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Despite decades of policy experimentation, the ultimate goal of efficient and effective environmental regulation has continued to elude policy-makers and regulatory theorists. The less than satisfactory performance of both government and market approaches to environmental protection has led to the introduction of a broader range of policy mechanisms, such as education, information-based strategies, economic instruments and self-regulation. Yet these various policy instruments are usually treated as alternatives to one another rather than as complementary. Drawing from studies in North America, Europe and Australia, the authors show how the design of complementary combinations of policy instruments, tailored to particular environmental goals and circumstances, will produce more effective and efficient policy outcomes. They also confront the critical problem of how, at a time of fiscal constraint and small government, environmental policy might still be designed in ways that improve outcomes both for the environment and for business.