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Moreover, smart regulation encourages a principles-based approach rather than a strict adherence to prescriptive rules. This flexibility allows businesses to innovate while still meeting regulatory objectives. For instance, in the field of environmental regulations, a principles-based framework may focus on achieving specific sustainability outcomes rather than dictating the exact methods businesses must use to reach those goals. This empowers companies to pursue innovative solutions that might not yet exist while still holding them accountable to important environmental standards.


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