Strategic CSR - Meat

The article in the url below raises the possibility of extending the idea of a Pigovian tax (a tax on an activity that causes a negative consequence – i.e., a sin tax) to eating meat. In other words, meat would be taxed as a 'sin' in the same way that cities and states are beginning to tax a range of products, from plastic bags (e.g., Strategic CSR - Kenya) to sugar (e.g., Strategic CSR – CSR Threshold):

 

"Meat could be a target for higher taxes given criticism of the industry's role in climate change, deforestation and animal cruelty. … The idea is still its infancy and faces a lot of opposition from farming groups, but it's emerging as a trend in Western Europe. … If taxes gain traction, it could encourage more people to switch to poultry or plant-based protein and help drive the popularity of meat substitutes."

 

Such a tax has been advanced as a way to address animal welfare, as well as reduce meat consumption:

 

"In Germany, some politicians have proposed raising the sales tax on meat products to fund better livestock living conditions. A poll … showed a majority of Germans, or 56.4%, backed the measure, with more than a third calling it 'very positive' and some 82% of voters for the environmentalist Greens in favor."

 

This article coincides with another report from the IPCC recently on climate change and the land (https://www.ipcc.ch/report/srccl/), documenting the waste and damage associated with our current farming/land-use methods:

 

"The loudest argument against meat at the moment is not based on health but climate change. In a report this month, the United Nations said agriculture, forestry and other land use contributes about a quarter of greenhouse emissions."

 

In the face of the scale of the problem, a tax on red meat seems as though it will not get us all the way to there from here. The principle is important, however. If you believe that the market is the most effective means of allocating scarce and valuable resources (which I do), then sin taxes are the way to account for negative externalities in the pricing of products. Get the pricing right, and demand/supply will balance at the 'appropriate' level. In my opinion, this lifecycle pricing (together with technological innovation) is the only way we will combat climate change and have some hope of preserving a planet on which we can live.

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Red Meat Could Be the Next Sin Tax After Sugar, Fitch Says

By Olivia Konotey-Ahulu

August 13, 2019

Bloomberg Businessweek

https://www.bloomberg.com/news/articles/2019-08-13/red-meat-could-be-the-next-sin-tax-after-sugar-fitch-says

 

Strategic CSR - Trees

The article in the url below demonstrates the danger of relying on carbon offsets to work our way towards carbon neutrality:

 

"Up to 90% of [11 million] saplings planted in Turkey as part of a record-breaking mass planting project may have died after just a few months, according to the country's agriculture and forestry trade union."

 

The problem comes when the people driving such projects bring their good intentions, but lack the necessary expertise:

 

"The government-backed programme broke the world record for the most trees planted in one hour in a single location, with 303,150 saplings planted in the northern Anatolian city of Çorum. The head of the union claimed, however, that 90% of the saplings his teams have inspected so far have died because of insufficient water. [A spokesperson] attributed the deaths to the saplings being planted at 'the wrong time' and 'not by experts,' as well as a lack of rainfall."

 

What would be interesting is to see how this tree planting project was accounted for at the time it was initiated. If, for example, 11m trees are expected to absorb a certain amount of carbon over their lifetimes, that amount of carbon can either be offset in one lump today or it can be amortized over the expected life of the trees. The latter method is more accurate (and honest) and should be weighted toward the end of the time period, because older, bigger trees absorb more CO2 than younger, smaller trees. Adopting this approach avoids falsely accounting for carbon that has yet to be removed from the atmosphere; it also allows for eventualities such as the trees dying and, therefore, never being able to reach their full, carbon-absorbing potential:

 

"The dispute adds to the global debate about mass tree-planting, with critics pointing out the sometimes poor survival rate of mass-planted saplings, and the use of such projects to 'greenwash' states and companies with otherwise poor environmental records."

 

If firms continue producing carbon at their current rates, then falsely accounting for carbon absorption will not make much difference. But, by planting trees that die before they get to absorb the carbon that has been 'allocated' to them, not only are we doing nothing to reduce the future damage of climate change, we are also kidding ourselves that we are making any kind of meaningful progress.

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Most of 11m trees planted in Turkish project 'may be dead'

By Sami Kent

January 30, 2020

The Guardian

https://www.theguardian.com/world/2020/jan/30/most-of-11m-trees-planted-in-turkish-project-may-be-dead

 

Strategic CSR - Jeremy Grantham

Following-on from Tuesday's newsletter, the article in the url below challenges the idea that an investment fund that excludes certain industries cannot be as productive as one that has no such restriction. In particular, the article reports on research by Jeremy Grantham looking at the effect on returns of excluding specific industries from funds he created:

 

"Mr Grantham checked the data to find out whether, and how much, omitting the stocks of any industry over three decades would have hurt a hypothetical investor. He created synthetic portfolios that left out each of the ten broad stockmarket sectors and compared their returns with the market as a whole."

 

The results were surprising, to say the least:

 

"[Excluding specific industries] made hardly any difference. The S&P index returned an average of 9.71% annually between 1989 and 2017; the index excluding energy stocks returned 9.74%. The range of returns, from the worst portfolio to the best, was just 0.5 percentage points."

