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.

Thursday, September 28, 2023

Strategic CSR - Value

The article in the url below is a radio interview, held a decade after the 2008 Financial Crisis, with the author of a book that had just been released, The Value of Everything: Making and Taking in the Global Economy (2018). The author's goal in writing the book, and why I found it interesting, was to redefine (or perhaps 'recapture' is more accurate) what we understand to constitute value.

To summarize: In calling for a broader theory of value in a wide ranging discussion (in the interview), the author draws a distinction between value determining price (previously) and price determining value (today) – a change she argues has occurred over the last couple of hundred years. In other words, previously, the more we valued the way something was produced, the more we would be willing to pay for it (emphasizing trades people and artisanal skills). This compares to today, where the author argues we now have it backwards because we interpret the price itself as determining how much we should value the product or service – in other words, things that are expensive are, by definition, more valuable to us than things that are cheaper. This same logic can be extended to resources such as labor, which is today valued by wage levels (generally determined at the intersection of demand and supply), rather than necessarily the nature of the work that is performed. In other words, we reward rarity, simply for the sake of being rare, rather than rewarding the work that delivers the most happiness or social value, or some other metric, which we used to do and the author thinks is a more commonsensical understanding of what we should value.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


A New Way to Calculate Economic Value
The Brian Lehrer Show
September 10, 2018
WYNC
 

Monday, September 25, 2023

Strategic CSR - Green-hushing

The article in the url below suggests that, in the face of growing polarization around ESG-related issues, companies are engaging in more "green-hushing":

"Executives at U.S.-listed companies mentioned 'environmental, social and governance,' 'ESG,' 'diversity, equity and inclusion,' 'DEI' or 'sustainability' on 575 earnings calls from April 1 to June 5, down 31% from the same period last year. … That is the largest such year-over-year decline and the fifth consecutive quarter of year-over-year drops, following a pickup in these discussions and corporate social efforts in the wake of the police killing of George Floyd in May 2020."

The chart in the article highlights the definite trend that emerged over the last couple of years:

 

Although executives are talking less often about the variety of issues that fall under the ESG umbrella, there does not seem to be any less action (which is encouraging):

"While such instances of 'green-hushing' may be part of a larger strategy for many companies to avoid weighing in on divisive issues, there is little sign that public companies are pulling back from the initiatives themselves, such as DEI employee training and emissions reductions. Companies still regularly voluntarily issue detailed sustainability reports, disclose greenhouse-gas emissions and tie a portion of their executive compensation to ESG metrics. Businesses are also busy preparing soon-to-be-unveiled new climate-disclosure requirements from the Securities and Exchange Commission by creating systems for collecting data and managing future compliance costs."

This reminds me of Walmart, which has long engaged in best-practice sustainability issues in its supply chain, but does not advertise their progress to their customers. Research suggests that customers who see a "green" product assume that it is priced as a premium product, even though it could easily be cheaper. But, Walmart is most concerned about its price sensitive customers and perceptions around value (rather than actual value), so better for the firm to engage in the practice, but not tell anyone about it.

This is opposite to a strategic CSR approach to business. Much better, in my opinion, to stand behind a clear set of values and run the business accordingly. In my mind, that generates greater loyalty to the firm among all stakeholders, which is essential in order to operate the business at its optimal potential.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


Companies Seek to Avert Backlash, Avoid Talk of Social, Green Issues
By Mark Maurer
June 13, 2023
The Wall Street Journal
Late Edition – Final
A1-2
 

Friday, September 22, 2023

Strategic CSR - Oatly

I saw this ad in main section of The Sunday New York Times on May 7 (pp.18-19), earlier this year:


Several thoughts on this (and Oatly, which I featured favorably in a prior newsletter; see Strategic CSR – Oatly):

First, Tropicana was one of the earliest brands to calculate the carbon footprint of their orange juice, more than 10 years ago (see Strategic CSR – PepsiCo). What is interesting is that, at that time, I recall they did not advertise the number – the wanted the knowledge primarily to improve their operating/supply chain efficiency. But, if marketing is central to the effort, as it obviously is for Oatly, then there are two questions that are essential – how accurate is the number (are they counting everything that needs to be counted; there are real issues with scope 3 emissions, let along scope 4 – see Strategic CSR – Scope 4 emissions) and does anyone understand it? It will not cause any change in behavior unless customers understand what that number means and can compare it to competing products (the absence of consistent numbers across companies and industries is why all the ESG stuff has been essentially meaningless, so far; see Strategic CSR – ESG).

Second, Oatly is not as good a product as I originally thought. It tastes great, but the reason is that it is stuffed full of sugar. My doctor told me the golden rule is that the amount of protein needs to be greater than the amount of sugar, and I think in Oatly it is the same, 5g of both (if I am remembering the numbers correctly). Fairlife (a Coke product) is much better on this metric – lactose free and much more protein than sugar.

