Tag: Environment

The Holy Grail of the Sustainability Discourse: Linking Financial and Environment & Social Performance tangibly

Sustainability has graduated from being a definition in the 1987 Brundtland Report to being one which is embedded in to mainstream corporate strategy. A ton of business literature has been dedicated to the ‘cause’ and some companies have truly derived value from being sustainable apart from the green washing aspect, which we all know is the principal driver in most cases. Sustainability has transitioned from a being a rhetorical vantage point to an implementable procedure which could extract some impact on the bottom-line.  Resource savings to better motivated employees, every possible trick in the book has been utilized to promote sustainability. Most of it has been driven from a piecemeal perspective.

Sustainability has grown in currency as often a safety related death, an oil spill or an industrial accident is terrible for the reputational capital of the firm, which is in turn bad for the face value of the stock if it is a publically listed company.  BP collapsed from an industry giant to a takeover target post the deep water horizon disaster. The Indian Multinational Group Mahindra & Mahindra, uses Sustainability as a governing ethos of the enterprise. It is the Harvard read Anand Mahindra’s leadership and foresight to utilize Sustainability as a compass to drive inclusive growth.  In developing nations such as India, sustainability often is a business pre-requisite as an unhappy community of stakeholders will douse the flames of any tentative project flaring up into a profitable venture. POSCO and Singur are a case in point where social inclusion which is critical component of a 360 degree sustainability strategy faltered terribly.

Social Satisfaction, Safety, Happy Employees are issues which are intangible positives which cannot be translated in to the financial bottomline. The triple bottomline is popular, but the only bottomline which matters is the ROI for the share holder.  The era of Sustainability is passé, Corporate Resilience is better paradigm in a discontinuous and networked world.  New indicators will have to be devised for that Environmental & Social Performance is better communicated to shareholders. Resource Extractive Industries are on the frontline of the Sustainability Battle.  Globalization in an uncertain world demands better parameters to generate insights. This is the Holy Grail. Someone needs to unlock it?

May be a PhD topic if a University funds me 🙂

Environmental Governance as inclusive Developmental Architecture: Time for action

There are a few issues with the public discourse on Environmental issues.  Environment matters are essentially political as they are backward integrated in to public values. Environmental issues are livelihood concerns for native communities off the economic grid. The retinue of ‘Quality of Life’ Indicators is contingent upon the environment. Free Market Capitalism and Environmentalism since the days of Rachel Carson,  are always at odds. As the pioneering Environmental economist Herman Daly once quipped that what will a saw mill be worth without a forest captures the paradox of the relationship between the scent of money and the fresh breeze of the forest.  Robert Costanza’s 1997 paper on Valuation of Ecological Services was a watershed moment, in academic circles but incorporating these lessons in mainstream policy frameworks is all together a different cuppa. Valuing and taxing Greenhouse gases through CDM and other market oriented vehicles have resulted in a mixed bag. These instruments have been appropriated by neo-liberal forces to extract money out of multi-lateral institutions rather than catalyze foundational transformations which take longer timelines. My environmental policy professor at grad policy school at the National University of Singapore was right when he meant that it is only money that prompts people towards normative ends and not good intentions alone.

The real issues regarding the metastructure of Environmental Governance get drowned in the cacophony of the rhetoric between Growth Fundamentalists and Ecological Activists. The price here at stake is usually quite basic; clean air and water. Investment Bankers drinking beer on a Friday evening at a South Bombay Pub will like to breathe cleaner air, as a person cannot buy clean air in a can. The Bottom-line matters but the biosphere does count slightly too.

This seems very simple but political will backed by resources along with active community engagement is the key. I can visualize another pitfall. The policy community is good at theorizing problems, but activating those ideas in to concrete action is the chink in the Developmental Architecture.   There is a slip between the cup and the lip. Civil Society, Industry and Government all have their own agenda and there is no synergy in thought processes for concrete action.

The National Advisory Council of celebrity academics and activists are bent towards entitlement welfare legislations. Environmental and Social Justice go hand in hand, and the writer of this post would suggest the esteemed body to focus on incorporating Environmental issues while designing welfare mandates. The Environment Ministry has been tainted with the tag of being the fore-bearer of a new Green Tape License Raj regime. While the perception exists, statistically it’s in correct.

Our focus ultimately needs to be re-calibrated to solve real issues, and embedding environmental drivers in to policy design is a good way ahead.

Is the Green Tape killing Development: a pragmatic environmentalist’s take?

I prefer to read the pink papers as I feel they address more relevant issues of the day rather than the usual general papers which are prone to cover more Bollywood and Cricket than actual news for the people.  But the pink papers are so driven by financial data that they sometimes forget that the economy is not run in silos, but is dependent upon society and natural resources to run the economic growth engine. People and Ecology hold more value than sheer balance-sheet numbers. Capitalism runs on the ideological framework of ‘QSQT’ or Quarter se Quarter Tak. The Balance Sheet counts more than the Biosphere.

Well, India has massive developmental challenges too. We are short on power generation, and the coal which is needed to fuel the furnaces to rev up the turbines of growth is often not available. In Ruchir Sharma’s book ‘Break Out Nations’ an anecdote is shared that it is easier for Indian Mining Companies to procure coal in Indonesia than in India.  It is not available due to so called delay in regulatory clearances. This is the Green Tape which is blamed for the delay.  According to Public Intellectual Pratap Bhanu Mehta this is a perception as statistics show on the contrary, that India has a pretty lenient regulatory regime.

Cases from Orissa and Goa show that regulatory clearances are politically driven by motivation. The centre uses tribal rights as a whip to crack on the opposition lead Orissa government’s developmental agenda. Judicial Activism has lead to mining being banned in Bellary and Goa, although the BJP Government banned it earlier to the Supreme Court order. Environment is inherently political in nature as different ideologies with separate normative ends, conceptualize the utility of ecosystem services in a different context.

Recently, due to the negative criticism of the Green Ministry, the perception has been created that environmental clearances have been speeded up with Hydel Power Projects in Himachal and the North East given the ‘green’ signal. A recent incident of an environmental ministry official taking a bribe, does not help the reputation of the already over stretched body. The delays in clearances are due to the under-staffed employee roster of the Green Ministry, and not due to some malicious intent to derail the progress of the nation. The Single Window Clearance National Investment Board was a good idea in retrospect as the global investment climate is competitive. POSCO and Vedanta sites in Orissa illustrate this matter really well. In a rapidly urbanizing country with increasing living standards, such debates will be perennial in nature but we have to address them with rapid pace taking in to consideration the needs of the native community and the natural environment. This is a million rupee question, but we cannot afford to die from smog as the Middle Kingdom’s Forbidden City is now suffering.