INTRODUCTION II. HAZARD TRANSFER III. THE FORCE OF MARKET DECISIONMAKING IV. THE FORCE OF LEGAL DECISIONMAKING V. THE FORCE OF ETHICAL DECISIONMAKING A. The Traditional Algorithm B. The Traditional Algorithm, Fortified for Use in Hazard Transfer Cases VI. CONCLUSION I.
Captain Planet is a cartoon superhero who strives to solve environmental problems. (1) He draws power from the natural forces of earth, fire, wind, water and heart. These forces combine and magnify, creating Captain Planet. Captain Planet not only solves environmental problems, but he also inspires others to use their individual power to create change. He reminds those he inspires, "Planeteers," that, "The power is yours!" (2) This message "captures the extraordinary ability of one person to make a change." (3) Captain Planet works using strength and wits, and he never inflicts pain on environmental villains. Ultimately, Captain Planet hopes to inspire Planeteers to "continue to work for a cleaner, greener future that celebrates diversity and cultures from every corner of the globe." (4)
The Captain Planet is a useful way of looking at global attempts to respond to and reduce the transfer of environmental hazards from rich to poor countries. (5) Often, free trade in hazards--from garbage, (6) to toxic sludge, (7) to junked computers bound for "recycling" (8)--yields disaster in countries ill-equipped to handle hazards. (9) Market-based solutions and legal prohibitions have helped limit the problems related to hazard transfer. However, each of these approaches has its shortcomings. Even efforts that combine these forces have fallen short in attempts to stop problems in the international trade in toxic waste. This Article suggests that a third power, that of ethical decisionmaking, can magnify the forces of the market and legal decisionmaking, creating the force necessary to respond appropriately to hazard transfer.
Business ethicists consult a traditional algorithm or "test" to assist them as they decide on a course of action. In particular, they ask: Would the practice be acceptable at home, in the United States, if my country were in a similar stage of economic development? This test allows for lower ethical standards based upon different levels of economic development, as long as the transnational corporation does not violate core human rights. (10) The primary purpose of this Article is to consider this traditional algorithm and suggest additional questions that fortify the algorithm, thereby making it more useful to corporate managers and officers who contemplate specific actions related to hazard transfer.
Part II of this article explains how international trade in toxic waste has changed over time and describes what hazard transfer from rich to poor countries looks like today. Part III explores the strengths and limitations of market decisionmaking to reduce forms of hazard transfer. Part IV does the same for legal decisionmaking. And Part V highlights ethical decisionmaking and its role in reducing hazard transfer and offers suggestions for reforming the traditional algorithm described in the preceding paragraph. An ethical algorithm that helps those who trade in hazards think through the dilemmas they face empowers them to generate corporate profits while promoting a more sustainable and environmentally just world.
