GLOBAL BUSINESS: Operating in the Green

Article excerpt

For years, the Halliburton Company followed local standards in its management of Brazil's state-owned oil company in Catu. This meant discharging stormwater runoff and wastewater effluents directly into the Catu River, untreated. Then, in 1994, the Dallas, Texas-based energy and engineering company initiated new company-wide environmental standards. In Catu, that meant an effort to reduce the pollution going into the river. The company engaged its 70 local employees in a project to identify elements of the waste stream and then find ways to reduce waste and properly treat and dispose of the remainder. The result was the construction of a water treatment facility that treats 100% of the water it releases into the river. But that was only the start.

The waste stream study also identified the need for a sanitary landfill, not only for Halliburton, but for the entire community. Then, after the landfill opened in 1996, the company and community saw the need to better manage the stream of landfill waste. So Halliburton began an educational program for city employees that led to a citywide waste reduction and recycling program. In addition, the city of Catu has begun to sell recyclable materials from the landfill to purchase food for the city's poor. By 1999, more than 15 tons of food had been purchased.

The story of Halliburton and Catu is one of 12 case studies discussed in the 1999 report Fostering Environmental Prosperity, published by the Global Environmental Management Initiative (GEMI), a nonprofit organization of major global companies who contend that good environmental practices and good business practices go hand-in-hand--even when doing business in a developing country with low environmental standards.

In its efforts to adopt environmentally friendly (or, at least, friendlier) environmental management standards company-wide, Halliburton was following a broad corporate trend that many believe can date its inception to 3 December 1984, the day a Union Carbide storage tank in Bhopal, India, burst open and sent a cloud of poisonous methyl isocyanate gas out into the community, killing by some estimates as many as 6,000 people within a week and some 13,000 to date. Subsequent highly publicized accounts of developed countries shipping hazardous waste to poor nations further focused world attention on the environmental dangers facing developing countries in an increasingly globalized industrial economy. Over the intervening years, the environmental costs that developing countries bear in the new world economy have been addressed by a series of conventions, treaties, and protocols--with mixed results.

The Charge against Globalism

The complaint against global development is largely that corporations, driven by profit and reluctant to pay for expensive pollution-control technologies, seek to do business in developing countries where environmental regulations are more lax. As Hilary French, vice president for research at the Worldwatch Institute, reports in her new book, Vanishing Borders: Protecting the Planet in the Age of Globalization, this complaint may be quite valid. According to French, one notoriously polluted region of Mexico that is home to some 3,200 mostly foreign-owned manufacturing plants is an "environmental disaster zone" where more than one-fourth of the factory operators freely admit that Mexico's lax environmental laws are the reason they operate there.

Some toxic and ozone-damaging substances have been banned internationally, but rules of industrial operation have remained primarily local matters. French reports that despite the environmental side agreement that accompanied the North American Free Trade Agreement, more U.S. companies have flocked to Mexico and environmental conditions have not improved. To these mostly smaller companies, the advantages of lower environmental costs in developing countries are significant, and thus represent one of globalization's palpable dangers. …