Menemani

Corporate Social Responsibility: how far are we from the tipping point?

Harvard Business Review Jonathan Lash and Fred Wellington devise this month on the effect of climate change on corporations and on their ability to handle the various related risks: regulatory, supply chain, product & technology, litigation, reputational, physical… and turn them into competitive advantages.

Are we seeing a change in economic and management theory embracing corporate social responsibility? Will csr become mainstream as a corporate value any time soon?

Technically, it seems that directors are mandated by law to put their shareholders' interests above the interests of any other stakeholder. Henry Ford himself received a supreme court ruling in 1919 when he vowed to reinvest his surplus profits in cutting the prices of his cars and hiring more workers to "spread the benefits of this industrial system to the greatest possible number, to help them build up their lives and their homes."

In his book The Corporation*, Joel Bakan claims that corporations relentlessly pursue their own self interests regardless of the harmful consequences they may cause to others. A concept promoted by Nobel Prize Milton Friedman who titled a New York Times article in 1970 The social responsibility of business is to increase its profits, a stand he confirmed in a 2005 Businessweek interview. For Friedman, Social Responsibility goals are to be pursued exclusively at the individual and personal level, and should be considered as a misappropriation of corporate assets and “fundamentally subversive” if pursued at the corporate level.

The controversy over Friedman's theories also sparked the US academic world. In a remarked white paper, the late management education guru Sumantra Ghosal explained a couple of years ago how the "oversimplifying" sets of ideas that have shaped management theories for the past 30 years have freed students –today's actors- from any sense of responsibility, influenced social and moral behaviors, and have led, in a self-fulfilling process, to the worst excesses -see one of my previous posts on this subject. Ghosal entrusted the academy to promote pluralism and alternative theories and reverse the trend. With success it seems given all the articles white papers, podcasts and conferences on the subject of CSR and global warming.

Has a page been turned since Friedman passed away, and are we close to the tipping point? Large corporations -including Walmart- are starting to embrace the concept,  customer and public pressure have a visible effects, and policy makers are on the job. let's be optimistic.

*Many thanks to Lauchlan Mackinnon for  pointing me to this resource.

High Tech Scavengers

High Tech recycling may be a lucrative business, but with dangerous side effects...

According to the UK Environmental Agency, more than 20 000 tons of electronic waste have been sent illegally by Western countries to China, India, Pakistan and Africa in 2003. Exporting electronic waste to China or India costs a tenth of the price of recycling it in Europe or the US. On top of low labor costs, exporters benefit from no regulations on health and safety. A recent article in L'Express -a good occasion to practice your French ;-) - describes how Indian High Tech scavengers get sick by manipulating ultra-dangerous and cancerous chemicals: chrome, baryum, mercury, lead, cadmium, acids and toxic gas. Western countries are starting to regulate and organize the recycling of electronic products. The recycling itself is yet to be regulated and organized...

Technology makes kids dumb!

An interesting article I discovered on Loïc le Meur's blog.

Modern technology depletes human cognitive abilities more rapidly than drugs, and is dumbing down the population more rapidly than television according to a psychiatric study conducted at King's College, London.

Messaging users suffered a 10 per cent drop in IQ scores, more than twice the fall recorded by marijuana users, in a clinical trial of over a thousand participants. Doziness, lethargy and an inability to focus are classic characteristics of a spliffhead, but messaging users exhibited these particular symptoms to a "startling" degree, according to the study.

Another study of 100,000 school children in over 30 countries around the world testified that non-computer using kids performed better in literacy and numeracy than PC-using children who neglect their homework. Awash with facts, children don’t know what to do with the information they access, how to prioritize. They lose their creativity and imagination, their ability to analyze and build coherent arguments, they've forgotten how to think.... Education experts have dubbed it the "problem solving deficit disorder".

Extract from theregister.co.uk, April 22, 2005

Ok girls, I need your constructive comments on this with the right facts, arguments and counter-examples, quick! Otherwise, my friends who think I'm crazy to let each of you own a computer and do what you want with it are right. And I should put a halt to all of this for your IQ's, your EQ's and your critical thinking’s sake...

Ebay & Electronic Recycling

Ebay and most of the big names in the electronics hardware industry have set up the Rethink Initiative, an alliance to promote recycling of electronics: reselling, reuse, donation, safe & responsible disposal of old computers and hardware. An effort to educate consumers and prevent this type of equipment, with both its hazardous and recoverable materials, from ending up in landfills.

Also an attempt from the industry to develop market-based solutions for waste disposal and prevent further government regulation on electronic waste such as the Electronic Waste Recycling Act, voted in 2003 and recently come into application in California, requiring  retailers to add a Collection and Recycling Tax on sales of TVs, monitors and laptops.

If dumps are a new Eldorado, this market-based solution will most probably turn out quite profitable! A win-win solution? ...à suivre...

Dumps: a new Eldorado?

With soaring raw material prices, recycling, traditionnally a field left to scavengers and environment activists, is becoming a profitable and growing business. Europe has experienced double digit growth rates in this sector in the past few months. More than 30% of the French steel production, 50% of glass and paper and 60% of non-ferrous metal come from scrap material or sorted waste. Perspectives are promissing as demand will continue to grow, while resources are drying up. Mandatory recycling of electronic and houshold appliances has been voted by the EEC. This opens a new world of opportunities. Copper prices have rocketted to a 2500€ per ton. An old TV conceals 1.5 kg of copper. On a similar note, gold costs 10000€ per kilo, and 400gr of gold can be extracted from one ton of discarded mobile phones. The math is simple. Sweden already draws 40% of its gold production from recycled electronics. Will western dumps become the world largest open-mine?
Listen to this Europe 1, march 4th editorial by Luc Evrard -in French-   Ecoutez
Or read the transcript on Yahoo.fr  Lire 

Are views changing on this side of the Atlantic?

After several weeks of intense negotiation, a US senate committee refused to approve Pdt Bush's Clear Skies air pollution bill. Opponents argued that the bill would weaken  environmental protection and did nothing about reducing the greenhouse gas carbon dioxide. They received the support of Independent sen of Vermont and Rep sen of Rhode Island, quoted saying "It just seems a shame to me that Congress is the last bastion of denial when it comes to climate change". Read  Related Article

Is awareness around the corner?

Could the American dream in China become a nightmare for the world?

What would happen to the world's ecology and natural resources if the Chinese economy continues to grow at an average pace of 8% per year as it did for the past 26 years, with a Western style of consumption? The US Earth Policy Institue, in an article published today, predicts a catastrophy. China's demand for raw material would exceed todays world demand in 25 years. The impact on natural resource supply, global warming, and in the end the economic order is frightening. Read Earth Policy Institute: learning from China

It is time to start working on a new economic model that can sustain economic progress and preserve the earth's natural system. It is urgent that we turn to clean and renewable sources of energy, that we stop overconsuming and burying up our waste without discrimination.