Voluntary Environmental Programs: A Comparative Perspective

Voluntary environmental programs (VEPs) are institutions for inducing firms to produce environmental goods beyond legal requirements. A comparative perspective on VEPs shows how incentives to sponsor and participate in VEPs vary across countries in ways that reveal their potential and limitations. Our brief survey examines conditions under which VEPs emerge, attract participants, and improve participants’ environmental performance. We focus on the costs and benefits for actors seeking to supply (or sponsor) these governance mechanisms as well as the costs and benefits for firms who are considering joining VEPs and adhering to their program obligations.