 

So surprising, that he double-checked his results:

 

"This finding seemed like it might be a fluke. But a further check, going back to 1925, had a similar outcome. The spread between the best and worst portfolios was 0.54 percentage points; there was hardly any gap between the portfolio with energy stocks and without them. … The market, it seems, has done rather a good job over time of pricing stocks so that no broad industry group yields abnormal returns."

 

Grantham's conclusion is that, since there is no effective difference in excluding specific industries, there is no (financial) reason not to exclude oil stocks from any fund, or divest any funds of existing investments in oil stocks. On the contrary, given the risks facing the oil and gas industry in the (near) future, Grantham recommends that there might be very good reason to exclude them:

 

"Oil demand has already peaked in rich countries and, as climate fears grow and green technologies become cost-effective, it will eventually peak worldwide. But not everyone is keenly focused on this prospect. Scepticism regarding climate science is common in America. To the extent that sceptics are investors, and are betting on business as usual, at least some of the risks facing Big Oil may not be in the price. Investors might, for instance, miscalculate the speed of transition to greener energy. Advances in materials science and battery technology are making electric vehicles a cost-effective alternative to petrol-fuelled cars, Mr Grantham reckons. Other potential hazards face oil companies, including increased regulation and costly lawsuits. In other industries, such as tobacco, firms have been forced to pay up when found to have knowingly sold harmful products. He thinks the oil industry faces a similar reckoning."

 

He goes further:

 

"Is there also a moral case for disinvestment? … Bill Gates, a software mogul and philanthropist, has argued that people should not waste idealism and energy on a policy that will not cause any reduction in the use of fossil fuels. What matters are incentives set by governments: tax breaks to fund research in green energy; tax rises to discourage carbon use. But this misses the point, says Mr Grantham: 'You have to make the oil industry a pariah for bad behaviour.' Only then will politicians feel the need to act."

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Inessential oils

By Buttonwood

January 11, 2020

The Economist

Late Edition – Final

61

https://www.economist.com/finance-and-economics/2020/01/09/jeremy-grantham-on-divesting-from-big-oil

 

Strategic CSR - 50th Earth Day

With a nod to tomorrow's 50th anniversary of Earth Day, the newsletters this week focus on the field of ESG/SRI investing. Today, the article in the url below offers a broad critique by the WSJ columnist (James Mackintosh) who occasionally returns to this issue. Whenever he does, I find his perspective insightful because he tends to cut through a lot of the fluff that surrounds ESG/SRI (created largely by the investing companies trying to jump on the bandwagon). This column is no exception – I find the central conundrum that he presents fascinating:

 

"Much of ESG is about what economists call externalities: things such as carbon emissions that are free to the emitter but costly to wider society. Making money from pricing externalities is a matter of identifying which ones will lead to government, consumer or worker action and which ones won't."

 

The comment may seem cynical, but I think reflects how many investors (whether professional or layperson) think and act. If so, it captures an economic reality that is missing from most CSR commentary around ESG/SRI investing. It also takes into account the inconsistent approach from politicians (and all stakeholders, broadly speaking) to public policy:

 

"Treating your workers badly might help your profits, but it is likely to backfire in the long run as they leave for other employers. Using cheap ingredients that poison your customers, even if it seems to be legal, leads to lawsuits or government crackdowns."

 

The challenge, of course, is to identify when the backlash will come (and how strong it will be):

 

"It took decades for government to act on evidence that tobacco was killing people but just a few years to move against vaping. Alcohol, meanwhile, remains a great business despite the damage it does."

 

The result is that, although the amount of capital flowing into SRI/ESG funds is increasing rapidly (even more so in the current political environment), it is not clear it is achieving the goals that are intended for it. If so, then the investment companies are arguably deceiving many who are trying to channel their investments in ways that reflect their values. As Mackintosh notes at the beginning of this column:

 

"It is hard to move in the world of investment without being bombarded by sales pitches for running money based on 'ESG,' or environmental, social and governance criteria. The trouble is that few involved seem to agree on how it works (or, more to the point, doesn't)."

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

A Socially Responsible Strategy Can be Tricky

By James Mackintosh

November 13, 2019

The Wall Street Journal

Late Edition – Final

B1

https://www.wsj.com/articles/a-users-guide-to-the-esg-confusion-11573563604

 

Strategic CSR - Business Roundtable (III)

Here is an extra newsletter for this week due to the article in the url below, which is a follow-up to last Fall's Business Roundtable statement on stakeholder democracy (see Strategic CSR – Business Roundtable and Strategic CSR – Business Roundtable (II)). The purpose here is to check-in with how some of the statement's signatories are doing in light of the COVID-19 pandemic. In short, not good:

 

"Last August, the chief executives of 181 of America's largest corporations signed a document pledging their commitment to run their companies for the benefit of workers and communities, and not just for shareholders. … Today, with the planet under assault from a pandemic that has delivered the most profound economic pain since the Great Depression, key signatories are furloughing employees, paying dividends to shareholders and provoking complaints from workers that they aren't adequately protected from danger."

