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Companies Wanting To Sell Green Products Must Understand Rules, Voluntary Standards.

Publication Date: 
February 08, 2012
Daily Report for Executives - BNA
Pat Rizzuto

Lecturer Joe W. "Chip" Pitts spoke with Pat Rizzuto of the Daily Report for Executives on the possible consequences of allowing compliance with environmental standards to be voluntary for companies.

Companies that wish to profit from the sales of green products must be familiar not only with myriad regulations and purchasing policies but also with corporate codes of conduct, consumer expectations, international agreements, and other non-regulatory initiatives, two attorneys and other experts said during a Feb. 7 webinar.

“Regulatory compliance is only the starting point,” said Charles L. Franklin, senior counsel with Akin Gump Strauss Hauer & Feld LLP and chairman of the American Bar Association's Pesticide, Chemical Regulation, and Right-to-Know Committee during the Greening of Consumer Products webinar organized by Bloomberg BNA.


Voluntary Norms Can Have Legal Implications

Joe W. “Chip” Pitts, a legal lecturer at Stanford Law School and Oxford University and vice chair of Fairtrade International, which promotes trade justice, said virtually every industry trade association has developed codes of conduct that point to the qualities of desirable or green products. Many corporations and intergovernmental organizations, such as the United Nations and the Organization for Economic Cooperation and Development, have done so as well.

Focusing on the voluntary nature of these norms of behavior would be a mistake, Pitts said.

The norms are often developed with the assistance of governments, unions, environmental, and other parties and take on a “legal character” that must be taken into account, he said.

“Soft law,” meaning nonbinding standards, flow into expectations and enforcement to eventually converge with global, regional, national, and local “hard law,” Pitts said.

For example, compliance with such standards of practice can be taken into account in domestic and international toxic tort claims, Pitts said.