Using Stakeholder Processes in
Environmental DecisionmakingAn Evaluation of Lessons Learned, Key Issues, and Future Challenges
IX. Appendices
APPENDIX 5: CASE STUDIES
Case Study: Release of RMP Information, BASF, Freeport, TX
In August of 1997, BASF Corporation’s Freeport chemical facility began a stakeholder outreach program to evaluate the community’s reaction to the dissemination of its Risk Management Plans (RMPs), including worst- and alternate-case scenarios. The preparation of RMPs is intended to provide the public with additional information on the potential for release of acutely hazardous compounds. Final submission of the RMPs to EPA is required by June 20, 1999, under Clean Air Act regulations issued by the Agency.
The goals of the stakeholder process were to inform the public of the RMP information as well as to present the commitments to environmental, health, and safety by the Brazoria County Petrochemical Council (BCPC), a group of sixteen chemical companies in the area. Through such efforts, BASF and peer companies hoped to build public understanding and trust on its RMP and other issues related to environmental and social responsibility.
Process Design and Management
To gauge initial stakeholder response to BASF Freeport’s worst and alternate-case scenarios and to identify potential community concerns, BASF organized focus groups with three sets of stakeholders, including BASF employees, community advisory panel (CAP) members, and community leadership organizations. Copies of the draft RMPs were submitted, and these stakeholders provided their critiques of the documents.
In addition, BASF participated in a town hall meeting in November 1997 at a local high school to explain and help visualize the worst-case scenarios and other RMP data. Presentations also were given by neighboring chemical facilities. Stakeholders participated in the meeting, which included one-on-one discussions with individual company officials, poster stations explaining the potential risks associated with chemical plant operations, and a presentation of measures to prevent such risks from occurring.
Unique Aspects of the Project
Although many industrial facilities across America will be required to prepare RMPs for public release, most have not yet begun to integrate the community and other stakeholders into their planning process. BASF Freeport determined the community’s sentiment regarding their worst-case scenario information, and identified areas for improvement regarding safety and the environment.
Instead of solely concentrating on the technical issues of RMP preparation, BASF Freeport identified the necessity of community interaction on the issue, and sought stakeholder input in the release of its information.
Outcome of the Stakeholder Process
The BASF Freeport RMP stakeholder communication effort was a success. The absence of a major controversy in the community, as well as the successful town hall meeting, testified to the effectiveness of BASF’s RMP stakeholder planning.
The planning process, which included focus groups, media briefings, and a town hall meeting, established a dialogue with the community. Although the public was concerned about the potential dangers outlined in the RMP, they were reassured by BASF Freeport’s previous environmental, health, and safety performance, which was included in the materials distributed by BASF.
Lessons Learned
Lessons learned from this process include the following:
Early stakeholder participation is instrumental to success. Early involvement is needed to create a dialogue with community stakeholders and to clarify information regarding worst- and alternate-case scenarios and to relay the industry’s commitment to safety and the environment.
The presentation of clear and thorough RMP information can facilitate a common understanding of complex environmental issues throughout the community. The reception of mixed messages may cause the community to question the accuracy of the presented information. To ensure the dissemination of accurate information, it was important for BASF to provide stakeholders with fact sheets on its worst- and alternate-case scenarios and commitments to safety and the community.
Disclosure of information to the public is critical to building community trust. With the presentation of BASF Freeport’s RMP information, many local residents noted that they trusted the company because they felt that they were kept informed of happenings at the facility. This trust helped to dispel many of the fears that might have otherwise accompanied the presentation of the facility’s RMP information.
Public understanding of the context of worst-case scenarios is necessary to diffuse potential confusion or panic. Although the community may receive accurate information of the facility’s worst- and alternate-case scenarios, it is important to inform the community of the likelihood of each scenario.
Case Study: BP America’s Stakeholder Forum
Like other major corporations, BP America’s health, safety, and environmental (HSE) performance is under constant scrutiny by many different kinds of stakeholders. To improve its HSE performance and reputation at the local level, the company established community advisory panels as part of its commitment to the Responsible Careâ program many years ago. Over the past several years, it has sought to integrate stakeholder participation in its HSE and business planning at the regional and corporate levels through a mechanism known as the Stakeholder Forum.