 

Some would argue this is not the best time to measure any shifts in the priorities of the firms that signed-up to the statement. Others would no doubt note that the responses of firms has varied (the article features Marriott prominently), with some signatories taking a broader stakeholder perspective. The article, however, is firm in its conclusions:

 

"Their actions expose the reality that the rhetoric of the Business Roundtable did not alter the decisive question of American capitalism — where the money goes. In the run-up to the crisis, many companies used cash to buy back their shares and pay out dividends, rewarding shareholders, while leaving themselves with fewer resources to aid workers when disaster struck."

 

Interestingly, the article calls out the main barrier to substantive change:

 

"So long as executive pay remained tied to stock prices, shareholder interest would remain supreme."

 

Have a good weekend.

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

A Vow by Big Business Proves Too Hard to Keep

By Peter S. Goodman

April 14, 2020

The New York Times

Late Edition – Final

B1, B4

https://www.nytimes.com/2020/04/13/business/business-roundtable-coronavirus.html

 

Strategic CSR - Buses

Following on from Monday's newsletter, the article in the url below presents the results of some data analysis that I found surprising:

 

"Sometime around 2013, bus ridership across much of the country began to decline. It dropped in Washington, in Chicago, in Los Angeles, in Miami. It dropped in large cities and smaller ones. It dropped in places that cut service, and in some that invested in it. It dropped in Sun Belt cities where transit has always struggled to compete with the car, and it dropped in older Eastern cities with a long history of transit use. By late 2019, through nearly seven straight years of decline, national bus ridership in America was at its lowest level since the mid-1970s, a trend that has left service already weakened as transit agencies brace for a public health crisis."

 

A graphic in the article reveals the extent of the decline in specific cities:

 

 

As always, attempting to work out what caused such a decline is challenging:

 

"The answer probably lies deep in a number of trends: the rise of on-demand technology, the changing nature of work, the evolution of e-commerce, the redevelopment of city centers, the influx of young professionals, and the suburbanization of the poor. Many seismic shifts in urban life are reflected in this one data point — the broad decline of bus ridership. … That's worrisome both for the remaining riders and for cities that will need strong mass transit to meet their climate goals."

 

One variable that needs to be controlled for is overall traffic – commuting traffic, in particular. The article suggests that, throughout the period under study, the economy was strengthening, which means there should have been more workers with more jobs requiring them to commute. But, if commuting traffic was declining at a faster rate than public transportation (perhaps, as younger workers move downtown instead of living in the suburbs) then, relatively, public transportation is capturing a higher percentage of the commuting population, even though overall numbers are declining. If commuting traffic has been flat or increasing, however, that is a more worrying situation:

 

"In Minneapolis, bus ridership began declining in 2014 and has fallen by 26 percent. Some bus trips appear to have shifted to a newly opened light rail line. But Uber and Lyft have expanded in the city over this same time. Bike commuting has increased. The transit agency has also detected an uptick in car ownership in neighborhoods historically well served by buses. And in a strong economy, Metro Transit struggled to replace a generation of retiring bus operators, hampering service. Workers have simply had more options, as agencies around the country have found."

 

One shift over this period that was not accounted for in the analysis is the influence of ride-hailing apps, like Uber or Lyft. As I have noted previously, many suspect that part of the business model of these companies is to slowly under-price public transportation (or over-convenience passengers) and, then, after all the buses have been removed from our streets, they will be able to increase prices and riders will have no other choice (see Strategic CSR – Uber):

 

"Studies have been less conclusive on the effect of ride-hailing companies, in part because their user data hasn't been accessible to researchers. But preliminary findings from a continuing project through the Transportation Research Board show that the largest declines in transit ridership at the metro level can be attributed to the introduction of ride-hailing services. And in the largest cities, ride-hailing has affected buses more than rail."

 

In spite of this, I found these results surprising because my idiosyncratic perception is that public transport is increasing. But, I live in the middle of a city, and the fact that the numbers are down across most metro areas in the U.S. is compelling (and concerning). And, if we end up working more at home after this pandemic, we should expect these declines to increase.

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

The Mystery of the Missing Bus Rider

By Emily Badger and Quoctrung Bui

March 13, 2020

The New York Times

https://www.nytimes.com/interactive/2020/03/13/upshot/mystery-of-missing-bus-riders.html

 

Strategic CSR - Uber

The CSR Newsletters this week are on the topic of transportation, public and private, in and around our cities.

 

One of the many advantages Uber was supposed to bring was the reduction in traffic around our cities. If we all didn't need to buy cars, the argument went, congestion would drop, we could find something more useful to do with all the space taken up by parking spots, we would arrive for appointments on time (because we would not need to search for parking), and, of course, the air would get cleaner as emissions dropped. As noted in the article in the url below:

 

"Five years ago, Travis Kalanick was so confident that Uber Technologies Inc.'s rides would prompt people to leave their cars at home that he told a tech conference: 'If every car in San Francisco was Ubered there would be no traffic.'"

 

Well, file this under the bulging folder of unintended consequences, but you may not be too surprised to find out that it has not worked out quite like that:

 

"Today, a mounting collection of studies shows the opposite: Far from easing traffic, Uber and its main rival Lyft Inc. are adding to congestion in numerous U.S. downtowns."