So, the danger with so many of these initiatives at present (because there is no standardization) is that Oatly draws consumers' attention to this work that they are doing (which is no doubt well-intentioned, but may or may not be meaningful – really hard to know without a lot of digging) as a way of concealing the fact that their product is not that much different than drinking a can of soda.

For more information on some of Oatly's progressive approach to this issue, see: https://www.oatly.com/en-us/stuff-we-sell/climate-footprint

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

Tuesday, September 19, 2023

Strategic CSR - Diamonds

The article in the url below suggests that artificial (man-made) diamonds are beginning to make serious inroads into the market for natural diamonds:

"More than a third of all engagement rings with center stones purchased last year were created in a lab, according to an online survey of nearly 12,000 U.S. couples. … That's double the number from 2020."

Since the survey data are self-reports, the results might be dismissed by some but, if there is a bias, I would expect it to be in favor of inflated numbers for real diamonds. More important, I think (and missing from the report), is whether it is price or values that is driving demand. A natural diamond takes millions of years to be created and then, of course, needs to be mined under conditions that are often far from ideal. Artificial diamonds, on the other hand, clearly do not take quite so long and are much more accessible (and ethical):

"Man-made diamonds are grown by placing a diamond seed in a sealed chamber with a carbon-containing gas such as methane. The carbon atoms bond like a lattice to the seed, building up a diamond crystal. It takes about 600 hours to grow one carat depending on the method. Their appeal, according to lab-diamond makers, is that they cause less environmental and human damage than mining diamonds from the earth as well as their cheaper price."

As a result, it is assumed, their popularity is spreading:

"It's not just engagement rings. Diamonds grown in a lab accounted for 13.6% of the $88.6 billion in diamond jewelry sold globally in 2022, up from less than 1% in 2015 where they had hovered since the early 2000s."

Specifically, the goal (for supporters) is to eradicate the possibility of an unethical supply chain:

"Proponents of man-made diamonds say growing diamonds in a lab helps stamp out conflict diamonds, or diamonds mined in war-torn regions and used to fund insurgencies. [In response] The mining industry says it traces the origins of diamonds to help stop the flow of conflict diamonds under what is called the Kimberley Process."

But, even if the primary motivating factor is morality (and the environmental angle is interesting), it is not clear there is an easy choice, as the main lobbing group for the diamond industry is getting better at arguing:

"'Consumers are being told that lab-grown diamonds are sustainable and that couldn't be further from the truth,' says David Kellie, CEO of the Natural Diamond Council, a diamond mining trade group. The group began airing videos on social media in April as part of what it calls a 'myth-busting' campaign. According to a new report by the group, more than 60% of lab-grown diamonds are made in China and India, where climate-polluting coal is the major power source. The report also touts efforts by the mining industry to cut carbon emissions and boost the economies of countries with major diamond mines such as Botswana and Namibia."

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


This Wedding Season, Diamonds Face a Challenge
By Suzanne Kapner
April 29-30, 2023
The Wall Street Journal
Late Edition – Final
B1, B6
 

Thursday, September 14, 2023

Strategic CSR - #boycott

The article in the url below raises a question that is central to the challenge of strategic CSR – how do firms know what their stakeholders truly care about? More specifically, it focuses on the intersection of strategic CSR and social media, and the extent to which firms should view online 'protests' as a valid indicator of stakeholder values:

"Amanda Booth first witnessed the phenomenon of labeling yourself progressive online while endorsing different values in real life when her white coworkers mentioned buying property in East Austin. The area is popularly known as a redlined neighborhood, primarily housing Austin's Black and brown community. Recently, the East Side has undergone major renovations with new modern houses, trendy bars, and local coffee shops, as gentrification pushes out the original inhabitants of the area. But when Booth, a 24-year old content designer in Austin, confronted her coworkers by explaining that Black and Hispanic people were being displaced from the area, her remarks were met with silence. 'Both of these guys proudly express themselves as being more on the progressive side of the Democratic party,' Booth said. 'Mind you, both of them have houses on the East Side now.' 'It's not enough to believe in racial justice and that Black people deserve things. White people need to begin giving up their privilege. The least they can do is try to plug into Austin's anti-displacement efforts. But I don't really see those people doing that,' Booth continued."

In prior newsletters, I have highlighted instances where companies acted in ways that led to consumer/public backlash (including negative headlines and #boycott protests online), but that did not affect future performance (e.g., Strategic CSR – Uber, Strategic CSR – United, and Strategic CSR – United Airlines). Clearly, all such examples are complicated and, to some extent, idiosyncratic. But, the fact that there are multiple examples suggests that, just because an online #boycott campaign erupts, that should not necessarily be taken as a sign by companies that their stakeholders actually mean what they say (or, at least that a meaningful proportion of them are serious in their online pledges to boycott).

