MSWG Documents

March 27, 1999

I. Introduction and Background
II. History of Project
III. Research Questions
IV. Research Design
V. Research Significance
VI. Opportunities for Broader Research on EMS Implementation
VII. Pilot Program Summaries
VIII. Summary of Participating Facility Demographic Information
IX. Ongoing Activities and Future Work

I. Introduction and Background

The widespread adoption of environmental management systems (EMSs) by organizations has the potential to alter profoundly the relationship between their economic and environmental performance. An EMS is a formal set of procedures and policies that define - sometimes in great detail - how an organization will manage its potential impacts on the natural world and on the health and welfare of the people that depend on it. When implemented, an EMS has the potential to move a facility beyond compliance with environmental regulations, toward a dynamic, continual process of operational and organizational redesign, with the objective of continually reducing the facility’s adverse impacts on the environment. Furthermore, by adopting a high-quality EMS, it is likely that the facility will discover many opportunities to reduce wasteful uses of resources, thus saving money while improving the environment.

Some businesses have experimented with EMSs for many years, but until recently there has been no major trend toward widespread adoption, perhaps due to the perceived lack of an economic rationale. In late 1996, however, the International Organization for Standardization (ISO) published the final version of an international EMS standard, called ISO 14001. An organization that adopts an EMS that conforms to the standard can be certified as conforming to it by a third party "registrar." Publication of the standard has generated great interest in the business community, since in some international markets certification may in the future be viewed as a prerequisite for commerce. On the domestic front certification may be required or encouraged for many suppliers by their customers, including both business purchasers and government procurement officers. Businesses and other organizations may also view ISO 14001 certification as an opportunity to send strong signals to regulators and the public about their commitment to environmentally-friendly operations.

Environmental regulators in the United States, both at the state and federal levels, have been watching this business interest closely. In theory, a facility that adopts an ISO 14001 (or ISO-14001-equivalent) EMS should, in the long run, conform with all environmental regulations without the threat of punishment by government officials, since the standard requires a procedure for identifying and complying with regulations; and it should surpass regulatory standards for many activities. Furthermore, the ISO 14001 standard requires facilities to commit to continuous improvement of their EMS over time. Some government officials therefore see in ISO 14001 an opportunity to make many regulations more self-enforcing and thus less demanding of formal enforcement actions by government. Other regulators and most environmental groups, however, remain skeptical of the idea that facilities will properly monitor and correct their negative environmental impacts without effective regulatory oversight. For this reason, these groups argue that regulatory scrutiny of ISO 14001-certified facilities should never be reduced.

To date there has been little systematic research on the adoption of environmental management systems by facilities, and almost no research on ISO 14001 certification. Such research is essential both to answer the questions posed above—whether EMS implementation and certification do in fact achieve equal or better environmental results than regulatory compliance alone—and more generally, to determine the environmental and economic results of EMS implementation, both on the subject firms and on the public.

II. History of the Project

Regulators have recognized that there is a need for information about how ISO 14001 EMSs will affect the environmental, economic, and regulatory performance of organizations. In 1996 officials of nearly a dozen U.S. states and USEPA formed an informal "multi-state working group" (MSWG) to develop a common set of ground rules and data collection protocols for pilot projects with businesses that were contemplating EMS certification through ISO 14001, and to pool their data on the environmental and economic results into a national publicly-accessible database. From the start, the MSWG also included representatives of environmental and business organizations and of the academic community. USEPA’s Office of Water has provided funding to support almost all of the state pilot projects. Each state is working with between four and fifteen cooperating organizations. In addition to these state pilot projects, USEPA is sponsoring its own sets of ISO 14001EMS pilots, including one project focusing on municipalities and a second concentrating on the "Star Track" program in EPA’s New England regional office, which is working with facilities that are adopting EMSs. Thus, with common data collection methods, a database of at least eighty comparable case studies on ISO 14001 implementation will be generated, and perhaps ultimately far more. In addition to these pilot facilities, a second EPA-funded project examining "non-pilot" facilities using the same data collection methods is just beginning, which will add to the scope and richness of the database over the next year.

The research group, comprised of researchers from the University of North Carolina (UNC) and the Environmental Law Institute (ELI), working on behalf of USEPA and the MSWG, has participated in the design of these projects over the past two years with the support of USEPA. UNC and ELI have developed a common set of protocols for the pilot projects, and have been given responsibility for the management of the database and production of the resulting research reports. UNC and ELI have developed research questions, formulated hypotheses, and designed detailed data collection instruments. In addition, we have conducted training sessions on how facilities should complete the data collection instruments and how state personnel can facilitate the data collection process. The facility/state training was completed in October 1998 and took place on location in participating states. Data collection began in the summer of 1998, and EPA and the MSWG hope to continue it for at least three years.

Through the cooperation of the pilot facilities, USEPA, the states, and other pilot program sponsors, this project offers an extraordinary and unique opportunity to examine the implementation of EMSs in many kinds of organizations across multiple states and environmental conditions. The pilot projects include manufacturing facilities but also agricultural operations, municipalities and local water authorities, military bases, and other kinds of organizations, both large and small. Through these pilot projects, researchers will be able to observe closely the EMS design and implementation process, and the environmental and economic performance data generated by facilities. Most importantly, the pilot project managers and participating facilities agree that data will be collected in a standardized manner, so that information generated through the projects will be consistent and comparable between states and among pilot facilities.

In this report, we first introduce the research questions that UNC and ELI will attempt to answer with the data being collected from pilot and other facilities. Second, we discuss in more detail the design of the research, including sample selection issues and survey instrument design and methodology. Next, we turn to the initial results derived from the early stages of data collection. Specifically, we first provide an overview of participating state pilot programs, including descriptions of facility recruitment processes, technical and other support activities, and regulatory incentives for participating facilities. Next, we turn to a detailed demographic profile of participating pilot facilities. Finally, we introduce ongoing activities and future work. An important caveat to this report is that as of January 30, 1999, only about two-thirds of participating facilities had submitted usable demographic data that could be incorporated into this report. We hope that by the time the second public report is published at the beginning of August, 1999, we will have complete data and will report on any significant differences between the results outlined in this report, and the results determined from the complete set of demographic data.

III. Research Questions

The fundamental research question to be answered with this research is, to what extent does the implementation of an ISO 14001 or other environmental management system change a facility’s behavior with respect to each of six primary dimensions:

1. Environmental Performance

2. Regulatory Compliance

3. Economic Performance (costs and benefits)

4. Pollution Prevention

5. Interested Party Involvement

6. Environmental Condition Indicators

While these six dimensions lie at the heart of the research design, many more detailed subsidiary questions are also of fundamental interest. For instance, an extremely interesting and important basic question is what features will ISO 14001 EMSs have, and how much variation will they exhibit in practice? How different will ISO 14001-based EMSs be from other EMSs? The ISO 14001 standard allows great flexibility to facilities as to what environmental performance attributes they select for detailed attention, what environmental goals they set for themselves, and other considerations. Examining the implementation process therefore offers real-time opportunities to determine why firms choose to implement an ISO 14001 EMS in the first place; whether it is done only at a facility level or corporation-wide; what personnel are involved in designing the EMS, and how they do so; what environmental aspects and impacts they include in the process, and how they determine the significance of these impacts; what objectives and targets they set for improvement of them, and how they set them; how they involve and communicate with the public; and how the process of certification itself affects the outcomes.

