The CSR Newsletters are a freely-available resource generated as a dynamic complement to the textbook, Strategic Corporate Social Responsibility: Sustainable Value Creation.

To sign-up to receive the CSR Newsletters regularly during the fall and spring academic semesters, e-mail author David Chandler at david.chandler@ucdenver.edu


Wednesday, October 31, 2012

Strategic CSR - Value

How should we value things? How far should we allow the commercialization of life to intrude? How much does it diminish life if everything has a price? The article in the url below revived these thoughts in the run-up to the Olympics this summer:

SOME marketers are spending tens or hundreds of millions of dollars on Olympic sponsorships. Then there is Hanson Dodge Creative, an advertising and design agency in Milwaukee, which spent $11,100 to perch on the shoulder of an Olympic athlete.

The ad agency placed the highest bid on e-Bay for the right to place a temporary tattoo on the shoulder of Nick Symmonds who needed the money to finance his pursuit or Olympic glory. While needing the money, Symmonds (an 800m runner) also used the fundraising effort to criticize what he sees as his lack of freedom to cash-in on his moment in the spotlight:

Mr. Symmonds, known for being outspoken, was seeking to make a point about what he has described as the outdated policies governing athletes’ endorsements that are enforced by organizations like USA Track and Field. To underline that point, he wears white tape over the @HansonDodge tattoo each time he runs — it is visible the rest of the time — to draw attention to the policies that prohibit sponsor logos and branding from being displayed.

So, my question is, Does this matter? Does it matter that Symmonds is willing to deface his body (albeit temporarily) in order to secure a relatively small amount of money (the winning bid was $11,100). Would it be OK if the tattoo was permanent? Is it OK if anyone is allowed to sell advertising space on any part of their body, as long as they were happy with the price the company that wanted to display its logo was willing to pay? If so, is it OK for people to sell, rather than donate, blood? What about parts of the body for transplant (a kidney, say)?

Many of these, and other, issues are taken up by Michael Sandel in his book (What Money Can’t Buy). Sandel fails to arrive at a satisfactory answer, however; partly because he never argues from a point of principle, merely pointing out that things have gone too far. In other words, he never allows us to draw a line in the sand and say this behavior is OK and this behavior is not OK. Instead, his arguments are more along the lines of ‘these things represent slippery slopes and things have gotten out of hand.’ This is not a criticism of Sandel; these are very difficult questions, to which I do not see any easy answers. As the article in the second url notes:

Money is not essential to a market. After all, economics is about maximising welfare, not GDP. But the absence of a price to allocate supply and demand makes it harder to know whether welfare is being maximised.

At present, monetary value is the best way we have of capturing welfare maximization. The price of a product and the profit of a firm incorporate a significant amount of the social value encapsulated in market transactions. What is important to remember, however, is that markets are far from perfect and people are far from rational. As such, how big is the gap between economic and social value and how do we make it up? In Strategic CSR, we argue that approaching market decisions through a CSR Filter and embedding those decisions within a set of guiding values gets us most of the way there. Quantifying the gap, however, is extremely difficult. If we only had a good way of measuring the CSR profile of a firm, we would have a better indicator. Until then, we need to be conscious of the imperfections of the market system, while also recognizing the value inherent in the tension between demand and supply.

BTW; in London, Nick Symmonds qualified for the men’s 800m final, finishing fifth overall:

In the greatest 800-meter race in history, Oregon Track Club Elite's Nick Symmonds placed fifth with a lifetime best of 1 minute, 42.95 seconds at Olympic Stadium on [August 9]. Kenya's David Rudisha won the gold medal by lowering his own world record to 1:40.91. … Symmonds' time makes him the third-fastest American at that distance.

Take care
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


A Bet (and Tattoo) On an Olympian
By Stuart Elliott
July 5, 2012
The New York Times
Late Edition – Final
B3

Game, set and match
October 20, 2012
The Economist
71

Monday, October 29, 2012

Strategic CSR - Tobacco

I am still processing the news, contained in the article in the url below, that tobacco companies in Australia will no longer be able to see their products with their regular, brand-oriented packaging. Instead, they will have to display extremely graphic photos and statements in large bloc lettering stating how “Smoking Causes Lung Cancer”:

One of the world’s toughest cigarette labeling laws is set to take effect in Australia in December … . Graphic images of mouth ulcers, cancerous lungs and gangrenous limbs will dominate the front of all cigarette packages sold in the country, and brand logos will be banned, after a landmark ruling by the High Court of Australia determined that the new laws were consistent with the Constitution and did not violate the rights of Big Tobacco.

