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End of EPA Program Catches Companies Off-Guard

Tuesday, September 21, 2010

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AkzoNobel, Turner Construction and other industry leaders are expressing surprise and disappointment at the Environmental Protection Agency’s abrupt decision to end its Climate Leaders program, a voluntary government-industry partnership to develop climate change strategies.

The program, established in 2002, is being canceled, Gina McCarthy, Assistant Administrator of EPA’s Office of Air and Radiation, informed corporate partners in an email Wednesday (Sept. 15).

“Recognizing the need to promote and advance climate leadership amid growth and change, EPA has decided to transition the program over the coming year in order to take advantage of the full range of information, expertise, and approaches available to Partners eager to go above and beyond in reducing their greenhouse gas (GHG) emissions,” McCarthy wrote.

The Climate Leaders Program’s 275 voluntary partners included some of the world’s biggest and most forward-looking corporate and organization names.

Partners included Bank of America; Alcoa; Anheuser-Busch; Pepsi; the World Bank; and Tyson Foods. Coatings and coatings-related partners include 3M, AkzoNobel, The Sherwin-Williams Company, Air Products and Chemicals, and PPG Industries.

Corporate Commitments

Under the program, Climate Leaders companies committed to reducing their impact on the global environment by completing a corporate-wide inventory of their GHG emissions, sharing hundreds of best-practices case studies, setting long-term reduction goals, and annually reporting their progress to EPA. They also received technical assistance from EPA.

For example according to the program's site:

• 3M set and achieved its initial goal of reducing total U.S. GHG emissions by 60 percent from 2002 to 2007.

• Air Products and Chemicals Inc. is developing a greenhouse gas reduction goal.

• AkzoNobel is developing a greenhouse gas reduction goal.

• DuPont Company has pledged to reduce total global GHG emissions by 15 percent from 2004 to 2015.

• PPG Industries Inc. has pledged to reduce total global GHG emissions by 10 percent from 2006 to 2011.

• The Dow Chemical Company is developing a greenhouse gas reduction goal.

• The Sherwin-Williams Co. has pledged to reduce total U.S. GHG emissions by 4 percent from 2007 to 2012.

• Turner Construction Company has pledged to reduce total U.S. GHG emissions by 5 percent from 2006 to 2011.

‘Changing the Way We Do Business’

EPA Administrator Lisa Jackson praised the Climate Leaders program at last fall’s Partners program, calling it “an excellent example of what industry and government can do together to tackle the shared problem of climate change.”

“This partnership is an important one, because it represents our country’s largest greenhouse gas goal-setting program,” said Jackson, noting that the Partners had reduced greenhouse gases “by 18 million metric tons of CO2 each and every year” of the program.

“That alone is reason to celebrate this program,” Jackson said. “But there is another excellent benefit as well… . This program sends a message about changing the way we do business in this country and, consequently, around the world.”

‘Left Hanging’

Partners expressed surprise at EPA’s decision to end the program. The agency has been very active in this administration and, in fact, McCarthy noted that it is implementing Mandatory Reporting Rules that may serve some of the Climate Leaders goals. Still, the program has no immediate successor.

“I was a little bit shocked,” Michael Deane, vice president and chief sustainability officer for Turner Construction, said in an interview Monday (Sept. 20). Turner took advantage of the program’s technical assistance in developing its sustainability program, Deane said.

“We liked the guidance,” he said. “We liked the notion that a federal government agency charged with protecting the environment was encouraging us, validating our work, and setting goals for us.

“As much as we like to think we’re all self-motivated to do the right thing, there’s also the incentive of being recognized by a government agency for doing the work. …. We will miss the support they provided.”

Deane said the program’s demise would not change Turner’s sustainability or reporting practices, or its GHG reduction goals. On the other hand, he added, “Whether anyone will be there to recognize our goal when we reach it is left hanging.”

‘Surprised and Disappointed’

A spokesman for AkzoNobel said “the industry is surprised and disappointed” by the program’s end. AkzoNobel was just named Supersector Leader for the chemicals industry by the Dow Jones Sustainability World Index.

“As the world’s largest paints and coatings company, we were disappointed to learn of the news concerning the elimination of the EPA’s Climate Leaders Program,” said Eric Stasiowski, director of communications.

“However, this will in no way alter our focus to remain one of our industry’s leading sustainable companies, as evidenced by our recently announced ranking atop the Dow Jones Sustainability Indexes within the Chemicals sector.”

‘Less than Thrilled’

The EPA will be discussing the program’s demise at an abbreviated Partners meeting Oct. 5-6 in New Orleans.

Still, that may do little to mollify some of the Partners. As Bruce S. Klafter, head of Corporate Responsibility & Sustainability Office at Applied Materials, told

“I am less than thrilled that there was no prior notice or an opportunity to convey input to the agency. I respect their right to manage their budgets and so on, but CL is a collaboration, and the Partners deserved an opportunity to weigh in on the decision."


Tagged categories: 3M; AkzoNobel; Climate Control; EPA; PPG; Regulations; Sherwin-Williams

Comment from L Kushner, (9/22/2010, 8:35 AM)

I don't see how companies can feel they were left hanging. If they have not been able to set a GHG emmisions goal in 8 years, what makes them think more time would have enabled them to come up with something.

Comment from Gary Hall, (9/22/2010, 8:58 AM)

This is another example of the lack of understanding on the part of the Obama administration of corporate culture and operating procedures in industry. The CL companies have committed, and spent, millions of dollars worldwide in expectation of the EPA's support and assistance. Now that is gone. That sort of decision making is like the Indianapolis Colts getting rid of Peyton Manning because he has been too successful. Another dumb decision by EPA and this current administration.

Comment from Fred Jounson, (9/22/2010, 12:19 PM)

Good, Its about time they pulled the plug on insiders attempting to uneven the playing field by using agencies to create unfair legislation to gain a leg up on competitors

Comment from Tim LaBorde, (9/26/2010, 9:01 AM)

Beware. The current administration might soon surprise everyone with unreasonable and unobtainable regulations tied to fines. Why have business involvement and partnerships when you can simply institute demands and penalties? This is the way things are done today.

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