EarthX Website: https://earthxmedia.com/
Seasoned attorneys Scott Fulton, Tracy Hester, and Jim Bruen explore the intricacies of international environmental liabilities and compliance.
About Law & Nature:
Discussions of Environmental Law & Policy developed by the EarthxLaw Advisory Council
Law & Nature promises lively discussions by environmental thought leaders on legal and policy issues of critical importance to environmental protection. This series is developed by the EarthxLaw Advisory Council, a blue ribbon board of prominent environmental law practitioners brought together by EarthX to assist in developing programs and facilitating dialog on environmental law and policy.
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Seasoned attorneys Scott Fulton, Tracy Hester, and Jim Bruen explore the intricacies of international environmental liabilities and compliance.
About Law & Nature:
Discussions of Environmental Law & Policy developed by the EarthxLaw Advisory Council
Law & Nature promises lively discussions by environmental thought leaders on legal and policy issues of critical importance to environmental protection. This series is developed by the EarthxLaw Advisory Council, a blue ribbon board of prominent environmental law practitioners brought together by EarthX to assist in developing programs and facilitating dialog on environmental law and policy.
EarthX
Love Our Planet.
The Official Network of Earth Day.
About Us:
At EarthX, we believe our planet is a pretty special place. The people, landscapes, and critters are likely unique to the entire universe, so we consider ourselves lucky to be here. We are committed to protecting the environment by inspiring conservation and sustainability, and our programming along with our range of expert hosts support this mission. We’re glad you’re with us.
EarthX is a media company dedicated to inspiring people to care about the planet. We take an omni channel approach to reach audiences of every age through its robust 24/7 linear channel distributed across cable and FAST outlets, along with dynamic, solution oriented short form content on social and digital platforms. EarthX is home to original series, documentaries and snackable content that offer sustainable solutions to environmental challenges. EarthX is the only network that delivers entertaining and inspiring topics that impact and inspire our lives on climate and sustainability.
EarthX Website: https://earthxmedia.com/
Follow Us:
Instagram: https://www.instagram.com/earthxmedia/
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TikTok: https://www.tiktok.com/@earthxmedia
YouTube: https://www.youtube.com/@EarthXMedia
How to watch:
United States:
- Spectrum
- AT&T U-verse (1267)
- DIRECTV (267)
- Philo
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#EarthDay #Environment #Sustainability #EcoFriendly #Conservation #EarthX
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TVTranscript
00:00Welcome to Law and Nature, a program sponsored by EarthX.
00:14And today's program is going to be addressing international environmental issues.
00:20As those of you who work in the environmental field know, it's hard enough to try to navigate
00:25those issues here in the U.S.
00:28And when you add the complexity of language, culture, and different rules all over the
00:32world, you can imagine how much more difficult that is.
00:37And so our experts today are going to try to bring some clarity to those issues and
00:42discuss some of the ways that people can get ahead of any kind of problems.
00:46Our first speaker is Scott Fulton, who is the president of the Environmental Law Institute.
00:52And prior to that, Scott had many years in government.
00:55He was general counsel of the Environmental Protection Agency, and he has been fabulous
01:02in bringing the rule of law across the world and including training judges in other countries
01:11on environmental law basics so that if somebody has some issue in another country, the judiciary
01:18is at least prepared on how to analyze and address those issues.
01:24Our second speaker is Tracey Hester, who is a professor of environmental law at the
01:29University of Houston, has worked so much on climate issues and other just cutting issues.
01:36And Tracey is going to talk about the really practical problems associated with liability
01:43in the U.S. for toxic tort and other environmental violations that occur in other countries.
01:53And then finally, Jim Bruin is going to be our final speaker, and he's going to be talking
01:59about the practical ways that companies can set up systems to anticipate and address environmental
02:07issues in other countries.
02:09Jim was president of the American College of Environmental Lawyers, recognized all over
02:15for his expertise in environmental problem solving.
02:20So Scott, let's turn it over to you.
02:23Thank you, Pam.
02:25Great to be here with EarthX today for this important conversation.
02:29I'm going to try to set a little context for us by talking about some of the broader trends
02:34that are influencing international environmental law and policy.
02:38And let's start with a couple of megatrends that may not have obvious environmental signatures
02:43but are nonetheless to the environmental terrain.
02:47First, technology.
02:49I am at bottom a believer in technology as one of our primary hopes for the future.
02:54There can be a downside to rapid technological advancement, and a case in point is perhaps
03:00what's happening in the information and communication software space and the social media revolution.
03:08Very much in the news at the moment, driven by the recent Senate testimony of Francis Haugen,
03:14a former Facebook product manager turned whistleblower.
03:18The rather grim story emerging from Ms. Haugen and a growing number of other sources describes
03:25a platform that's been used to, among other things, sow cultural division and undermine
03:30democracy.
03:32We're told that Facebook's algorithms tend to promote and amplify sensational content,
03:38such as posts that feature rage, hate, or misinformation.
03:43And as we've learned, when fictions become conviction in the minds of people, trouble
03:49is sure to follow.
03:51And the storming of the United States Capitol on January 6th is a loud and visible case
03:56in point.
03:58But disinformation is playing a broader, more pernicious role.
04:04Conspiracy theories enabled by disinformation are elevating cynicism about government, about
04:10institutions, even about democracy itself.