I find this decision fascinating on two levels: First, talk about societal indictment of a particular practice!

Australian officials welcomed the ruling, which they hope will combine with some of the highest taxes in the world on tobacco to further drive down smoking rates.

Second, for the businesses and executives who run them, it must be increasingly difficult to justify to themselves that they are adding social value. In the lawsuit, British American Tobacco, Imperial Tobacco, Japan Tobacco, and Philip Morris Australia had all argued that new law was an infringement on their intellectual property rights—i.e., their right to sell their products under their established brands. Part of me is amazed that a government would be willing to go so far (the photos are extremely graphic), although part of me is also a little shocked at the infringement of a business’ right to operate:

The Australian decision on the suit filed by the multinational tobacco companies was the last major legal hurdle to implementing the new rules, which require health warnings to cover 75 percent of the front of cigarette packages and 90 percent of the back starting Dec. 1. Brand logos and colorful designs will be banned, with only a small space remaining where the brand name and variant of the cigarette can be printed. Packages will be required to be a uniform shade of olive green.

It will be interesting to see how other governments respond:

The European Union already bans cigarette advertising on billboards, television, radio, print media and the Web. The Union also prohibits tobacco companies from sponsoring cross-border events. National governments can go further, and some member states have banned tobacco companies from distributing promotional merchandise like ashtrays and umbrellas.

There is evidence to suggest the strict tobacco laws already in place in Australia have already made a difference:

Partly as a result, smoking rates in Australia have declined in recent years and stood at 16.4 percent among adult men and 13.9 percent among adult women as of 2010, according to figures from the Australian Cancer Council. In the United States, by comparison, most recent data from the Centers for Disease Control show the smoking rate is 21.5 percent among adult men and 17.3 percent for adult women.

Contrast this response, however, with the response from U.S. courts in the article in the second url below:

A U.S. appeals court ruled on Friday that cigarette companies do not need to comply with new federal rules requiring their products to show graphic warning images, such as of a man exhaling smoke through a hole in his throat. The 2-1 decision by a court in Washington, D.C., contradicts a ruling in a similar case by another court in March, setting up the possibility that the U.S. Supreme Court will weigh in on the dispute.

Although the images are nowhere near as graphic as the ones being imposed on firms in Australia, the logic behind the Court’s decision was that the U.S. government’s demands infringed the corporations’ right to free speech:

’This case raises novel questions about the scope of the government's authority to force the manufacturer of a product to go beyond making purely factual and accurate commercial disclosures and undermine its own economic interest -- in this case, by making 'every single pack of cigarettes in the country mini billboard' for the government's anti-smoking message,’ wrote Judge Janice Rogers Brown of the U.S. Court of Appeals for the District of Columbia Circuit.

Take care
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


Australian High Court Upholds Tobacco Rules
By Matt Siegel
August 16, 2012
The New York Times
Late Edition – Final
B7

Court: Cigarette companies don’t have to show graphic warning labels
Reuters
August 24, 2012
NBCNews.com

Friday, October 26, 2012

Strategic CSR - Greed

The blog posting in the url below by Mallen Baker (Foreword, pxvii) cuts through much of the comment over recent executive pay discomfort suffered by many firms. Earlier this year, companies from Aviva to Barclays to Citigroup all had strong protest votes registered against executive compensation packages as a result of increased requirements on firms to put the compensation packages of their senior employees to shareholder vote at their annual general meetings:

It's an interesting point to note, that suddenly shareholders have become lauded as this group that has the power to stick it to the greedy bad bosses.

Baker, however, recognizes that, rather than a long-awaited exercise in shareholder democracy, this is a case of one highly-criticized group holding another highly-criticized group to account. Or, as Baker puts it:

For [shareholders], the point is more one of disappointment that they are not earning similarly high returns through the value of the shares that they own. If they were, they would smile warmly on inflated executive bonuses because they had been 'earned.'

Baker reminds us not to kid ourselves that shareholders are acting on behalf of the wider, social interest:

This is not a benign force for good. It is the demand of shareholders for 'above average' returns that drove many of the financial institutions to bring in high-risk high-return policies in the first place, which led to the financial crisis. Now they complain that the bosses at Aviva have 'destroyed shareholder value.'

