Business and environmental sustainability are not natural bedfellows. Business is about making money. Sustainability is about protecting the planet. Business is measured in months and quarters. Sustainability often requires significant short term costs to secure a sometimes uncertain long-term benefit. To some activists, all executives are exploitative, selfish one percenters. To some executives, all activists are irresponsible, unyielding extremists. And yet engaging with the issue isn’t optional – all businesses must have a strategy to deal with sustainability and, like any strategy, this involves making choices. This Strategy and Sustainability course based on Rosenberg's recently published book by Palgrave (http://www.palgrave.com/la/book/9781137501738) that encourages learners to filter out the noise and make those choices in a hard-nosed and clear-eyed way. Prof. Rosenberg’s nuanced and fact-based point of view recognizes the complexity of the issues at hand and the strategic choices businesses must make. He blends the work of some of the leading academic thinkers in the field with practical examples from a variety of business sectors and geographies and offers a framework with which senior management might engage with the topic, not (just) to save the planet but to fulfill their short, medium and long-term responsibilities to shareholders and other stakeholders. This course promises to be both engaging and thought-provoking, aimed at anyone who wishes to gain a deeper understanding of a subject that is no longer perceived as a choice but a necessity for future managers and business leaders alike.
4. Localists
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Strategy and Sustainability
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Week 4 - Environmental Interest Groups
Part of the issue in choosing a strategy to deal with environmental issues is to fully understand the broad spectrum of environmental interest groups. This session explores how the movement took off, distinguishing between four types of groups and examining how business might consider interacting with them (and vice versa). Learning Objectives: To explore the nature of four different types of environmental interest groups such that their motivations and behaviors can be better understood.
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Mike RosenbergAssistant Professor
Strategic Management
[MUSIC]
This is Mike Rosenberg on strategy and sustainability.
We're in session four, so in this segment, I'm going to talk about another type of
environmental interest group, which I call localist.
Localists are very important because the tensions can run very high,
and it's very important that business treat them very carefully.
Roger Scruten talks about love of home, he uses this word called oikophilia.
And for him, the love of home is when people are worried about their children,
their children's health, the property values of their homes, the aesthetics of
where they live, and humans natural resistance to change.
And typically localists are against a specific project,
in a specific place, in a specific town.
They are accused of being what the activists call nimbys.
Because what they say is, I don't have an opinion about whether this is good or bad,
just don't do it in my house.
Don't do it near my house, don't do it in my backyard.
And a deeper goal is just for an activist, well,
we'll see this as a bad thing, that these guys are not fighting for the planet.
They're just fighting for their home.
Roger Scruten would actually think this is a very good thing.
And he believes very strongly that if everybody were allowed to run their own
affairs, in the end the world would be a more sustainable, and a nicer place.
An example of something which is create a huge amount of localist
opposition is wind energy.
There is literally hundreds and hundreds of organizations and
websites in different parts of the world in opposition of wind power.
Stop These Things is from Australia.
This is one from Wells County which is in the north part of the United States,
from England, Keep Kent Scenic.
Typically these groups say, hey, maybe the world needs wind power, maybe not.
I don't really care, just don't do it here.
Or they say that wind power is a sham and the whole thing is just another plot
by some corporate interest to take our money away.
Typically they say wind power has problems with noise,
can have problems with the vibration and can kill the birds and
some people simply say it doesn't look very nice.
James Lovelock, we talked about him earlier in the course,
the founder of modern ecology, the inventor of the Gaia concept,
he hates wind energy especially on shore wind.
And he actually wrote in his book, which is called, The Revenge of Gaia,
which I recommend to anybody interested in this stuff.
He offers to take all the nuclear waste in the UK forever and
bury it in his garden in exchange for them not building one windmill in his town so
that when he takes a walk in the evening he can enjoy the scenery.
He thinks the idea of building or ruining the aesthetic value of the countryside
in order to give wasteful cities more energy, he just thinks that's ridiculous.
