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Articles

Transition to greener pulp: regulation, industry responses and path dependency

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Pages 862-884 | Published online: 23 Mar 2015
 

Abstract

Although the dioxin alarm broke at the same time in Sweden and the US in the mid-1980s, Swedish pulp and paper (P&P) firms led the way towards the new market for low-chlorine and chlorine-free P&P products. This study explores the transition in the Swedish P&P industry and contrasts the Swedish case to the US experience. We highlight the importance of already established technological paths to deal with pollution, paths which were strongly formed by the different national environmental policies since the 1970s. Thus while US P&P firms were technologically locked-in when the dioxin alarm broke, the strategy of Swedish P&P firms to proactively collaborate in environmental research and development (R&D) together with a national policy that favoured process integrated abatement technology, helped Swedish firms take technological leadership. This article particularly stresses the implications of technological path-dependency and different national regulatory styles in understanding the evolution of different modes of corporate environmental strategies.

Acknowledgements

The authors would like to thank the anonymous referees for their comments, which have been improving the manuscript considerably. We would also like to thank the participants of a session at the European Business History Association Conference in Uppsala, 22–24 August 2013 for valuable and inspiring comments.

Notes

This work was supported by the Swedish Environmental Protection Agency [2226-13]; Riksbankens Jubileumsfond (The Swedish Foundation for Humanities and Social Sciences) [P10-0997:1]; and Ragnar Söderberg foundation (nr. E27/10).

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5. Norberg-Bohm and Rossi, “The Power.”

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13. Mikler, Greening, 26, 113.

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15. Mikler, Greening, 37.

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18. Hellgren and Melin, “Business Systems”, suggests that the Swedish P&P industry forms a nation based business system with rather specific characteristics: (1) a high international dependence and export orientation; (2) a domestic pattern of production plants; (3) ‘stick to the knitting’ and product specialisation; (4) powerful owners with a long term interest of the industry; (5) autocratic authority structures within authority structures within firms; (6) collaboration between domestic firms; and (7) vertically integrated firms (from raw material to refined products).

19. CitationMelander, “Industrial Wisdom”, 289.

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26. CitationMagnusson, Sveriges ekonomiska historia.

27. Mikler, Greening; Wallace, Environmental Policy. For Sweden, see CitationLundqvist, The Hare.

28. Ibid.

29. CitationArthur, “Competing Technologies”; CitationRosenberg, Exploring the Black Box.

30. For an overview of Sweden, see e.g. Hellgren and Melin, “Business Systems”; CitationJärvinen, Ojala, Melander, and Lamberg, “The Evolution.”

31. CitationFahlström, “Några drag.”

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34. Skogsstatistisk Årsbok Citation1986, Table 15.9.

35. Skogstatistisk Årsbok Citation1989, Foregin trade, Table 10.3, 149, 176.

36. CitationKonrad, Ecologically Sound Production?, 49.

37. Rennel, Långsiktigt Värdeskapande.

38. Toivanen, “Waves of Technological Innovation,” 76–77.

39. For an overview of different pulping methods and its environmental impact, see CitationSmith, The US Paper Industry.

40. See e.g. CitationSSVL, Klorid i återvinningssystem, 23.

42. Smith, The US Paper Industry,124.

43. Gunningham et al., Different Shades; CitationSöderholm and Bergquist, “Firm-collaboration.”

44. Söderholm and Bergquist, “Firm-collaboration,” Table 1.

45. Smith, The US Paper Industry,109–110.

46. Lundkvist, “Firm-collaboration” Miljövårdsförvaltning; Söderholm and Bergquist, 190.

47. For an overview, see Harrison, “Ideas and Environmental”; CitationPowell, Control of Dioxins.

48. For an overview, see Bergquist et al., “Command-and-Control Revisited.”

49. The EPAct was based on plant-by-plant licensing; firms had to have their plans for construction or alteration of production plants assessed according to several criteria specified in the Act. Moreover, the regulatory approach was in practice based on performance (emission level values) rather than on technology-based standards, and emission levels were negotiated with each plant owner, sometimes over extended periods of time. As a general rule, the industrial polluters were required to take all precautionary measures and tolerate such restrictions on their activities as could be reasonably demanded on the basis of what was considered Best Available Technology (BAT). In practice, BAT referred to the least polluting technologies that proved practicable (or, as we will see below, almost practicable) in other industrial plants of the same type, either in Sweden or in other countries.

