• Regulatory environment

Who could oppose better regulation?

Well, probably no one.

So, what could possibly be the reason for six prominent persons, myself and an audience to spend a rainy Thursday afternoon addressing this topic?

Let’s put the blame at the European Commission’s feet.

The European Commission’s recently drafted Better Regulation agenda sets a framework for a policy making process which is supposed to deliver evidence-based, transparent and adequate regulations, while ensuring that the views of those affected are taken into account.

It sounds good, right? According to our roundtable participants in Huhtamaki’s Think Circle event this is not always the case, though.

Having spent 10 years of my life as a politician in the Swedish national parliament I know how difficult this is in practice.

I had the privilege to moderate this discussion in which our panel participants managed to illustrate the problems today and give ideas for tomorrow.

So, let me lead you through some of the topics we discussed.

First, let me clarify that everyone agreed on the ambition of the EU Green Deal and the climate targets. Any differences in opinions were related to how to get there and how to ensure that regulations bring about the transition in the best way.

What is the objective of regulations?

Patrick ten Brink from the European Environmental Bureau supports a think-sustainability-first principle, meaning that a regulation should be devised mainly to reach the sustainability targets.

Lorenzo Allio, representing the European Regulation and Innovation Forum, and Alexandre Affre from Business Europe stress the need for innovation. All regulation should be assessed by how well it gives incentives to innovation. Thomasine Kamerling from Huhtamaki also emphasizes that regulations need to empower a positive change within the industry.

Even if these two different objectives might not necessarily be in total opposition, it is nonetheless an interesting disparity in focus which might sometimes result in conflict.

Personally, I believe that this is often the reason we disagree in politics. Sometimes we have different objectives and focus areas.

Bans vs incentives

In this context it is also interesting to examine the question of bans versus incentives.

All our participants agree that bans can be necessary, and even sometimes work as an incentive to change. In the view of Henna Virkkunen, member of the European Parliament for EPP, though, any ban should be considered very carefully, and enough time must be allowed for the industry to adapt.

With a sustainability-first principle the issue of “enough” time might be seen in a different light.

Scheduling and timelines

Connected to “enough time” is the issue of scheduling and timelines in policy making.

Sometimes planned initiatives or guidelines on how to implement them are delayed. This creates a lot of uncertainty for all stakeholders affected by the regulation. To complicate things further, one initiative is often dependent on another, and if one is delayed it might cause an avalanche of problems.

Fatma Sahin from Unilever has seen several examples where initiatives are not coordinated, guidelines are published late, or the value chain perspective is lacking. “When decision-makers craft legislation, every part of the value chain must work together if there are to be regulations that work for everyone.”

Fatma wants a more holistic approach, where different Commission departments work together to align policies in different areas and thus support the whole value chain in the same direction at the same time.

As a former politician I couldn’t agree more. The silos within our societal structures are a constant obstacle.

Evidence-based policy making

Policy makers need scientific evidence, impact assessments and facts on the table. There is no doubt about that.

Evidence-based policy making is easier said than done, though. Patrick ten Brink emphasizes the problem of short-term economic focus on impact assessments, while several others point out that unintended consequences are not enough taken into account. The benefits of Life Cycle Thinking were mentioned more than once as the right way to go to achieve the best overall outcomes, with Huhtamaki in particular arguing its value as a baseline for all regulation.

The processes of gaining knowledge might be well defined, with expert groups, public consultation, and impact assessments. In reality, though, there might be sudden changes which are not evaluated, politicians need to consider expectations from their electorate and, not least, there are facts and facts.

In my opinion the issue of evidence-based policy making is the most interesting, the most important AND the most difficult.

Depending on if you look at a regulation from an environmental, social or economic perspective you will focus on different sets of facts. It could negatively impact the economy, save lives, and cause unemployment at the same time. The same regulation could be good for one industry and bad for another. Moreover, if you assess short term or long term consequences you will often come to different conclusions.

Conclusion

In the end, even if you would have all facts on the table in all relevant areas - you would probably still end up having different opinions. That’s democracy. People have different opinions, priorities, values, objectives and preferences.

So, if they’ll disagree anyway, what’s the point of Better Regulation?

Well, the long-term respect for democracy depends on it.

Having good, transparent policy making processes where stakeholders can give input is crucial if we want citizens and different sectors to feel confident that policy making is based on knowledge, understand what trade-offs have been done and what ideological preferences have been applied.

Without it, trust in institutions and policy making erodes.

There is undoubtedly room for improvement and this round table pinpoints the challenges today and gives input on how to improve for the future.