'Tragedy of the commons." (perceived insignificant environmental lapses of executives leads to greater environmental damage) (Letter from the Publisher) (editorial).

• Author: Rock, Robert H.

"Tragedy Of the Commons"

Managing Environmental Responsibility is the Chairman's Agenda for the Summer edition of Directors & Boards. We examine the environmental challenges confronting businesses and their boards. Once defiant in opposition to environmental initiatives, corporate executives are beginning to realize that environmental issues present opportunities, as well as constraints, for their companies. Moreover, they now realize that the more they resist, the more they could lose.

Last April, 100 million people celebrated the 20th anniversary of Earth Day, launching what many agree will be the decade of environmentalism. The public's awareness, and alarm, have been raised by incidents and accidents such as the disappearing ozone layer, acid rain, and the Exxon Valdez spill. This hightened concern is not restricted to the United States. Political and social forces throughout Europe, for example, are thrusting environmental issues into the forefront of European Community policy making.

For over one hundred years, social activists have warned about the environmental harm brought about by people's actions and indifference. William Forster Lloyd, in his 1833 essay "The Tragedy of the Commons," depicted the inexorable demise of the common good caused by each individual farmer seeking personal gain from using the town commons for grazing. Unfortunately, every farmer thought the same way, resulting in the overuse, and eventual erosion, of the commons. Similarly, today, many executives dismiss their own environmental lapses as insignificant in the greater scheme of things. In particular, they believe that costs for cleanup are too high and the benefits too distant.

Although many executives have not yet recognized that arresting pollution is in their own enlightened self-interest, government regulators are reminding them of their potential liabilities. Federal, state, and local officials have become zealous...