U.S. Business Woos Delegates to Earth Summit
American business, fearful of sweeping ecological treaties that could hamper growth and profits, has been striving to influence the results of the coming world summit on the environment and to develop its own agenda for attacking the planet’s ills.
For U.S. corporations, the unprecedented environmental conference in Rio de Janeiro from June 3-14 represents risk and opportunity, the dreaded possibility of new regulations and the more pleasant prospect of peddling modern and cleaner technology to developing nations under pressure to industrialize in ways that minimize environmental harm.
“It’s been a real push-pull situation the whole way,” said Robert Long, an assistant vice president of the National Coal Assn.
So far, much of the business world has focused on the risk side, trying to head off treaty provisions it considers harmful. It has scored one important victory--keeping the Bush Administration on course in opposing a global warming treaty that contained requirements and deadlines for reducing gases that contribute to climate change.
“Every time we see timetables and targets, we go berserk,” said Tia Armstrong, an environmental specialist for the U.S. Chamber of Commerce, part of the lobbying campaign.
Much of the attention surrounding the upcoming United Nations Conference on the Environment and Development has focused on global warming and wildlife conservation.
But development issues--specifically how poorer nations industrialize without greatly harming the planet--also will be on the agenda when the heads of state of more than 100 nations assemble.
Heading into Rio, corporate representatives intend to lobby against any new provisions that could raise business costs or restrict flexibility, including proposals on measures to share technologies with developing nations.
Also at the top of their priority list will be wooing delegates and economic ministers in hopes of influencing future treaties or business deals in other countries. A trade fair for industries to promote their wares will be held in Sao Paulo, Brazil, during the summit.
Industrial nations are expected to pledge financial assistance to developing countries to help them preserve their wild lands and use less destructive technologies in the building of factories and power plants. Some of that money could be used to purchase technologies from the industrialized world.
“It’s a business opportunity,” said Robert A. Beck, the Rio-bound director of environmental affairs for the Edison Electric Institute, which represents electrical utilities. They burn coal, oil and gas to generate much of their electricity and, in the process, release gases that contribute to global warming.
Beck notes that some developing nations may want to purchase “clean-coal” technology.
Promoting coal at an environmental summit may sound sacrilegious: Coal is the greatest offender in the production of carbon dioxide, which is the primary source of man-made gases contributing to global warming. Environmental groups want coal and oil replaced with renewable sources of energy. “From the point of view of an environmentalist, the idea of the coal industry peddling its wares at the Earth Summit is more than a little bit macabre,” said Michael Oppenheimer, a senior scientist with the Environmental Defense Fund.
But industry sees both profit and potential for environmental benefits in promoting “clean-coal” technology--cutting-edge developments that make it possible to burn less coal for more energy--in developing countries that intend to use the fuel to industrialize.
“It could make major strides in India and China, which are definitely going to use coal, no question about it,” said Beck.
Much of the most important work for corporations has already been completed. More than 55 business representatives lobbied U.N. negotiators who met in New York over the past few months to draft a global warming treaty to be signed in Rio.
Most businesses were pleased with the results. European leaders had called for a treaty that would require industrialized countries to cap emissions of carbon dioxide at 1990 levels by the year 2000.
Much to the disappointment of environmentalists, the Bush Administration succeeded in drafting a watered-down compromise that merely says countries will aim toward that objective.
Instead of plying delegates with “doodads and entertainment,” the business lobbyists at the negotiations showered them with reports intended to cast uncertainty on global warming predictions and to emphasize the potentially high costs of heading off climate change, said the chamber’s Armstrong.
To influence results at Rio, 18 major trade associations and 25 corporations, including the chamber, the Edison Institute and the coal association, banded together in a group called the Global Climate Coalition nearly two years ago.
“It was a relatively new experience for business to be involved in the U.N.,” said John Shlaes, executive director of the coalition. “We want to stay involved and make an impact because we think we’ve got to ensure there is an even playing field.”
Corporate lobbyists, accustomed to courting city councils and Congress, found it trickier to influence the U.N. negotiators, who are divided into delegations of several members from each country and often meet in closed session.
Corporate representatives of multinational companies tended to buttonhole delegates of countries where they had overseas offices. Delegates from OPEC countries also became their natural allies.
“But even the more green countries in the European Community were willing to sit down and talk with us,” said Beck.
Shlaes, like many other business representatives, admits that he does not “really know what to expect in Rio,” including how much access lobbyists will have to delegates. But he has the good fortune of having captured a highly coveted room in the hotel where the U.S. delegation is staying.