The data collection protocols allow us to capture detailed variation in each of these areas. So, creating a typology of ISO 14001 EMS types based on the dimensions outlined above will be possible, as well as other classification schemes that are not yet determined. While a typology will be useful in itself, it will be critical to the later stages of the research, when we hope to correlate performance changes with EMS type and EMS design parameters.

Within each of the six primary performance dimensions listed above, we are examining more detailed questions:

1. Environmental Performance

1. Does the adoption of an ISO 14001 EMS change the facility’s use of environmental performance indicators (for example, does it choose to pay attention to additional unregulated environmental performance measures?)?
2. Does environmental performance improve after the adoption of an ISO 14001 EMS, with respect to either regulated or unregulated aspects?

2. Regulatory Compliance

1. Does the facility’s regulatory compliance record change as a result of the adoption of an EMS?
2. Does the number and nature of "near-misses"—that is, instances where a facility was nearly out of compliance but discovered the event and rectified it before a non-compliance occurred—change as a result of the adoption of an EMS?
3. Does the number of non-compliance events not reported to regulators—that is, instances where a facility was out of compliance but discovered the event and rectified it without informing regulators—change as a result of the adoption of an EMS?
4. Does the adoption of an EMS allow facilities to remove regulatory burdens by moving down in "regulatory status"—for example, by moving from a large quantity generator to a small quantity generator or non-generator of hazardous wastes?

3. Economic Performance (Costs and Benefits)

1. Does the adoption of an EMS change the firm’s use of economic performance indicators (for example, by identifying environment-related costs and benefits more explicitly for management attention)?
2. To what extent does the adoption of an EMS change a facility’s use of advanced environmental and materials accounting techniques?
3. What economic costs and benefits—both direct and indirect—does a facility accrue as a result of EMS adoption?
4. Given the costs of EMS design, implementation and certification themselves, is the payoff of EMS adoption positive or negative?

4. Pollution Prevention

1. How does the adoption of an EMS change a facility’s use of pollution prevention techniques?
2. Do significant changes in environmental performance after EMS adoption result from greater use of pollution prevention practices?

5. Interested Party Involvement

1. How does the involvement of outside parties, such as environmental NGOs and the general public, change as a result of the adoption of an EMS?
2. What benefits does this involvement provide (e.g. ideas not otherwise considered, more positive community and customer relations, greater legitimacy for outcomes)?
3. What effects does this involvement have on the decisions made by facilities?

6. Environmental Condition Indicators

1. How are indicators of local, regional, and global environmental conditions incorporated into the design of a facility’s EMS?
2. How does the use of environmental condition indicators change as a result of the adoption of an EMS?

7. Relations and Correlations

As the data are collected, relations between the categories will also be explored. We anticipate that there may in fact be interesting and important differences in results from case to case depending on factors involved in the design and implementation processes. For example:

1. Are the outcomes of the significance determination and the setting of objectives and targets processes different depending on whether interested parties were involved in a meaningful way during a facility’s EMS design process?
2. Do facilities with EMSs certified by independent registrars show greater environmental performance improvements than those with uncertified EMSs?
3. Is there a relationship between a facility’s compliance history and the type of EMS it designs?
4. Does state agency involvement change the nature of the EMS a facility designs? Specifically, are significant aspects and impacts different? Are objectives and targets different?
5. Does public involvement change the nature of the EMS a facility designs?
6. Does it matter what kinds of personnel had responsibility for EMS design? For example, how does the involvement of the environmental manager, health and safety manager, plant manager, or corporate mandates affect the design and performance of the EMS?
7. Does the nature and performance of a facility’s EMS differ depending on whether the facility employs environmental consultants in their EMS design process?

IV. Research Design

To answer the questions we pose above, UNC and ELI have created and field tested a series of detailed data collection protocols for use by each pilot facility, to ensure that data are collected in as comparable a manner as possible. State and USEPA agency personnel who are participating in the pilot project have also been trained in the protocols’ content and use.

Data collection

Because the main objective of the research is to demonstrate how the adoption of an EMS changes a facility’s performance, data are being collected on each pilot facility at each of several points in time—baseline, EMS introduction, and subsequent performance monitoring—as they move through the EMS introduction and implementation process. Note, of course, that since the facilities in the sample have different adoption dates for their EMSs, these timelines will not be identical for each facility. The research thus follows the path presented in Figure 1 below. In this report we describe preliminary results of the baseline data collection process.

 Figure 1: Research Design

During the baseline stage, we are collecting information on environmental, regulatory, and economic performance over the three years prior to EMS introduction. The protocols obtain specific historical information on the facility’s pre-project environmental management system, environmental performance, compliance, pollution prevention, and economic performance. In addition, industrial and demographic data have been collected to ensure that specific facilities are suitable for comparison during the analysis phase. Because much of this research is exploratory, open-ended questions help to capture a broad set of facility issues. However, facilities are asked to answer each question based on documentable environmental data that are maintained in their environmental records, in the hope that by referring to environmental records, recall errors will be minimized.

The baseline data on historical performance are particularly crucial to this type of research, in that without them it would be easy to misinterpret both the magnitude and the validity of changes attributable to introduction of an EMS. Most facilities that choose to adopt formal EMSs, especially those willing to serve as pilot facilities in a very public data collection process, may already be leaders in pollution prevention and environmental compliance, and be using the EMS simply to document and institutionalize those changes. In fact, some participating states barred the participation of facilities that have had a history of significant compliance problems, with the result that some facilities that might otherwise show more dramatic changes due to EMS introduction are not included in the study. Given these issues, careful baseline data collection over several prior years is essential to avoid grossly under- or over-estimating the potential benefits of an EMS to a broader cross-section of organizations.

The second stage of data collection is the EMS design stage. The instruments designed for use in this stage collect information that will enable us to characterize and categorize each facility’s EMS, and the process and choices involved in its introduction. Since there is great flexibility in the ISO 14001 standard, understanding the EMS design process is also critical and of great interest. This research will capture firm-specific information on how each facility implemented its EMS and why such an implementation strategy was adopted, using both open- and closed-ended questions. In addition, the protocols will capture information on the facility’s costs and perceived benefits of introducing and certifying an EMS.

The third stage of data collection, performance updates, is the final stage of the research design. Information will be collected every six months for at least two years following EMS adoption. Data on environmental, regulatory, and economic performance will be collected so that significant deviations from the baseline can be evaluated. We will also obtain information on each facility’s EMS implementation changes, environmental compliance status, and pollution prevention activities.

Sample Constraints and Comparison Groups

One of the major research design issues we face is an upward bias in the sample of facilities to be studied. First, all pilot facilities necessarily are volunteers, and therefore limited to those who are willing to open their environmental records and decision processes to the researchers and state or federal agencies—probably those who have strong pride and confidence in their performance already. Second, UNC and ELI have no control over how the participating states and EPA recruited and selected pilot facilities from the pool of volunteers. Most of the states advertised the project in a state business journal and environmental agency newsletters, and interested facilities contacted the state personnel to express interest in participating. Some states then selected all interested facilities to be part of the pilot program, whereas others excluded interested facilities which had poor compliance records.