Process Design and Management
The objective of BP America’s Stakeholder Forums is to learn of new ways to address HSE challenges and to communicate the company’s performance in these areas. At the national level, the forum consists of an annual two-day meeting between senior BP executives and leading stakeholders. The latter have typically represented government agencies (e.g., Environmental Protection Agency, Department of Interior), the legislative branch, environmental groups, and non-profit energy and resource management organizations, including the Environmental Defense Fund, Natural Resources Defense Council, and The Nature Conservancy. The meeting format includes general discussion sessions as well as break-out groups focused on specific issues. Stakeholder input has been solicited on business planning assumptions, public policy issues, factors that shape corporate reputation, and an evaluation of HSE performance. BP executives also use the forum as a means to communicate HSE and business commitments, respond to stakeholder inquiries, and report on recommendations received at previous forum sessions.
BP also organizes regional stakeholder forums centered around two of its principal asset locations—Alaska (site of its principal crude oil exploration and production activities) and Ohio (the center of its downstream refining and marketing businesses in the United States). A process similar to that employed for the national forum is utilized with state and local stakeholders (e.g., government agencies, environmental groups, civic and community organizations) who solicit and provide input on important HSE, business, public policy, and reputation issues.
Unique Aspects of the Project
For BP, the stakeholder forum has proven to be a flexible, yet durable, tool for conducting an ongoing dialogue with stakeholders. By designing a process that is tailored to BP’s business culture, the forum is increasingly able to provide senior management and stakeholders with early notification of upcoming issues and developments, build relationships that have led to partnerships on specific issues, and highlight broader reputation issues to executives. Over time, the forum has evolved as a strategic management tool that provides BP with an improved understanding of the environmental, social, and political issues that have an impact on business planning.
Outcome of the Stakeholder Process
The principal success of BP’s stakeholder forum process stems from its role as a catalyst in helping to shape the company’s positions on a range of important issues. These include: global climate change, sustainable development, cleaner fuels, and HSE issues related to exploration and development. In addition, relationships enhanced through the stakeholder forum have, on occasion, evolved into more formal programs as, for example, through the BP-Environmental Defense Fund partnership on emissions trading for greenhouse gases. The forum process also has promoted a greater sense of mutual accountability on HSE and business issues between BP and its principal stakeholders. Stakeholders are now asked to grade BP’s HSE performance. Knowing that they will face each other across the table in the future has helped to promote a greater focus on practical issues where progress can be achieved.
Lessons Learned
At least three lessons have emerged from the BP Stakeholder Forum process. These include:
The forum provides a valuable means for senior management to improve their awareness of HSE/business issues of concern to external organizations. This occurs through the ongoing interaction of management with stakeholders over time as well as resulting from the broader agendas that have evolved over time.
BP has utilized the results from previous forums as an input to differentiate its HSE and business strategy from peer organizations. By seeking stakeholder input on issues related to future business planning, BP has acquired improved information on how to apply HSE issues to support its strategy of business differentiation as well as a better understanding of its reputation and performance relative to its industry peers.
Both BP and stakeholder organizations have an improved understanding of issues that can and cannot lead to agreements. The forum process has enabled both BP and its major stakeholders to become more accountable to each other through a process leading to areas where HSE progress can be achieved.
Case Study: Columbus, Ohio, Priorities ’95 Project
City officials in Columbus, Ohio, created Priorities ’95 to develop an environmental management plan for the community. A two-year comparative risk effort, Priorities ’95 sought to identify and rank environmental risks in the community and to improve environmental decisionmaking. Additional goals were to build trust between the government and the public, build non-traditional environmental partnerships, and educate citizens on local environmental risks.
Process Design and Management
The study was divided into two distinct phases. Phase one included an assessment of the community’s environmental risks, while the second phase included risk management options and the drafting of recommendations.
In designing the stakeholder process, more than 200 community volunteers were subdivided into committees and assigned specific roles, deadlines, and objectives. The committees worked on a consensus basis, and dissenting opinions were noted. The city government played a purely administrative and supportive role in the study. The following is a list of the committees and their responsibilities.
Steering Committee
- Developed mission statement and project philosophy
- Established project scope and parameters
- Made all major policy decisions
- Used input from other committees, selected issues to be studied
- Ranked environmental issues in terms of severity
Technical Advisory Committee (TAC)
- Responsible for scientific data collection and analysis
- Reported findings to the Steering Committee
- Evaluated risks associated with each issue considered
Public Advisory Committee (PAC)
- Orchestrated all public outreach concerning the assessment
- Raised community awareness of the project by promotion of the study
- Requested community feedback and input
Strategic Planning Team
- Developed strategies to reduce negative impacts from environmental issues
- Included some members from state/local environmental agencies
Unique Aspects of the Project
Priorities ’95 was unique in its approach to environmental decisionmaking in several areas. It was the first effort of its kind in Ohio to study a variety of environmental issues within one community, rather than the effects of one risk at a time. Two-way communication was established between the participants in the study and the community at large to identify issues and raise awareness. And although the study was government-funded, the government itself played a modest role in the process.