As such, rather than a liberation, Baker pierces the rhetoric behind these new “say-on-pay” requirements to call it as it is—an exercise in self-deception:

We may think they are now meting out the justice we have been so long denied by giving certain individuals a huge roasting. Actually, they are standing up for their right to demand financial performance that is unreasonable in the face of the current state of the marketplace. The fact that some of those individuals may deserve their roasting (others were just in the wrong place at the wrong time) shouldn't get in the way of the fact that the process is simply keeping us on the path that caused the problems in the first place.

Have a good weekend.
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


Greedy bosses get punished by ... um ... greedy shareholders
By Mallen Baker
May 7, 2012

Wednesday, October 24, 2012

Strategic CSR - GSK

The article in the first url below shows what is possible when one of a firm’s stakeholders holds that firm to account for its actions and responsibilities:

Drug maker GlaxoSmithKline PLC agreed to plead guilty to criminal charges of illegally marketing drugs and withholding safety data from U.S. regulators, and to pay $3 billion to the government in what the Justice Department called the largest health-care fraud settlement in U.S. history.

Specifically:

Under the deal, which requires court approval, Glaxo will plead guilty to criminal charges involving three drugs—the antidepressants Paxil and Wellbutrin and the diabetes drug Avandia. … The guilty plea covers a range of behavior by the U.K.-based company, including illegally promoting the antidepressants in the U.S. for uses that weren't approved by the Food and Drug Administration, a practice known as off-label marketing, and withholding important safety data about Avandia from the U.S. regulator.

In addition to these illegal activities, a pattern of practices was identified that resulted in this settlement, GSK’s fourth with the U.S. government in the past few years:

Over a period of more than a decade, the government's latest investigation found, the company plied doctors with perks such as free spa treatments, Colorado ski trips, pheasant-hunting jaunts to Europe and Madonna concert tickets, Justice Department officials said.

I firmly believe that there are two sides to the “responsibility” that we talk about when we discuss “CSR.” The first responsibility is the responsibility of companies to meet the needs and demands of a range of stakeholders, broadly defined. It is in firms’ best interests to do this because it helps secure the societal legitimacy necessary for long-term survival. The second responsibility, however, lies with stakeholders to hold firms accountable for their actions. This responsibility is equally (if not more) important than companies’ responsibility because I also believe that firms respond to market forces much more effectively than they can predict market forces (see also: ‘Why Aren’t We Stressing Stakeholder Responsibility?’). As such, if stakeholders are not willing to hold firms to account, only a small percentage of firms will alter their behavior sufficiently.

If we are going to talk about a corporate social responsibility (the responsibility on firms to act in accordance with stakeholder needs) and, in particular, if we are going to talk about the business case for CSR, therefore, we also need to be talking about corporate stakeholder responsibility (the responsibility on a firm’s stakeholders to hold that firm to account). Both sides of the responsibility coin are equally essential to the extent that, without one, we are unlikely to see enough of the other.

Additional reporting on the GSK case is available in the article in the second url below.
Take care
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


Glaxo Sets Guilty Plea, $3 Billion Settlement
By Jeanne Whalen, Devlin Barrett, and Peter Loftus
The Wall Street Journal
July 3, 2012

Drug Firm Guilty in Criminal Case
By Katie Thomas and Michael S. Schmidt
The New York Times
July 3, 2012

Monday, October 22, 2012

Strategic CSR - Carbon Tax

What would public policy look like if our political system focused on substance rather than rhetoric (and also threw in a bit of intelligence for good measure)? The article in the url below suggests that, regarding carbon emissions and taxation policy at least, it might look a little bit like British Columbia, Canada:

[Last July], the best climate policy in the world got even better: British Columbia’s carbon tax — a tax on the carbon content of all fossil fuels burned in the province — increased from $25 to $30 per metric ton of carbon dioxide, making it more expensive to pollute.

Why is raising tax on carbon emissions so good? Because the provincial government uses the revenue as an offset to lower both individual income and corporate taxes:

Thanks to this tax swap, British Columbia has lowered its corporate income tax rate to 10 percent from 12 percent, a rate that is among the lowest in the Group of 8 wealthy nations. Personal income taxes for people earning less than $119,000 per year are now the lowest in Canada, and there are targeted rebates for low-income and rural households.

As the authors argue:

Substituting a carbon tax for some of our current taxes — on payroll, on investment, on businesses and on workers — is a no-brainer. Why tax good things when you can tax bad things, like emissions? The idea has support from economists across the political spectrum … . That’s because economists know that a carbon tax swap can reduce the economic drag created by our current tax system and increase long-run growth by nudging the economy away from consumption and borrowing and toward saving and investment.

