Friday, April 22nd will be Earth Day 2022 in the United States and around the globe. Earth Day 2022’s theme is Invest in Our Planet. It also focuses on Environmental, Social, and Governance (ESG), which is an important metric to evaluate activities that could have an impact on human health and the environment. In this article, we will review Earth Day’s 50-year-old history and the progress made in addressing environmental concerns in the United States. In the second article we will discuss the history of Earth Day and the current status of various efforts at standardizing the measurement of ESG issues. The final article will give practical guidance on how to create or refine an ESG program.
At the first Earth Day, 1970, there wasn’t an Environmental Protection Agency (the EPA became a federal agency by executive order in December 1970). There was also no Clean Air Act (also December 1970). Many of the environmental regulatory programs administered by EPA (and other federal agency) today can be traced back to the original Earth Day and a growing awareness about environmental issues that could impact human health and the environment. The Clean Water Act, Endangered Species Act, Safe Drinking Water Act, Toxic Substances Control Act, and the Toxic Substances Control Act, respectively, as well as the Resource Conservation and Recovery Act and the Comprehensive Environmental Response, Compensation and Liability Act or Superfund, are all command and control programs that attempted to address environmental pollution problems by regulating or mandating specific actions.
Although none of these federal laws has achieved all of their goals, they have each worked in a different way to improve the environment and prevent any harm to the environment or human health. They also have the ability to hold those responsible to clean up after polluting the environment or pay the cleanup costs. The Clean Water Act, for example, had one goal: to make all waters swimmable and fishable. This goal has yet not been met, but the number of waters that don’t allow swimming or fishing is on the decline. Even if the goal is not reached, the Clean Water Act had a significant impact both on the quality of waterways and the way that domestic and industrial wastewater are controlled in the United States.
Many times, shortcomings in initial environmental programs were discovered and new programs were developed or refined. The history of TSCA is a good example of this. At the time TSCA was adopted in 1976, it was decided that most existing chemicals would be grandfathered under TSCA’s regulatory structure. In June 2016, the Frank R. Lautenberg Chemical Safety for the 21stCentury Act (Lautenberg Chemical Safety Act), significantly amended TSCA, and provided a way to evaluate chemicals that were grandfathered.
After addressing some of the obvious environmental issues with air, water and soil pollution, EPA, along with other environmental agencies, emphasized pollution prevention programs programs that eliminate or reduce pollution at source. EPA established programs to prohibit or limit certain activities. In federal programs, environmental programs were also adapted to address persistent issues even after certain practices had been controlled or eliminated by environmental laws and regulations.
As we’ll see next week, many of the metrics used to evaluate ESG performance in companies have been influenced by the evolution, adaptation, and progression of environmental laws and regulations.