Outcome of the Stakeholder Process
The overall success of this project occurred on two levels—process and outcome. The study process included evaluating the severity of various environmental risks as well as trust building within the community. Some interim deadlines were missed, but the final report was presented on schedule.
The committee system worked well, with each committee member representing an individual viewpoint rather than that of an affiliated group or organization. The committees were clear on their assigned mission and tasks.
The final report included 260 recommendations on environmental risk management in the Columbus community. Implementation of these recommendations was neither a goal of the study nor a guarantee by the local government.
Lessons Learned
Lessons learned from the study include the following:
Accountability is difficult in a volunteer project. With more than 200 volunteers participating in the study, it was difficult to reach deadlines for various projects. Volunteers did not feel accountable to achieve every deadline, or to attend each meeting.
Two-way communication is an important tool to build community trust, awareness, and interest. Vehicles of two-way communication, such as community forums and surveys, helped the community to better understand the importance of Priorities ’95.
The use of committees is an effective way to organize the management of such a study. By assigning specific roles to committees, goals were met efficiently, without confusion about tasks.
Scientists can perform an important role in environmental stakeholder processes. In this stakeholder process, which involved the health of the community, scientists provided the stakeholders the necessary information with which to make educated and informed decisions about the severity of risks involved with each identified environmental hazard.
Case Study: Health Effects Institute Review of MTBE and Other Oxygenates
The Health Effects Institute (HEI) is a non-profit organization funded principally by the Environmental Protection Agency and U.S. automobile manufacturers to fund health research on automotive-related pollutants. In 1995, HEI was requested by the EPA and the Centers for Disease Control and Prevention to conduct an independent review of scientific information on the health effects of Methyl-Tertiary Butyl Ether (MTBE) and other oxygenated substances added to motor gasoline. The 1990 Clean Air Act Amendments required the refining industry to introduce oxygenated fuels to reduce ambient levels of carbon monoxide in 1992 and mandated the use of reformulated gasoline (which also contains oxygenates) to begin in 1995 for ozone control in selected metropolitan areas.
This widespread use of motor gasoline with oxygenates was followed by an increase in the number of complaints of health effects in the general population in various regions of the United States, including Alaska, New Jersey, North Carolina, and Wisconsin. The most frequently reported symptoms included burning of the nose and throat, dizziness, eye irritation, and headache. Government agencies and private industry responded to these concerns by initiating scientific studies to better understand the health effects associated with exposure to MTBE-containing fuel, the most frequently used oxygenate.
In sponsoring scientific research, HEI has maintained a rigorous peer review process to select investigators to conduct health-related research and to review the quality of their methods and results. However, given the intense public interest and concern related to health issues and oxygenates, HEI supplemented its peer review process with a specially convened set of stakeholders to better integrate scientific and stakeholder issues.
Process Design and Management
To meet the EPA/CDC request to review health risks associated with the use of oxygenated fuels, HEI organized an Oxygenates Evaluation Committee. The Committee consisted of some of the nation’s leading experts in such fields as biochemistry, toxicology, neurobehavior, pathology, epidemiology, exposure assessment, statistics, and carcinogenesis.
The Committee was tasked with the responsibility to evaluate three interrelated issues. These included:
- What are the likely health effects of the use of oxygenates in gasoline?
- How does the use of oxygenates in gasoline affect the health risk from exposure to other evaporative and exhaust emissions from motor vehicles?
- What additional research is needed to determine the potential health effects of oxygenates currently being used or those that may be used in the future?
The Committee held several meetings to review the existing literature on oxygenates and to plan and draft its report.
Complementing the operations of the Oxygenates Evaluation Committee was the establishment of a stakeholder Advisory Committee for the HEI’s Oxygenates Evaluation Project. Stakeholders included state public health and regulatory authorities, federal agency representatives, environmental and industry groups, unions, and other representatives of the scientific community.
Stakeholders were requested to work with the Oxygenates Evaluation Committee in reviewing the scope of HEI’s review, identifying appropriate scientific information and the health significance of such information, and providing an ongoing review of the quality and relevance of the HEI Committee’s report as its work progressed.
Unique Aspects of the Project
Various environmental stakeholder processes have invited the participation of scientists or created a mechanism to provide technical input into stakeholder deliberations. It is relatively rare, however, for scientific organizations to integrate stakeholder perspectives into their planning, data gathering, and report preparation. HEI’s review of the health effects of MTBE and other oxygenates maintained the technical standards of the scientific community, while incorporating the issues and values of concern to stakeholders.