To encourage facility participation, some states also offer varied incentives, which may affect state and facility comparability. Some states, for instance, offer participating facilities the possibility of regulatory flexibility as an incentive for their participation, while other states pledged to provide favorable publicity. A few states offer grant money or free technical assistance from state personnel to participating firms. For example, on state offers grants to offset the financial burdens of pilot project participation. Another state offers its facilities an "enforcement waiver policy" stating that if a violation is discovered during the course of a facility’s pilot project participation, it will be forgiven so long as it is not criminal and does not pose imminent public danger. A third state offers a somewhat different incentive, in the form of cost savings for consolidated reporting requirements and electronic reporting options. In contrast, other states offer no regulatory flexibility in any form. These differences will be outlined in greater detail later in this report.

Given these selection biases, the pilot firms clearly are not a representative random sample of all firms that affect the environment. In general, we may expect that better-than-average facilities have been more likely to volunteer as participants, and that states also have tended to select better-then-average organizations as pilots.

Another challenge to the validity of this research is that some of the sponsoring states and EPA are themselves active participants in pilot facilities’ EMS design processes. Almost all the states are providing EMS design and implementation training to participating facilities in some form. Also, some pilot programs managers are holding periodic meetings with all project facilities as well so that facility representatives can learn about each other’s EMS implementation successes and failures. Most states also have assigned key state environmental agency personnel—typically from their pollution-prevention staff—to work intimately with each facility during its EMS design process. Given such involvement, it is not clear how closely the EMSs developed by such pilot facilities will resemble those that would be developed by non-pilot facilities.

To partially mitigate this selection bias, we have received funding to examine a range of "control" facilities as well. That is, we plan to recruit three types of "non-pilot" facilities to determine more accurately the effects of EMS introduction. The first type of control group will include facilities that implement ISO 14001 EMSs but do not receive state assistance. By studying this group, we will be able to obtain some indication of the effects of state intervention on facilities’ EMS design and implementation. The second group of control facilities will include facilities that have implemented EMSs but are not following the ISO 14001 standard. The inclusion of this set of facilities as a second control group will allow comparisons to be made between facilities with certified and non-certified EMSs. Finally, we plan to recruit a control group of similar types of facilities that have not implemented any form of an EMS, so that we can draw comparisons between EMS and non-EMS facilities.

Such "controls" are not a perfect solution to the problem, since even control firms must be willing at least to cooperate with us and share comparable data. In general, we expect that a self-selection process will occur in control group recruitment as well, since facilities with relatively superior environmental performance will more likely see value in allowing us to study their environmental performance. Motivating the control facilities to complete the surveys will also be a challenge, since the survey questions request information that some facilities may consider confidential to their business operations. Given the upward bias of both the experimental group and the control sample, there may be important limitations on the extent to which findings can be generalized to businesses in general. However, we do have a diverse set of industries represented in the sample and a variety of facility sizes, and this should allow us to understand better both the commonalities and the variability that can occur in EMS implementation practices, on the factors that motivate even the "best" firms to introduce them, and on the interactions between participating firms and state agencies and the public.

V. Research Significance

The widespread introduction of formal environmental management systems into the practices of businesses that affect the environment offers a unique opportunity to observe both the processes and the environmental and economic consequences of these initiatives, and to compare similarities and differences across different firms, sectors, sizes, and other characteristics. From a public policy perspective, it offers an unusual opportunity to look at the achievement of environmental and economic objectives through the eyes of the businesses whose actions are critical to those outcomes, rather than merely through the perspective of government agencies themselves. At the same time, it should also shed light directly on environmental policy questions such as the practical issues involved in improving regulatory compliance, environmental performance, cost-effectiveness in monitoring and reporting, and other issues. Understanding the variables that contribute to the facility’s decision to reduce its environmental impacts, both regulated and non-regulated, is critically important to future environmental initiatives at both the state and federal level, both voluntary and mandated. The outcome of this study will afford environmental agencies a better understanding of the opportunities and constraints to environmental performance and compliance improvement within the integrated context of an ISO 14001 EMS. Government officials may thus be able to incorporate incentives into future policy that better encourage environmental compliance and improved performance while minimizing costs both to businesses and to government itself.

VI. Opportunities for Broader Research on EMS Implementation

The data we collect will describe and help explain many issues associated with EMS implementation for the kinds of facilities that have agreed to participate in these comparable pilot studies. At the same time, however, the phenomenon of EMS implementation offers rich opportunities for additional kinds of research that go beyond what these data and pilot cases by themselves can accomplish. Over the past several months, the MSWG has arranged a series of regional research roundtables—at the University of North Carolina, Harvard, Stanford, Northwestern, and Carnegie-Mellon—to broaden interest in these research opportunities and to encourage interest by additional scholars. In fall 1999 a national research discussion is also being planned by the MSWG and USEPA at the Brookings Institution in Washington, D.C. In November 1999 UNC hopes to bring these questions to the annual meeting of the Greening of Industry Network which will be held next year in Chapel Hill, NC. Examples of these broader research questions are listed below.

1. Business Uses of EMS

1. Are EMSs used by firms to anticipate and prevent problems?
2. What differences in the benefits and costs may arise between facility-level and corporation-wide implementation of EMS procedures? Are there some benefits and efficiencies that can only be captured through corporation-wide implementation?
3. Are EMSs used by firms to make strategic decisions? If so, how?
4. Does the use of an EMS affect capital decisions?
5. What is the impact of EMS implementation on customers? On suppliers?
6. Is there a link between EMSs and financial accounting systems (e.g. "green accounting")?
7. Is there a relationship between regional conditions such as markets, labor and/or government incentives and EMS adoption by businesses?
8. Is there business value in third party certification?
9. How is the experience of U.S. businesses with EMSs similar to or different from experiences of firms operating in other countries, including the experience of overseas branches of U.S. firms themselves?

2. The ISO 14001 standard and its implementation

1. Does the ISO standard adequately incorporate non-regulated but important environmental considerations such as biodiversity and ecosystem management principles?
2. Is the ISO approach compatible with a supply-chain approach to product stewardship?
3. Will the implementation of ISO-compliant EMSs help executives reposition their enterprises on issues such as product stewardship and industrial ecology? Under what conditions?
4. Does the introduction of an ISO-compliant EMS help or hinder product development?
5. What can be learned from broader comparisons of ISO-14001 EMS introduction in the U.S. and in other countries, and of ISO-compliant EMSs with the European Union’s somewhat comparable EMAS ("Eco-Management and Auditing Scheme") procedure?

3. Public Policy Issues

1. What sorts of regulatory flexibility might prove appropriate in the context of an effective EMS, and with what conditions?
2. How do EMSs fit into the broader environmental policy debate over requirements for scientific and economic justification of regulatory policy?
3. Do government, business and interest groups act and interact more or less productively in EMS implementation processes than they do in regulatory proceedings? What lessons does this offer for policy and procedural improvements?

VII. Pilot Program Summaries

There are many factors that will affect a facility’s EMS implementation and subsequent performance. The most obvious influence is a facility’s internal structure and management. There are outside factors, however, that may also affect a facility’s EMS implementation and performance. Indeed, state and other government involvement may play an important role. For example, states or other pilot project managers may influence which facilities choose to participate in the program. They may also influence the structure of facility’s EMSs through their frequent involvement. For this reason, it is important to understand how each of the pilot project managers (the ten participating states and USEPA) structured their pilot program, the types of incentives the states offer to their pilot facilities, and the level of assistance the states provide once facilities commit to the program. These dimensions are described below.