04:13Momenting openness to autocratic or even fascist alternatives and fueling nationalist
04:20and anti-international zeal.
04:23And of course, social media is but one mechanism through which such misinformation is flowing.
04:30So a big problem, but what does that have to do with the environment?
04:35Well, it's relevant to us because environmental solutions have always depended on societal
04:41consensus for action.
04:45Disinformation can confuse or cloud the public debate, impede consensus, and slow or prevent
04:51response.
04:52And we can see this at work in the context of climate change, a global problem requiring
04:58a global solution, where a denial by some of the overwhelmingly predominant view of
05:05the science has made the world exceedingly slow to act on an issue with potentially existential
05:11implications for humanity and other living creatures.
05:15And we also see that the willingness to overlook the science is making it difficult to even
05:22respond to a pandemic in a coherent and effective way.
05:28So let's talk for a moment about the pandemic.
05:32Does this have an environmental dimension?
05:35I would say yes.
05:36At bottom, it does.
05:39The most likely explanation of the origins of COVID-19 remains that the disease is a
05:45spillover from animals to humans.
05:48Whether the specific cause of that spillover was a laboratory studying an animal-originated
05:54virus or a wet market selling wild animals almost doesn't matter.
06:01Scientists have been warning us for decades about the risks of species-jumping viruses
06:06and the sorts of conditions that can produce this kind of transfer.
06:10And we've had prior undeniable experience with this via SARS, MERS, and the like.
06:16A recent report by the UN Intergovernmental Science Policy Platform on Biodiversity and
06:23Ecosystem Services estimates that there are 1.7 million undiscovered viruses in animals
06:31and that about half of those have the potential to migrate to human beings.
06:36And indeed, 60% of current infectious diseases are zoonotic in origin, and 70% of those come
06:45from wild animals.
06:46So the bottom line here is that stressed and unhealthy animals represent a public health
06:52threat to human beings.
06:54And destruction of animal habitat and migratory patterns contributes to animal stress and
07:00intensifies animal interaction with human beings.
07:05This is a classic expression of the idea that failing to protect nature is failing to protect
07:10ourselves.
07:11Okay, let's move to a few trends with more clearly defined environmental signatures,
07:17starting with the biggest one of all, which is climate change.
07:22The issue is front and center at the time of our taping as the world community is preparing
07:27to gather for the 26th Conference of the Parties, or COP, under the United Nations Framework
07:33Convention on Climate Change in Glasgow, Scotland.
07:37Several of us on this panel will be there to try to contribute to those discussions.
07:42My focus there will be what Pam has already mentioned, which is the importance of the
07:47judiciary and meeting climate objectives and a project that we have underway to equip
07:52judges around the world with education on basic climate science so that they're prepared
07:58for the increasing number of climate-sensitive cases coming before them.
08:03Tracy will have more to say about the role of the courts and his part of the discussion
08:07today.
08:10Today's program will be broadcast after the COP, but I think we can safely forecast what
08:14the COP will yield.
08:17As a backdrop, recall that the 2015 Paris Climate Agreement had the goal of limiting
08:23global warming below 2 degrees Celsius and preferably to 1.5 degrees as compared to pre-industrial
08:31levels.
08:33A country submitted so-called nationally determined contributions, or NDCs, to help achieve that
08:40goal.
08:42The Paris Agreement called for the updating of the NDCs every five years.
08:47So the most important to-dos for the upcoming COP will be discussing what was achieved from
08:53the last round of NDCs, with respect to which I think it's fair to say most of the world
09:00seriously underperformed, and then gathering up and tabulating the updated NDCs.
09:10Updating the NDCs is no trivial undertaking, as climate science has continued to evolve
09:16and inform what is needed.
09:19The Intergovernmental Panel on Climate Change, the science body created by the Framework
09:24Convention, issued its most recent report just this past September, and it is not encouraging.
09:33The report doubles down on the grave and potentially disastrous implications of a 2-degree increase
09:40and points to an accelerated rate of change, finding that the Earth is already on the doorstep
09:47of the 1.5-degree threshold, is already experiencing the consequences of a changing climate, and
09:55will likely reach 1.5 degrees by 2040, our mitigation efforts notwithstanding.
10:02So the goal of this COP will be to try to muster the big emissions cuts needed to help
10:08keep temperature from going past 1.5 degrees over the long haul, and that is a tall order,
10:15as it looks like we are more likely tracking to a 2-degree or higher increase, which would
10:22make for a world inhospitable to life as we know it.
10:28And not just inhospitable for us, but for all living creatures, and maybe a brief word
10:33on another trend line, what's happening with biodiversity, also greatly affected by climate change.
10:42Extinction of species is, of course, a natural process, but the rate of extinction that we
10:48are experiencing today is estimated to be between 1,000 and 10,000 times higher than
10:55the background or expected natural rate of extinction.
11:00And unlike the extinction events before the Industrial Age, the current extinction phenomenon
11:07is one for which a single species, ours, appears to be almost entirely responsible.
11:15And we're at risk of losing up to a million more species in coming decades if we don't
11:21somehow bend the curve on this.
11:25Does it matter to us as humans?
11:28And you bet it does.
11:29The variety of species and their habitats plays a vital role in ecosystem function and
11:36ecosystem services, and those include things like nutrient and water cycling, soil formation
11:43and retention, resistance against invasive species, pollination, local climate regulation,
11:50and pest and pollution control.