So, what is the takeaway – that firms should not care what is written about them online? Probably not, but I do think that asking stakeholders what they care about is likely the least effective way of finding out. Much of what happens on social media is performative and, at best, captures the social temperature at a moment in time. Such momentary indicators should probably not drive firm strategy. Much better to ensure all action is consistent with the firm's professed values (which should be determined via discourse with stakeholders), and then ride out any criticism that follows. I am guessing if Budweiser had done that over the summer, for example, they may still be making the best selling beer in the U.S.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


White clicktivism: Why are some Americans woke online but not in real life?
By Brianna Holt
December 9, 2020
The Guardian
 

Tuesday, September 12, 2023

Strategic CSR - Homelessness

I love buildings that have been designed intentionally to serve multiple purposes in the community. A good example is a "new family homeless shelter" in Washington D.C. that is described in the article in the url below and was named after "Aya" ("a benevolent soul in Turkish mythology"):

"The facility, … completed in 2021, aims to live up to its name. The Aya is part of a citywide effort spearheaded by DC Mayor Muriel Bowser in 2016 to create a series of neighborhood homeless shelters, one in each of the city's eight wards. Tasked with designing a 50-unit facility for Ward 6, [the architects] enlisted local residents for their input. The firm's design reflects their priorities …. Neighbors wanted a building that looked hopeful, not bleak."

Moreover, the local community asked that the building should not have a discernable front or a back:

"That means that on top of incorporating the special needs of a shelter for families experiencing homelessness, the designers made sure that the Aya has no face — or rather, four different faces. Each side of the building expresses a different function for the families staying at the shelter. … 'Each façade of the building is telling its own story.'"

There are a number of other features that reinforce the idea that this building is part of the solution for those who live in it, rather than exacerbating the problem, which is a big part of modern-day urban life in the U.S.:

"Families that stay at the shelter are quite young: The average age for children there is 3. So the city required it to offer safe spaces for play. [The architects] designed a series of outdoor-style indoor play rooms on the building's east side, rooms that climb in a stair-wise pattern up the building. Brick brise-soleil screens along these rooms offer a playful mirror of the architectural textures found in mid-century apartment buildings in the neighborhood."

One of the challenges of being a European living in the U.S. (after several years living in Japan) is coming to terms with the level of homelessness that is a very present part of the society in which I live. In short, homelessness is generally not a problem that you see in Europe, or other developed countries like Japan or South Korea. That means there are solutions that work in those countries that are not being applied here in the U.S., for whatever (likely ideological) reason. On that, the article in the second url below presents a fascinating re-framing of the problem, arguing that homelessness is purely a function of the amount of affordable housing in a society. The article also makes clear that homelessness is most definitely not caused by "drug abuse and mental illness," or even climate. Such ailments might be characteristics of homelessness, but not the main cause. This is clear when you realize that homelessness is not experienced equally across the country, but collects in very specific places where housing costs are high, which is most often in areas that are growing in popularity. So much so that, homelessness is really only a problem in those cities that everyone wants to move to:

"Why is this so? Because these 'superstar cities,' as economists call them, draw an abundance of knowledge workers. These highly paid workers require various services, which in turn create demand for an array of additional workers, including taxi drivers, lawyers and paralegals, doctors and nurses, and day-care staffers. These workers fuel an economic-growth machine—and they all need homes to live in. In a well-functioning market, rising demand for something just means that suppliers will make more of it. But housing markets have been broken by a policy agenda that seeks to reap the gains of a thriving regional economy while failing to build the infrastructure—housing—necessary to support the people who make that economy go. The results of these policies are rising housing prices and rents, and skyrocketing homelessness."

More specifically, because these supercities in the US are largely Democratic, the article argues it is the liberal policies advocated in these areas that are fueling the homeless crisis:

"Liberals have stated preferences that housing should be affordable, particularly for marginalized groups that have historically been shunted to the peripheries of the housing market. But local politicians seeking to protect the interests of incumbent homeowners spawned a web of regulations, laws, and norms that has made blocking the development of new housing pitifully simple. This contradiction drives the ever more visible crisis."

It naturally follows that the solution is to build more housing – more affordable housing in those cities to which people want to move means less homelessness:

"Houston's success in combatting homelessness—down 62 percent since 2011—suggests that a focus on moving people into permanent supportive housing provides a road map to success. (Houston is less encumbered by the sorts of regulations that make building housing so difficult elsewhere)."

Although, initially, more housing will stem the price increases of those (loyal voters) who already own their own home; ultimately, it should make these cities even more livable (and desirable) because there should be less incidents of homelessness.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


A DC Homeless Shelter with Many Faces
By Kriston Capps
December 10, 2022
Bloomberg

The Obvious Answer to Homelessness: And why everyone's ignoring it
By Jerusalem Demsas
December 12, 2022
The Atlantic
 

Thursday, September 7, 2023

Strategic CSR - Climate justice

The article in the url below suggests a meaningful step to making progress on climate change, and reinforces the sense that the vehicle to achieving this progress will increasingly be the courts (see Strategic CSR - Danone):

"A UN resolution was adopted [in March] that should make it easier to hold polluting countries legally accountable for failing to tackle the climate emergency, in a vote which was hailed as a historic victory for climate justice."