 

The article begins to quantify the effect of ride-hailing cars on our city streets and it is not good. For example:

 

"In New York, for-hire vehicle trips more than doubled from 2010 to 2018, while travel speed in lower Manhattan slowed 23%."

 

Here are some more select statistics quoted:

• 2.5 miles an hour: "Average downtown San Francisco traffic speed slowdown due to ride-hailing apps between 2010 and 2016."
• About 40%: "The share of time ride-hailing cars in California and New York City cruise without passengers."
• 77%: "Share of ride-hailing trips that are requested for one party only, rather than pooled, in Chicago's downtown."
• 309%: "The rise in ride-hailing trips starting or ending in downtown Chicago between 2015 and 2018."

 

Of course, none of this includes the effect Uber has had on the people who drive these cars for us, the conditions they work under, and whether the rise of contract workers simply exacerbates inequality (e.g., see Strategic CSR – Uber). Now, how do we put that genie back in its bottle?

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

The Ride-hail Utopia That Got Stuck in Traffic

By Eliot Brown

February 15-16, 2020

The Wall Street Journal

Late Edition – Final

B1, B6

https://www.wsj.com/articles/the-ride-hail-utopia-that-got-stuck-in-traffic-11581742802

 

Strategic CSR - Farming subsidies

The article in the url below summarizes a report by the Food and Land Use Coalition (https://www.foodandlandusecoalition.org/), which demonstrates the scale of the market distortions currently being distributed by governments in the agricultural sector:

 

"The public [worldwide] is providing more than $1m per minute in global farm subsidies."

 

What is worse is that almost none of these subsidies are promoting sustainable production processes. On the contrary, they are encouraging extremely damaging practices:

"Just 1% of the $700bn (£560bn) a year given to farmers is used to benefit the environment, the analysis found. Much of the total instead promotes high-emission cattle production, forest destruction and pollution from the overuse of fertiliser."

 

The best way to do this, the report argues, is to redirect these subsidies to more sustainable farming practices:

 

"The security of humanity is at risk without reform to these subsidies, a big reduction in meat eating in rich nations and other damaging uses of land, the report says. But redirecting the subsidies to storing carbon in soil, producing healthier food, cutting waste and growing trees is a huge opportunity, it says."

 

Specifically:

 

"A series of major recent reports have concluded the world's food system is broken. It is driving the planet towards climate catastrophe while leaving billions of people either underfed or overweight, 130 national academies of science and medicine concluded in November. Another report found that avoiding meat and dairy was the single biggest way to reduce your environmental impact on the planet, with livestock using 83% of farmland to produce just 18% of calories. The 'planetary health diet' published by scientists in January requires an 80% cut in the red meat eaten by Europeans and North Americans. Adopting this diet in coming decades would mean 60% of today's pasture could be used for wildlife or other purposes, an area similar to the size of Brazil."

 

In spite of these warning signs, the report:

 

"… couldn't find any examples of governments using their fiscal instruments to directly support the expansion of supply of healthier and more nutritious food. Overall, [the report] said the damaging way the world currently produces food and uses land causes $12tn a year in hidden costs to the environment, human health and development."

 

The report looked at agricultural subsidies worldwide, but also covered food production and the R&D that goes into improving the food supply chain:

 

"The subsidy analysis in the report was done by the International Food Policy Research Institute, using OECD data. It found three-quarters of the $700bn annual subsidy is paid directly to farmers and that 15% supports measures such as research on higher yielding crops and road building in rural areas. It analysed subsidies in 51 nations and includes most, but not all, of global subsidies."

 

While the report is highly critical of existing government support for big-ag, it finishes on a high note by mentioning some examples of the (rare) good practices that it found:

 

"Benefits from reforming subsidies has been seen in some places. Farmers in the European Union have reduced greenhouse gas emissions from fertiliser by 17% while yields rose, and China is phasing out support for fertilisers."

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

$1mn a minute: The farming subsidies destroying the world

By Damian Carrington

September 16, 2019

The Guardian

https://www.theguardian.com/environment/2019/sep/16/1m-a-minute-the-farming-subsidies-destroying-the-world

 

Strategic CSR - Democracy

The article in the url below reports on an interesting experiment in France aimed at a limited form of direct democracy:

 

"A nurse, a roofer, an electrician, a former fireman, a lycée pupil, a photographer, a teacher, a marketing manager, an entrepreneur and a civil servant. Sitting on red velvet benches in a domed art-deco amphitheatre in Paris, they and 140 colleagues are part of an unusual democratic experiment in a famously centralised country."

 

The group was formed as part of Emmanuel Macron's response to the Yellow Jackets movement, a citizen's uprising protesting against increased gasoline taxes, specifically, but growing income and wealth inequality, in general:

 

"Their mission: to draw up measures to reduce French greenhouse-gas emissions by at least 40% by 2030, in line with an EU target that is otherwise in danger of being missed. … Six months ago, none of them had met. Now, they have just one month left to show that they can reinvent the French democratic process—and help save the planet."