But whatever your position on wind power I'm just using it
as an example of what localists talk about and how they think.
Key characteristics is again to protect a specific neighborhood or natural area.
The scope, usually these groups are formed almost ad hoc against
something specific, a project or a plan, or a plant.
Key strategies, sit-ins, boycotts, and increasingly,
social media which is starting to connect different localist groups into networks so
that they can start to behave more like global activist organizations.
The funding model is usually quite modest, local people, bake sales,
these kinds of things.
But sometimes when their opposition connects to an activists group,
they can get real money coming in from a global organization.
And typically they're just ordinary people,
maybe with no technical training whatsoever.
And that sometimes creates the possibility that companies will write them off as,
this is just neighbors or moms or farmers.
What do they know about the deep science behind what we're doing.
And the example which kind of proves that this is something to think about and
that these people are people to take seriously is Love Canal.
Love Canal is a neighborhood of Niagara Falls in New York, north of New York City.
And in that neighborhood, the Hooker Chemical Company, many, many years
ago had used a piece of land as a dump for its waste, burying drums of stuff.
And this was back in the 20s and the 30s when there was no law against doing that
and, in fact, very little understanding of what this stuff was or what it could do.
And this was long before many of the stuff we take for granted,
the legislation we take for granted, was put into place.
At a certain point they decided to close the dump and
they sold the land to the city for $1.
And wrote to the city and said, but don't use this land because we've buried some
stuff there and we don't know what it's going to do.
20 years go by and a guy called Love wants to build a development.
He buys the land from the city, builds 100 homes and a school on top of the land.
Another 20 years go by and this woman, Lois Gibbs, she notices that her
children and some of the other children in the neighborhood are getting sick.
At much higher rates, they're getting leukemia and other horrific diseases,
much more though than you would think statistically.
And she says, why is this happening?
And they start to investigate that the history of the place.
Until finally, they get the media involved and there's protests, and
they investigate and find that it's the toxic chemicals leaking out of
these drums, which is hurting the kids.
So eventually the government steps in.
The president signs an emergency order to resettle these families,
get them new homes.
And then, there's a $350 million clean up of the land.
Who has to pay?
Not the government, not the people, but Occidental Chemical Corporation,
which is the company which bought Hooker a generation ago.
Creating a precedent, a legal precedent which is for companies you are reliable
for what you do, even if it's legal at the time, if it causes damage in the future.
Which from a business planning point of view is quite complicated but
it really changed the nature of the debate and
also shows that sometimes these localist groups can be right.
It also shows that sometimes these localist groups can be right.
So it's really important to listen to them carefully.
And the latest example is hydraulic fracturing, or fracking, as it's called,
which is from a lot of points of view, from an energy balance point of view,
is finally making energy independence possible for the United States.
And offering huge amounts of fairly clean gas in different parts of the world,
but it's a process which uses huge amounts of water.
And through the very specific, you can see in the picture,
there's a specific moment when the drill string has to go through the water cable.
And you cement that down to make sure that the gas doesn't connect to the water, but
it's possible that that doesn't work well.
It's possible that the gas can escape into the water table and
you have some situations, some towns, where there's fracking going on
where there's natural gas seeping into the water.
Here's an image of a guy here lighting his faucet on fire
because there's gas in the water.
So, you find tremendous local opposition
to fracking in certain parts of the United States and around the world.
And a lot has to do with who owns the mineral rights.
Because if the neighbors are getting rich with fracking,
they're pretty relaxed about it.
If nobody's getting rich, then it's another issue.
But in all these cases, in dealing with fracking, or in dealing with wind energy,
or in dealing anything when you have very, very passionate local groups who
are worried about the safety of their children or the value of their homes.
Companies have to be very, very careful because you can get into this kind of
David and Goliath situation and if the press gets a hold that.
It can really damage a company's image or even his license to operate.
His social license to operate in this specific part of the world.
So localist groups I think should be treated very carefully.
And to degree possible with kindness because their motivations typically
are very genuine.
[MUSIC]
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