11:54So we're in a hard spot with biodiversity loss, and it's getting harder.
12:00You might wonder why are we struggling so in meeting our biodiversity goals, and for
12:04that matter, meeting our climate goals.
12:08That's because of the last alarming trend I will mention, which is inconsistency in
12:15or failure of government systems.
12:19A recent report that our institute did for the United Nations Environment Program, styled
12:26as Environmental Rule of Law, First Global Report, found major rule of law gaps in the
12:33natural resource arena, pointing to a few key and interrelated problems, such as weak
12:41and underfunded institutions, vacillating political will, ineffective enforcement, and
12:48corruption.
12:49A very big problem, and it's hard to muster the intensity of purpose and resources to
12:57fix such a problem.
13:00Recognizing that I'm painting a fairly discouraging picture, let me point to some possible rainbows
13:06on the horizon.
13:09Historically, we've tended to look at environmental problems as government's problem to solve.
13:17Government is thankfully no longer the only game in town.
13:21There is emerging a whole of society approach to these problems that is being greatly assisted
13:27by private sector leadership and some positive contributions by technology.
13:33Jim's going to talk some about private sector leadership initiatives, so I'll be brief on
13:37this.
13:39I just want to observe that the sustainability agenda has strongly taken hold in the business
13:44community, and the drivers for this are no longer signals from government, but rather
13:49demands by consumers, business customers, shareholders, financiers, insurers, and other
13:57risk managers.
14:00Because the levers that attach to these expectations are really about access to markets and access
14:06to capital, which are the life's blood of business, they are quite powerful.
14:12When these initiatives endeavor to not only reduce the environmental footprint of a particular
14:17company, but also drive the behavior of that company's entire supply or value chain, they
14:24have the potential to reach literally around the world and can help compensate for uneven
14:30government performance.
14:32As an example of this, Apple, having reportedly already achieved carbon neutrality in its
14:39own operations, announced just this morning an initiative to achieve carbon neutrality
14:45in its supply chain, or at least a major portion of its supply chain, so-called scope three
14:51emissions by 2030.
14:54And this is not a one-off, but is reflective of the kinds of initiatives that are popping
14:59up all across the business world.
15:01So look for the private sector to be a major and important voice in Glasgow.
15:07The last trend that I will mention takes me back to where I started, which is technology.
15:13But this time I'm talking about emerging technologies that offer environmental promise, so the upside
15:19of technology.
15:21There's a lot that can be talked about here, and indeed we have an entire green tech initiative
15:26at ELI aimed at this.
15:28But let me just focus briefly on what may be the brightest light, which is enhanced
15:34sensing technology, from space to drones to ground level, that is increasingly giving
15:41us near real-time and highly granular data about so many things, from natural resource
15:48exploitation to local air pollution.
15:52So for example, we now have the ability to monitor forests daily from satellites at a
15:57resolution of 16 feet.
16:00That means you can detect from space the removal of an individual tree and observe and apprehend
16:07illegal deforestation as it is unfolding.
16:11This growing sensing capacity promises to change everything, and for the better.
16:17Non-performance and illegal action will no longer need to go undetected.
16:23Add to this the growing capacity of artificial intelligence to digest, synthesize, and make
16:28sense of the large amounts of data that new technologies are generating.
16:33Add to that communication software that can move data narratives quickly into the hands
16:39of those who can do something about them, and not just government, but big supply chain
16:44managers and other stakeholders, and then, well, you have something to feel hopeful about.
16:51So I'm going to wrap up there, as I think you can see.
16:55Just as everything in the natural world is interconnected, so too are the major trends
17:01affecting the natural world.
17:04So back to you, Pam.
17:05Okay.
17:06That was excellent.
17:07Really appreciated your very insightful remarks.
17:10So Tracy, we're now going to turn it over to you.
17:13Thank you, Pam.
17:14As always, it's a great pleasure to be with my friends and colleagues on this panel and
17:18to be participating with EarthX.
17:20I'm going to be talking about a topic that's in between the larger trends that Scott's
17:26identified and some of the specific actions done by private parties that Jim will describe.
17:31I'm going to be talking about the world of transnational liability.
17:37We all know the important role that courts play in determining rights and remedies and
17:43liabilities when environmental harm occurs, but we tend to think of that in two opposite
17:49ends of the spectrum.
17:52International law, where we might have a decision made by an international body, like the International
17:56Court of Justice or the International Arbitral Tribunal, or a national court or a state court
18:03where it's done under that nation's laws by a court under the powers and jurisdiction
18:08of that nation.
18:10But the reality is, most of the major environmental issues we're wrestling with, most of the significant
18:17economic activity we do, has international dimensions.
18:20It spills across borders.
18:22So as a result, we can't think in silos anymore.
18:25It's not a question where we try and answer who's liable and who isn't from the scope
18:31of one board.
18:33We're actually having multiple issues, multiple courts, dealing with oftentimes different
18:39facets of the same issue, all under their own separate rules, and all of which can impact
18:44each other.
18:45So this field is transnational environmental liability, and essentially what happens when
18:51someone from abroad sues you at home, or alternatively, you end up being sued in a way where someone
18:59sues you abroad, but then they bring that judgment to the United States to be enforced.