Outcome of the Stakeholder Process
HEI issued a final report evaluating exposure and health effects of oxygenates early in 1996. The report concluded that adding oxygenates to motor gasoline can reduce emissions of carbon monoxide and benzene and thus lower certain risks to the public. However, releases of certain other compounds, such as aldehydes (which are carcinogenic in laboratory animals), are increased through the use of oxygenates.
Stakeholders participating in the HEI process emerged with an improved understanding of the health issues associated with the use of oxygenates in motor gasoline. Because HEI’s review responded to a one-time request from EPA/CDC, there has been no continuing stakeholder participation with HEI on this issue. Concerns of various stakeholders (including public health and industry groups) persist over the continued use of MTBE.
Lessons Learned
Two lessons emerged from the incorporation of a stakeholder process during HEI’s review of health issues associated with the use of MTBE and other oxygenates. They include:
Scientific organizations can integrate stakeholder perspectives into their own operations with no loss in scientific quality. Scientific and other stakeholder perspectives can be integrated so that the value added by each can be incorporated into reports made available to policymakers and the public.
There are benefits to stakeholders from obtaining an improved, easy-to-access, scientific understanding of important public policy issues. Scientific information will continue to play an important role in environmental decisionmaking, and better informed stakeholders will, over time, increase the probability that decisions will be made that are more consistent with scientific understanding.
Case Study: Intel Corporation’s Project XL Agreement
Intel Corporation, a semi-conductor manufacturer, was one of the first corporations in the country to apply for participation in EPA’s Project XL—an effort to consolidate and simplify environmental permit procedures to facilitate the development of "environmentally superior" manufacturing processes and procedures. In November 1995, Intel’s Ocotillo Campus, located in Chandler, Arizona, applied for the project, which was estimated to be conducted over six months.
Requirements of Intel’s participation in Project XL included adhering to all current air quality standards, the inclusion of a stakeholder process to establish environmental goals and requirements, and quarterly reporting on the environmental outcomes of the program.
Intel’s objectives through participation in Project XL were to increase production flexibility and accountability, improve environmental performance, and to involve stakeholders on key issues.
Process Design and Management
The first stage in the process, which lasted approximately eleven months, included the formation of a fifteen-member stakeholder team. One facilitator, with no vested interest in the project, was also a member of the team. The team’s goal was to create Intel’s final environmental agreement before its release to the community for review. The stakeholder team was a decisionmaking body, not solely a sounding board, and great effort was invested in selecting appropriate members. Agreements were made on a consensus basis.
The stakeholder team broke into smaller committees to review sections of Intel’s plan, and attended seminars conducted by government scientists to learn about current air quality standards. The division of the environmental process into smaller issue segments ensured that the team would not be overwhelmed with scientific information.
Local and national stakeholders were given the opportunity to have input into the process on many occasions. During the drafting of the agreement, eight highly publicized public meetings and more than 100 meetings of the stakeholder team were held to review Intel’s agreement and solicit the community’s input. Drafts of the agreement also were posted on the Internet to ensure widespread distribution. The EPA also reviewed drafts and materials provided by the team.
Unique Aspects of the Project
In addition to posting drafts of the report on the Internet, Intel used advertisements to encourage public participation and input in the Project XL process. Unlike a traditional community advisory panel (CAP), Intel’s stakeholder team was a decisionmaking body and had input in the project’s planning process.
Outcome of the Stakeholder Process
A final agreement was produced by Intel and its stakeholder team, incorporating the community’s interests. The agreement should help the Ocotillo facility to improve its environmental performance and enhance public understanding.
Intel’s environmental reporting was consolidated, and quarterly stakeholder meetings are held prior to the posting of quarterly reports. The reports mostly consists of easy-to-understand charts and graphs, as requested by the community.
Trust and accountability were increased, and the project is often used as a case study by other companies.
Lessons Learned
Information technology is a valuable asset in managing stakeholder processes. Intel’s use of the Internet proved to be a highly effective way of engaging local as well as national stakeholders in the XL process for its facility. Continuous reporting on the plant’s environmental performance posted on Intel’s Web site also creates a valuable mechanism to improve its reputation with stakeholders by increasing transparency.
Stakeholder processes of this magnitude are time consuming. Although the stakeholder team met more than 100 times, most meetings lasted in excess of three hours. The goal was to involve as many stakeholders as possible, but members conceded that it was time consuming to become technically conversant on various air quality control issues.
There is difficulty with defining the goal of "superior environmental performance." Although the process was successful in obtaining a signed EPA agreement for Intel, certain national environmental groups, such as the Natural Resources Defense Council (NRDC) and The Campaign for Responsible Technology, objected because of their concern that results would not achieve "superior environmental performance."
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