This tax policy, of course, also lowers carbon emissions:

Economic theory suggests that putting a price on pollution reduces emissions more affordably and more effectively than any other measure. … British Columbia’s carbon tax is only four years old, but preliminary data show that greenhouse gas emissions are down 4.5 percent even as population and gross domestic product have been growing. Sales of motor gasoline have fallen by 2 percent since 2007, compared with a 5 percent increase for Canada as a whole.

The authors argue that the U.S. should adopt a similar approach to taxation policy and have gone to the trouble of outlining what such an approach would look like:

According to our calculations, a British Columbia-style $30 carbon tax would generate about $145 billion a year in the United States. That could be used to reduce individual and corporate income taxes by 10 percent, and afterward there would still be $35 billion left over. If recent budget deals are any guide, Congress might choose to set aside half of that remainder to reduce estate taxes (to please Republicans) and the other half to offset the impacts of higher fuel and electricity prices resulting from the carbon tax on low-income households through refundable tax credits or a targeted reduction in payroll taxes (to please Democrats).

All of that might be possible if, of course, our political system cared anything about substance and meaningful change, rather than empty rhetoric.

Take care
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


The Most Sensible Tax of All
By Yoram Bauman and Shi-Ling Hsu
July 5, 2012
The New York Times
A17

Friday, October 19, 2012

Strategic CSR - Ben & Jerry's

During the height of the Occupy Wall Street protests, Ben Cohen (co-founder with Jerry Greenfield of Ben & Jerry’s ) lent his public support to the protestors, donating money and giving advice. Primary among his concerns was that the movement organize and pursue specific goals more methodically.

Cohen has continued to support the Occupy Wall Street movement (http://occupywallst.org/) and recently became involved again as the one year anniversary of the initial occupation of Zuccotti Park in Lower Manhattan approached on September 17. As a recent article in BusinessWeek suggests, the protestors are beginning to rebel against what some see as his heavy-handed (dare I say it, corporate) involvement:

After giving $30,000 in March to fund a van outfitted with a projector to beam the group’s messages onto the sides of buildings, Cohen felt the van was not doing the job and wanted more control. … ‘He’s a 1 percenter telling the 99 percent, ‘I’m your boss,’’ Mark Read, the activist who proposed the mobile projector idea, recently told the New York news site DNA Info.

The article goes on to speculate why Cohen’s involvement has not spurned some new Ben & Jerry’s flavors and identifies a missed opportunity. Helpfully, the author has some suggestions of her own:
  • Occu-Pie Wall Street: Vanilla ice cream with chunks of apple pie and other random throw-ins; no flavor is dominant, making it hard to describe what it really is.
  • Occupy Walnut: For those who don’t like pie, there’s Occupy Walnut—maple ice cream with walnuts distributed equally among all segments of the container (unlike those other ice creams in which all the good stuff goes to the top).
  • 99% Delish: Strawberry ice cream made with 1 percent milk (i.e., it’s 99% fat free) with Sweethearts candies bearing anti-corporate slogans with subtle dietary messages such as: “Stop hyper-consumption!”
  • Biz-cotti Park: Trust us—Zuccotti Park isn’t delicious. Instead, try this coffee-flavored ice cream with biscotti crumbs and tiramisu.
  • Ain’t That Rich: Double chocolate ice cream with peanut butter cups, fudge brownies, and foie gras, all dusted with edible gold powder. Instructions for use: Eat half and then dump half on an unwitting banker’s head.

Perhaps the Occupy movement has an opportunity to stimulate real change, after all!

Have a good weekend.
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


Ben & Jerry's Cohen Repos Occupy Wall Street's 'Batmobile'
Bloomberg Businessweek
October 02, 2012

Wednesday, October 17, 2012

Strategic CSR - Commodities

I have been thinking a lot about commodities recently for a class I am thinking of putting together in the spring. The article in the url below introduces a way of thinking about commodities that I think adds a layer of nuance—assessing commodities in terms of both market value and social value:

Beekeeping is one example beloved by economic theorists. Bees create honey, which can be sold on the market. But they also pollinate nearby apple trees, a useful service that is not purchased or priced.