 

The "citizen's climate convention," as it is known, does not appear to have its own webpage, but it does have a Wikipedia page. The convention consists of a randomly-selected group of citizens who have been tasked with finding alternatives to the gas tax rise, which was so soundly rejected by French citizens last year:

 

"On March 6th the 'citizens' climate convention' was due to begin its penultimate three-day sitting, the sixth since it began work last October. The convention is made up of a representative sample of the French population, selected by randomly generated telephone numbers. … In response to the demand for less top-down decision-making, [Macron] first launched what he grandly called a 'great national debate,' which took place a year ago. He also pledged the creation of a citizens' assembly. It is designed to focus on precisely the conundrum that provoked the original protests against a rise in the carbon tax on motor fuel: how to make green policy palatable, efficient and fair."

 

By all accounts, it is a serious exercise:

 

"Divided into five working groups—to discuss such topics as transport, housing or food—they then began working on proposals that could actually be put into practice. Scientists, farmers, businessmen, urban planners and over 100 other witnesses were summoned. In January they invited Mr Macron, who spent over two hours answering questions and urged them to be 'precise' and 'bold.' In an over-lit basement meeting room on a recent Friday evening, small groups could be found poring over documents, discussing the feedback given by legal experts on their initial ideas. Five lawyers are on hand to help shape proposals into legally enforceable text."

 

It will be interesting to see whether the convention can generate some practical and meaningful policy recommendations. Due to the fact that the group was randomly-selected, it consists of people across the ideological spectrum and, as such, includes a representation of climate sceptics. While the ideological differences remain, perhaps the absence of special interests or lobbying groups can help cut through the inertia that has paralyzed the conventional political process on this issue:

 

"Despite such differences, over 90% of the original delegates are still taking part. … the gravity of the subject, along with Mr Macron's backing, have been crucial in persuading delegates to invest long hours and weekends away from home in the exercise. It is a gamble nonetheless. Next month, the assembly will send its final list of measures to Mr Macron. He has promised delegates that he would put the bulk of them either to parliament, or to a referendum."

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Aux powerpoints, citoyens!

March 7, 2020

The Economist

Late Edition – Final

50

https://www.economist.com/europe/2020/03/05/france-asks-its-citizens-how-to-meet-its-climate-change-targets

 

Strategic CSR - Revolution

The article in the url below states the case very well, I think, for the completely inadequate societal/governmental response to climate change so far. The current mass response to COVID-19 clearly shows we are capable of rapid mobilization when we want to (even while recognizing that many political leaders dragged their feet and continue to do so). It is a matter of desire rather than resources or any other possible explanation we have so far offered for not having done more, sooner:

 

"Had we put as much effort into preventing environmental catastrophe as we've spent on making excuses for inaction, we would have solved it by now. Everywhere I look, I see people engaged in furious attempts to fend off the moral challenge it presents."

 

The cause, according to the author, is a decoupling of individual action and societal benefit – first, the idea that the problem is too big for any single person can make a difference and/or, second, the idea that burying our heads in the sand is easier than facing up to reality:

 

"As the environmental crisis accelerates, and as protest movements like YouthStrike4Climate and Extinction Rebellion make it harder not to see what we face, people discover more inventive means of shutting their eyes and shedding responsibility. Underlying these excuses is a deep-rooted belief that if we really are in trouble, someone somewhere will come to our rescue: 'they' won't let it happen. But there is no they, just us."

 

I am in two minds about the proposed response, however:

 

"The political class, as anyone who has followed its progress over the past three years can surely now see, is chaotic, unwilling and, in isolation, strategically incapable of addressing even short-term crises, let alone a vast existential predicament. Yet a widespread and wilful naivety prevails: the belief that voting is the only political action required to change a system. Unless it is accompanied by the concentrated power of protest – articulating precise demands and creating space in which new political factions can grow – voting, while essential, remains a blunt and feeble instrument."

 

In short, and as revealed in the title of the article, the author is calling for revolution:

 

"Those who govern the nation and shape public discourse cannot be trusted with the preservation of life on Earth. There is no benign authority preserving us from harm. No one is coming to save us. None of us can justifiably avoid the call to come together to save ourselves."

 

I see the logic in the argument (incremental change is not going to get us there), but am troubled (somewhat) by the implications of the line of thought that is being advanced:

 

"Every nonlinear transformation in history has taken people by surprise. As Alexei Yurchak explains in his book about the collapse of the Soviet Union … systems look immutable until they suddenly disintegrate. As soon as they do, the disintegration retrospectively looks inevitable. Our system – characterised by perpetual economic growth on a planet that is not growing – will inevitably implode. The only question is whether the transformation is planned or unplanned. Our task is to ensure it is planned, and fast. We need to conceive and build a new system based on the principle that every generation, everywhere has an equal right to enjoy natural wealth."

 

What I find fascinating about the author's argument, however, is the quantification of revolution – what it would actually take for such a rebellion to occur. What is surprising about it is that the research he quotes suggests that it takes much less than you might think:

 

"As Erica Chenoweth's historical research reveals, for a peaceful mass movement to succeed, a maximum of 3.5% of the population needs to mobilise. Humans are ultra-social mammals, constantly if subliminally aware of shifting social currents. Once we perceive that the status quo has changed, we flip suddenly from support for one state of being to support for another. When a committed and vocal 3.5% unites behind the demand for a new system, the social avalanche that follows becomes irresistible. Giving up before we have reached this threshold is worse than despair: it is defeatism."

