Canadian economy is facing “significant economic repercussions” by neglecting green practices: panel
OTTAWA-Canadian businesses are facing “significant economic repercussions” that will affect the country’s growth and international competitiveness because of inadequate policies to ensure environmental stewardship through the lifespan of products, says a new report released Wednesday by a doomed federal advisory panel.
The research by the National Round Table on the Environment and the Economy was requested last year by Environment Minister Peter Kent and included multiple consultations with officials from government, businesses and academics to research the emerging issues.
The report, entitled Canada’s Opportunity: Adopting Life Cycle Approaches for Sustainable Development, noted that foreign governments have already started to introduce regulations that set minimum environmental standards on products such as requiring fuels to have a cleaner environmental footprint, restricting the trade and market access of Canadian companies.
“The risk that Canadian companies are not prepared for existing and future foreign government regulations that require Life Cycle Approaches has significant economic repercussions,” said the report, led by policy adviser Hilary Davies from the round table.
“Businesses can lose part or all of their access to export markets, face fines or penalties for not complying with the regulations, or suffer damage to brand recognition.”
David McLaughlin, the president and CEO of the 24-year-old advisory panel, noted that some companies and brands, such as Canadian Tire, have already introduced new policies to consider the life cycle costs of products and packaging that have actually allowed it to avoid some energy consumption and save about $6 million annually.
He also gave credit to Kent for asking the round table to address questions about the risks and opportunities surrounding taking a “life cycle approach” to economic and environmental policies.
The government announced in its last budget that it is shutting down the round table, that has a staff of about 30 people and receives $5 million in annual federal funding, because Kent explained it could get some research and policy advice from the Internet and other non-government sources of information.
McLaughlin explained that the findings from the latest report emerged because the panel convened several meetings with affected stakeholders and business executives who were openly discussing the issue for the first time and expressing some growing concerns about the issue.
“It surprised us that there was that much concern,” McLaughlin said in an interview. “It was under the table a bit. It hadn’t been brought up because nobody asked about it before.”
McLaughlin and Davies also said that the approach reflects consumer demand for greener products that a company must address in order to protect its reputation.
By failing to adopt life cycle approaches in Canada, the report suggested that companies, such as Canadian oilsands producers, would be at risk from emerging foreign policies in the United States and Europe to lower greenhouse gas emissions from transportation fuels.
It said the risks also plague other sectors such as aeropace, electronics, and building and construction.
“Canada risks serious harm to its national economic interests by not proactively developing frameworks nor engaging in initiatives related to Life Cycle Approaches domestically and globally,” said the report.
It also warned that forcing companies to comply with regulations requiring a life cycle approach to their operations in a short time frame would require “larger and more immediate investments” to either respond or “risk losing market share.”
“This risk is real and Canada must act now to maintain its competitiveness,” said the report.
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