Arizona

The Arizona Department of Environmental Quality (DEQ) has recruited three facilities as part of its EMS pilot project. A fourth Arizona facility is participating as part of USEPA’s Municipality Project. DEQ began recruiting its pilot facilities by placing advertisements about the program in a state business journal and DEQ newsletters (that were sent to over 4,000 subscribers). Also, DEQ staff made speeches about the project at various association meetings. About seven interested facilities contacted DEQ to express their interest. A selection committee was then convened to review the potential candidates. The committee consisted of both DEQ officials and staff from the Attorney General’s office, as well as local air quality personnel. The committee found that of the seven candidates, three had compliance problems, and so were excluded from the pilot project. Three of the remaining facilities committed their participation to the pilot project by signing a memorandum of understanding (MOU) with all of Arizona’s regulatory agencies.

As an incentive for facility participation, the state offers its pilot facilities enhanced publicity through DEQ press releases and announcements. In addition, the state offers pilot facilities regulatory flexibility in the form of an "enforcement waiver" policy. The policy states that if during the course of a facility’s pilot project participation, a violation is discovered, as long as it is not criminal or poses eminent danger, penalty will be waived if the facility takes immediate steps to disclose, correct, and remediate the non-compliance. An additional incentive for facilities to participate in Arizona’s pilot program is that DEQ will give pilot facilities first opportunity for any future regulatory flexibility opportunities that the state has to offer.

DEQ has a hands-off approach to managing its pilot project facilities’ EMS development relative to the other participating states. DEQ does not require an ISO-based EMS, although all the participating facilities have chosen to implement an ISO (or ISO-based) EMS. In addition, facilities design and implement their own EMS, with only limited state-sponsored assistance. DEQ offers one formal EMS design training for its participating facilities and holds periodic facility group meetings to help pilot facilities complete the data collection surveys. During the meetings, the state assists the facilities in designing their EMSs, if needed. DEQ encourages its facilities to hire their own EMS consultants if additional assistance is required. Because Arizona’s pilot program is relatively small (three facilities are participating), the program director is able to provide individual facility technical assistance.

 Finally, while DEQ encourages interested party involvement during the EMS development and implementation process, it does not require it.

California

The California Environmental Protection Agency (Cal/EPA) expects to work with at least ten facilities as part of its EMS pilot project. Recruitment for Cal/EPA’s pilot program began when state personnel spoke at several industry conferences about the program and facilities’ potential participation. During the same time, the state published a white paper on the pilot program that was widely circulated for industry and interested party comment. The state received responses from interested facilities from both of these activities. After interested facilities contacted the state, staff members held individual meetings with facility representatives to further discuss the program’s intent and requirements.

In concert with the pilot projects, Cal/EPA and the USEPA are conducting a joint project with the Metal Finishers Association of Southern California to implement EMSs at two metal finishers. An EMS template developed by USEPA for use by small- and medium-sized enterprises will be employed by these two facilities.

While Cal/EPA does not offer grant money to all of its facilities, it has made grant money available to one pilot facility for EMS training. This facility intends to implement an EMS and then subsequently assist its own customers in developing EMSs in their organizations, too.

Cal/EPA is interested in regulatory innovation and learning about more efficient ways of operating. It works with their pilot projects who are interested in developing regulatory efficiencies in the areas of monitoring and reporting, audits and inspections, permits, and application of the self-disclosure policy. To date, facilities have sought regulatory efficiencies in the form of consolidated reporting and consultative inspections.

Cal/EPA provides their pilots with enhanced publicity through Cal/EPA press releases and public announcements.

A team of state advisors assists the participating facilities in both the EMS development process and completing the data collection protocols. The advisors represent the offices of water, air, solid waste, and toxics. Staffing consists of several Cal/EPA project managers who are "teamed" with one or two facilities to provide individual assistance. There is also a Cal/EPA project director, who is also responsible for pilot facility assistance. Cal/EPA staff believe that, because of their broad cross-section of multi-media facilities, it would not be possible to manage its pilot project without their teamed approach.

California has not sponsored EMS design training. Rather, the Cal/EPA project managers and the project director have received EMS design training along with one of the pilot project facilities. The project managers, equipped with their EMS design skills, assist their pilot facilities in designing their EMSs on an individual basis. In the case of the single California pilot project facility that attended the training, state grant money paid for its participation.

Interested party involvement is an important component of California’s pilot project and is anticipated in all its pilot projects. Local and regional working groups representing NGOs, government and industry meet on a regular basis to learn about, discuss and provide input on the individual pilot projects. In addition, Cal/EPA holds periodic state-level meetings with business, government and NGOs to dicuss the program.

Finally, Cal/EPA has the capacity to offer pollution prevention information if requested, although, funding assistance is not available. To date, state personnel have not received any facility requests for such information.

Illinois

To recruit pilot facilities, the Illinois Environmental Protection Agency (IEPA) invited representatives of 50 facilities to a meeting in which IEPA representatives described their ISO 14001 EMS pilot project. Five of the facilities present at this meeting decided to participate. Five additional facilities were recruited to the pilot program through individual IEPA staff – facility contacts. The Illinois EPA was interested in recruiting exemplary facilities to its pilot, so a minimum standard of compliance with existing environmental regulations was required of participating facilities. All pilot facilities were offered an opportunity to enter into an MOU with IEPA, but only one elected to do so. Illinois expects to have a total of fifteen facilities participating by June of 1999.

A number of benefits have been offered to facilities as incentives to participate in the pilot. One benefit that participating facilities enjoy is enhanced publicity. A kick-off press conference was held to recognize participating facilities. Press releases describing pilot facility activities are also issued. Technical assistance is also provided as an incentive. To determine what type of assistance might be most useful to pilot facilities, IEPA developed a technical assistance questionnaire. Based on responses to this questionnaire, IEPA plans to provide technical assistance to the pilot group in the areas of stakeholder involvement and risk communication. This assistance will be designed to address these issues as they relate to EMS design and deployment. Individual assistance from IEPA staff in pollution prevention and in completing the research protocols is also provided. A staff member is assigned to work with each pilot facility in completing the research protocols. State staff providing assistance to facilities has received ISO 14001 EMS design training

Pilot facilities are also provided opportunities to attend presentations on specific aspects of EMS design and to meet regularly to share ideas. Finally, pilot facilities are offered the potential for regulatory flexibility through IEPA’s Regulatory Innovation Pilot Program (RIPP) in which companies enter into 5-year agreements with Illinois, called Environmental Management System Agreements (EMSAs). EMSAs may provide facilities opportunities for self-permitting or self-reporting through the use of their EMSs in lieu of certain specific Illinois requirements

In a second phase of recruiting, Illinois hopes to recruit non-traditional facilities such as small businesses, hospitals and agriculture to the pilot program.

Indiana

Indiana Department of the Environment (IDEM) is participating in the national pilot project program to verify whether EMS implementation leads to increased pollution prevention, compliance, and communication between facilities and stakeholders. If the program does indeed show these benefits, then IDEM will attempt to promote EMS implementation within its state.