 

The author takes solace in the recent protests in London by Extinction Rebellion. But, he argues, they cannot be an end in themselves, but must be the beginning of some much bigger:

 

"The success of this mobilisation depends on us. It will reach the critical threshold only if enough of us cast aside denial and despair, and join this exuberant, proliferating movement. The time for excuses is over. The struggle to overthrow our life-denying system has begun."

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Only rebellion will prevent an ecological apocalypse

By George Monbiot

April 15, 2019

The Guardian

https://www.theguardian.com/commentisfree/2019/apr/15/rebellion-prevent-ecological-apocalypse-civil-disobedience

 

Strategic CSR - Waste

Here are some fascinating facts and figures about three types of waste from the article in the url below. First, food waste:

 

"According to a 2013 study from the University of Minnesota's Institute on the Environment, just under 40 percent of global crop calories are used to feed animals, most of them from corn and soybeans grown at an industrial scale. It's a particularly inefficient way to feed people: It takes about 100 calories of grain to produce just three calories' worth of beef, or 12 of chicken."

 

Second, clothing waste:

 

"The Rainforest Action Network has found that about 120 million trees from existing forests are cut down for textiles every year. … one study showed that about 2,900 gallons of water can be produced to make a pair of jeans."

 

Third, e-waste:

 

"About a third of the global population was expected to have an internet-connected phone by 2017, according to a report from eMarketer. In the United States, the typical home has 65 electronic appliances, according to a study from Natural Resources Defense Council."

 

And, the following two quotes are from the article in the second url below, which focuses on the waste being generated by food-delivery apps in China:

 

"Scientists estimate that the online takeout business in China was responsible for 1.6 million tons of packaging waste in 2017, a ninefold jump from two years before. That includes 1.2 million tons of plastic containers, 175,000 tons of disposable chopsticks, 164,000 tons of plastic bags and 44,000 tons of plastic spoons. Put together, it is more than the amount of residential and commercial trash of all kinds disposed of each year by the city of Philadelphia. The total for 2018 grew to an estimated two million tons."

 

As a result:

 

"China is home to a quarter of all plastic waste that is dumped out in the open. Scientists estimate that the Yangtze River emptied 367,000 tons of plastic debris into the sea in 2015, more than any other river in the world, and twice the amount carried by the Ganges in India and Bangladesh. The world's third and fourth most polluting rivers are also in China."

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Small Steps Take Aim at a Global Threat: Waste

By Tatiana Schlossberg

May 28, 2019

The New York Times

Late Edition – Final

B3

https://www.nytimes.com/2019/05/12/climate/waste-not-if-you-want-to-help-secure-the-future-of-the-planet.html

China Chokes on Takeout Plastic

By Raymond Zhong and Carolyn Zhang

May 28, 2019

The New York Times

Late Edition – Final

B1, B5

https://www.nytimes.com/2019/05/28/technology/china-food-delivery-trash.html

 

Strategic CSR - Oatly

Recently, I have made an effort to reduce the amount of milk that I consume and have started using oat milk, instead. This is not for medical or allergy reasons, I just thought it was a good idea to reduce my dairy intake and I really like the taste of Oatly. From the firm's website (https://www.oatly.com/int/about-oatly):

 

"Our sole purpose as a company is to make it easy for people to turn what they eat and drink into personal moments of healthy joy without recklessly taxing the planet's resources in the process. Oatly was founded back in the 1990s and is based on Swedish research from Lund University. The company's patented enzyme technology copies nature's own process and turns fiber rich oats into nutritional liquid food that is perfectly designed for humans. Today, the Swedish company remains independent and dedicated to upgrading the lives of individuals and the general well being of the planet through a lineup of original oat drinks."

 

In other words, not only is Oatly a good product, but I also like the company. Here is its mission/vision statement that is printed on every carton under the heading "Here's what we believe":

 

"Most companies think having a strong opinion means scaring away customers who think differently. We think it's a good way to make some new friends. For the record, we believe we should eat stuff we can grow instead of growing stuff to feed animals and then eat them. Everybody – regardless of spiritual beliefs, birth country, race, gender, sexual orientation or color of their nail polish – is of equal worth. The reckless pursuit of profits without any consideration for the well-being of the planet and the humans that live here should be considered a crime. Companies have as much responsibility as politicians for building a society the rest of the world can admire."

 

Good stuff, both ideologically and nutritionally, which we all need at the moment.

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

 

Strategic CSR - COVID-19

The article in the url below argues that plastic is making a bit of a comeback. And not just any old plastic, but the dreaded single-use plastic. After being the bane of environmentalists for the past couple of years, people are beginning to recognize there are at least some advantages to a material that is relatively cheap, sterile, and disposable:

 

"The war on plastics is being put on hold as the battle to contain coronavirus ramps up. Single-use plastic products, in the crosshairs over environmental concerns in recent years, are now getting a boost amid efforts to stop the spread of the virus. Personal drinking cups and reusable shopping bags are being shunned, while sales of bottled water, masks and wipes—made from plastic—have soared. At the same time, some recycling programs are being suspended because of concerns about the virus spreading."