In addition to the coalition, a group called the Climate Council has been busy lobbying U.N. delegates on behalf of electrical utilities, coal companies and railroads. Some of its members also belong to the coalition.
The council is represented by lobbyist Donald Pearlman, a former Reagan Administration official. Pearlman, who refuses to identify his clients by name, formerly served as executive assistant to Donald Hodel, who served as energy secretary and secretary of the Interior under President Ronald Reagan.
“It did appear that Pearlman had extensive contacts with the delegation that went beyond anything that the environmentalists did,” said Oppenheimer, an environmentalist who noticed Pearlman enjoying long chats with U.S. delegates at the U.N. coffee bar.
Pearlman is modest about his achievements. He said he was pleased to see language about timetables slashed from the proposed global warming treaty but still objects to “certain rhetoric” among its provisions, such as language that he believes “guilt-trips” industrialized nations for environmental troubles.
In Rio, Pearlman said, he will be collecting information his clients may need in the future, such as the mood of nations on energy conservation, climate change and the conservation of plant, animal and other species.
The lobbyist also will present his clients’ point of view on global warming issues, and monitor and try to influence a proposed biological diversity treaty.
Like environmental groups, business has focused primarily on the global warming treaty, ignoring negotiations on the wildlife pact even though early drafts would have, in Pearlman’s view, made the U.S. Endangered Species Act look like “child’s play.”
“It just didn’t really come to (business’s) attention with the force and clarity it should have,” he said of the conservation treaty. “And they have been fighting so many battles on so many fronts that they are just limited as to what they can focus on.”
The main corporate opposition to the pact came from the biotechnology industry, which has urged President Bush not to sign it. An industry lobbyist said the agreement could weaken patent protections and spark more regulation.
The Bush Administration, which has tried to protect the industry in negotiations, has indicated it may not sign the agreement, primarily because of objections to a provision that could set up a fund for funneling aid to developing nations.
A U.S. official familiar with the treaty, describing the biotechnology industry as “understandably paranoid,” said the agreement probably would not trigger new U.S. regulations, nor would it necessarily dilute patent protections.
As the biotechnology representatives and other business organizations lobbied on the treaties, another corporate group was meeting to try to spur industry toward new ways of operating to protect the environment.
Called the Business Council for Sustainable Development, the group of chief executive officers and board chairmen of 48 major corporations from around the world met over the past two years at the request of Maurice Strong, secretary general of the Earth Summit and a former oil executive. The group issued a report in May.
The report represented a departure from standard business anxieties about environmental reforms.
The executives argued that energy prices should reflect environmental costs, that pollution taxes and charges should be levied and offset by other tax breaks, and that subsidies that encourage waste and pollution be phased out.
“It’s a lecture to the rest of the business community to get with it,” said Benjamin Read, president of Ecofund ’92, a nonprofit group established to solicit financial support for the Rio conference from business and foundations.
Scott Hagost, international counsel for the Environmental Defense Fund, said the excerpts from the report projected a “much more forward-looking role for industry” than the stance of either the climate coalition or the council.
But Pearlman, whose clients include the coal industry, said: “It’s by and large a group of companies who believe that they can profit by having various regulatory schemes put into place that would cause major problems for other existing business.”
Greenpeace, at the other end of the political spectrum from Pearlman, also attributed cynical motives to the chief executives.
“Billions of dollars in development aid are likely to be generated” by the Earth Summit, said Greenpeace’s Kenny Bruno. “And the greener a transnational corporation looks, the better its chances of capturing some of these funds.”
At least two of the corporate leaders who wrote the report, including the Dow Chemical Co.'s Frank Popoff, represented companies that were part of the Global Climate Coalition’s campaign to remove timetables and targets from the global warming treaty.
Popoff, Dow’s president and chief executive officer, sees no conflict. Companies need flexibility to reduce greenhouse gas emissions in the cheapest and most environmentally beneficial manner, he said, and may not be able to do that if bound by a deadline.
Popoff said none of the corporate executives were trying to deflect attention from their environmental records. Environmental issues “are too big to hide from,” he said. Nor were the corporate leaders trying to position themselves to win projects in developing nations.
Rather, Popoff said, firms are discovering that environmental improvements can improve profits.
Despite the lukewarm, even negative, reaction to the report from some business quarters, Popoff does not believe the executives should be viewed as traitors by the business community.
“I think (others) in industry, given our data and given the circumstances, might have reached very similar conclusions,” he said.