IDEM has seven facilities in its EMS pilot project. IDEM recruitment began its facility recruitment process by sending a postcard that described the project to approximately 10,000 businesses. Approximately 250 interested facilities subsequently called IDEM to express their interest. In response to facility interest, IDEM mailed a detailed program information packet and a grant application to each of these interested facilities. About 18 completed applications were received by the state’s deadline, and several others came after. Since IDEM chose to focus its pilot program on the manufacturing industry (which was later broadened to include public utilities after expressed interest from members of the industry), all non-manufacturing facilities were excluded. Of those remaining candidates, IDEM did compliance checks on their historical environmental records. If a facility had some violations and they were minor ones, then that facility was included in the participant pool.

As an incentive for facilities to participate in the pilot program, grants of $8,000 are available for each participating facility under a binding agreement between the state and each participating facility. Grants are dispersed in three stages and are based on facility progress. The first $2,000 is dispersed after a facility submits its draft stakeholder work-group list that is subsequently approved by IDEM. Next, $4,000 is granted based on the facility’s progress and EMS implementation. Progress is defined by IDEM staff and the grant agreement. The remaining $2,000 is dispersed after a facility submits its final EMS report to IDEM at the end of the pilot project. IDEM requires that facilities implement an ISO 14001-based EMS to participate in this pilot program. Because of this requirement, several of the Indiana pilot facilities intend to seek ISO 14001 certification.

In addition to the project grant monies, pilot facilities also have the potential for increased publicity via the Governor’s annual pollution prevention awards. Last year was the first year that the Governor’s office recognized EMSs as part of the awards ceremony. Recognition was awarded if a facility implemented pollution prevention as part of its EMS. Like most of the other states, Indiana offers pilot facilities enhanced publicity through IDEM press releases and public announcements. Also, IDEM has developed a web site, which discusses the program and introduces all the participating facilities.

Unlike some of the other participating states, Indiana does not offer any form of regulatory flexibility to its pilot facilities. However, IDEM states that flexibility is possible in the future, although in what form is uncertain. It is also not certain whether flexibility will be granted at all.

While the IDEM has not assigned a "point person" for each of its participating facilities, individual assistance is provided if requested. In order to assist its facilities further, IDEM will soon ask its participating facilities meet on a quarterly basis to discuss their EMS design and program experiences. In addition, if a facility requests it, IDEM will provide individual technical assistance. Moreover, state-sponsored pollution prevention assistance is available if the pilot facility requests it, as both IDEM and the Indiana Clean Manufacturing Technology and Safe Materials Institute have the capacity to provide pollution prevention assistance, although to date, there have been no facility requests for technical or pollution prevention assistance.

Finally, interested party participation is a requirement for pilot facilities, as part of their grant agreement with IDEM. Specifically, IDEM outlines what categories of stakeholders groups (i.e. academia, environmental groups, other businesses, and local government) must be included in their stakeholder work-group. Indiana emphasizes the diversity of stakeholder members when approving or disapproving a facility’s stakeholder list. If a facility’s draft list does not contain certain categories of stakeholders, then IDEM requests that the facility attempts to solicit the participation of an individual from that particular category. If a pilot facility has difficulty finding category representative, IDEM will assist the facility if possible and if requested. Once all of IDEM’s stakeholder requirements are met, then IDEM will approve a facility’s stakeholder work-group and the first $2,000 of grant money is released to the facility. To aid the process, pilot facilities may hire an interested party facilitator for the work-group meetings. None of the Indiana facilities, however, have chosen to do so.

New Hampshire

In New Hampshire a decision was made to focus on ISO 14001 EMS development with tenants of a single industrial park. All tenants were invited to participate in the ISO 14001 EMS Pilot program. Five tenants chose to participate. Each tenant signed a required MOU with the state. Two facilities have since dropped out, leaving three active participants. In a second round of recruitment, New Hampshire’s focus has been broadened to cover the entire New Hampshire seacoast area. A number of new participants are expected to join the pilot program. In New Hampshire, a minimum level of compliance with existing environmental laws and regulations has been required of participating facilities.

A number of benefits were offered to participants as an incentive to participate in the pilot program. The most significant benefit offered to New Hampshire pilot program participants is the opportunity to attend state sponsored EMS design training provided by an ISO 14001 experienced consultant trainer. In addition, facilities receive one-on-one technical assistance from New Hampshire Department of Environmental Services (DES) staff on issues such as pollution prevention, stakeholder involvement and EMS design. A New Hampshire DES staff member also assists pilot facilities in completing the data collection protocols. As a further benefit, ISO EMS training was provided both to state staff providing technical assistance and to potential stakeholders. The group training and one-on-one technical assistance efforts address the specific concerns and issues of the small business and government agency tenants of the industrial park which make up the pilot participant population.

Finally, an additional benefit to participants includes a potential for enhanced publicity through press releases and recognition events.

North Carolina

North Carolina initially recruited firms with existing relationships with state Department of Environment and Natural Resources (DENR) staff. Facilities which were known to DENR Pollution Prevention and Technical Assistance Division staff through programs such as the DENR Working Group and the Governor’s Award for Environmental Excellence were encouraged to participate in the ISO 14001 EMS pilot. Six firms agreed initially to participate and entered into an MOU with the state, as required. Subsequently, one facility dropped out of the pilot program when a corporate decision was made to close the plant, leaving five facilities. In a second round of recruiting for this initial phase, two additional facilities joined the pilot program. A minimum level of compliance with existing environmental laws and regulations is expected of participating firms. DENR has recently begun a second pilot phase, and a targeted recruitment will enlist municipalities, small businesses and state agencies. One municipality has already agreed to participate in this second phase.

A number of benefits have been offered to facilities as incentives to participate in North Carolina’s ISO 14001 EMS pilot program. One benefit is enhanced publicity. Participating facility achievements and activities are regularly chronicled in the Department’s publications and in press releases as milestones are reached. Individual technical assistance is provided to participating facilities by DENR staff who are expert in pollution prevention and have either received ISO 14001 lead auditor or EMS design training. A staff member has been assigned to work one-on-one with each facility. Staff provides assistance in completing the research protocols and in EMS design and pollution prevention.

Finally, regular meetings of pilot participants are held at participating facility locations to share experiences with ISO 14001 EMS development and exchange ideas. Technical presentations by outside experts are often provided at these meetings.

Oregon

Oregon Department of Environmental Quality (DEQ) is working with three facilities as part of its EMS pilot project. The facility recruitment process for the DEQ pilot project began after a series of meetings to discuss the design of Oregon’s preliminary EMS Incentives Project (EMSIP). Approximately 50 people participated in these meetings. The facilities attended these meetings were invited to participate in the EMSIP program, and the invitation was also extented to all 300 people on the project’s mailing list. Concurrently, DEQ staff made contacts with facilities, which they believed might make suitable candidates for its ISO 14001-based EMS pilot program. Finally, DEQ placed informational advertisements in local forums and a DEQ-authored article was published in a widely circulated environmental newsletter that encouraged interested facilities to contact DEQ staff. The outcome of these efforts was that 15 facilities mailed to the state letters of their potential interest. Of these facilities, six subsequently determined that the timing of the pilot project was not beneficial to them and so chose not to participate.

