Environmental Law 101: The Wisdom of Sun Tzu Applied to Environmental Negotiations.

The three step process I propose for achieving success in environmental negotiations consists of defining success up front, planning strategically and focusing intensively on the desired outcome. I have suggested that you should consider not only what your own objectives are (i.e., your “needs” as compared to your “wants”), but also the needs of the party with whom you are negotiating. Everyone has their own approach to negotiating; lots of speakers make lots of money explaining their preferred approach.

Some people are aggressive negotiators; some are cooperative negotiators; and some fall between those two extremes. All are professionals and, depending on context, all of their techniques are (for them) correct. My philosophy is that (1) facts determine strategy; (2) environmental negotiations are materially and critically different than commercial negotiations; and (3) the parties with whom you are negotiating are not dummies. So what does all this mean in an environmental context?

First of all, context is hugely important. Negotiation over the sale or purchase of a piece of contaminated land is one case. One party wants to sell and one wants to buy; leverage may be relatively equal. On the other hand, the owner may be very motivated to sell; in that context, the buyer may have more leverage. But if the negotiation is about getting a permit from a regulatory agency, concepts of leverage are less applicable. You want a permit and need the agency to give it to you. You are the seller and the agency is the buyer; and it’s a “buyer’s market.” This doesn’t mean, however, that you have no leverage because there is an expectation that a permit will be issued—the negotiation is really about the terms (and the amount of time it will take for the agency to act).

The agency may lack resources to act quickly. It may be helpful to request an expedited review by offering to pay for a consultant, working for the agency, to do it.

In the case of a remediation, there may be an “off-the-shelf” remedy that is applicable; but there may also be a “state-of-the-art” remedy that will make the agency’s decision quicker and easier—albeit at a higher cost. But, to a business, time is money and, taking that into account, a more expensive remedy may mean a shortened review schedule. Environmental regulation is replete with “trade-offs” and sophisticated practitioners and applicants use this reality to their advantage. This is all part of “defining success” up-front and planning strategically.

It is important to understand the agency perspective. It wants certain information and it wants it in a certain form. It lives in a “binary” world—either an application (or a proposed remediation) is done the way it wants or it isn’t. It is important to know the rules of the game; or retain a consultant which does.

If negotiating with environmental groups, you have to talk to such groups to evaluate their motivation. There is an old saw that “talk is cheap.” That is true, but it is also critical. Positions are so hardened on environmental issues that it becomes impossible sometimes to have a conversation; but business is the party interested in getting something done and ignoring “stakeholders” is a huge mistake. The media won’t ignore them; therefore you can’t afford to ignore them. You should not assume that you cannot deal with environmental groups. You may conclude that after talking to them, but you should not assume that without even talking to them.

You may ask: What does Sun Tzu have to do with all of this? In his book The Art of War, he spoke to this subject (in a military, but yet applicable context) when he wrote: “We cannot enter into informed alliances until we are acquainted with the designs of our neighbors and the plans of our adversaries.” In a more recent work on the same subject, Wharton Professor Adam Grant reported in his book Give and Take that negotiators who think carefully about the other party’s interests tend to make more profitable deals. I agree with both; and I’ve spent 40 years applying these concepts successfully. I share them here with the hope that they will be of help to you.

Takeaways: Define your objectives, plan strategically and focus on outcome. But, while doing so, know the regulator and its expectations. Make its job easier by submitting well prepared materials in the form, and containing the information, that the agency wants. Your application is the equivalent of a take-home exam; there is no reason not to get an “A” on it. Determine what, if anything, you can do to speed the process. Also, talk to your adversaries as you would with anyone with whom you are negotiating. Make a determination as to their motivations—do they have demands that are negotiable or are they unalterably opposed to your project under any circumstances? It makes a difference to your success.

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