19:05Both of those have different rules that apply to them that have significant impacts.
19:10So I'm going to be talking about, first of all, that direct liability, where someone
19:14comes to the United States and sues in a U.S. court for liabilities and harms that were
19:20created in their home nations abroad.
19:23This sort of direct liability is possible.
19:27It is premised on the fact that there is nothing in our judicial system in the United States
19:32that bars foreign litigants from taking advantage of our rule of law and our ability to have
19:39courts breach justice if the courts have met certain fundamental jurisdictional requirements.
19:46Now just a small note of clarification, I am not talking about two different smaller
19:52issues that are important, but really talk about different things.
19:56We need to remember that when U.S. citizens go abroad, oftentimes U.S. law still governs
20:02them when they're acting abroad.
20:04So for example, if I'm a U.S. citizen and I throw something over the edge of a boat
20:09into waters, the Ocean Dumping Act may apply to me as a U.S. citizen even if I'm on the
20:14high seas.
20:15That's a totally different set of issues.
20:17At the same time as well, I'm not going to be talking about cross-border spills where
20:22someone emits something or dumps it and it crosses the border into the United States.
20:28That's also a separate set of issues about a harm in the United States that then leads
20:32to the exercise of U.S. law over the border.
20:34I'm talking about something different.
20:37Like for example, an actor goes abroad, does something like mining or energy production
20:43or other type of land reformation as part of a larger construction project and causes
20:48harm abroad.
20:49Now in this context, a direct lawsuit in the United States is possible if those foreign
20:55litigants come to the United States and essentially allege a claim either a U.S. law that applies
21:03to them abroad or alternatively they want to bring a lawsuit under tort or other issues
21:08that could apply to the United States actor.
21:11In that circumstance, the basis for jurisdiction would be what we would call either a federal
21:16question if there's like a federal statute that gives the ability for recovery or alternatively
21:22it could be under what's called diversity jurisdiction where the federal courts can
21:28hear a case if there is what they call diversity between the parties.
21:32They come from different states, they come from different nations and that diversity
21:36gives the court, the federal court, the ability to hear the case.
21:40Now normally that opens the doors for a broad array of cases that can be heard particularly
21:46between citizens of different states within the United States but not so here.
21:51One of the reasons why the U.S. courts have been a difficult forum for people who want
21:56to sue in the United States for harm that occurred in their home is because number one,
22:02that diversity I just talked about only applies if there is a U.S. citizen in the mix.
22:09If you have foreign litigants on the defense and foreign litigants as the plaintiffs, well
22:14that sort of combination of parties is not diversity.
22:18It's not complete diversity and the courts don't have jurisdiction.
22:22So automatically that rules out probably a large swath of the kind of cases we might
22:27see filed in the United States.
22:30But number two, there's a host, there's a gauntlet of procedural challenges that a litigant
22:37would have to get past if they wanted to bring a lawsuit in the United States for harms,
22:41for a cause of action abroad.
22:43Things such as they have to show that there is jurisdiction that the court can exercise
22:49over the parties.
22:50The court can only bring someone before them if they have contacts and there's a constitutional
22:55minimum level of contacts they must have.
22:57They also have to show that the court is the logical place to bring the lawsuit.
23:02There's a doctrine called forum nonconvenience which basically says if the law and the facts
23:09and the witnesses and judicial system that can most appropriately hear a case is the
23:13one that's abroad, the federal court of the United States can decline to take the case
23:19and send it to the other court first.
23:22Oftentimes that's, they may put conditions on that.
23:25They may require that the defendants take certain steps to assure that they are not
23:30playing the system.
23:31But the bottom line is that forum nonconvenience is a powerful barrier to these kinds of direct
23:37lawsuits I'm talking about.
23:40There are other doctrines as well.
23:41Things such as the doctrine of comedy, which is basic, not C-O-M-I-T-Y, which reflects
23:47respect for other judicial systems.
23:50There's a doctrine called active state, which says the judiciary is not going to second
23:54guess the actions of a state within its own borders under its own laws.
24:00If you put all those together, especially with some other doctrines such as political
24:04question doctrine, it is very difficult for foreign litigants to come to the United States
24:10and bring a significant environmental claim for actions that take place abroad.
24:15And as a result, we do have some of those claims that have been filed, but they have
24:19a rather torturous history.
24:22To give an example related to that, there was a lawsuit that was filed dealing with
24:29Costa Rican farm workers who allegedly were harmed by the use of certain types of chemicals
24:35to kill pests.
24:38They filed in the United States.
24:40And that lawsuit was originally challenged in the forum nonconvenience ground.
24:46When that challenge was denied, the state legislature in a court where it was filed
24:51passed a law tightening what the forum nonconvenience standard was.
24:55So you can see it's a very difficult task for someone to try and bring these cases in
25:01the United States.
25:03In addition, there is one small area that's worth noting in that there's a cottage industry
25:08of these lawsuits that is filed under one particular statute called the alien tort claims
25:13act.
25:14This is a longstanding, very short statute passed way back in 1789, which essentially
25:21says that aliens can sue in the United States under the law of nations.
25:26And that simple statement has led to lawsuits claiming that parties who violate international
25:34law abroad can be sued in the United States under the alien tort claims act because international
25:40law applies to their actions.
25:44Now having said that, the Supreme Court has been busily whittling down those cases.
