April/May 1997

The Environment in a changing world: the role of the OECD

TUAC welcomes this opportunity to make an input to the OECD High Level Advisory Group on the Environment, by responding to the questions posed to us. The OECD has comparative advantages which equip it for playing a central role in the pursuit of sustainable development :

it is composed of a group of countries which are the leading economies in the world, which have to assume the prime responsibility for environmental stewardship ;
at the same time the OECD is attaining a global reach through its work with non-member countries and so can act as a catalyst for more effective governance of the global economic system, examples are the Environmental Action Programme for Central and Eastern Europe as well as the Chemicals Programme ;
the OECD is a community of shared values, its members have more similarities than dissimilarities in their political, economic and social structures, this enables on occasion binding agreements to be reached which can be used as a progenitor for agreements in wider fora ;
it represents almost the whole range of government departments and policy fields, allowing the interconnections and inconsistency of policy to be resolved, different policy "cultures" to be confronted and a multidisciplinary approach adopted ;
although an intergovernmental body, the OECD through TUAC and BIAC and its contact with the environmental NGO's has the opportunity to involve the social partners and the wider community in its work.

1. What should be the OECD's strategic direction on the environment and more broadly, sustainable development issues? How might these be translated into near and medium term priorities ?

The issue of climate change and its economic and societal impacts must be at the centre of the OECD's concerns on sustainable development and the environment. The difficulties of reaching binding agreement on this issue are well known, both because of the economic and social implications for OECD countries and the implications for third world development. However the task of halting climate change, whilst meeting the objectives of economic development and social progress set out in the OECD's Charter and eliminating world poverty is the central challenge facing the people of this planet as we enter the third millennium.

Some of the central policy instruments needed to develop sustainable production and consumption and so combat climate change are well known. However obstacles arise from the failure to integrate environmental policies with other economic and social policies as well as diminishing public commitment to change. OECD's near and medium term priorities should therefore focus on building a consensus to achieve sustainable production and consumption through the integration of different areas of policy including employment and equity.

The OECD Secretary-General has, in his own Strategic Objectives Paper said that the OECD's mission must be to achieve a balance between economic development, social progress and political stability against the background of the growing pressures of globalisation. TUAC has agreed with him that OECD countries face a breakdown in this balance and risk popular backlash, because too little emphasis has been placed on social factors. We also support his view that "all economic policies designed to foster economic growth must have social policy objectives". The integration of social and environmental concerns would therefore seem to us a logical starting point. Five examples of priorities are :

policies for sustainable production and consumption should be linked to a strategy for sustainable jobs which maximises the employment gains and minimises the costs from environmental action. TUAC has in the past proposed that the OECD should undertake a thematic review on "sustainable employment" ;
the social costs and benefits of environmental protection and management, and in particular the use of economic instruments should be fully assessed and any negative distribution and employment effects offset on an equitable basis. The OECD should establish best practice norms for evaluating and offsetting these effects ;
a new "workplace partnership for change" is needed which includes strategies for environmental management, involving employees and their trade union representatives. Effective participation must be based on the "right to know" and the "right to influence". The OECD should establish Guidelines for Environmental management at the workplace, based on the conclusions of recent labour management programme meetings ;
environmental strategies should fully integrate workplace health and safety issues (building on the work of the Chemicals Programme) and ensure that these are not undermined by deregulation or even mistaken approaches of regulatory reform ;
basic environment standards and basic labour standards must not be undermined by competitive pressure from the global trade and investment system. The Multilateral Agreement on Investment, being negotiated in the OECD, must have an effective treatment of environmental and labour issues. The OECD Guidelines on Multinational Enterprises should be reviewed so as to include an updated environment section and a more effective implementation mechanism.

Although OECD countries themselves have the lead responsibility in environmental stewardship themselves, the OECD must also act as a catalyst for change elsewhere in the world. In the dialogue with non-member countries it must demonstrate a greater willingness to help developing countries and others adjust to the economic, social, environmental, and health costs of costs of environmental protection. It will not be possible to promote sustainable production in the non-OECD countries without meeting basic social and economic development objectives. Poverty and environmental degradation feed off each other. The OECD governments thereby must do more to enable developing countries to combat poverty, disease and social injustice and integrate the goal of sustainable development into these strategies.

One positive example with which TUAC has been closely involved has been the OECD's work on the Role of Trade Unions in Promoting Cleaner Production in Central and Eastern Europe, which includes the development of a best practice "guide" to enable unions and workers to play a greater role in monitoring, promoting and implementing cleaner production activities and programmes. The OECD could also help to organise resources and advice within its Emerging Markets Forum for detailed practical problems e.g. how to ensure the financing of clean technology coal power stations in India and China.

2. What type of internal OECD structure/arrangement will be required to enable the OECD to adequately address these priorities ?