DEQ chose from the nine facilities that remained interested in the program, basing the choice on several criteria. First, selected facilities should have implemented a mature EMS that accounts for the facilities’ aspects and impacts to the natural environment. Second, selected facilities should have satisfactory compliance histories. That is, DEQ sought facilities that had a history of environmental compliance with state and federal regulatory requirements and a cooperative working relationship with DEQ staff. Third, selected facilities should be willing to share their EMS performance data with the public. Finally, selected facilities should demonstrate to DEQ a good potential for program success. After these criteria were applied, four facilities were identified as program participants. Once identified by DEQ, each of these four facilities subsequently volunteered to be part of the pilot program. One facility subsequently ceased operations, and will not be submitting data beyond the Baseline Protocols.

Each of Oregon’s EMS pilot project facilities are also participating in the state’s Environmental Management Systems Incentives Project (EMSIP). The two programs are not necessarily independent of one another. As part of the EMSIP, the state has hired a contractor to help design a three-tiered EMS implementation system. Tier I is an entry-level tier for facilities that have committed to implementing an EMS. Tier II is a mid-level program for facilities that have already implemented an EMS, achieved environmental results that are superior to other facilities regulated under the current regulatory system, and discussed those results with interested parties. Finally, Tier III is a top-level tier for facilities that DEQ considers "environmental leaders." That is, these facilities have implemented all of the above elements and also demonstrated leadership in applying sustainability principles to their activities, products and services. Oregon is also developing rules to implement the Green Permits Program, which will enable more facilities to participate in the ISO 14001 pilot program.

MOUs have been drafted as part of the EMSIP program, which also apply to the EMS pilot program. The agreements are designed to clarify program expectations between DEQ and the facilities. These agreements are available for public comment as stakeholder involvement is an essential component of DEQ’s program.

Enhanced publicity for facility achievements is a key component of Oregon’s program and an incentive for facility participation. Enhanced publicity may include recognition at regional conferences and meetings. In addition, facilities with superior performance may receive plaques that are presented by the DEQ Director or Governor.

An additional incentive for facility participation is regulatory flexibility. Participating facilities are offered a set of regulatory incentives or benefits that is commensurate with the level of tier achievement. Under this framework, DEQ’s Green Permits legislation authorizes the state to waive state regulations, and seek waivers of federal regulations, for facilities that achieve environmental results that are superior to those otherwise required by law.

To support the pilot facilities, all relevant DEQ personnel have undergone ISO 14001 lead auditor training. Training has been customized to place a greater emphasis on environmental management systems rather than environmental auditing, which is typically oriented for agency personnel who routinely conduct field inspections and offer technical assistance as part of their jobs.

DEQ staff have also undergone stakeholder involvement training so they can better support Oregon pilot facilities. In addition, the state has hired a stakeholder consultant to develop a "how-to" manual to assist its facilities in interested party involvement. Stakeholder involvement and dialogue regarding the facility’s environmental performance are key ingredients in the Green Permits program.

Oregon’s pilot facilities are all members of a formal DEQ advisory committee, which meets periodically. At the committee meetings, facilities are able to discuss the program’s rules and final guidance for the program. The facilities also meet periodically to share their EMS design and implementation experiences, and learn about other EMS design experiences through workshops of the American Electronic Association (AEA), Oregon Council’s EMS Committee, and individual sessions at several local conferences. Moreover, a new EMS monthly lunch group has been formed which will likely supersede AEA’s monthly EMS meetings. This lunch group is less formal and offers facilities more opportunity for discussion.

Because many of the facilities that were interested in participating in Oregon’s pilot program did not support ISO 14001’s documentation requirements as well as the expense associated with ISO certification, the state does not require certification. DEQ does require, however, that the facilities participating in Tier II and Tier III of the EMSIP program use ISO principles as a foundation for their EMS development. The state is currently developing a tool to determine how non-ISO 14001 EMSs compare to the standard.

Pennsylvania

To recruit facilities to its pilot program, the Pennsylvania Department of Environmental Protection invited 46 facility EHS managers to an initial meeting to describe the ISO 14001 EMS project. These facilities were identified through various DEP programs, including regional pollution prevention roundtables and the Governor’s Awards for Environmental Excellence. To date, three facilities that attended the initial meeting have agreed to participate and have begun the process of negotiating MOUs with DEP. A signed MOU is required of all participating facilities. While a minimum level of compliance with existing environmental laws and regulations is not explicitly required of participating facilities in Pennsylvania, all those who have agreed to participate are known to be good corporate citizens.

A number of benefits are being offered to facilities as an incentive to participate in the program. These benefits include enhanced publicity through articles in DEP publications, regular press releases, press conferences and recognition events. Individual assistance will be provided to participating facilities in completing research protocols and in areas such as pollution prevention and stakeholder involvement from Pennsylvania DEP experts in such technical issues. State staff provides technical assistance to facilities, and have received ISO 14001 EMS design training. Opportunities to attend presentations and training sessions on specific aspects of ISO 14001 EMS design will be provided to pilot facilities. Pilot participants will also be provided opportunities to meet together regularly as a group with state staff to relate progress on EMS development and to share ideas.

Vermont

To recruit participants to the ISO 14001 EMS pilot project, Vermont sent out a mass mailing to regulated facilities across the state offering free EMS design training. In response to this mailing, twelve facilities expressed interest and provided the required letter of commitment to the Agency of Natural Resources from facility top management. A formal MOU between the state and pilot participants is not required of Vermont facilities. In addition, the state does not require participating facilities to have a minimum level of compliance with existing laws and regulations. None of Vermont’s participating facilities had existing EMSs. Pilot facilities will not be required to implement an ISO 14001-based EMS.

A number of benefits were offered to facilities as an incentive to participate in Vermont’s ISO 14001 pilot program. The most significant benefit offered to participants is the opportunity to attend the state-sponsored EMS design training. This training is provided to facilities by an experienced ISO 14001 consultant-trainer and was specifically designed to address issues of concern to Vermont’s small and medium sized pilot facilities. Facilities meet regularly with the trainer as they learn about and engage in the step-by-step process of designing and implementing an ISO 14001 EMS. These meetings also provide pilot facilities with the opportunity to meet regularly to share ideas and experiences. Six training sessions have been held to date.

Pilot facilities are also offered one-on-one technical assistance from Vermont Agency of Natural Resources staff on EMS design and pollution prevention. Vermont staff members have provided on-site technical assistance to participating facilities. Finally, as an added incentive, if pollution prevention is addressed in participating facilities’ EMSs, Vermont may provide a waiver of the state’s requirement to develop a three-year facility-level pollution prevention plan.

Wisconsin

Wisconsin’s Department of Natural Resources (DNR) facilities are divided into two EMS design tracks: ISO pilots and cooperative agreements. Currently, there are five ISO pilot facilities and two cooperative environmental agreement facilities. The DNR’s primary motivation for implementing both programs and for participating in the multi-state EMS pilot programs is to test new strategies for determining companies’ environmental performance as well as to develop innovative ways to increase the effectiveness and efficiency of regulatory strategies.