25:52The most recent case is one that involved Nestle that dealt with the use of child labor
25:57abroad.
25:59And the U.S. Supreme Court in an 8-1 decision just this summer basically said that the alien
26:04tort claims act cannot be read to apply extraterritorially outside the United States because Congress
26:11didn't say so clearly.
26:15It leaves very little room for the possibility of future lawsuits.
26:19But stay tuned.
26:20There's still at least a little glimmer of possibility based on U.S. corporations taking
26:26actions that have a significant nexus to things happening in the United States.
26:31So those are direct actions.
26:32The other one are what I'd call the indirect actions, where instead of packing their lawsuits
26:37and coming to the United States and suing a U.S. court, instead, if someone is hurt
26:41abroad, they sue in their home courts, they get a judgment, and then they bring that judgment
26:46to the United States to collect.
26:49Now, the most important thing to keep in mind here is that courts are usually loathe to
26:54try and retry cases that have already been decided.
26:58So as a result, it's not a question of the U.S. court retrying the case.
27:02They basically just check for that foreign judgment meets minimum standards of fair play
27:08and due process.
27:10What are those minimal standards?
27:11Well, basically, as a matter of what we call federal common law, this is not written into
27:16a treaty or into a statute in the United States.
27:19The court's going to look for certain things that we expect to see from a fair judgment,
27:23such as the judicial system provides an impartial tribunal, that there is personal jurisdiction
27:29that was fair to ask the person to appear before that court because they had some contacts
27:33with it, that there's some sort of notice that was given, and there was no fraud that
27:40infected the judgment.
27:42Now, if you meet those standards, the court in the United States doesn't unpack it and
27:47try and figure out whether or not they would agree with it.
27:49They simply enforce it.
27:50Now, given that standard, you would think that it would be attractive for foreign litigants
27:55to sue abroad and then enforce the United States, particularly if there's no assets
27:59abroad and they have to come here because that's where the money is.
28:03Well, one example shows how fraught this process can be.
28:07There was a lawsuit that was brought by indigenous peoples in Ecuador against Chevron as the
28:13successor to Texaco.
28:15They alleged that oil and gas production in the Amazon, with the Ecuadorian government's
28:20participation in the 1950s, caused contamination that was still hurting them today.
28:26And after suing the United States, those direct actions I talked about, they got kicked out
28:31for foreign non-convenience and were told to go back to Ecuador, which they did.
28:35And in the classic case of a Pyrrhic victory, the Ecuadorian lawsuit resulted in a judgment
28:41that was ultimately pegged to be at about $8.65 billion.
28:46So the real story begins after that.
28:50Just like Eva Peron's body, it's some all sorts of peregrinations and twists and turns
28:55after the actual judgment was made.
28:58In this situation, the judgment was attacked in the United States when it was brought before
29:05the Southern District of New York.
29:06And it was found to be infected by fraud.
29:10And it was actually a RICO lawsuit declaring it to be essentially an illegal action.
29:15And the court enjoined the enforcement of that judgment in the United States.
29:20Right now, the lawyer who brought that claim is, as we speak, reporting to be serving a
29:25sentence for contempt, civil contempt, for failing to provide information to the court
29:30as to how that judgment was obtained.
29:33That has led to a constellation of other lawsuits in Canada, and Brazil, and Argentina, and
29:39even Granada, claiming that there was assets that could be used to satisfy the Ecuadorian
29:46judgment.
29:47And all of those actions so far have been rejected by the courts.
29:50So this indirect route, that even if it results in a pretty sizable judgment, doesn't guarantee
29:56you actually can collect on it, despite this reduced standard.
30:01So with that all in mind, what's next?
30:05The biggest issue on the horizon right now is climate litigation.
30:08There are climate tort lawsuits followed in numerous national court systems all over the
30:13world.
30:14And there is a very high likelihood that one of them will ultimately someday result in
30:18the judgment that will be attempted to be collected in the United States.
30:23When that day comes, all these standards we've been talking about will be applied and magnified.
30:29And we can expect to see an enormous battle over the enforcement of that kind of climate
30:34tort foreign judgment.
30:37A couple of predictions.
30:38It will be hard for Congress not to get involved if there is a multi-billion dollar judgment
30:43dealing with climate liability.
30:45And Congress has already gotten involved in some other types of cases.
30:48For example, we have a federal statute that limits the ability to bring defamation judgment
30:55enforcements to the United States, unless they meet our standards.
30:59It wouldn't surprise me to see that there'd be some congressional legislative intervention
31:03to make sure that the judgments collected abroad meet standards we would expect to see
31:07in the United States beyond just the simple ones I've outlined earlier.
31:11The other possibility is that we might see attempts to have preemption brought into play.
31:17Congress can essentially bar the enforcement of these kinds of claims.
31:21And that circumstance targeted with legislation.
31:24And that circumstance, we can expect that Congress might actually just directly foreclose
31:30these kinds of lawsuit judgment enforcement actions in the United States.
31:34But I think really the big picture at the end of the day is there will need to be a
31:39real discussion about whether or not this type of quilt of judgments and collections
31:45results in a set of incentives and policy that we need to try and move the world toward
31:53the direction we have to for climate change response.
31:55Frankly, right now, there's a possibility of it being fairly uncoordinated and mixed
32:00signals.