What makes this decision different, the article suggests, is that it helps define the responsibilities that state actors have to prevent climate change:

"The UN general assembly adopted by consensus the resolution spearheaded by Vanuatu, a tiny Pacific island nation vulnerable to extreme climate effects, and youth activists to secure a legal opinion from the international court of justice (ICJ) to clarify states' obligations to tackle the climate crisis – and specify any consequences countries should face for inaction."

As made clear in the reaction to the decision, it is those countries who had little to no role in producing the carbon that is now saturating our climate (and also did not see any of the economic benefits that it allowed) who will face some of the worst results of that pollution:

"'We are just ecstatic that the world has listened to the Pacific youth,' said Cynthia Houniuhi, president of Pacific Island students fighting climate change (PISFCC). 'Through no fault of our own, we are living with devastating tropical cyclones, flooding, biodiversity loss and sea level rise. We have contributed the least to the global emissions that are drowning our land.'"

The advantage of the resolution, from the perspective of its advocates, is that it helps lay out a legal process for determining culpability:

"The resolution, which was co-sponsored by more than 120 countries including the UK, but not the US, will help establish a legal litmus test of sorts for the global climate justice movement seeking to hold countries to account for climate failures in the courts. … In essence, the ICJ advisory will help establish whether there is legal obligation for countries to do what they have committed to in non-binding treaties such as the 2015 Paris climate accord, and whether failure to do so can be challenged through litigation."

But, as with most collective action taken in the name of combatting climate change, enforcement will be the defining factor as to whether this moves the needle, at all, and also the most challenging aspect of the decision to implement:

"While the opinion from the world's highest court will not be binding in domestic courts, establishing international legal rules can be influential on judges and governments. It also represents the first attempt to establish climate action obligations under international law, which advocates hope will strengthen climate-related litigation by helping vulnerable states and advocates hold countries accountable for their action and inaction."

As with any action that is perceived to be unfair, or even illegal, it is not the action itself that determines culpability, but the attempt to hold the actor to account by others that matters. In the U.S., for example, a law can be passed at a lower level, and implemented and enforced for years (even decades), but it is only when someone takes the time to sue that the law itself can be challenged and might be determined unconstitutional. It is always our willingness to hold others to account, in reality, that determines the behavior that is sanctioned or prohibited by society:

"The resolution emerged out of mounting frustration at the mismatch between the global community's rhetoric and action on climate change, amid escalating losses for countries such as Vanuatu, which face an existential threat due to sea-level rise. The frustration spurned a social movement led by Vanuatu law students turned youth activists, and work on the resolution was led by Indigenous lawyers in the Pacific."

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


United Nations adopts landmark resolution on climate justice
By Nina Lakhani
March 29, 2023
The Guardian
 

Monday, September 4, 2023

Strategic CSR - Sesame

File the article in the url below under the category of unintended consequences (see also Strategic CSR – Jevons Paradox; Strategic CSR – Dodd-Frank; and Strategic CSR – Unintended consequences). The issue is sesame allergies in children, and the responsibilities companies have to clearly label their food products with all ingredients and prepare them in a way that is consistent. On January 1, this year, the government introduced legislation in the U.S. that was designed to strengthen these responsibilities. In other words, if there was no sesame in the ingredients, companies were compelled to adequately clean their equipment to eradicate the possibility of contamination. Crucially, the new higher standards only applies to products that already have sesame as an ingredient. Straightforward, right?

"On Jan. 1, a law intended to safeguard the more than 1.5 million Americans with a sesame allergy … took effect. The law mandates, among other things, careful cleaning to prevent cross-contact between food products with and without sesame."

Apparently not. Because the companies felt a zero-tolerance approach to compliance was too difficult for them to guarantee, they instead started adding small amounts of sesame to products that normally did not have any as a way of skirting the law. This change has had predictable consequences for children who have sesame allergies:

"The result? Foods that sesame-allergic kids and adults have eaten safely for years are now potentially life-threatening."

What is interesting about this legislation, though, is that it is far from unique:

"The Food Allergy Safety, Treatment, Education and Research (Faster) Act mandates careful cleaning of manufacturing equipment to ensure foods are sesame-free or clear labeling of all foods with sesame — many foods previously were labeled only as containing tahini, which is made from ground sesame, for instance. Similar laws have protected millions of Americans allergic to peanuts, tree nuts, milk, eggs, wheat, soy, fish and shellfish for nearly two decades. Like those foods, sesame can provoke allergic reactions from mild to life-threatening."

Whatever the explanation, companies are being explicit about the response they made, seemingly with little concern for the implications for those who the legislation was intended to protect – allergic children:

"Some in the food industry say adding sesame flour is the safest path forward. They contend that they can't sufficiently clean their equipment to guarantee it is free of sesame, as the Faster Act requires. And, under federal labeling rules, they can't state that their products contain sesame unless the items actually contain it — so they're adding sesame and labeling it."