50. Smith, The US Paper Industry, 133.

51. CitationGunningham, “Environment Law,” 4. In contrast to Sweden, heavy reliance has generally been placed on the design (Best Available Technology [BAT]) or specification standards (which stipulate duty holders exactly what measures to take) rather than on performance (emission level) standards. The Clean Air Act set ambitious national goals for air quality, and in order to guard against ‘agency capture’ of the American EPA, the congress used the ‘hammer clause’ which gave the EPA a strict compliance deadline for its implementation, a strategy that industry considered to be unreasonable (Wallace, Environmental Policy, 114).

52. CitationUekötter, The Age of Smoke, 114 ff.

53. See e.g. CitationYarime, “Promoting Green Innovation”; CitationKemp and Soete, “Inside the Green Box.”

54. Kemp and Soete, “Inside the ‘Green box’,” 252.

55. Ibid.

56. See David, “Economics of QWERTY”.: e.g. Arthur, “Competing Technologies”; Rosenberg, Exploring the Black Box; CitationLiebowitz and Margolis “Path Dependence.”

57. CitationRycroft and Kash, “Path Dependence,” 23.

58. CitationFreeman, “The National System”; Rycroft and Kash, “Path Dependence.”

59. CitationDosi, “Technological Paradigms.”

60. Smith, The US Paper Industry, 124.

61. Norberg-Bohm and Rossi, “The Power”; CitationPowell, Control of Dioxins.

62. Ibid.

63. CitationWaluszewski and Håkansson, “Das Plagiat.”

64. Bergquist and Söderholm, “Green Innovation”; Söderholm and Bergquist, “Firm-collaboration.”

65. Today Innventia AB.

66. CitationSörlin, En ny institutssektor.

67. Bergquist and Söderholm, “Green Innovation.”

68. CitationEriksson, STFIs öden och äventyr, 272.

69. Jerkeman, Bokslut.

70. Bergquist and Söderholm, “Green Innovation.”

71. CitationInterview with Hans Norrström, 8 June 2010, Stockholm. Hans Norrström has central insight in and participated widely in the SSVL-projects of the period. He has been engaged by both IVL, STFI and the largest consulting firm of the P&P industry.

72. Smith, The US Paper Industry, 134.

73. Ibid., 133.

74. Ibid., 136 ff.

75. When the basic research of IVL and STFI primarily aimed at clarifying the biological effects and chemical composition of the bleach plant wastewater, SSVL had greater focus on process technologies for reducing emissions, although these areas of knowledge – which not least the organisation of the SSVL projects bear witness of – are strongly connected with each other.

76. CitationSSVL, Klorid i återvinningssystem; CitationSSVL, Miljövänlig tillverkning av blekt massa; CitationSSVL, Miljö 90. See also Eriksson, STFIs öden och äventyr, 272.

77. SSVL, Klorid i återvinningssystem, 13.

78. Söderholm and Bergquist, “Growing Green.”

79. The organisation was co-funded by the Nordic countries and operated under the Nordic Council of Ministers, now Nordic Innovation.

81. SSVL, Miljövänlig tillverkning av blekt massa, 5.

82. Jerkeman, Bokslut, 13.

83. Smith, The US Paper Industry, 136.

84. SSVL, Miljövänlig tillverkning av blekt massa, 7.

85. Norberg-Bohm and Rossi, “Power of Incrementalism.”

86. SSVL, Miljö 90.

87. Ibid.

88. Waluszewski and Håkansson, “Das Plagiat.”

89. Documentation from the licensing of the Norrsundet mill in 1981–1987, Decision 1986-12-09, p. 44f, National Archive of Arninge, E1:817-819, Sweden: Stockholm.