32:01And we probably need to have some sort of discussion about how to harmonize all these
32:05issues in a more systematic way to achieve a common goal.
32:09So with that in mind, hopefully that sets the framing for Jim to talk about what corporations
32:13are doing while all this transnational litigation is swirling around them.
32:18Thanks so much, Tracy.
32:20You've once again confirmed why I believe you are the leading authority on this subject.
32:25And you did a great job of making the complicated simple.
32:28Okay, Jim, you're going to take it on home as our last speaker.
32:32Hello.
32:33In the next segment of our program, we're going to talk about problem solving.
32:38And in particular, I want to give you a general overview in which I describe the creation,
32:44operation, and continuous improvement of an important approach to reducing multinational
32:50environmental health and safety liabilities.
32:54This approach has been used by Ford, Amazon, Walmart, Apple, and a number of household
33:01names.
33:02In my environmental practice for the last 25 years of my practice, I have been global
33:07product stewardship counsel to a number of household names in the apparel industry and
33:12the consumer products industry.
33:15And I want to tell you, based on that experience, how the companies in those industries solve
33:22one of the major problems of multinational companies.
33:26And that's how to produce a single form of each project that is lawfully sold in each
33:33one of the international markets it deals with.
33:37There are 192 countries in the world, and many of my clients sold or manufactured products
33:44in over 100 of those countries.
33:46So they needed a product standard that would meet the legal requirements, the environmental
33:52health, safety, and corporate responsibility requirements and desires of the company for
34:00each of the markets in which it's sold.
34:03I'm going to talk to you today about the system that Ford, Apple, Walmart, Amazon, Levi Strauss,
34:10and others use, which is based upon a set of specifications.
34:15The specifications themselves are called the restricted substance list.
34:20The list is not the management system, but it's a key part of the management system.
34:26So I'm going to tell you in the time I have allotted to me today, what the system is,
34:30who uses it, how it's enforced, and then I'll show you examples of what the restricted
34:35substance list looks like.
34:39Now with respect to the specifications that we refer to as the restricted substance list,
34:45it is really initially a list built on the bans or limitations of certain chemicals,
34:51which are used either in raw materials, in the manufacturing process, or in the distribution
34:57of those products.
34:59And what we're looking for there in constructing a restricted substance list is to find the
35:04most restrictive requirements in any of the markets in which the product sold by that
35:10company is sold.
35:13And then we turn to the industrial hygienists and we find whether or not those requirements
35:18are sufficient to protect raw material workers, manufacturing workers, and end product users.
35:25If the requirements are not sufficient, we lower the levels of chemicals and other substances
35:31permitted in raw materials and in the finished product.
35:35If we need to improve end user safety, we again lower the limits and ban these substances
35:43if necessary.
35:44And then we can reverse the goals we set for ourselves in air emissions, water emissions,
35:51and solid waste disposal, so that if these bans and limits that are in our graph or substance
35:57list does not meet those goals, we again lower the restrictions and limits.
36:03Well, I say raise restrictions, make the contents of the chemicals lower in each product.
36:11And then finally, these restricted substance lists are used to standardize product labeling
36:18and to enforce recycling of products, which is particularly important now with extended
36:24product responsibility laws being passed in Oregon, Maine, and being considered now in
36:31seven other states in the United States.
36:33These responsibility laws will be a model for international requirements on product
36:38distribution.
36:40And finally, the restrictions in our graph restricted substance list can be modified
36:48to reflect the corporate responsibility goals of our clients.
36:52One such goal as mentioned by Scott today, Apple has set a carbon emission reduction
36:59goal for 2030.
37:01That's the type of thing that can be put in the restricted substance list.
37:06Another example is when Theo Colburn wrote a book in 1996 called Our Stolen Future.
37:14That book was hailed as the most important environmental book written since Rachel Carson
37:20wrote Our Silent Spring.
37:23And in this book, Theo Colburn and her co-authors hypothesized that a number of chemicals were
37:30endocrine disruptors, and that in fact, the men alive in 1996 may be the last males able
37:38to father children on this planet, which led, by the way, the French press to say that may
37:44be true, but that won't apply to French men.
37:49The RSL is enforced through a number of mechanisms.
37:53And this is where the management system comes into play.
37:57It's enforced through rigorous education by the brand name involved of its raw material
38:02suppliers, of its manufacturing facilities, and of the public generally as to what is
38:09being restricted and eliminate in the restricted substance list.
38:14These restrictions are then enforced with contracts, which have penalties in them with
38:19raw material suppliers and manufacturing facilities, so that you can return a lot if it doesn't
38:27meet the specification, or you can cancel a relationship with the raw material supplier
38:33if in fact that supplier does not adhere to the restrictions in the list.
38:39Then of course, you don't trust those contracts entirely.
38:42There are surprise audits of all of the raw material suppliers and manufacturing facilities
38:48that supply materials to your brand.
38:52And beyond that, there is testing.
38:54The suppliers are required to test their products extensively for compliance to the testing,
39:02and then the manufacturer and distributors test the products as well for compliance.
39:07And here's the key to any testing regime, and I say this based on a quarter century
39:12experience in this field.
39:15Tests are meaningless unless the testing standard is specified and the testing lab
39:22is required.
39:23A specific laboratory is required for evaluation purposes.
39:29If different test methods are used, different laboratories are used, the test results really
39:35are basically meaningless.