And, of course, they are not doing anything illegal. There is nothing to say that a product cannot contain sesame, as long as it is clearly labelled. The frustrating thing for parents of children with these allergies, however, is that they are now forced to re-check all the food products they had previously determined were safe for their kids. Needless to say, the companies do not advertise their change; they simply alter the ingredients listed on the label:

"Because companies are adding sesame in the form of flour, not seeds, the added allergen is invisible to the eye, making it more dangerous — especially when food is served in group settings, like schools and summer camps, where labels aren't nearby, advocates say."

The fact that legislation like this is far from unique makes the corporate response more frustrating is it appears to be the first time it is happening (whereas, previously, they complied). It could be that the legislation is more onerous in this case, but that is not suggested in the article. More likely, it seems the companies just could not be bothered to comply and that adding a little bit more of another ingredient to the product (even though there is no beneficial impact in terms of that product) was the easiest response:

"'There was no hint that this would happen, because companies had not done this with the other eight allergens [specified in federal law], and this isn't happening in other countries that label for sesame,' said Sen. Chris Murphy (D-Conn.), one of the bill's co-sponsors."

As a result, the only reason that sesame flour is now an ingredient in many products (there are lots of examples in the article) is because it helps companies avoid complying with a law that would increase their costs. The companies themselves, of course, are presenting their response to the legislation as an attempt to increase customer safety:

"The American Bakers Association did not respond to questions about adding sesame flour. Instead, it provided a statement from Lee Sanders, its senior vice president of government relations and public affairs: 'The wholesale baking sector prioritizes consumer safety. Baking companies are working with their customers, including restaurants, to transparently disclose any allergen labeling changes to help ensure consumer safety.'"

The response of parents with allergic children who are now threatened, is slightly different:

"Manufacturers 'could have done the right thing, and they didn't,' said Brubaker-Flood, the mom from Michigan. 'They had ample time to come up with new procedures to prevent cross-contamination, and instead they took the crazy route and deliberately added an allergen instead.'"

For more on this issue, see the article in the second url below.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


To comply with a new sesame allergy law, some businesses add – sesame
By Karen Weese
April 11, 2023
The Washington Post

Sesame Labels Backfire for Allergic
June 15, 2023
The Wall Street Journal
Late Edition – Final
A6
 

Thursday, August 31, 2023

Strategic CSR - Fossil fuel subsidies

Here's a number, from the article in the url below, to focus your attention on the scale of the challenge ahead:

"The International Monetary Fund calculated that just over $7 trillion in subsidies went to fossil fuels last year. That is a record for at least the past decade. Since the IMF's report expresses all figures in 2021 dollars, inflation cannot explain away the increase. In short, the world has never spent this much to subsidize fossil fuels."

Just as concerning, perhaps, is that this number (which is spent annually) is many times larger than the amount of money being invested in the transition to renewables:

"The world is headed for a record year of investment in the energy transition. Every new clean electron generated by wind turbines and solar arrays, and each new battery-powered car and hydrogen electrolyzer, will reduce some measure of the fossil fuels consumed on the planet's roads and grids. More than $1 trillion was spent on the transition last year, and almost certainly will be spent again in 2023."

The only hope, perhaps, is that this $7 trillion comprises both explicit subsidies (lowering the purchase price) and implicit subsidies (failing to account for externalities), and not in equal amounts:

"About one-quarter of the total — $1.33 trillion — is made up of what the IMF terms explicit subsidies, or undercharging for the cost of supplying a fossil fuel or electricity. … But that still leaves a balance of $5.7 trillion in implicit subsidies, or undercharging for the environmental costs of a fuel, as well as forgone taxes on consumption. … Implicit subsidies grew less in percentage terms than explicit ones, but given their scale, they increased nearly as much in absolute terms — by more than $500 billion."

Both numbers are record highs (so the problem is getting worse, not better). But, in theory at least, these implicit subsidies could be fixed if the political willpower existed to pass a global carbon tax (the approach that is widely acknowledged by economists as the most effective way to make immediate headway against climate change – see Strategic CSR – Carbon Tax).

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


The Biggest Fossil Fuel Subsidies Are Indirect, and Bigger Than Ever
By Nathaniel Bullard
August 31, 2023
Bloomberg

Monday, August 28, 2023

Strategic CSR - WFH

I think there are a number of disadvantages (individually) to working from home (WFH). These range from a lack of social interaction (and excessive screen time) to a reduced chance of being promoted. I am betting there are disadvantages to the organization, too. The article in the url below covers an issue that bridges both – a disadvantage to the individual (less meaning/purpose) and a disadvantage to the organization (fewer engaged employees):

"People who work from home are feeling more disconnected from the larger mission of their employers. In a new Gallup survey, the share of remote workers who said they felt a connection to the purpose of their organizations fell to 28% from 32% in 2022—the lowest level since before the pandemic. The findings are from a survey this spring and summer of nearly 9,000 U.S. workers whose jobs can be done remotely."

