Environmental Accounting. Factory pollution and Fishermen.

Imagine a factory located upstream that pollutes a river. It produces steel for the automotive industry. Downstream, local fishermen find they catch less fishes due to the pollution.

Both are flourishing businesses that produce wealth and prosperity for the community. But there is a problem environmental economists must deal with: 1. Can you suggest any criteria that could be used to decide on who has the right to use the river?  The factory, the fishermen, both? 2. Can you propose any instrument or agreement to solve the problem?

The July 28 of 2010, the United Nation General Assembly approved a resolution that recognizes the drinking water as a “basic human right”. However, although the problem proposed is not about drinking water, in my view, everyone has the right to use a resorce.

The river is a resource that both (the factory and the fishermens) can use as long as they use it bearing in mind the sustainability requirements. Therefore, in this case the factory loses its status of “user” because of it is changing the ecosystem in a non-sustainable manner, polluting, killing fishes and consequently avoiding the fishing. From my point of view, both may use the river but solely in a sustainable manner, without altering the system and thinking about the future generations.

In this case, because of the use of the river by the factory is to pollute and also the river is not able to assimilate this pollution, it does not make sense that the factory has the right to use the river. The “property to use a resource has to be linked to a “proper” use.

Regarding to the second question, and taking into account that sometimes the environmental and social cost sometimes is incalculable, I would propose the following solution:

1. Remove the contamination. The first point would be to remove immediately the contamination focus.
2. Economic and Social Analysis. In parallel, an expert (such as a consultant/ researcher) should calculate the economic and social impact during the days that the fishermen cannot catch enough fishes. The economic analysis is relatively easy while the social impact, in this case, could be included as an economical impact.
3. Environmental Analysis. Once the contamination focus has been removed, and in parallel to the economic and social analysis, I would propose to carry out a project in order to evaluate the current status of the river. I will analyse the different necessary actions and the estimated time until the fish population was similar to the previous situation (or at least, a stable that allows a controlled and stable fishing).
4. Payment. After the Economic, Social and Environmental Analysis, I would force the factory to pay for each day that the fishermen cannot catch enough fishes (multiplying the economic analysis with the necessary time to recover the ecosystem)
5. Regulation. Finally, once the fish population has been stabilized and based on the Environmental Studies, I would set an emissions limit and pollutants that allow the sustainable exploitation of the river. Furthermore, if the company exceeds these emissions/contaminatin limits, it could face to criminal sanction due to its liabiloty. Thus, forecasting future impacts and problems, and taking advantage of existing studies developed, I will apply a captures limit to avoid a future possible overfishing.

To sum it up, both sides are entitled to use the resource as long as they have as a common goal the sustainability; it is considering not only the economic factor, but also the social and environmental factors. However, a doubt arises; Is it possible that the cost of theses studies are not payed by all the taxpayers? Maybe…

Comments Off on Environmental Accounting. Factory pollution and Fishermen. / 01 Dec 2011 por Carlos Cerdan Infantes
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