Shell No! Shows The Way

It's not often I get invited to a party with Emma Thompson, but today I had to turn down an offer to join the actress for a party outside the Shell Centre in London.

The celebration was the news that Royal Dutch Shell had pulled out of their plans to drill for oil in the High Arctic. Campaigning by Greenpeace around the world had made the icy north a little too hot for the oil giant, and so after investing 7 billion dollars in the project they decided to pull the plug. Publicly they said there wasn't enough oil for them, privately they admitted they were shocked by the degree of public opposition to their plans.

The good news, coming so soon after the VW scandal broke, makes an interesting test case on how we should deal with "sustainable" companies. Like VW, Shell had invested heavily in a brand image as a modern company that cares about its responsibilities, and both companies have a string of awards and a library of glossy reports to prove their credentials as socially responsible corporations.

Greenpeace had run a limited campaign against VW because of their lobbying to reduce EU
emissions standards, but had ultimately lost.

Against Shell though they deployed their full arsenal, with protests from Seattle to London, on land, at sea and most recently hanging in the air off a bridge in Portland. First they went for their allies, forcing Lego to back out of £68 million deal with the company, and then they came for Shell in person. First they dropped a banner, then they serenading their headquarters with a succession of musicians, some famous and some not, and then they parked a three ton animatronic polar bear outside for most of September. That's when they gave in.

VW and Shell came at Sustainability from different directions.

Volkswagen made cars for hippies in the sixties, and more recently gained a reputation for safety, economy and practicality.

Shell, meanwhile, gained a reputation in the nineties as one of the worst companies in the world. They had devastated the Niger Delta, funded an oppressive military dictatorship, and they were culpable in the execution of the man who opposed them. For VW Corporate Social Responsibility was the natural progression of a sensible car company, for Shell it was a passport to rejoin the human race.

However VW and Shell were alike in other ways; they both wanted to be number one. Merging with
Audi and then Skoda, VW became the giant of the European market. With arch rival BP disgracing itself in the Gulf of Mexico, Shell became the world's second biggest oil company.

But there were problems ahead. VW had the challenge of making it's diesel cars cheaper and faster than the opposition. Shell had to face up to the decline of conventional oil resources. Both companies faced a choice: become genuinely 'sustainable', or go for that coveted Number One slot.

Unfortunately greed won out. VW fitted the 'defeat devices'. Shell went into tar sands and Arctic oil.
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It's easy to think that the chief execs of these companies live on a different planet to the rest of us, but actually they don't. This makes it even more sickening to think of the world they planned to leave for their children.

Because the truth is that more often than not the 'sustainable corporation' is a lie.

True, there is good news out there.

There are the Googles and the Interface Carpets of the world, but these are companies who streaks ahead of the opposition and can afford to be generous, and whose core business was never a major threat to the planet.

There are also the Teslas, and the Solar Centuries and the Ecotricities of the world, but these are small
companies that will never become big until the VWs and Shells move aside.

However despite twenty years of talk of 'sustainability' and 'social responsibility' not one fossil fuel company has switched to renewables, not one car company has given up petrol, not one cement company has given up coal. They have talked the talk, but they've not walked the walk.

Worse, they have pulled the wool over the eyes of politicians and governments have abdicated their responsibility to legislate. VW was trusted to keep it's own house in order. As a result it's crimes were not discovered by any government agency, but by a small NGO. Shell had been given permission to drill in the Arctic by President Obama. What stopped them was not our 'democracy', but people power.

The lesson is clear. The corporate world will not reform itself voluntarily. We need to make them.

Power never gave up without a fight. Shell was the most recent battle. Lets get on and win the war.

Changing the Scorpion's Nature

VW joins the Dark Side

Fans of the Citroen 2CV may object, but once upon a time if you drove anything other than a VW Beetle or Camper, then you couldn't call yourself a true environmentalist.

The company that had made Adolf Hitler's People's Car', and which owed its post war survival almost entirely to a single officer in British Army, had successfully made the leap from the Nazis to the New Age.