In recent decades, citizens both in developing nations and in the United States have been exposed to wastes that were "toxic, poisonous, explosive, corrosive, flammable, eco-toxic, or infectious." (11) Over time, government regulators in the United States have passed and enforced legislation to decrease and eventually eliminate exposure to hazardous waste. (12) Citizens of developed nations take for granted increased health and safety made possible by government regulation. But citizens of developing nations are not as fortunate. While developed nations have improved conditions for their own citizens, (13) they have increased their export of hazards to developing countries. As a result, citizens of those developing countries have been exposed to more and more dangerous waste. (14)
The language of economic globalization makes hazard transfer sound morally neutral. Globalization has created an interconnected world economy, complete with opportunities--from trade (15) to direct foreign investment. (16) While some writers describe hazard transfer as part of the "ugly underbelly of economic globalisation," (17) many others describe it as trade itself--waste transfers are trading opportunities like any other. (18)
In the 1980s, it was relatively easy to recognize hazard transfer, as it often took the form of dumping. Dumping, 80s-style, brings to mind images of the Khian Sea, the cargo ship famous for its quest to dump 14,000 tons of toxic incinerator ash from Philadelphia in countries around the world. (19) Citizens in the United States and beyond were outraged after the Khian Sea dumped approximately 30 million pounds of toxic ash in Haiti as "topsoil fertilizer." (20) The Khian Sea continued its dumping expedition, changing its name to Felicia, then Pelacano. (21) The cargo ship could not get any country to accept the waste. By 1988, the ship had disposed of the remaining tons of ash, presumably dumping as it traveled around the Indian Ocean, looking for a place to dock. (22)
The waste disposal industry knew it could not continue to engage in outright dumping, as the public had lost patience and supported international treaties to prevent another Khian Sea incident. The 1989 Basel Convention (23) banned hazardous waste dumping in developing countries, but included a loophole that encouraged companies to invent new, more sophisticated ways to dump. The Convention allowed companies to consider waste as tradeable raw materials for recycling and further use. In the 1990s, companies engaged in creative labeling or outright mislabeling. (24) Creative labeling included classifying waste as products, (25) recycling, (26) or humanitarian aids In addition to creative labeling, companies tried to change the nature of waste so it fell under the exception for raw materials for further recycling and further use. Companies mixed hazards with other products (28) and sold waste as an energy source. (29)
More recently, developed countries have been moving hazardous production processes (30) and industries (31) to developing countries as a form of direct foreign investment. Scholars have raised questions about the potential for this investment to provide long-term economic value. They have also explored the extent to which particular countries have enacted regulatory schemes to protect their citizens from environmental hazards created by highly polluting industries, such as petroleum and electronics production.
As hazard transfer has evolved, a range of stakeholders have participated in attempts to create a framework for hazard transfer consistent with notions of opportunity and fundamental fairness. The key stakeholders active in discussions about hazard transfer are waste generators, (32) exporters, (33) non-governmental agencies, (34) regulators (35) and associations that lobby on behalf of industries. (36) These stakeholders have responded to and shaped both market and legal decisionmaking.
THE FORCE OF MARKET DECISIONMAKING
Some businesses that engage in industrial activity externalize costs of production by releasing waste into the environment. Economists refer to pollution as a negative externality. (37) Corporations that create products and generate pollution as a byproduct count on society to bear part of the cost of the product-the part related to pollution. (38) From this perspective, companies have little economic incentive to create products in environmentally friendly ways unless local, state, federal, or international regulators require it. Laws shore up market failures, including pollution. (39)
Some stakeholders call for market-based or voluntary solutions to environmental degradation. At first glance, it seems illogical to call for market-based solutions to pollution, since market inefficiencies created the problem. (40) Upon closer examination, however, it seems likely that the market decisionmaking offers some contributions to environmental cleanup. (41) Private companies, who are concerned with being good corporate citizens independent of legal regulation, pursue two voluntary options for environmental protection: (1) they manage the downside of environmental responsibility by reducing cost and risk (42) and (2) they manage the upside of environmental responsibility by generating revenue and creating intangible value. (43)
When private companies manage the downside of environmental responsibility, they enact policies and procedures that reduce cost and risk. Companies that want to manage cost and risk are likely to engage in assessment and self-policing (44) as a first step. Companies might then trade in the right to pollute--either as buyers, sellers or traders of pollution allowances. (45) Another strategy to reduce cost and risk is reducing supply-side costs. For example, a trucking company might reduce the costs of transportation by using fuel-saving technologies that both save money and reduce pollution. (46)
Standard-setting by private industry assists companies as they manage the downside of environmental responsibility. (47) Standards are guidelines, not legal agreements or treaties. (48) The most well-known private standard setter is the International Organization for Standardization (ISO). (49) This standard-setting body is a non-governmental organization (NGO). ISO 14000 helps organizations determine how they can take steps to reduce negative environmental impacts. (50) It also helps them think through how they can comply with relevant laws and regulations. ISO 14001 is more specific: It outlines specifications for company environmental management systems...