39:37And then the restricted substance list in all of these companies is evaluated according
39:43to something called the continuous improvement loop.
39:46The continuous improvement loop means that you plan a management system, you execute
39:52it by laying it out in the field, you then evaluate it based on your audits and tests,
39:59and then you revise the plan.
40:01And then you repeat the same loop again and again, so that the system of managing restricted
40:06substances and achieving other environmental health and safety goals is continuously improved.
40:14Let me turn to slide two of my presentation and show you a list of the major companies
40:21that can easily be found in an online search for restricted substance list to show you
40:27who's following this management regime.
40:31And they include in slide two, Apple, Amazon, Walmart, Ikea, Hewlett Packard, Ford, Nike,
40:39Adidas, Lenovo, you get the picture.
40:42This is a system which is proven to be effective over the years and which works because it
40:49is a management system that is enforced the way I have described.
40:55And let me show you a couple of examples of what a restricted list, restricted substance
41:00list looks like.
41:02Let's look at slide three.
41:05This is a list suggested by the Industry Association for Footwear and Apparel, the American Apparel
41:13and Footwear Association as of 2021.
41:18As you can see, with respect to chemical substances, which is only one of the types of things again,
41:24included in this management system, those substances are identified by caste system
41:30so that no matter what market you're in, everyone knows specifically which substance you're
41:36referring to, chemical name, whether the substance is prohibited or limited in either raw materials,
41:46in the manufacturing process, or in the end user process, what the country is that imposes
41:53the greatest restriction in the world, what the test method is, and then I would add what
42:00the laboratory for the test should be.
42:04And then it mentions other countries which regulate the substance, presumably those countries
42:09have less severe restrictions on the use of the substance.
42:15And then let me show you one final example of a restricted substance list, which really
42:21illustrates well, I think, what I'm trying to drive at in terms of the breadth of this
42:27management system.
42:28And that's slide four.
42:31Slide four is a typical restricted substance list used for manufacturing companies.
42:39And in this, if you look across the top at lead, for example, it will show you again
42:45the caste number, the chemical, the threshold limit, then what those limits apply to.
42:51In other words, a company may produce different products for which the limit or ban may be
42:59different.
43:00And this system allows for that difference.
43:03It then gives examples.
43:05And then for each of the various limits applying to each specific process, it shows you the
43:12most restrictive regulation in the world for that.
43:16Look down five lines to the restriction on n-hexane and look to the far right for references
43:22and you will see that the restriction there is company policy.
43:28Now we found this type of policy to be followed in restricted substance lists.
43:34For example, after Theo Coburn's book in 1996, bisphenol A and nonylphenol were substances
43:42that were not highly regulated, but bisphenol A in particular was thought to be an endocrine
43:48disruptor.
43:49So a number of companies added bisphenol A to their restricted substance lists, even
43:55though it was not regulated, because that was the responsible thing to do.
44:00So this is the approach that I would suggest.
44:05I want you to take a look, if you would, at other restricted substance lists, which can
44:12be found in a Google search for that term.
44:15And you will see that there are many different variations to this approach.
44:19The approach is widely applied to not only meet legal restrictions, but with respect
44:25to safety, worker safety and end user safety, but they can be used additionally to meet
44:32environmental requirements for water, air emissions, and they can be used additionally
44:39to meet corporate goals for social responsibility.
44:44And with that, Pam, I turn the program back to you.
44:46Thanks, Jim.
44:48That was terrific and very informative.
44:51And now, if you're ready, we're going to have some questions.
44:55We're not able to tie in an audience, so you're going to have to rely on my questions.
45:01One of the things that I wanted to pose really to all three of you, I was hired years ago
45:07by a multinational company to summarize environmental laws in 17 Latin American countries.
45:15And one of the things that I discovered was that contrary to popular belief, the U.S.
45:20doesn't have the most rigorous of all the environmental statutes in the world.
45:26And that, in fact, a number of those countries had environmental laws and regulations that
45:31were tougher than ours in certain areas.
45:34So my question to you all is, is there any country in particular outside the U.S. that
45:40you think has exemplary environmental laws?
45:44Because again, some countries, as you know, even have environmental protection embedded
45:49in their constitutions, which we don't.
45:52But just in your experience and your world travels, is there some country that you think,
45:58you know, they actually have some ideas that we should incorporate?
46:03Pam, let me start with answering that question if I can.
46:08What we do to find out what the laws are for chemical content, for example, is to hire
46:13an international chemical testing lab.
46:17They track those.
46:18And for non-chemical requirements, we hire a lab like Underwriters Laboratory or Huntington
46:26Laboratory, which will track those comments.
46:29Certainly Switzerland and Germany and the United States, particularly California, have
46:35among the most strict requirements in the world.
46:39But there are lots of traps here.
46:41For example, in the environmental safety, in the health and safety field, the EU requires
46:4842 millimeters between the two prongs of their plugs.
46:53Some Asian countries require 40 millimeters.
46:56And it is a crime to sell a product in Asia, in some countries, that has European plugs
47:03on it, even though they look identical to the casual observer.
47:07So there are both countries that are very safe, like Germany, Switzerland, California
47:11is a state, and then other international laws that are dangerous, that don't appear so on
47:17their face, like the plug law, relating to safety.
