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Third, the use of economic incentives, in contrast to that of traditional regulations, can more easily control pollution generated by a multitude of small and dispersed sources. Fourth, economic incentives can stimulate technological improvements and innovations in pollution control in situations where traditional regulatory mechanisms may not.
Progressive companies are shifting rapidly from an approach of compliance to one of proactive environmental management. The revolution in thinking has gone through three stages: 1) the widespread business practice in the 1960s and 1970s of coping with environmental crises as they occurred and of attempting to control the resulting damage; 2) the reactive mode in the 1980s of struggling to comply with rapidly changing government environmental regulations and minimizing the costs of compliance; 3) the proactive environmental management strategy in the 1990s, through which corporations began to anticipate the environmental impacts of their operations, take measures to reduce waste and pollution in advance of regulation, and find positive ways of taking advantage of business opportunities through total quality environmental management...
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