The facility recruitment process for both the ISO Pilots and Cooperative Environmental Agreement Program began with a fact sheet and application outline, which were distributed to 400 major air sources in Wisconsin, members of the Small Business Advisory Council, the Small Business Environmental Council, and the ISO 14000 Working Group. A cover letter co-signed by Governor Thompson and Secretary Meyer introduced the programs and invited companies to participate. As a result of the mailings, DNR received 49 requests for additional information. Each of these interested companies were sent a three-page application form. Later, in-person meetings were held at eleven companies to explain both programs. In addition, DNR held numerous public speeches to provide information and answer specific questions on the programs.

As part of designing the Cooperative Agreement Program, the DNR took an informal poll of its staff and state business leaders to determine what type of regulatory flexibility is either most commonly requested by facilities, or would be valuable to businesses in the state. The results of the poll fell into seven categories: testing, reporting and record-keeping, permitting, standards and regulations, compliance, inspection and enforcement, and resources.

Both the ISO Pilot Program and the Cooperative Agreement Program require that participating facilities implement an ISO 14001 or equivalent EMS that is certified by a third party auditor. In addition, both programs require facilities to gather data on their EMS design and implementation.

The state offers ISO Pilot facilities no regulatory incentives for their participation, while in contrast, the Cooperative Agreement Program offers regulatory flexibility as an incentive to participate. Facilities in the latter program receive regulatory innovation and enforcement discretion for "detect and correct" violations. In return, DNR requires that participating Cooperative Agreement facilities involve stakeholders in their EMS design and implementation. It also requires that participating facilities’ environmental performance is beyond regulatory compliance and that they demonstrate to the state "superior environmental performance." Finally, the Cooperative Agreement Program requires that each participating facility sign an enforceable agreement that details the terms of the project. A written agreement, however, is not a requirement for the ISO Pilot Program.

Beyond the provision of possible regulatory flexibility, the DNR is providing enhanced publicity to participating facilities through press releases and public announcements. DNR staff are also available to assist all pilot facilities with stakeholder involvement if needed.

The Department of Commerce provides an additional incentive for facility participation. It offers pilot facilities customized training grants of up to $5,000 towards each facility’s ISO EMS design and implementation. A condition of the grant is that the recipient facility must become ISO 14001 certified. If it does not, then the $5,000 is treated as a loan and must be repaid.

DNR staff who are involved in the pilot program and who are available for facility assistance consist of Cooperative Environmental Assistance staff and rotating business sector specialists. DNR staff have undergone EMS design training so they can help pilot companies identify impacts and aspects during EMS development, and several have completed lead auditor training as well. In order to provide facilities with individual-level assistance, each pilot facility is assigned a DNR staff member to whom they can direct questions and concerns.

USEPA’s National Municipalities EMS Initiative

USEPA’s Office of Wastewater Management and Compliance is funding and managing a pilot program focusing solely on municipalities. Currently there are nine public sector organizations from seven states participating in the project. Each is adopting an EMS based on ISO 14001. Ongoing project organization and management are provided by the Global Environment and Technology Foundation (GETF).

Municipalities were recruited by USEPA and GETF through existing contacts, as well as through an announcement on GETF’s globeNet internet resource. Participating municipalities were promised extensive training and public recognition, but were not provided with financial resources. Thirteen municipalities applied to be part of the program. Applicants were carefully screened through an interview process that included both the municipality’s environmental management staff who would be designing and implementing the EMS and the municipality’s political leadership, since a pledge for commitment of resources for two years was required. Applicants were not screened by compliance history, but were required to have internet access, since GETF planned to use the internet extensively for communication and cooperation between facilities. Of the thirteen applicants, seven were selected as pilot municipalities. Subsequently, two more municipalities were added. More recently, one municipality dropped out of the program and a replacement was selected. Participating facilities all signed an MOU with GETF.

After participants were selected, each had to choose a "fenceline" around the public work to be served by the EMS. For example, several municipalities chose to develop their EMSs around the local wastewater treatment facility. Other facilities include a corrections facility, an electricity generating facility, and a waste management facility.

Participating facilities were provided with extensive technical information on ISO 14001 by GETF. This included off-the-shelf materials, like Reality Interactive’s Understanding ISO 14000 CD-ROM, the NSF Implementation Guide for Small and Medium-Sized Organizations, and portions of GETF’s ISO 14000 Cookbook. More importantly, an intensive, three-day training session was held in August 1997. During this session, municipalities were trained in the basics of ISO 14001, and began to work on the initial stages of EMS design. Similar training and discussion meetings are held every six months. The municipalities are also able to communicate with each other through an "intranet" set up by GETF.

USEPA and GETF encourage municipalities to involve external interested parties in the EMS design and implementation process, but do not require it and do not directly support interested party involvement. The municipalities are expected to "spread the word" about ISO 14001 to other municipalities, and to report on their experiences at various meetings of public management professionals.

VIII. Summary of Participating Facility Demographic Information

Although at least 80 facilities will eventually be examined in this study, by the deadline for this first public report, 55 had submitted a usable detailed demographic profile. This demographic information includes the primary function of the facility, its size, its ownership, its relationship to larger organizations, whether it produces or markets products internationally, and the character of community that surrounds it. In addition to short answers to the questions posed above, which are tabulated and explained below, facilities were encouraged to explain their answers to some of these questions.

The sample includes facilities that represent more than twenty industrial and functional sectors. The majority of facilities are manufacturers, with 69 percent citing some form of manufacturing as their primary business function. Of the rest, 18 percent are local, state, or federal government facilities, and 11 percent represent non-manufacturing industries. The two industries contributing the largest number of facilities to the survey are the electronics industry, with six facilities, and the electric power generation and distribution industry, with four facilities. The diversity of industries is beneficial, in that many different types of environmental issues will be confronted by these facilities, posing different challenges and opportunities for EMS design and development. However, this diversity also poses a challenge in that it will be difficult to simultaneously control for both differences in facility EMSs and differences in the facilities themselves, and thus it will be difficult to make strong claims about the effects of EMSs.

In Table 1, the distribution of facilities based on size is presented.

Table 1: Facility Size

Most participating facilities are medium to large sized enterprises, which is probably a fair representation of those facilities currently considering the adoption of ISO 14001 EMSs. In the future, there will be a large enough sample so that EMS design and environmental performance data can be related to facility size. With this sample, however, researchers will not be able to derive conclusive results about the special issues that small facilities face when designing and implementing ISO 14001.

A significant number of facilities or their parent organizations conduct business internationally as well as in the United States. Twenty-seven of the 55 facilities or parent organizations (approximately 49 percent) produce products in countries other than the United States. Of these facilities, four engage in production on a worldwide basis. Furthermore, twelve carry out production in North America (including Canada, Mexico, or both); ten produce their products in Western and Eastern Europe; nine in Asia; and seven in South America. Thirty-eight of 55 facilities or parent organizations (approximately 69 percent) market their products abroad. A breakdown by region reveals that sixteen companies market their products worldwide; fourteen in Europe; twelve in Asia, Africa and the Middle East; six in North America; and four in South America. Of 38 facilities or parent organizations reporting international activities, three did not specify the regions in which they market their products.

