This article explores the mechanism by which the voluntary approach to climate change policy in the industrial sector works, based on a case study of the "voluntary action plan" to mitigate greenhouse gases in industry sectors organized by an initiative of the Japan Business Federation during the first commitment period of the Kyoto Treaty. Adopting the theoretical work of Renate Mayntz and Fritz Scharpf (1995), as well as their successors Tanja Börzel and Thomas Risse (2010), this case is examined from the viewpoint of "governance without government," and employs data from interviews. In addition, the background of strong ties between the Japanese government and industry organizations and among industry organizations themselves that arose during World War Two, and were maintained thereafter, as we can observe in the domain of climate change policy, is discussed. The main section of the paper explores two issues: First, it demonstrates how the problem of "free-riding" can be prevented. Then it reveals how the target of voluntary action can be kept from being set to the minimum level. With regards to "free-riding," it is important to consider how Japanese business associations are organized. There iss often only one business associations per sector. Therefore, the relevant business association is the only organizational entity for the companies in each industry sector, and the relationships between the staff of companies are maintained over relatively long periods. These relationships function as repeated "games" in game theory. In addition, business association form their attitudes towards a policy based on their consideration of how member companies would be affected in the most adverse scenario. This principle of decision-making prevents the occurrence of "free-riding". Nevertheless, using only this first mechanism means that each company performs as low a level of mitigation as possible. However, there is also a second mechanism. There are some company staff that are enthusiastic about tackling the climate change problem, and their actions have raised the standard of the target in their sectors. Moreover, industry associations also need to show evidence of the effectiveness of the "voluntary action plan" to avoid the introduction of formal mitigation policies such as green taxes and an emission trading system, and they also need to demonstrate their leadership so as to have their voices heard in other policy areas. The "voluntary action plan" was generally evaluated as working relatively well but did have limits stemming from its mechanisms. The plan will not work, if climate change issues in policy discussions have a low priority or if the status of the business associations diminishes. Furthermore, within the framework of the "voluntary action plan," most companies do not regard their mitigation actions as combining positively with their business strategies.

Satoh, Keiichi
Private Governance in Japanese Climate Change Policy: How Has the Voluntary Approach by the Japan Business Federation Worked?[in Japanese]
Date / Year
Jan 2017
The Journal of Environmental Sociology