Making a Profit “IN MY BACKYARD”

For the past decades most cities, counties and states seem to have adopted the slogan NIMBY – “not in my backyard” when it comes to the disposal of hazardous and solid waste, making the disposal of such byproducts of industry and consumption difficult. An exception is Tooele County, Utah, where the slogan could be IMBY – in my back yard. The county, roughly the size of Connecticut is mostly desert. At the Tooele Army Depot nearly half of the nation’s nerve gas is in storage, awaiting permanent disposal. The county also accepts nuclear waste for disposal. In 1993 United States Pollution Control Inc., a subsidiary of Union Pacific, completed building within the county a $150 million commercial incinerator the nation’s largest. The incinerator disposes of such elements as paint sludge and PCB-contaminated soil brought in form all over the country.

It was in 1988 that the county decided to go against the tide of sentiment against solid and hazardous wastes and seize an opportunity to create jobs and income for its 28,000 residents. To accomplish this, the county set aside a 100 square mile hazardous waste disposal district. There three private disposal companies have created about 500m new jobs. Local property taxes have not gone up, largely because of the special “mitigation fee” the companies pay the county to compensate for the stigma of having a “dirty” reputation for being associated with hazardous waste disposal. In 1992 the county collected almost 20 percent of its revenues from the mitigation fees. So far the residents have not seen any signs of the pollution affecting them other than beneficially in jobs and tax revenues.

Climate changes: We have to worry about human induced climate changes such as global warming. Some scientists have suggested that global warming poses a severe threat to life as we know it. A small rise of several degrees in the average temperature would be enough to set off major changes in climate. Greenhouse gases which are emitted from the burning of carbon based fuels such as gasoline serve to trap warmth in the atmosphere, and some scientists predict a global average temperature increase of 1.5 to 4.5 degrees centigrade over the next century unless current trends abate.

Ozone Depletion: When chlorofluorocarbons (CFCs) are released into the atmosphere and break down, they release chlorine molecules, which destroy ozone molecules resulting in the degradation of the ozone layer surrounding the earth. If the earth’s protective ozone layer gets too thin, then damaging ultraviolet radiation will lead to an increase in skin cancers. Ozone depletion has led to an international agreement to limit the production of CFCs altogether in some countries.

Other Global Issues: Finally, we have to worry about large global issues such as biodiversity, adequate water supplies, population, and food security. The recent debacle in Somalia has been called an environmental crisis by some, since the nomadic way of life of the Somali people is no longer sustainable given de-vegetation, population increases, and the scarcity of food.

Confusing the issue is the fact that for each scientific “gloom and doom” projection, there are other scientific studies that conclude that environmental problems are not severe. Managers must decide how to act before all of the scientific facts are in. They must rethink their organizations from top to bottom if they are to respond effectively ton the environmental crisis—if there is indeed a crisis. Although the science is unclear, two facts are clear. First, we have not lived in an environmentally friendly way and continuance on the same path may have devastating effects. Secondly, as McDonald’s concluded, today’s managers have to be concerned not only with scientific facts, but with public perception.

It is also important to note that, on a global scale, the environment is becoming one of the hottest issues for business in the 1990s. The export market for “green” goods services and technologies is rapidly expanding. Stricter regulatory standards are being adopted globally as developing regions such as Asia discover that high rates of industrial expansion and economic growth are compromising the quality of the environment. Thus, there is a greater demand for American technologies and know how to tackle and solve environmental problems in the Pacific and Asia. The market for US environmental exports includes Latin America, Asia, Eastern Europe, and the countries of the former Soviet Union. It has been estimated that on a worldwide basis spending on environmental protection reached $590 billion by the year 2000, with a growth rate of 6.7 percent annually.