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Lecture Presentation

  1. 1. Corporate Environmentalism Radical Change or Greenwash?
  2. 2. <ul><li>In 1970, University of Chicago economist Milton Friedman wrote in the New York Times Magazine that any company making pollution control expenditures beyond what was &quot;required by law in order to contribute to the social objective of improving the environment&quot; was practicing &quot;pure and unadulterated socialism.&quot; </li></ul>
  3. 3. <ul><li>In 1995, Harvard strategy professor Michael Porter wrote in the Harvard Business Review that environmental protection was not a threat to the corporate enterprise but rather an opportunity, one that could increase its competitive advantage in the marketplace. Put another way, he was arguing that any company that made pollution control expenditures beyond what was required by law was now practicing pure and unadulterated capitalism. </li></ul>
  4. 4. Corporate Social Responsibility A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis. (European Commission) The commitment of business to contribute to sustainable economic development, working with employees, their families, the local community and society at large to improve their quality of life. (World Business Council on Sustainable Development)
  5. 5. Corporate Environmentalism/Social Responsibility: a History From the 1960’s
  6. 6. Four periods of Development of Environmentalism From Heresy to Dogma : An Institutional History of Corporate Environmentalism. Hoffman, Andrew J.(2001) Stanford University Press Industrial Environmentalism (1960-1970) Regulatory Environmentalism (1970-1982) Environmentalism as Social Responsibility (1982-1988) Strategic Environmentalism (1988-1993) Environmentalism as brand (1993-)
  7. 7. The 60’s <ul><li>The chemical industry had fervently rejected the conclusions of Rachel Carson's The Silent Spring in 1962, denouncing her personally and parodying her book with a version produced by the chemical company Monsanto called The Desolate Year. </li></ul><ul><li>The oil industry had denied the environmental effects of the 1969 Santa Barbara oil spill and the health effects of lead, arguing at one point that politically inspired air pollution regulations would put the automobile out of the reach of the average American. </li></ul>
  8. 8. The 60’s <ul><li>Industry fundamentally free to determine its environmental management system. Corporate environmentalism came into existence early 60’s for chemical industry (pesticides) and mid 60’s for oil industry (emissions and spills). Environmentalists not influential – seen as political extremists, not scientifically respectable. </li></ul>
  9. 9. Regulatory Environmentalism 1970-1982 <ul><li>The EPA was formed in USA. </li></ul><ul><li>Industry became increasingly defensive and efforts directed at technical compliance with regulation. Environmental Management had a low status and ancillary role. </li></ul><ul><li>Limits to growth argument of the environmentalists – not bourn out </li></ul>
  10. 10. Environmentalism as Social Responsibility (1982-1988) <ul><li>In USA Reagan failed to rein in the activities of the EPA. Environmental activists grew in strength and influence. Worried about public confidence industry began to establish environmental rules as a sign of social responsibility – became more cooperative with government. Managerial structures developed to achieve emissions compliance. Environmental credentials became an important aspect of the brand. </li></ul>
  11. 11. Strategic Environmentalism (1988-) <ul><li>Power balance between industry, government and activists began to equalize. Industry began to adopt a proactive stance on environmental protection. </li></ul><ul><li>Board-level environment committees – publication of environmental reports. </li></ul><ul><li>Environmental concerns reached “cognitive level”. Accepted norm. </li></ul><ul><li>Incorporation of a public relations component in environmental strategies. </li></ul>
  12. 12. Environmentalism as brand (late 90’s to date <ul><li>Stakeholder dialogues </li></ul><ul><li>Incorporate the environmentalists – image transfer </li></ul>
  13. 13. Greenwash?
