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Rainfall is like regulation. Too little or too much of either is bad news for the economy.
The flood of bad news these days begs for new paths to take.
One prospect is self-regulation with a modern twist. The task is for an industry to regulate itself and self-enforce effective rules on all of its members. Experience says the task fights against human nature.
More human nature says that camps fight against anything from outside their camp that restricts how things are done.
Human nature will never change, so how can regulation be made effective and efficient?
One way is by changes that make different use of human nature. How might industry really self-enforce its own regulations and why might it work for a large problem?
First, put in place pre-set government rules that define and guard against the known environmental harms of an industry activity.
Second, hold the government’s rules in reserve, to go into effect only if industry’s self-enforcing its own rules fails to prevent the specified harms.
Measurements are key in showing the status of the harms.
Avoiding government’s rules, with their cost and bother, is the modern twist.
It is the new Incentive, capital “I,” in modern self-regulation. The Incentive gives industry the opportunity to show success in preventing real harms in cost-effective ways.
The same Incentive (the government rules in reserve) is also the industry-wide enforcer and major penalty if industry fails in its enforcement role. The constant Incentive changes everything.
Self-regulating next needs a good operating framework to use.
A practical one is available in the International Organization for Standardization or ISO, which began work in 1947.
The ISO website says: ISO is a network of the national standards institutes of 162 countries, one member per country, with a Central Secretariat in Geneva, Switzerland, that coordinates the system.
ISO is a non-governmental organization that forms a bridge between the public and private sectors.
On the one hand, many of its member institutes are part of the governmental structure of their countries, or are mandated by their government.
On the other hand, other members have their roots uniquely in the private sector, having been set up by national partnerships of industry associations.
ISO does not regulate or legislate. Use of its work products is voluntary for a company, an industry or a country.
Operations of ISO illustrate the framework an industry could use to self-enforce its own regulations.
The ISO takes requests from associations, say the several associations in the gas industry such as the Natural Gas Supply Association (NGSA), to develop new standards in a requested area.
ISO assigns an approved request to develop standards to one of its 214 technical committees. Or a new committee may be established for the purpose.
The tech committee could be staffed with anyone the NGSA prefers. The Incentive assures the NGSA would select committee members having depth of expertise and judgment. If not, the industry will fail to prevent the specified harms, which activates the government rules.
The assigned committee needs to know the specified harms and the government rules in reserve to prevent the harms.
Only then does the committee know all the purposes and parameters of the standards they are asked to set.
The Incentive again assures that industry’s standards are well judged from all aspects. Mistakes or poor judgment bring the government rules.
Finally, ISO has an extensive system of auditing for compliance that begins with auditor training and certification.
An entire industry could use ISO’s system of inspectors, create its own, or decide that inspection is not cost-effective.
Again the Incentive will prompt a judicious decision that favors effectiveness.
Practical, modern means exist for an industry to regulate itself more efficiently, at less cost, than any government agency can.
The surety would be the Incentive – the pre-set government rules in reserve.
It turns human nature from a roadblock to a pathway.
New Mexico Citizens
for Clean Air & Water