Vienna with regard to the presentation of a comprehensive strategy for the sectors, including a timetable for measures and a system of indicators, in Helsinki and confirms the need for continuing this process up to the Swedish Presidency in 2001.

The Council states that the indicator system adopted in Vienna should include consistent headlines that need to be considered in the future reporting of the Councils in order to allow for a parallel integration strategy:

For a resource-efficient development of the Union, the Council proposes the headlines Òmaterial requirementÓ, Ònon-renewable fuelsÓ and ÒlandÓ. In order to minimise the environmental load, the Council proposes the headlines ÒclimaticimpactÓ, Òacid loadÓ and ÒwasteÓ. All the reports submitted should be reviewed and complemented with regard to these common headlines.

The headlines shall be provided with a uniform core set of cross-sectoral indicators supplemented by sector-specific indicators. Objectives and timetables should be laid down in sector-specific action programmes.

35





Excerpt from the Conclusions of the European Council of Cardiff on 15 and 16 June 1998

ENVIRONMENT

32. A healthy environment is central to the quality of life. Our economies must combine prosperity with protection of the environment. That is why the Amsterdam Treaty emphasises the integration of environmental protection into Community policies, in order to achieve sustainable development. The European Council welcomes the Commission's submission of a draft strategy and commits itself to consider it rapidly in view of the implementation of the new Treaty provisions. It invites the Commission to report to future European Councils on the Community's progress in meeting this Treaty requirement and welcomes the commitment of the Austrian, German and Finnish Presidencies to achieve further practical progress.

33. The European Council endorses the principle that major policy proposals by the Commission should be accompanied by its appraisal of their environmental impact. It notes the Commission's efforts to integrate environmental concerns in all Community policies and the need to evaluate this in individual decisions, including on Agenda 2000.

34. The European Council invites all relevant formations of the Council to establish their own strategies for giving effect to environmental integration and sustainable development within their respective policy areas. They should monitor progress taking account of the Commission's suggested guidelines and identifying indicators. The Transport, Energy and Agriculture Councils are invited to start this process. The Council and Commission are invited to keep under review their organisational arrangements necessary to carry this forward. The European Council at Vienna will take stock of progress.

35. The European Council welcomes the progress in following up the Kyoto Conference on Climate Change. The Community and the Member States now need to develop strategies to meet their commitments under the Kyoto Protocol. Meeting these demanding targets will be a practical test of the progress the Community and Member States are making towards integrating environmental concerns into their policies. The European Council will review progress in 1999.

36. The European Council urges the earliest possible agreement of those elements of the Auto-Oil package which are under conciliation with the European Parliament. These measures will make an important contribution to improving Europe's air quality. 36





Excerpt from the Conclusions of the European Council of Vienna on 11 and 12 November 1998

VI. ENVIRONMENT AND SUSTAINABLE DEVELOPMENT

66. The European Council reaffirms its commitments made in Luxembourg and Cardiff to integrate environment and sustainable development into all Community policies in view of the Amsterdam Treaty. It welcomes the initial reports received from the Transport, Energy and Agriculture Councils on this aspect and invites them to continue their work with a view to submitting comprehensive strategies in these sectors, including a timetable for further measures and a set of indicators, to the Helsinki European Council. The European Council recognises that it will be important to ensure that environmental integration is adequately treated in the decisions to be made on agricultural and structural policies within the context of Agenda 2000 taking note of the progress reported so far.

67. It invites the Council to further develop this work in other Community policies, particularly in the Development, Internal Market and Industry Councils. The Council should also put emphasis on cross-sectoral issues such as climate change and the environmental dimension of employment and enlargement. In this context, the European Council welcomes the Council Conclusions on accession strategies for the environment, and on nuclear safety in the context of enlargement of the European Union.

68. The Commission is invited to submit a progress report on mainstreaming of environmental policy in time for the Cologne European Council, particularly taking into account the use of environmental appraisals for its major policy proposals.

