Governing Through Markets

Benjamin Cashore

Deanna Newsom

Graeme Auld

The Transformation of Global Environmental Governance

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Review - Journal of Environmental Planning and Management

Students of public policy were blindsided in the 1990s by the widespread use of private authority as a means to address global environmental deterioration and social concerns. This book explores the emergence of a startling new institutional design within these broad trends: non-state market driven "certification" governance systems that gain their policy making authority not from the state, but from the market's supply chain. From forestry to fisheries to coffee to food production to mining, and even tourism, non-governmental organizations have developed governance structures and standards designed to permit environmental and social "certification" of goods and services. Can these new initiatives address key policy problems in ways that traditional public policy processes have been unable?

This book addresses this questions through the case of forest certification, which emerged in the 1990s following strong criticism of international and domestic public policy efforts to reverse ecological deterioration of the world's forests. The book compares the politics behind forest certification in British Columbia, Canada, the United States, Sweden, the United Kingdom and Germany, as the environmental group backed Forest Stewardship Council (FSC) certification program competed with industry and landowner initiated programs for rule-making authority. Investigating this competition, the book argues, is important for understanding whether non-state market driven governance systems will result in increased standards vis-à-vis existing public policy approaches.

Key Findings

Two key findings emerge from this book. The first is that the place of a region or country in the global economy, the structure of the domestic sector, and the nature of traditional public policy approaches, strongly affect whether environmental groups are successful in their efforts to convince industrial companies and private forest owners to support the FSC. Second, certification programs initiated by forest company and forest owner associations as an alternative to the FSC have changed (upward) their programs in response to this competition, while the FSC has changed their program to be more palatable to business. Determining whether these new systems can address matters of concern to civil society in ways that global governance and domestic governments are unable means carefully analyzing the dynamic nature of this competition, and the ultimate form and function of these new systems.

Forest Certification and a Sustainable Future

The book concludes by noting that what is clear is that, measured by an array of indicators, the world’s forests are under stress. They are home to an increasing number of threatened and endangered species (in both developed and developing countries), the number of intact watersheds is diminishing, natural forests are disappearing, and forest ecosystem structure and function are under considerable threat. The choices that are made in addressing these important problems in the next decades will say much about our generation’s determination to systematically and thoughtfully address environmental destruction. The ability of forest certification to be a part of this solution is a question that needs to be carefully researched and analyzed, so that those in a position to make strategic choices in this regard are able to make the most well-informed and environmentally sensitive choices. It was, after all, for this reason that Hubert Kwisthout [an originator of the forest certification idea] first became concerned and why he developed an idea that has transformed the world of global environmental governance.