How much industry self-regulation is too much?

The Environmental Law Centre at the University of Victoria, British Columbia, has recently published a report entitled Professional Reliance and Environmental Regulation in British Columbia. The ELC is a non-profit society that operates an environmental law clinic at the Faculty of Law. While the extensive report is focussed on BC government environmental activities it contains a number of insights that are worth broader consideration. Among these:

Much of BC’s deregulation goes too far in handing over what are essentially matters of public interest to those employed by industry.

  • Just over a decade ago the government adopted a goal of cutting or deregulating one-third of the regulations, coupled with an equivalent reduction in the size of the public service. Natural resource management and environmental protection laws and agencies were a prime focus for this initiative as government believed resource companies were significantly over-regulated.
  • Since then there has been negligible effort by government to assess the effectiveness of the current professional reliance regimes, or resolve to address known problems identified by the Auditor General, Ombudsperson, Forest Practices Board and others.
  • The approach to professional reliance is variable across regulatory regimes. Therefore, it would not be credible to make a blanket statement that “professional reliance is a success” or “professional reliance is a failure.”

The report proposes a set of ten criteria for regulatory “best practices” needed to maintain public confidence in resource management and environmental protection. These include:

  1. Clarity on who is qualified to perform professional reliance functions
  2. Clarity on professional functions, responsibilities and objectives
  3. Role reserved for government
  4. Formal procedures and clear rules for certification
  5. Conflict of interest, self-interest and independence
  6. Record keeping, disclosure and transparency
  7. Civil liability, insurance & bonding
  8. Duty to report non-compliance
  9. Auditing and reviews of professional work product
  10. Monitoring, compliance and enforcement

The report also proposes a series of threshold tests to determine whether it is appropriate for government to devolve responsibility for activities which have significant environmental impact:

  • Environmental, Health and Safety Risks: Government should regulate activity that poses a moderate to high degree of risk to the environment and public health.
  • Risk to Third Party Interests: In some cases the degree of risk to private property rights (e.g. pipelines on farm land), rights acquired through other Crown tenures (water licences, woodlot licences, commercial recreation tenures, etc.) and Aboriginal rights and title, and power imbalances in the ability of those third parties to defend them legally, argue for a role for government maintaining a greater degree of approval authority.
  • Decisions Involving Trade-offs: Many activities in the natural resource sector involve trade-offs between proponent interests and public interests in fish, wildlife, water, air, soil, scenic viewscapes, outdoor recreation, and more. Practices-type regulations cannot always effectively anticipate or address all of these issues. It is inappropriate to delegate decision making over trade-offs to private interests, unless the issues are minor and the activity poses low risk to these public interests.
  • Values versus Technical Expertise: Matters that are essentially about the values society places on a given resource that will be impacted by the activity or decision are problematic for single discipline oriented professionals. For example, it is one thing for a forester to prescribe seedling and stocking standards in a relatively uniform lodgepole pine stand without species at risk, and quite another to prescribe a harvesting system in a complex old growth forest that provides habitat for species at risk. The latter crosses over into issues requiring wildlife habitat expertise, and is not simply a technical issue squarely within a forester’s training.
  • Latitude for Discretion: In situations with broad latitude for discretion there is considerable merit in retaining the expertise resident within government agencies, and incorporating public input into decision making.
  • Scientific Certainty: There is a big difference between the engineering and biology advice required to construct a bridge or fish stream crossing, and the biological advice required to predict and evaluate broader ecosystem and wildlife impacts.
  • Conflicts of Interest: When government delegates decision making to professionals who are retained or employed by proponents, it introduces a risk of biased decisions.
  • Essential Government Functions: Some matters are essential government functions and should never be delegated to independent professionals employed by proponents. One example is compliance and enforcement.
  • Alternatives to Professional Reliance: Inherent in the notion of professional reliance is the need or desire to rely on a person with expert qualifications for matters that require discretionary judgment. However, in the natural resources sector there are many activities that have reasonably well known impacts that can be regulated in other ways, such as through international engineering standards or other industrial practice standards, sometimes known as Codes of Practice.

The full 155 page report can be found at http://www.elc.uvic.ca/documents/Professional-Reliance-and-Environmental-Regulation-in-BC_2015Feb9.pdf

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