In order to understand better the pilot facilities’ ownership and management, facilities were asked several questions about their organizational structure. Of the same 55 facilities, 23 facilities or their parent organizations are privately held, 17 are publicly traded and twelve are local, state or federal government facilities (three did not report.) Perhaps more importantly, approximately 69 percent reported that they are part of a larger business or government organization. This may prove to be an interesting dimension on which to compare facilities. For example, facilities that are part of a larger organization may have very different motivations for adopting ISO 14001 than independent facilities. The EMSs of independent facilities may be designed very differently than the EMSs of facilities that must report to a larger organization, perhaps because larger organizations exert a greater degree of bureaucratic control over their facilities’ EMS design. The relationships between facility EMSs and parent organization influences will be explored in later reports.

Table 2 summarizes how facilities define the communities that surround them.

Table 2: Population of Surrounding Community

Most facilities are located in small to medium sized cities. More telling are the facilities’ descriptions of these areas. Approximately 58 percent of 55 reporting facilities are located in mixed use or residential areas; 16 percent, in commercial or industrial areas; and 13 percent, in rural areas. Seven facilities, or 13 percent, did not provide details about their surrounding community.

IX. Ongoing Activities and Future Work

As of March 1999, in summary:

• UNC/ELI have completed the design and EPA and MSWG approval of data reporting protocols for collection of baseline data, of data on EMS design, and of update data on environmental and economic outcomes at six-month intervals following EMS implementation.
• UNC/ELI have identified four independent peer reviewers of these protocols and invited their review of the protocols and research design to date. Suggestions from approximately 150 participants in seven regional academic research roundtables have been received. These suggestions have been considered, and further refinements have been made to the EMS design and update protocols.
• In cooperation with the 10 participating states and USEPA, approximately 100 pilot facilities that are committed to participating in common data reporting and analysis have been identified, as characterized in the preceding sections of this report.
• UNC/ELI have received baseline data from about 55 of these pilot facilities, have completed coding of all data received, and expect to receive and code baseline data from the remainder of the pilot facilities by no later than May, 1999. Complete results from this phase should therefore be available for discussion in the second public report of the project (August 1999).
• UNC and ELI have distributed the protocols for EMS design to all participating facilities, and have requested preliminary data from all pilot facilities by no later than summer, 1999. Preliminary results from this phase should therefore be available for discussion in the second public report of the project (August 1999), and final results by the third public report (January 2000).
• Update protocols will be distributed to all firms in Spring 1999, for completion at 6-month intervals for three years thereafter.
• The resulting database is to be made publicly available when enough data have been received and coded to allow for meaningful aggregation and to avoid singling out individual reporting facilities.

The following additional activities are also currently ongoing:

• Continued data collection and training of pilot facility and state staff. UNC and ELI continue to provide training and answer questions from state staff and pilot facilities on an ongoing as-needed basis, and to follow up with all facilities to try to achieve accurate and timely submission of all data protocols. At this point this task includes the remainder of the baseline protocols and all EMS design and update protocols.
• Database and records management. On an ongoing basis, UNC and ELI are quality-checking and entering all data received into the electronic database, and maintaining and updating the archive of paper records for all aspects of the project as well.
• Interaction with EPA, participating states, and MSWG. On an ongoing basis, representatives of the research staff meet with each other (UNC and ELI) and with EPA sponsors, attend meetings of the participating state and pilot facility staffs (most recently in Scottsdale, AZ in January 1999), and attend meetings of the MSWG, its committees, and others at which UNC/ELI participation is requested and important to the progress of the project (e.g. research roundtables—see below).
• "Control" facilities. In cooperation with EPA and MSWG, UNC and ELI have urged comparing the implementation of ISO 14001 by the pilot facilities with arguably similar non-pilot comparison facilities ("controls"), in order to obtain more definitive results, and EPA has provided additional financial support for this task. The design of a control study has been drafted and has been approved by UNC, ELI and EPA. To the extent possible, these "controls" will include comparisons with (a) facilities implementing ISO 14001 environmental management systems that are not state-assisted pilot facilities; (b) facilities implementing environmental management systems other than under ISO 14001 certification; and (c) facilities managing the environmental impacts of their operations without the use of any formalized environmental management system, if such facilities can be identified and successfully studied. These comparisons will also include some facilities that are implementing EMSs as a requirement of negotiated compliance agreements. To the extent possible, comparison facilities will be matched with the pilot facilities by business sector, size, and state in which they operate. 20-40 comparison facilities are expected to be examined; recruitment of these facilities will take place by the summer of 1999, and data collection—under the same protocols as the pilot facilities, except as modifications are necessitated by their non-pilot status—will commence as soon as each facility is selected. It is well understood that the control study cannot avoid some important limitations, particularly since it depends on facilities’ willingness to participate and share data with us, and cannot in any event provide enough firms to match statistically all important dimensions of comparison. It will, however, provide a broader range of comparisons and a basic check against some biases that might distort the experience of pilot facilities alone.
• Internet web site. ELI staff has designed an Internet home page for the project (www.eli.org), which will serve as a location for public access to the national ISO 14001 EMS implementation database and might also serve as a home page for the MSWG.
• Research roundtables. At the request of the MSWG Research Committee, UNC research staff have participated in four of the regional research roundtables which MSWG has sponsored to encourage broader academic interest in the data and results of this project and in the larger domain of potentially useful research on EMS implementation. UNC and ELI are currently working with EPA and MSWG on the design of a possible national research roundtable on this subject, to be held later in 1999 at the Brookings Institution in Washington, DC. In October 1998 a similar summary of the project design and research questions was presented to the annual meeting of the Association for Public Policy Analysis and Management.

The following future work is also anticipated or under consideration:

• Public reports. UNC and ELI will continue to provide public reports on the progress of the project at six-month intervals.
• Update protocol data. UNC and ELI will begin to obtain, code, and analyze update information from all pilot and control facilities on continuing EMS implementation, ISO 14001 certification, economic and environmental results, and other identifiable aspects of EMS implementation, as well as on public involvement and impacts on state partner agencies, for an anticipated period of three years beyond initial EMS implementation.
• Data analyses. As sufficient data accumulate, UNC and ELI will produce analyses of what can be learned from them, share these findings with EPA and the participating states, submit them for peer-reviewed publication, and present them to other interested constituencies.
• Enlargement of research agenda. To the extent that additional funds and staff can be obtained, UNC and ELI anticipate enlarging the current research agenda to incorporate other important questions identified by the research roundtables and ourselves that go beyond those that can be answered from the current database. Examples might include EMS issues that must be addressed at a corporate level rather than at the level of individual facilities; uses and impacts of EMS procedures along supply chains involving multiple facilities and firms; issues related to the certification process, and to the qualifications, criteria, and incentives of third-party certifying organizations; and others.
• Expansion of database. To the extent that additional funds and staff can be obtained, UNC and ELI also anticipate enlarging the present database to incorporate a broader range of information and linkages on related topics: for instance, other studies and information sources on EMS design and implementation, on other aspects of environmental management by businesses, and on innovative policy incentives as supplements and alternatives to traditional environmental regulation. In short, we envision the current database serving as the core of a major potential information source and network on environmental management by businesses, transferable innovations, and related implications for governments and the public.

Prepared by: Richard Andrews, Nicole Darnall, Deborah Gallagher, and John Villani (University of North Carolina at Chapel Hill), and Eric Feldman, Suellen Keiner, and Matthew Mitchell (Environmental Law Institute), on behalf of USEPA and the Multi-State Working Group.

Contact: John Villani, (919) 962-2789, john_villani@unc.edu