The above priorities all necessitate the integration of different policy areas:- social, economic, trade, investment, public management and development. There is therefore a clear need for the development of structures within the OECD which encourage and facilitate horizontal work between Committees and Departments. In TUAC's view within such a structure there is a continuing need for a strong and dynamic Environment Directorate to act as a catalyst for environmental action and to ensure that environmental concerns are effectively voiced within the Organisation. For example TUAC's call for a "Thematic Review" in the context of the Jobs Study follow-up on "sustainable employment" would involve intensive cooperation between different Departments on :

the direct/indirect employment effects of more stringent environmental regulations and standards, and the employment costs of failing or delaying environmental improvements ;
the employment opportunities and quality of employment in the environmental technologies and services industry ;
the "double dividend" potential available from "green" public investment projects ;
the macro/micro employment effects of substituting taxes on labour with taxes on natural ressources ;
the need to support environmental skills training and retraining; and
the benefits of alternative methods of financial accounting which measure better environmental externalities and thereby could give a higher premium to "green" job creation.

If the OECD is to deliver more country specific policy advice and surveillance against a background of increased horizontal work, the current Economic Development Review Committee (EDRC) process, which produces Annual Economic Surveys of each OECD Member, will need to be substantially restructured. Rather than structural policy chapters being drafted by the Economics Department and appearing as national recommendations for implementing a general strategy, they need to be tailor made to specific country circumstances, and draw upon the knowledge of the specialist Committees, such as Environment. TUAC has proposed that the EDRC should be replaced by a more broad-based Committee, served by a general coordination unit of country desks not attached to any particular department and geared towards multidisciplinary work.

3. How can the OECD strengthen its influence on environmental and sustainable development polices at the national and international levels ?

By focusing on its areas of comparative advantage mentioned above and adopting the above priorities the OECD can most effectively strengthen its influence. The interdepartmental nature of the Organisation does give it a scope and potential influence which specialist international organisations lack. This also gives an opportunity for cooperation with specialist agencies e.g. with the ILO on workplace health and safety issues. One specific problem does however appear to be coherence within governments themselves between Finance, Foreign and other Ministries. It is significant that the 1996 OECD's own "Priorities" exercise yielded systematically low priorities for environmental work, which would not concur with much perception in individual countries.

4. What kind of external linkages should OECD maintain and/or establish with other international bodies, interest groups, non-member countries and private sector institutions in order to have greater influence on environment and sustainable development policy at national and international levels ?

The OECD needs constituencies of support and advice in Member countries over and beyond the government officials who come to regular Committee meetings. The creation of the High Level Group of the Environment is an interesting initiative to bring in external advice. Its membership represents an impressive wealth of experience in business, academia, government and the environmental movement. However the failure to include a member with the background of representing the interests of workers and employees is deeply worrying. All groups in civil society have to have confidence in and some "common ownership" of recommendations that the OECD makes on environmental policy. The Group should make a particular effort to take on board the needs for a "workplace partnership" on sustainable production and consumption.

For workers to contribute to solutions which can improve the environmental performance of companies they have to be granted the rights and means to participate, and not just obligations. The right to negotiate changes in production and work organisation, and the right to propose changes and not just react, form the foundations of green collective agreements and the basis of trade union partnerships with employers. However, these basic enabling rights will only be as effective as the extent to which they are applied practically. One important focus for direct, practical trade union involvement is on company eco-auditing, which has increased in almost all OECD countries and is viewed by many companies as an effective means of assessing and managing environmental performance. The confidence and cooperation of the workforce is an essential requirement of any eco-audit, and trade unions have an important contribution to make in the audit design, implementation and report process. Trade unions also have an equally important role to play in drawing up corporate environmental policy targets and objectives, and in helping to set and monitor workplace eco-standards. The international trade union movement has prepared series of case studies of good workplace practice on environmental protection. This could be developed into more systematic procedures for partnership at the OECD level.

TUAC has on repeated occasions indicated its desire to cooperate with both business and environmental NGO's to implement this vision of partnership at the workplace. Within the OECD it would support the objective of creating a "Sustainable Development Advisory Council" which could directly advise the Environment Committee. TUAC would expect to be part of any such Council. TUAC has also sought to cooperate productively with the Environmental NGO's in their own efforts to establish OECD-wide representative bodies.

The OECD is having a wider review of the need to develop communication and dialogue between the OECD and all parts of civil society. As far as TUAC is concerned involvement in the OECD discussions could be strengthened through for example :

the development of OECD seminars and round tables involving TUAC at national level ;
the invitation of representative trade union speakers to Committee and Ministerial meeting sessions ;
at a national level more intensive involvement of trade unions in consultations on country specific recommendations ;
the increase in resources for and more active use by the OECD of the Labour/Management Programme.

TUAC is ready to work with the OECD to develop the above initiatives into a genuine "In-reach" Programme.

Return to index  Back to top