90. Waluszewski and Håkansson, “Das Plagiat,” 223.

91. The new technology involved a combination of oxygen and chlorine dioxide in the bleaching process.

92. CitationKinneryd, Så Länge, Ch. 10.

93. Letter from the Federation of the Swedish Forest industry to the Swedish Environmental and Energy Ministry, 1989-06-89, The Centre of Business History.

94. Waluszewski and Håkansson, “Das Plagiat.”

95. The Lignox process: oxygen-bleached pulp is treated with hydrogen peroxide at high temperatures after the removal of heavy metals with a complexing agent. Subsequent final bleaching takes place with peroxide and chlorine dioxide.

96. CitationKonrad, ‘Ecologically sound production’, 48.

97. Waluszewski and Håkansson, ‘Das Plagiat’.

98. This was initially, already in the 1940s, motivated by economic reasons but soon also environmental.

99. Söderholm and Bergquist, “Growing Green.”

100. SSVL, Miljö 90 (see e.g. section 5.3).

101. SSVL, Miljö 90, 19.

102. The ‘chlorine-free’ level was in fact allowed to contain 0.5 kg AOX/tonnage of pulp (Waluszewski and Håkansson, “Das Plagiat,” 224).

103. Waluszewski and Håkansson, “Das Plagiat,” 224.

105. Waluszewski and Håkansson, “Das Plagiat,” 223.

106. CitationHardell, “Säldöden.”

107. Environmental issues played a central role in the election and the Green Party entered the Swedish parliament. About the ‘Environmental election’ in 1988, see e.g. CitationGiljam and Holmerg, Rött blått grönt.

108. Centre for Business History, Stockholm, Archive entity: Swedish Forest Industries Federation, Minutes from the Environmental Committee, Protocol No 2, 1990, Appendix 3. Hultman, “Marketing the Environment.”

109. Centre for Business History, Stockholm, Archive entity: Swedish Forest Industries Federation, Minutes from the Environmental Committee 1988–1990, Protocol No 6, 1989.

110. Ibid.

111. Ibid.

112. Smith, The US Paper Industry.

113. Ibid.

114. Gunningham et al., Different Shades, 16.

115. Reinstaller, “Policy Entrepreneurship,” 1380.

116. CitationPowell, Control of Dioxins, 12.

117. Gunningham et al., Different Shades, 59.

118. CitationKonrad, Ecologically Sound Production?, 49; CitationFloegel, “The Medium,” 106.

119. Smith, The US Paper Industry, 131.

120. For a detailed accounting, see CitationPowell, Control of Dioxins.

121. CitationPowell, Control of Dioxins, 4.

122. Norberg-Bohm and Rossi, “The Power,” 231.

123. Smith, The US Paper Industry, 131f.

124. CitationHåkanson and Waluszewski, “Path Dependency.”

125. Floegel, “The Medium,” 106.

126. Reinstaller, “Policy Entrepreneurship,” 1377–1378.

127. CitationPatrick, “TCF Driven by Sound,” 9.

128. Norberg-Bohm and Rossi, “The Power,” 231.

129. Harrison, “Ideas and Environmental,” 73.

130. Ibid.

131. CitationYoung, “Louisiana-Pacifics,” 61.

132. Norberg-Bohm and Rossi, “The Power,” 235.

133. Ibid., 239.

134. Ibid., 230.

135. The majority of the Nordic mills that had switched to TCF in 1994 were of Swedish origin. Only two mills in Finland and two mills in the US had then opted for TCF (Reinstaller, “Policy Entrepreneurship,” 1373).

136. Reinstaller, “The Technological Transition.”

137. Rodden, G. “TCF is here to stay at Södra”. Pulp and Paper International Magazine Okt. 1 (2002) http://www.risiinfo.com/magazines/October/2002/PPI/pulp-paper/magazine/international/october/2002/TCF-is-here-to.html

138. CitationHarrison, “Stora's Skoghall,” 77.

Additional information

Notes on contributors

Ann-Kristin Bergquist

Ann-Kristin Bergquist is Associate Professor at the Department of Geography and Economic History at Umea˚ University.

Kristina Söderholm

Kristina Söderholm is a Professor at the Department of Business Administration, Technology and Social Science at Luleå University of Technology.

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