  14. 14. In 1999, &quot;greenwash&quot; entered the official lexicon of the English language through its inclusion in the Concise Oxford English Dictionary. Oxford defines greenwash as:  &quot;Disinformation disseminated by an organization so as to present an environmentally responsible public image.“
  15. 15. Greening the World or 'Greenwashing' a Reputation? Exxon's role in Stanford's huge environmental-research project attracts attention and questions It's hard to pinpoint what is most jaw-dropping about Stanford University's new Global Climate and Energy Project: the sheer size of the $225-million, 10-year project or that Exxon Mobil is the chief sponsor. The project, hailed by Stanford leaders as &quot;a revolutionary collaboration,&quot; is stirring both marvel and worry among scientists and activists who focus on energy and global-warming issues. Landing a project of this size and scope is clearly a coup for Stanford. The project will involve researchers from Stanford and institutions around the world in developing a portfolio of clean-energy technologies, as well as techniques for controlling greenhouse gases produced by traditional fuels. The amount pledged to this project is greater than all of Stanford's corporate research support combined over the past 10 years http://chronicle.com
  16. 16. BP <ul><li>BP (corporate web site) </li></ul><ul><li>B </li></ul><ul><li>BP’s profits expected to be around £11bn this year </li></ul>
  17. 17. <ul><li>In  1989, as British Petroleum, at a cost of about £100 million it  shortened  its name to BP, redesigned its logo and  refurbished  its petrol stations to promote a greener, more  socially responsible image. </li></ul><ul><li>  Jolyon Jenkins wrote in  the  New Statesman and Society that BP, a  company  responsible for clearing large areas of rainforest  in  Brazil, responded to a rise in environmental  consciousness in the late 1980s with &quot;a £20  million  'reimaging campaign' in which it daubed all its  property in green paint and advertised its annual  report under the slogan 'Now We're Greener Than  Ever.'&quot; [6] </li></ul>
  18. 18. <ul><li>In 1990 BP had to apologize for an ad  campaign that claimed that its new unleaded petrol  caused no pollution. [7] </li></ul>
  19. 19. Sharon Beder, 'bp: Beyond Petroleum?' in Battling Big Business: Countering greenwash, infiltration and other forms of corporate bullying , edited by Eveline Lubbers, Green Books, Devon, UK, 2002, pp. 26-32 . http://www.uow.edu.au/arts/sts/sbeder/bp.html In 1997 BP left the Global  Climate  Coalition (GCC), a group of 50 corporations and  trade  associations that had been claiming global warming  was  unproven and action to prevent it unwarranted. In  several speeches that year, CEO John Browne argued  it  was time to act to prevent greenhouse warming  rather  than continue to debate whether it would occur.  [8]     The question, though, is whether BP's move was an  indicator of environmental leadership or a cynical  attempt to manage its reputation. When BP  left  the GCC, it was receiving adverse publicity  because  of  its activities in Colombia. The dramatic break  with  other oil companies on the issue of global warming  provided a useful diversion as well as a  much-needed  refurbishment for a reputation under attack on  human  rights grounds. In 1997, amid favorable publicity  about its stance on global warming, BP's share  price  and profit rose.
  20. 20. BP in Columbia <ul><li>Columbia’s appalling record on human rights – BP’s activities target for “terrorists” – BP relied on the  Colombian  army, which created a special brigade of 3,000  soldiers toprotect installations. In 1996, BP agreed  to  pay the Defense Ministry between $54 and 60  million  over three years to augment the battalion with 150  officers and 500 soldiers. </li></ul>
  21. 21. Only the Logo is Green <ul><li>  1991  bp was cited as most polluting company in the US  based  on EPA toxic release data. </li></ul><ul><li>1992 Greenpeace  International named it one of Scotland's two  largest  polluters. </li></ul><ul><li>1999 bp was charged with burning polluted  gases  at  its Ohio refinery and agreed to pay a $1.7 million  fine. </li></ul><ul><li>2000 BP paid a $10 million  fine  to  the EPA and agreed to reduce air pollution coming  from  its US refineries by tens of thousands of tons. </li></ul>
  22. 22. Alaska <ul><li>&quot;Between January 1997 and March 1998, BP Amoco was  responsible for 104 oil spills in America's  Arctic,&quot;  according to US PIRG research. </li></ul><ul><li>1999 BP  admitted illegally dumping hazardous waste at its  &quot;environmentally friendly&quot; oil field in Alaska and  was  fined $500,000 for failing to report it. It paid  $6.5  million more in civil penalties to settle claims  associated with the waste's disposal. </li></ul>
  23. 23. Alternative Energy <ul><li>  bp has invested heavily in solar power and  introduced  a program to reduce its own greenhouse gas  emissions.  But despite its investment in solar energy, the  company remains committed to ever-increasing  production and usage of oil and gas. Director of  Policy David Rice told the Global Public Affairs  Institute in London, &quot;We make no secret of our  intention to grow our core exploration and  production  business and to continue our search for new  sources  of  oil and gas.&quot; </li></ul>
  24. 24. Global Warming Giant And while bp has promised to reduce its own  emissions,  it does not accept the need to reduce those  arising  from the products it sells. Browne argues the  company's contribution is relatively small: &quot;If  one  adds up the emissions from all of BP's operations  and  from all the products we sell, it comes to around  one  percent of the total emissions from human  activity.&quot;  By  1999  BP's emissions were greater than those of Central  America, Canada or Britain, according to Corporate  Watch. [41] And BP's recent acquisitions mean the  company is now thought to be responsible for about 3 percent of  worldwide greenhouse emissions.
  25. 25. bp  is  seeking government permission to explore in the  Arctic  National Wildlife Refuge (ANWR), one of Alaska's  last  remaining pristine wilderness areas, [44] through  lobbying and donating to politicians and  funding  the lobby group Arctic Power. [45] President George W. Bush pledged to open the Refuge to oil drilling during his election campaign.
  26. 27. Shell and BP Amoco Emissions trading etc.
  27. 28. What do you think? <ul><li>Examine the issues </li></ul><ul><li>Draw a conclusion </li></ul>