The article focuses on a 2012 UN report investigating alternatives to GDP as a way of measuring a nation’s wealth:

Economists usually settle instead for GDP. But that is a measure of income, not wealth. It values a flow of goods and services, not a stock of assets. Gauging an economy by its GDP is like judging a company by its quarterly profits, without ever peeking at its balance-sheet. Happily, the United Nations this month published balance-sheets for 20 nations in a report overseen by Sir Partha Dasgupta of Cambridge University. They included three kinds of asset: “manufactured”, or physical, capital (machinery, buildings, infrastructure and so on); human capital (the population’s education and skills); and natural capital (including land, forests, fossil fuels and minerals).

In order to do that, it is essential to make all three kinds of capital commensurable—i.e., by placing a dollar value on them. Placing a dollar value on commodities is common—it is why there is such strong markets for investors interested in speculating on future commodity prices. This process is far from perfect, however. In fact, forcing the comparison of otherwise incomparable things presents a whole new set of issues:

By putting a dollar value on everything from bauxite to brainpower, the UN’s exercise makes all three kinds of capital comparable and commensurable. It also implies that they are substitutable. A country can lose $100 billion-worth of pastureland, gain $100 billion-worth of skills and be no worse off than before. … The idea that natural assets are substitutable makes some environmentalists (including some contributors to the report) nervous. Many of the services the environment provides, like clean water and air, are irreplaceable necessities, they point out. In theory, however, the undoubted value of these natural treasures should be reflected in their price, which should rise steeply as they become more scarce. … In practice, however, natural assets are often hard to price well or at all. As a consequence, the UN report has to steer clear of assets like clean air that cannot be directly owned, bought or sold. It confines itself to resources like gas, nickel and timber, for which market prices exist. But even these market prices may not reflect a commodity’s true social value.

These thoughts dovetail with thoughts prompted while reading Michael Sandel’s recent book, What Money Can’t Buy. Rather than about money, however, I think a more accurate title would have been something along the lines of ‘How Should We Value Things?’ One way to value things is to put a price on them (e.g., paying someone to line up for you to buy tickets to a popular event); another way is to value them in terms of time (e.g., willing to wait in line yourself to buy those tickets)—see Strategic CSR: The Moral Limits of Markets.

The UN report featured in the article (‘Inclusive Wealth Report 2012’) is located at: http://www.ihdp.unu.edu/article/iwr

Take care
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


The Real Wealth of Nations
The Economist
June 30, 2012

Monday, October 15, 2012

Strategic CSR - Shareholder value

It is well-established in both corporate law and business norms that, as the owners of the firm, the goals of the business should be aligned with the interests of its shareholders. Or, at least, popular perception is that this is the case. The article in the url below reviews a recent book that challenges this perception of shareholder primacy:

To Lynn A. Stout, however, it amounts to nothing more than a ‘shareholder dictatorship.’ Ms. Stout, a professor at Cornell Law School, has written a slim and elegant polemic … to explain the idea’s two problems: It’s worked out horribly and, as a matter of law, it’s not true.

The main argument of the book is uncontroversial—that the focus on shareholders as owners (and particularly attempts to solve the agency problem via stock options—Issues: Executive Compensation, p172) has caused executives to fixate on share price, which results in short-term decision-making. What is unique and important, however, is Stout’s reporting of this focus as a misinterpretation of corporate law:

… the idea that shareholders “own” their companies isn’t actually so set in the law, Ms. Stout argues. It’s almost as if the legal world has been keeping a giant secret from the economists, business schools, investors and journalists. Instead, … what the law actually says is that shareholders are more like contractors, similar to debtholders, employees and suppliers. Directors are not obligated to give them any and all profits, but may allocate the money in the best way they see fit. They may want to pay employees more or invest in research. Courts allow boards leeway to use their own judgments. The law gives shareholders special consideration only during takeovers and in bankruptcy. In bankruptcy, shareholders become the “residual claimants” who get what’s left over.

As Stout indicates, this logic results in a perversion of the goals guiding the firm:

A solvent company has completely different purposes from those of insolvent ones. We don’t decide what to do with living horses because we turn dead horses into glue, she says.

There is an apparent contradiction in Stout’s argument, however, as, while detailing the overly-strong influence investors have today on corporate policy, she also:

… contends that the idea that shareholders wield too much power is laughable. Shareholders have increasingly been voting against directors only to see them reappointed. Recently, shareholders at a handful of companies have voted the majority of shares against the pay packages of chief executives — and have been ignored.

The unhealthy influence of investors (who, today, are more like gamblers than owners), however, is a problem that seems difficult to refute:

The average holding period of a stock was eight years in 1960; today, it’s four months.