 

Starbucks, which recently started testing coffee cups with a biodegradable liner, has stopped allowing customers to bring their own cups into the store to be filled by baristas. Instead, at least for the time being, the progressive firm will only serve plastic and their own (non-recyclable) cups, in order to optimize hygiene. Similarly:

 

"Fearing reusable shopping bags could spread the virus, New York state Sen. John Flanagan is calling for the state's plastic-bag ban to be suspended."

 

Environmental advocates recognize the threat this poses to their goals:

 

"Environmentalists say temporary moves away from reusable cups and bags could have a lasting impact on the fight against single-use plastics. They worry the move could raise bigger doubts about the hygiene of reusable products and disrupt fragile consumer habits."

 

They are correct to be worried as concern about the hygiene of reusable plastic products is legitimate (see Strategic CSR – Conspicuous virtue and Strategic CSR – Anti-plastic), along with the argument that, in practice, plastic bags are more environmentally friendly than their supposedly greener alternatives (see Strategic CSR – Plastics). As noted in the article in the second url below, all the research suggests that the value to the environment of banning plastic bags is, at best, debatable:

 

"Independent studies conducted from 2010 through 2019 by researchers in the U.S., the U.K., Continental Europe, Asia and elsewhere all concluded that single-use plastic bags—like the ones commonly found in grocery stores—rank better in almost every environmental category than bags made of paper, cotton or more durable plastics."

 

The only respect in which alternatives to plastic bags are better is litter. In terms of resource utilization, single-use plastic bags are almost always the most environmentally-friendly option. Yet, littering is the one activity in the plastic bag lifecycle that we have the power to correct (i.e., by improving recycling rates and technologies). But, the arguments need to be made in a clear and comprehensive way that minimizes the spread of misinformation. Yet, misleading or inaccurate information (combined with knee-jerk reactions) is something we are very good at. As a result, if preventing the spread of this particular virus is the main concern, the firms mentioned in the article seem to be over-reacting with the measures that have been taken to date:

 

"Upstream, a nonprofit, … defended reusables. 'Coronavirus mainly spread through coughs and sneezes, not your reusable water bottle or cup,' it said, adding that disposable items could harbor pathogens that settled during manufacturing and transportation."

 

As we have seen the implications of COVID-19 play out, I have been really interested in research about how societies adapt to major disruptions. It seems that, many of the changes to our routines that we introduce are things that we tend to hold onto, even after the disruption ends. Clearly, we are currently facing a major disruption to almost all aspects of our lives. What will be interesting is how many of the adaptations we are currently grappling with will remain permanent and how many will fade as we are allowed to emerge from our homes (at some point). In terms of university education, in particular, I am worried that people who support more online delivery will use the current experiment we are running to advocate in favor of not returning to the classroom once it is safe to do so. If so, I worry that something fundamental about our profession will be permanently lost.

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

War on Plastic Takes a Back Seat

By Saabira Chaudhuri

March 20, 2020

The Wall Street Journal

Late Edition – Final

B4

https://www.wsj.com/articles/war-on-plastic-takes-a-back-seat-in-coronavirus-crisis-11584624140

What Happens When Plastic Gest the Sack?

By Jo Craven McGinty

March 21-22, 2020

The Wall Street Journal

Late Edition – Final

A2

https://www.wsj.com/articles/when-plastic-bags-get-the-sack-11584696600

 

Strategic CSR - Scientists

The article in the url below makes the case that scientists significantly under-estimated the threat posed by climate change. Although the potential scale was misunderstood, it was the pace of change that scientists most failed to predict:

 

"Science is a process of discovery. It can move slowly as the pieces of a puzzle fall together and scientists refine their investigative tools. But in the case of climate, this deliberation has been accompanied by inertia born of bureaucratic caution and politics. A recent essay in Scientific American argued that scientists 'tend to underestimate the severity of threats and the rapidity with which they might unfold' and said one of the reasons was 'the perceived need for consensus.' This has had severe consequences, diluting what should have been a sense of urgency and vastly understating the looming costs of adaptation and dislocation as the planet continues to warm."

 

The results of this (somewhat understandable) caution are increasingly obvious and potentially devastating:

 

"In 1990, the Intergovernmental Panel on Climate Change, the United Nations group of thousands of scientists representing 195 countries, said in its first report that climate change would arrive at a stately pace, that the methane-laden Arctic permafrost was not in danger of thawing, and that the Antarctic ice sheets were stable. Relying on the climate change panel's assessment, economists estimated that the economic hit would be small, providing further ammunition against an aggressive approach to reducing emissions and to building resilience to climate change."

 

More recent models, of course, suggest a very different picture:

 

"The climate change panel seems finally to have caught up with the gravity of the climate crisis. Last year, the organization detailed the extraordinary difficulty of limiting warming to 2.7 degrees Fahrenheit (1.5 degrees Celsius), over the next 80 years, and the grim consequences that will result even if that goal is met."

