"Cap-and-trade regional policies such as those currently used in the EU are not effective in reducing carbon dioxide emissions", said Philippe Varin, CEO of Corus and Executive Committee Member of the International Iron and Steel Insitute (IISI).
Such policies, he added, "merely result in a switch of production" to China and India and are "likely to increase, rather than reduce, global greenhouse gas concentrations."
Varin was speaking in Berlin after IISI members endorsed a common approach to addressing climate change at a meeting on 9 October. The common approach builds on seven commitments made by IISI member companies, including behemoths such as ArcelorMittal, Corus Group plc, China Steel Corporation and Nucor in the US.
ISII commitments in the short term focus on expanding the use of efficient technologies to minimise CO2 emissions and promoting recycling. In the longer run, they centre on boosting R&D investment to develop "breakthrough, new steelmaking technologies".
In addition, ISII agreed to common reporting procedures in order to verify progress on CO2 emission reductions. The move, ISII hopes, could pave the way for governments to adopt a global sector-specific approach for CO2 reductions in the steel sector after 2012.
"Constraining production from the best emission performing plants [in Europe, Japan and the US] is not the solution for a globally competitive industry such as steel," Varin argues. "An effective approach for the steel industry requires the participation of all major steel producing countries and a focus on improving emissions per unit of production," he added.
The UN is holding its major annual climate change conference on 3-14 December in Bali, Indonesia. The meeting is expected to make progress in defining a successor to the Kyoto Protocol, which expires in 2012.
The European Commission will present a proposal to review the EU-ETS in December.