ABSTRACT
This chapter describes valuation approaches and tools that have been specifically developed or adapted for estimating environmental liability costs for consideration in business management decisions such as capital investments, process/input substitutions, product retention and mix, facility-siting and waste management. It is intended to assist organisations in estimating future and/or potential environmental liability costs within reasonable limits of accuracy such that a manager is comfortable using the estimations when making decisions. The chapter also provides more information about the timing, likelihood and uncertainty characteristics of the various forms of environmental liabilities. A 'potential environmental liability' differs from an 'environmental liability' because an organisation has an opportunity to prevent the liability from occurring by altering its own practices or adopting new practices in order to avoid or reduce adverse environmental impact. Most of the identified tools appear to take a bottom-up approach, some characterise a population's environmental liabilities, and examples of the top-down approach are few.
