Governing environmental risk: regulation, insurance and moral economy

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Abstract
In this article I examine the governance of environmental risks produced by business. I disagree with Ulrich Beck that we now live in a distinct ‘risk society’ which renders science, government and business impotent in managing risk. However, I argue that centralized state regulation (and its corollary in commercial insurance) discourages relationships of mutual responsibility between private actors, exacerbating any so-called ‘tragedy of the commons’. This limits the effectiveness of both public regulation and private incentives, such as liability, in altering corporate behaviour. I then examine institutional arrangements which encourage mutual regulation between private actors. Governments are increasingly attempting to enrol this ‘moral economy’, which exists within business groups such as mutual insurance clubs. Although reinforcing some limitations of traditional governmentality these co-operative arrangements may enhance corporate environmental performance.