Nevertheless, such influence has the distinct advantage of acting as an important oversight function over executive independence. While distorting the firm’s goals in favor of the investor, this oversight influence also guards against executive incompetence and fraud. As such, weakening investor power, without strengthening the oversight function or abilities of other stakeholders, is unlikely to generate a positive outcome. Clearly, shareholders hold a disproportionate negative influence on executive decisions at present. The solution is to re-orient the firm towards more of a broad stakeholder perspective. But, as we point out in Strategic CSR, the responsibility on firms to act socially responsible is two-way. It will only work if all stakeholders act to hold the firm accountable for its actions.

Take care
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


Challenging the Long-held Believe in ‘Shareholder Value’
By Jesse Eisinger
June 28, 2012
The New York Times
Late Edition – Final
B5

Friday, October 12, 2012

Strategic CSR - Olympics

Written in the run-up to London’s recent Olympics, the article in the url below awards gold, silver, and bronze medals to those corporate sponsors who are accused of most “greenwashing the Olympics” (http://www.greenwashgold.org/):

Rio Tinto, the global mining company, has been named as early front-runner for the Greenwash Gold award for the worst Olympic sponsor, with BP, the oil and gas multinational, in second place and Dow Chemical third.

The activists have a pretty good case that the organizers are compromising the Olympic values and ideals by taking so much money from these firms:
  • Rio Tinto is providing the metals to be used in the Olympic medals from its mines in Utah, even though local residents have complained about the pollution these mines produce.
  • BP has been named a “Sustainability Partner” to the Games, in spite of its questionable environmental track record.
  • Dow Chemical is still being hounded to acknowledge formally full responsibility for Union Carbide’s role in causing the Bhopal tragedy (Dow merged with Union Carbide in 1999).

What I found surprising was the lengths the local organizers went to in order to accommodate their sponsors:

Olympic sponsors will avoid paying up to $942 million in tax as venues will be treated like offshore havens during the Games … . A report by Ethical Consumer claimed that under new tax rules ushered in as part of “Team Great Britain’s” winning Olympic bid, corporate partners like Coca-Cola, McDonald’s and Visa were given a temporary exemption from corporation tax as “non-resident” companies from March 30 to November 8. The new rules also reportedly mean foreign employees working for the companies do not have to pay income tax in the UK.


Have a good weekend.
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


Greenwashing the Olympics
By Daniel Nelson
July 4, 2012
CorpWatch Blog

Wednesday, October 10, 2012

Strategic CSR - Soda tax

I wasn’t going to write about New York City’s ban on soda drinks larger than 16 ounces (I try to avoid subjects that have received a lot of media attention), but the article in the url below brings a different perspective to the debate that I thought might be of interest. The author focuses on the issue of whether the ban would result in the amount of plastic used in soda drink packaging increasing, rather than decreasing:

If the super-size ban caused people to drink less soda, then perhaps the amount of waste from cups and bottles would decrease. But if people simply choose to buy more than one, then the packaging waste will increase.

All the NYC ban did was to prohibit the sale of certain sized sodas in certain situations. Consumers can still buy the same amount of soda, they will just need to buy multiple smaller servings, rather than one big serving. If they do that, they will use multiple cups/bottles, rather than one cup/bottle—hence the possible increase in plastic use.

Another reason why I liked this article is that it re-focuses the debate where it should be—what is the most efficient way to produce the desired outcome (less soda consumption)?

… a “soda tax”–a per ounce tax on beverages with added sugar. A tax like that would give people an incentive to drink less.

A tax would allow people the option to consume as much soda as they want, but they would be penalized in proportion to that amount. For people less able to afford the tax, this would discourage consumption. Other social ‘nudge’ experiments have demonstrated that small price increases can generate significant changes in behavior (e.g., Case-study: Paper vs. Plastic, p313).

But, if Mayor Bloomberg would rather focus on banning unhealthy calories (rather than making them more expensive), the Huffington Post has some helpful suggestions for which foods he might consider banning next (or, perhaps, should have banned before worrying about soda):

We certainly don't want to give them any more ideas, but these 11 foods -- most at 30-40 times the calorie count of the typical banned soda -- could very well now be on Bloomberg's radar.

Take care
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
The library of CSR Newsletters are archived at: http://strategiccsr-sage.blogspot.com/


Will a NYC Ban on Large Sugary Sodas Decrease Obesity or Increase Plastic Waste?

By Beth Terry
June 19, 2012
My Plastic-free Life