47:20Pam, I might also offer a thought too, but then get out of Scott's way, because I'm sure
47:24he has a much more thoughtful response.
47:27I am not really excited about trying to identify other nations that have environmental laws
47:32that might be characterized as better than the United States, but there are certainly
47:35other nations that have taken more creative and aggressive approaches to environmental
47:41law.
47:42And it's interesting to watch what's happening in Colombia, and New Zealand, and other nations,
47:47which have actually tried to invest aspects of the environment with actual personhood
47:54and special rights.
47:56The Philippines also has additional ways to vindicate environmental rights outside of
48:00strictly the judicial process, but still involves a public forum with an opportunity
48:05to produce records that identify needs for additional environmental protection.
48:11The other thing I'll say briefly is that a lot of nations have great environmental laws
48:15in the books, but their enforcement is much more problematic.
48:20And some of the most interesting developments have actually been efforts to ratchet up enforcement,
48:26apart from the environmental laws underlying it.
48:29For example, the new US-Mexico-Canada agreement, the replacement for NAFTA, actually has strengthened
48:36the process to review enforcement of environmental laws among the three nations, and the ability
48:42to challenge the failure to enforce a law that's in their books that might be an unfair
48:47trade advantage.
48:49That is a nice way to basically not try and ratchet up the laws as much as just to make
48:54sure they actually mean something, and that's a great way to go at it.
48:57That's a good point, because in my research, I did find that there were some countries
49:02that had wonderful laws, but they weren't enforced, and so you have to have both.
49:06Scott, did you have anything you wanted to add?
49:09Just a couple of thoughts.
49:10I do think that last point is fundamentally important, and just to brag on the United
49:17States a bit, I think when you look at the coverage of environmental topics across all
49:26of the statutes in the United States, and you add on to that the commitment to rule
49:33of law that has been reflected over time, I don't think there's any question that historically
49:39the United States has been the standard bearer when it comes to environmental protection
49:46and the laws that guarantee that.
49:49I would point some focus in a slightly different direction than what we've described so far,
49:55which is China.
49:58It's worth watching what's happening in China, partly because the Chinese are deeply solicitous
50:06of the experience to date in the environmental protection space.
50:12They spend a lot of time learning from the United States example, but they also have
50:18been visiting with the countries of Europe and some of the others that we've mentioned
50:23here to try to distill from the world experience the best practices and regulatory approaches.
50:34What we're seeing unfold in China in terms of the laws that they're developing are reflective
50:40of that.
50:41I'll also mention that, to their credit, the Chinese government is also solicitous of the
50:47experience of high-performing multinational companies in terms of what works well in their
50:56experience, what a well-designed environmental protection program looks like that is also
51:04manageable on the regulated side of the equation.
51:09We've got a project called the China International Business Dialogue on Environmental Governance
51:15that creates regular dialogue opportunities between high-performing multinationals and
51:22Chinese regulators.
51:25To their credit, again, the government of China takes those thoughts and ideas on board
51:31in the construction of their approach.
51:33What emerges there, I think, will be important for many years to come.
51:38Thanks.
51:40One more question.
51:42There's a lot of confusion and a lot of criticism about the use of the terms carbon neutrality,
51:49net zero, ESG, and among the general public, there is sort of a desire for one standard
51:58or criterion for good performance on the climate side.
52:04Do you find that those terms are used loosely and that a lot of people don't really know
52:10exactly what it means when a company says they're going carbon neutral?
52:16I think for the general public, there is some confusion around the use of these terms.
52:22I think within particular companies, it's reasonably well understood what they're aiming
52:29for and how they're trying to get to what they're aiming for.
52:34It remains to be seen whether ESG or environment, social, and governance as a new framing for
52:42sustainability will allow for better currency with the public.
52:47I'm not sure.
52:48I think in some ways, the notion of sustainability and avoiding the irretrievable commitment
52:54of resources is kind of an elegant notion that is easily confused.
53:01It could be that out of the COP, we'll get some useful new terminology that will help
53:08us understand this kind of crosswalk between carbon neutrality and net zero and that kind
53:16of terminology.
53:17This isn't the first time we've had to wrestle with the ambiguity of terms that consumers
53:25need signaling on.
53:27The long-running fight over what constitutes organic produce and food is not a promising
53:34signal as to whether we'll have clarity anytime soon as to what net zero or neutrality means.
53:41Even if the government does decide to try and set some standards to define what those
53:44terms mean with some regulatory bite behind them.
53:47Pam, let me add one point, which is from the consumer product stewardship perspective,
53:54I've always advised my clients to be very careful using terms like that.
53:58There are several famous cases, including one by a famous fruit company, that's a household
54:04name, where they said that all of their products were grown on environmentally responsible
54:10plantations in Honduras, and an environmental activist group went down there, filmed the
54:17operations, which looked like a moonscape, and then sued the company for consumer fraud.
54:23The ambiguity here actually is something that presents problems for product manufacturers
54:30and distributors if they simply blithely adopt that term and tell consumers that's something
54:37they adhere to.
54:38They have to be careful that it's true.
54:40Well, as you know, there are a lot of cases being brought alleging greenwashing, which
54:45is another term that has suddenly become sort of a rogues fashionable term.
54:52Well, thank you very much for your participation and your thoughts and your insights and helping
54:58us try to figure out how to navigate the difficult waters of international environmental law.