Environmental Engineering Reference
In-Depth Information
under standards developed by the accounting
industry and securities disclosure standards of
the Securities and Exchange Commission (SEC)
in the U.S. (ASC Topic 410(20) 2009). Financial
disclosure standards are undergoing harmoniza-
tion as of this writing.
The second type of standardization affecting
environmental markets are rules for the emissions
trading markets that clear pollution permits under
various programs such as “cap and trade” or al-
lowance auctions. Emissions markets set standards
similar to those organizing other markets. Market
structure standards assure efficient and fair opera-
tions, including: standardized nomenclature and
instruments or units of trade (e.g., removal unit
(RMU), emission reduction unit (EMU), certified
emissions reduction (CER)), professionalism
standards for trading representatives, standardized
clearance and transaction reporting, monitoring/
audit standards for measuring, reporting and
verification of compliance and emissions market
liquidity standards that reassure commitment fea-
sibility. While there has been considerable public
policy debate and conceptual research into devel-
oping these market mechanisms, these remain
nascent markets with much unfulfilled promise.
Nevertheless, as emissions market standards are
deployed, these markets will increase transactions,
verify results and may contribute to meaningful
emissions reductions.
inevitably and mechanically produced from em-
pirical findings that define the domains of natural
sciences and engineering. Increasingly, however,
standardization is understood to have substantial
impact on functional and economic success. Many
standards are produced by coordinated collective
activity that represents collaborative processes
infused with technical design but carried out
largely by self-selected groups whose foresight
is intended to serve their own self-interests.
Successful participation in SDA usually requires
considerable resource investments because SDA
can be protracted and a frustrating political pro-
cesses. Useful contributions by most modern SDA
participants depend on their technical analytical
acumen as well as their strategic savvy. The
standards developed in modern SDA often confer
economic benefits on many direct participants
but can also burden others, particularly those not
directly engaged in the SDA.
Traditional de jure standardization by gov-
ernment agencies have been presumed to make
objective and optimal selections from existing
technologies. Such traditional standards-setting
processes are increasingly displaced by SDA
because nontrivial design components infuse
modern technical standards. For example, SDA
generally involves at least some highly-active
participants who assume aggressively identifi-
able profiles (avatars) because they propose
particular solutions largely crafted outside the
SDA (Umapathy, et, al. 2010). Other, less active
participants are typically engaged in proposing
modifications, accepting, adopting, and standard-
izing this proposed solution as a new design.
Standards with a substantial design component
are known as anticipatory standards because they
anticipate markets for compliant products (Cargill
1989). Compare this development of voluntary
consensus standards with the innovation leading
to de facto standards. De facto standards are also
infused with design but are developed by one or
more independent private contributors, often in
PUBLIC PARTICIPATION,
INTELLECTUAL PROPERTY &
ANTITRUST ASPECTS OF SDA
Standardization is a political process infusing
design with public policy similar to the constraints
imposed by law and regulations (Lessig 1999).
A significant naive belief persists that standards
development activities (SDA) have minimal public
policy impact. This belief is based on the incor-
rect premise that standards are nothing more than