Interestingly, hybrid workers register the highest in terms of connection to the company's purpose. I suppose the key question then is, what does "hybrid" look like – what is the ratio of days spent WFH, compared to those spent in the office, which generates the highest level of motivation?

"By contrast, a third of full-time office workers reported a similar sense of connection, nearly the same as last year. Hybrid workers clocked in highest, with 35% saying their companies' mission made them feel their jobs were important."

I think the discussion around the effectiveness of teams that WFH was clouded by research early in the COVID pandemic that showed no loss of performance (and, actually, an increase in performance due to efficiencies like reclaimed commuting time). The trouble with that research, from my perspective, is that it was done on teams that had been formed in-person, prior to the pandemic. It makes sense that such teams should perform better remotely because they are combining all the benefits of remote work (e.g., saving commute time) with the benefits of relationships that were formed in person. When you remove that core foundation of deep relationships (i.e., employees who are socialized into the organization via Zoom), it is hard to imagine how such teams could be as effective:

"For now, many workers say remote work affords them the ability to focus on their essential duties and avoid some of the extracurriculars of office life. This leaves it to companies to try to foster that sense of connection."

Of course, because the deep relationships are missing. These social ties are what connect employees and gives them a reason to go above and beyond in support of their colleagues:

"In short, more remote workers appear to be approaching their jobs with 'a gig-worker mentality,' fulfilling the basic responsibilities of the role rather than anticipating the broader needs of their team or company, said Jim Harter, chief workplace scientist at Gallup, which has tracked worker engagement since 2000. Most professional roles, he points out, tacitly include expectations that go beyond the actual work, such as mentoring others or spurring innovation. 'That's much more likely to happen if they feel they're part of something significant,' he said."

Expect the challenge of how to 'return to work' to continue, given the popularity (and perceived value) of WFH:

"Nearly 30% of U.S. workers in remote-capable jobs work exclusively at home, according to Gallup, a share that hasn't wavered much in the past year."

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


Workers Feel Disconnect
By Lindsay Ellis
August 25, 2023
The Wall Street Journal
Late Edition – Final
B3

Wednesday, August 23, 2023

Strategic CSR - Beer


Welcome back to the Strategic CSR Newsletter!
The first newsletter of the Fall semester is below.
As always, your comments and ideas are welcome.
 

As the article in the url below notes, when introducing change to humans who are boundedly rational, perception is everything. This is especially true when trying to persuade people to drink recycled wastewater:

"'If you give somebody a glass of water and tell them that it's been purified from wastewater… one person out of two will not drink it.'"

So, of course, the solution is to turn it into alcohol:

"… 'But if you convert that same water to beer, all of a sudden nine out of 10 will [drink it].'"

This is somewhat ironic, given that beer was originally widely drunk to disguise the smell and flavor of water. Now, due to our mismanagement of our fresh water supplies, we are exploring ways that beer can allow us to be more efficient in our water use:


Hope you all have a great Fall semester.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


Can Beer Convince Americans to Drink Recycled Wastewater?
By Ira Boudway
May 22, 2023
Bloomberg
 

Tuesday, May 2, 2023

Strategic CSR - Climate anarchy?


This is the last CSR Newsletter of the Spring semester.
Have a great summer and I will see you in the Fall! 


The article in the url below is structured around analogies for three different geopolitical pathways for how climate change evolves, from our current starting point:
  1. "Green Globalization, where major powers coordinate closely to implement solutions, putting the world on track to meet climate goals.
  2. Climate Anarchy, where self-interest takes the form of protectionism and mercantilism, pushing the world in the wrong direction on emissions.
  3. Green Cold War, where the world splits into two or three rival camps that create regional trade barriers, producing emissions that land somewhere between the two extremes of the first two scenarios."

The characteristics and related outcomes of these three pathways are summarized in the article in terms of various risks:


The article concludes that the "Green Cold War" is the most likely outcome, while global cooperation ("Globalization") is "unlikely" and anarchy, thankfully, is "very unlikely." One option that is closer to the globalization pathway, but is not considered in this framework, instead revolves around competition (rather than cooperation). My sense is that this option is both more likely (than the "unlikely" globalization) and would be more beneficial in terms of innovating solutions (than the "likely" cold war; see Strategic CSR – Markets). Whether market-based competition is more likely than counterproductive protectionism (the "Cold War" pathway), though, is harder to determine.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


Green Cold War or Climate Anarchy? Together We Can Decide
By Akshat Rathi
January 25, 2022
Bloomberg
 

Friday, April 28, 2023

Strategic CSR - Art

The article in the url below reports on the attempt by an artist, Ben Grosser, to use his work to critique the rise of Facebook, in general, and the role of Mark Zuckerberg in driving that change, in particular:

"When the history of the first decades of this century comes to be written, there will be few more telling artworks than Ben Grosser's film Order of Magnitude. In the 47 minute video, Grosser, a digital artist and professor of new media at the University of Illinois, has spliced together every public instance in which Mark Zuckerberg has talked of 'more' and 'bigger.' The resulting montage of interviews and presentations is a fast forward of the rapid growth of Facebook as, in the chief executive's mouth, thousands become millions then billions. It makes a mesmerising monologue, the story of our times."