69. The European Council will review overall progress on integrating environment and sustainable development at its meeting in Helsinki in order to link the sectoral strategies developed by the various formations of the Council, a co-ordinated report on indicators presented by the Commission, and the global assessment of the 5th Environmental Action Programme.

70. Climate change is one of the most challenging environmental problems for the next decades. Work on common and co-ordinated policies and measures within the Community should be intensified with a view to domestic action providing the main means of meeting the Kyoto commitments. The European Council welcomes the Buenos Aires Plan of Action and underlines the importance of its implementation for an early ratification of the Kyoto 37





Protocol. A comprehensive EU strategy on climate policy should be considered by the Cologne European Council on the basis of a report by the Commission.

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EUROPEAN COMMISSION (1998 a): Communication from the Commission to the European Council: Partnership for Integration Ð A Strategy for Integrating Environment into European Union Policies. COM (98) 333 EUROPEAN COMMISSION (1998 b): Strengthening Environmental Integration within Community Energy Policy. COM (98) 571 EUROPEAN UNION / THE COUNCIL (1998 a): Environmental Integration and Sustainable Development in the Common Agricultural Policy (Doc. 13091/98) EUROPEAN UNION / THE COUNCIL (1998 b): Report to the European Council of Vienna on integrating the environment and the sustainable development into the transport policy of the Community (Doc. 13811/98) EUROPEAN UNION / THE COUNCIL(1998 c): Report to the European Council on environmental integration and sustainable development within the area of energy policy (Doc. 13805/98) EUROPEAN UNION / THE COUNCIL(1998 d): Minutes of the Industry Council Meeting on 16 Nov. 1998 (Doc. 12743/98) EUROP€ISCHER RAT (Cardiff) (1998) Ð Presidency Conclusions. (Doc. SN 150/98) EUROSTAT - Statistical Office of the European Communities (ed.), Indicators of Sustainable development - A pilot study following the methodology of the United Nations Commission on Sustainable Development, European Communities, Luxembourg 1997 FACTOR TEN CLUB (1997). The Carnoules Declaration - Statement to Government and Business Leaders FISCHER, H.(1997): Environmental Cost Management, in: Fischer, H. / Wucherer, C. / Wagner, B. / Burschel, C.: Umweltkostenmanagement. Munich, Vienna: Hanser FUNTOWICZ S. O. / RAVETZ, J. R. (1991): A New Scientific Methodology for Global Environment Issues, in: Constanza, R. (ed.): Ecological Economics. The Science and Mangement of Sustainability, New York / Oxford FUSSLER C., R., JAMES P. (1996): Driving Eco-Innovation, Pitman Publishing GEE, D. / MOLL, S. (EEA)(1998): Background paper for eco-efficiency workshop ÓMaking Sustainability AccountableÓ, Copenhagen GEGE, M. (1997)(ed.): Kosten senken durch Umweltmanagement. 1000 Erfolgsbeispiele aus 100 Unternehmen. Munich: Vahlen GERS, V. / H†BNER, H. / OTTO, P. / STILLER, H. (1997): Zur RessourcenproduktivitŠt von spurgefŸhrten Hochgeschwindigkeitsverkehrssystemen: Ein Vergleich von ICE und Transrapid. Wuppertal Paper Nr. 75, Wuppertal, June 1997 HAAKE, J./ KUHNDT, M. / LIEDTKE, C. / ORBACH, T., / ROHN, H. (1998): Firms and Dematerialisation, in: Sustainability in question - the search for a conceptional framework, edited by J. Gowdy, F. Hinterberger F., J. van der Straaten, KŸhn J., Cheltenham, U.K: Eduard Elgon Publishing HINTERBERGER, F. / LIEDTKE, C. (1999): BMBF - Verbundprojekt Ó…ko - effiziente Dienstleistungen als strategischer Wettbewerbsfaktor zur Entwicklung einer nachhaltigen 40





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