Most concerning:

"More likely, a separate United Nations report concluded, we are headed for warming of at least 5.4 degrees Fahrenheit. That will come with almost unimaginable damage to economies and ecosystems. Unfortunately, this dose of reality arrives more than 30 years after human-caused climate change became a mainstream issue."

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

How Scientists Got Climate Change so Wrong

By Eugene Linden

November 10, 2019

The New York Times

Late Edition – Final

SR4

https://www.nytimes.com/2019/11/08/opinion/sunday/science-climate-change.html

 

Strategic CSR - Microsoft

The article in the url below reports on an interesting finding from a particularly progressive experiment conducted by Microsoft Japan:

 

"Microsoft tested out a four-day work week in its Japan offices and found as a result employees were not only happier – but significantly more productive."

 

Specifically:

 

"For the month of August, Microsoft Japan experimented with a new project called Work-Life Choice Challenge Summer 2019, giving its entire 2,300 person workforce five Fridays off in a row without decreasing pay. The shortened weeks led to more efficient meetings, happier workers, and boosted productivity by a staggering 40%, the company concluded at the end of the trial. As part of the program, the company had also planned to subsidize family vacations for employees up to ¥100,000 or $920."

 

And, the benefits did not stop there:

 

"In addition to the increased productivity, employees took 25% less time off during the trial and electricity use was down 23% in the office with the additional day off per week. Employees printed 59% fewer pages of paper during the trial."

 

The article lists different related experiments with the four-day work week and productivity going on around the world. One German entrepreneur has even instituted a five-hour workday at his firm. Perhaps not surprisingly:

 

"The vast majority of employees – 92% – said they liked the shorter week."

 

The key here, of course, is whether this effect is due to the change itself (because the experiment was new and exciting, and therefore momentarily motivating) or whether there is something fundamental to the structure of a four day work week (and a three day weekend) that enables greater productivity. It seems difficult to believe, for instance, that a group could be 40% more productive in 20% less time. I would think that being able to sustain the same productivity in 20% less time would be a more realistic goal over the medium to long term. Either way, there is growing evidence that the number of hours at work is only loosely related to productivity (see also, Strategic CSR – Productivity). Companies that are willing to innovate in this area are likely to have employees that perform at a higher level, are more loyal, and most likely happier.

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Microsoft Japan tested a four-day work week. Productivity jumped by 40%

By Kari Paul

November 4, 2019

The Guardian

https://www.theguardian.com/technology/2019/nov/04/microsoft-japan-four-day-work-week-productivity

 

Strategic CSR - Ads

Under the heading of meaningful action, the article in the url below contains an interesting story:

 

"The Guardian will no longer accept advertising from oil and gas companies, becoming the first major global news organisation to institute an outright ban on taking money from companies that extract fossil fuels."

 

This is part of a larger effort by The Guardian to respond to growing concerns about climate change – these range from referring to the issue as the "climate emergency" (as opposed to 'climate change') and also reducing the organization's carbon footprint (a commitment to be "carbon-neutral by 2030, while also almost entirely divesting its Scott Trust endowment fund from fossil fuel investments"):

 

"The move … will be implemented with immediate effect. The ban will apply to any business primarily involved in extracting fossil fuels, including many of the world's largest polluters."

 

This decision is meaningful not for the impact it will have on fossil fuel firms (although, that would change if every media company did this), but more in terms of the sacrifice being made by The Guardian:

 

"The decision to reject the advertising money from fossil fuel firms comes at a tricky time for the media industry, with the Guardian Media Group board warning the business is facing substantial headwinds this year. Advertising makes up 40% of GMG revenue, meaning it remains a key way to fund the journalism produced by Guardian and Observer journalists around the world."

 

Although an important step, the newspaper avoided taking the more dramatic step demanded by some:

 

"… some readers would like the company to turn down advertising for any product with a significant carbon footprint, such as cars or holidays, but [the company] said this was not financially sustainable while the media industry's business model remained in crisis."

 

In other words, given the precarious nature of newspaper finances today, this is a risk and one the paper feels it will be rewarded for. In other words, it has listened to its stakeholders and responded with substantive action. In order for this to be sustained, readers need to demonstrate that they support what the firm has done, recognize there is a financial cost associated with it, and ensure that cost does not fundamentally damage the organization:

 

"The campaign group Greenpeace welcomed the move. 'This is a watershed moment, and the Guardian must be applauded for this bold move to end the legitimacy of fossil fuels,' said Mel Evans, senior climate campaigner for Greenpeace UK."

 

Unfortunately, Greenpeace was not proposing a way for the newspaper to replace the revenue that will be lost by refusing these ads. Nevertheless, I was pleased to see that the story was picked up in other major newspapers (e.g., here).

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (5e)

© Sage Publications, 2020

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e 

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


Guardian to ban advertising from fossil fuel firms

By Jim Waterson

January 29, 2020

The Guardian

https://www.theguardian.com/media/2020/jan/29/guardian-to-ban-advertising-from-fossil-fuel-firms-climate-crisis