By contrast, the equivalent video Grosser made of Zuckerberg saying things related to 'small' or 'decreasing in size' is much shorter:

"The film is part of a double act. Grosser has also spliced together all the moments he can find of Zuckerberg ever mentioning numbers diminishing or things getting smaller. This film runs for 30 seconds, though in a new version for his forthcoming exhibition at the Arebyte Gallery in London, he has slowed those seconds down so it also runs for 47 minutes."

Grosser (as "a teacher of art") uses this work as a foundation for more fundamental activism against the damaging effects of social media. A significant part of that work is trying to alter the perceptions of those who have grown up in an age of social media, which has affected their ability to evaluate its effects, objectively, as well as their notion of what art is:

"Grosser asks his students a question in their first seminar. 'Who here has deleted a social media post within 10 minutes of putting it up, because it didn't have the metric reaction they hoped for?' Every hand goes up. Then he says: 'Now imagine if any of the artists you admire from the past had paid attention to the first 10 minutes of reaction to their work and used that as a guide about whether to throw something away.' If you're going to have original, strange ideas, he suggests, the world might need time to adjust to them."

One interesting innovation he is trying seeks to alter perceptions around the value of each individual post:

"Grosser has been testing a platform that might help with that, too. Minus breaks all the rules of metric-obsessed media. It allows users only a finite number of posts: exactly 100 across a lifetime and there are no likes or follows. The only way you can interact with another poster is by replying. His beta testers have reported some anxieties, which sound a lot like the kind of anxieties that artists have always felt: 'They almost feel like there's so much weight on a post,' he says. 'It's like, 'I'm only going to get 100, what if I blow one on some bullshit?''"

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


How artist Ben Grosser is cutting Mark Zuckerberg down to size
By Tim Adams
August 15, 2021
The Guardian
 

Tuesday, April 25, 2023

Strategic CSR - Covid

The article in the url below, from a couple of years ago, discusses the ongoing labor shortage in the U.S. (a challenge faced by multiple economies around the world):

"More than a year and a half into the pandemic, the U.S. is still missing around 4.3 million workers. That's how much bigger the labor force would be if the participation rate—the share of the population 16 or older either working or looking for work—returned to its February 2020 level of 63.3%. In September, it stood at 61.6%."

Clearly, the pandemic had a lot to do with this, with a large percentage of these "missing" workers retiring early, but the situation has not eased much since the lockdown was relaxed. For many, during the pandemic, working was no longer worth the tradeoff:

"The participation rate experienced its biggest drop since at least World War II in the early months of the pandemic. It partly rebounded last summer and since then has hovered near the lowest level since the 1970s, despite sturdy economic growth and the strongest wage gains in years."

While the market is currently adapting to the new reality (increasing pay and other conditions for employees, which is adding pressure in the current inflationary environment), the real story is whether this situation will ever recover:

"Some economists are concerned that worsening worker shortages reflect longer-term shifts, such as the pandemic-driven acceleration of retirements, that won't reverse. Many expect the labor shortage to last at least several more years, and some say it's permanent. Of 52 economists surveyed by The Wall Street Journal, 22 predicted that participation would never return to its pre-pandemic level."

If not, as many economists suspect, then it forces employers to focus more intently on being a good employer. If they do not value their employees as their most important stakeholder, they will increasingly lose out in the competition for the best employees in the market. And, this is not just an issue of higher compensation, but providing opportunities for more meaningful work. Whether the overall effect continues to be inflationary, depends on whether productivity rates respond in line with better conditions.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


4.3 Million Workers Are Missing. Where Did They Go?
By Josh Mitchell, Lauren Weber, Sarah Chaney Cambon
October 14, 2021
The Wall Street Journal
 

Thursday, April 20, 2023

Strategic CSR - Bill Nye

For those of you in the U.S. who grew up learning about science from Bill Nye, I have a couple of videos for you that reflect his (public) position on climate change. There is the optimistic Bill Nye, who has been contracted by Coca-Cola to sell the idea that we are just around the corner from a perfect solution to the problem of waste:


This video/ad was reviewed in the article in the url below, with the author denouncing the relationship as a pretty straightforward incidence of greenwashing:

"Bad news for everyone who loved watching Bill Nye the Science Guy during middle school science class: your fave is problematic. This week, Coca-Cola, one of the world's biggest plastic polluters, teamed up with TV's favorite scientist for a campaign to create a 'world without waste,' a joke of a corporate greenwashing campaign."

Needless to say, the assessment of the author is that Bill is, at best, presenting a highly selective element of a much more complicated issue:

"The video is, on the surface, an accurate depiction of the process of recycling a beverage bottle. The problem lies in what recycling can actually do. … Most of those plastics can only be reused once or twice before ending up in a landfill. Nye, for all his talk of science on TV, should know this. Over recycling's 60-year history, less than 10% of plastic that has been produced has ever been recycled. And while in theory, PET—the type of plastic that makes bottles—can be recycled more times than other types of plastic, that's not usually what happens. Virgin plastic is, simply put, cheaper to make into things like bottles than recycled plastic. Less than 30% of plastic bottles are recycled in the U.S., and a lot of that stock is turned not into other bottles, but 'downcycled' into other things, like filler and fabric. These products, in turn, can't be recycled again. The plastic ends up in landfills."

Then, there is the more attention-grabbing (and realistic) assessment of the situation in a short video Bill recorded as part of a John Oliver segment on climate change:


I am guessing that the John Oliver video did not pay nearly as well as the Coca-Cola video, and I'll leave you to determine which one you think is the message we need to be sending from one of the most respected public voices on science.

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


Bill Nye, the Sellout Guy
By Molly Taft
April 7, 2022
Gizmodo
 

Tuesday, April 18, 2023

Strategic CSR - Tires

The article in the url below demonstrates to me how basic the current conversation is about environmental pollution, and the layers of complexity we are yet to even consider, let alone begin to tackle:

"The Tyre Collective does not yet have a name for its device. Hanson Cheng, one of the London-based startup's three co-founders, calls it a 'box.' Built to attach behind the wheel of a car, truck, van or bus, it's designed to capture emissions from an oft-overlooked source: tires. Every vehicle sheds tiny bits of its tires as it rolls, but 'where the rubber meets the road' is a bit of a misnomer: The tires on most passenger vehicles contain little natural rubber. Instead, they're made from a stew of petrochemicals, particles of which ultimately wind up in soil, air, waterways and oceans."

And, the amount of pollution tires create is not insignificant (see also Strategic CSR – Eco-activism):

"The International Union for Conservation of Nature pegs tires as the second leading source of microplastic pollution in oceans, and one 2017 study found a global per capita average of .81 kilograms in tire emissions per year, ranging from .23 kg per year in India to 4.7 kg (roughly 10 pounds) in the US. That may seem minor stacked up against the nearly 300 pounds in plastic waste the average American generates each year, but microplastics are tiny by definition — and an insidious source of toxins that researchers are only beginning to understand. 'When we talk about zero emissions, a lot of that conversation is about electric vehicles,' says Cheng, 30. 'But there's a whole world of non-exhaust emissions that also needs to be addressed.'"

We are like cats distracted by a laser pointer – we focus on one thing to the exclusion of other things, thinking we are making progress when we are really not even scratching the surface. The danger of this is that progress is too slow, but also that progress made on one dimension causes problems in other areas where we are paying less attention:

"Switching to electric cars helps to lower carbon emissions — even after accounting for manufacturing and charging batteries — but it actually exacerbates the problem of tire emissions. EVs typically weigh more and accelerate faster than their gas-burning counterparts, both of which add to tire wear. … 'Most of these EVs are big monstrous things, so it's perfectly intuitive that they will be chewing up tires faster,' says Nick Molden, founder and CEO of the UK-based research shop Emissions Analytics. Results from the company's latest road tests, [last year], show that under normal driving conditions a gas car sheds about 73 milligrams per kilometer from four new tires. A comparable EV, the company estimates, sheds an additional 15 milligrams per kilometer, or about 20% more."

The challenge of unforeseen consequences is enhanced when we develop any particular innovation in a vacuum, without investigating the potential ripple effects of the change:

"One landmark study makes the potential stakes clear. In 2020, researchers in Washington state solved a decades-old mystery of why storm runoff was causing mass deaths of coho salmon: 6PPD, a preservative commonly used in car tires. When exposed to sun and air, 6PPD transforms into a chemical called 6PPD-quinone, which turns out to be highly toxic to coho salmon — causing them to circle, gasp at the surface and then die within hours."

The goal for the Tyre Collective is to collect tire residue at the point of emission, by way of the device they have created:

"In the laboratory, Tyre Collective's device pulled in 60% of airborne emissions by mass, but real-world implementation is proving more challenging. The company is currently testing a prototype on a pair of delivery vans in London, where it's so far gathering around a fifth of emissions. The Tyre Collective's plan is to begin retrofitting the devices on delivery and bus fleets and, eventually, for EV manufacturers to integrate the technology into their cars — doing for tire emissions what the catalytic converter did for the tailpipe. Cartridges full of tire emissions could then be emptied at collection points as part of routine vehicle service and reused in new tires, soles of shoes and other products."

But that, in itself, is not a solution. That only happens when we encourage the collection of the waste, widespread adoption of the technology, and an ability to recycle what is collected:

"'There's a need to create a circular loop around this waste,' says Cheng. 'Otherwise, we're going to all this effort to capture it for it to be released back into landfills.'"

Take care
David

David Chandler
© Sage Publications, 2023

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler6e 
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


When Driving, Tires Emit Pollution. And EVs Make the Problem Worse
By Ira Boudway
September 2, 2022
Bloomberg Green