The good vibes generated in the sixties carried forwards to the modern era where VW were regular receivers of awards for Sustainability and Corporate Social Responsibility.

But all was not what it seemed.

In 2011 Greenpeace took them on for their lobbying efforts to reduce European Union emissions standards. VW won and, in a dirty deal with the United Kingdom, the Germans agreed to help block the regulation of coke-snorting British bankers in exchange for the UK helping to block regulation of the gas-guzzling German cars.

Then, in this last week, the true scale of the extent to which VW had sold its soul became apparent.

A sophisticated electronic device told the car when an emissions testing device was attached, causing the engine to reduce its otherwise illegal emissions.

The alternative would have been to fit a system that uses urea, under the slightly more appealing trade name of AdBlue. Just refilling your tank of AdBlue costs around £200, so with 11 million cars on the road VW had clearly saved themselves a lot of money. However the "defeat device" meant that these vehicles were pumping out between 10 and 40 times the permitted amounts of nitrous oxide. That really is taking the piss.

For VW, this is big.

For those of us who want a cleaner world, and who recognize that, for better or worse the corporations will be running the show for a few years yet, it's potentially even bigger.

Jefferson Randolph 'Soapy' Smith

In 1897 the Yukon, part of Canada's frozen north, experienced the last gold rush of the nineteenth century. To get to Canada the prospectors had to pass through the town of Skagway, part of the US state of Alaska. Possibly the most lawless town in the world, it was the place where "a bunch of the boys were whooping it up" in Robert Service's poem The Shooting of Dan McGrew.

But Skagway was also one massive confidence trick. Virtually the private property of one Jefferson Randolph 'Soapy' Smith, the entire town was built around ripping off the gullible gold seekers. Smith owned the newspaper, his own militia, the US Marshal's office and scores of pickpockets, robbers, crooked lawyers and prostitutes. New arrivals paid to send overpriced telegrams on the non-existent telegraph, lost money on the rigged gaming tables and were ripped off by apparently benevolent friends who met them off the ships from the south.

Sometimes, when the unfortunate soul was left penniless on the freezing streets, Smith would meet them, express concern and, reaching into his bulging wallet, give them just enough money to get back to Seattle. The victim would then leave Skagway convinced that they had just met the one honest citizen in the town.

To those of us on the outside of the corporate machine the behaviour of many of our bog companies seems little better than that of Soapy Smith. They rob us, poison us, engorge themselves at our expense and then, when the hordes of outraged people gather at their gates to demand justice, they deploy a little largess to make themselves look good.

For far, far too many corporations this is indeed how they work.

Dick Barton

But not all of the corporations are evil all of the time. The reality is rather more complex.

The 1940s British radio drama Dick Barton, which was very popular with small boys my Dad's age until it was replaced by an educational farming program called The Archers, allegedly used to employ two teams of writers. One had the job of inventing dire predicaments to land the daring detective in, whilst the other had the task of coming up with ingenious ways for the square jawed hero to escape.

It certainly seems as if many companies run a similar system. One team tours the world driving down prices, encouraging suppliers to cut costs and uprooting entire factories and moving them across the world when governments or Trade Unions threaten to spoil the party. Simultaneously the other team tries ensure the company obeys the law, respects human rights and doesn't trash the planet.

I expect VW operates in a similar way. Team B that puts together the Corporate Social Responsibility reports and strives  to ensure the company treads lightly on the earth are probably dedicated professionals who really want to make the world a better place. The problem, as the Dick Barton script writers found, is that Team A tends to win.

On the radio this led to them inventing the cliche 'with one bound he was free' as the hero was trapped in ever more fiendish plots. In real life there is no such easy way out when the profit motive trumps ethics.

And VW certainly isn't the only Janus-faced company trashing the planet whilst trying to be good.

BP broke the mould by ending the denial of climate change by the oil industry and genuinely put a lot of effort into cleaning up their act on human rights. Green groups never fell for it, but John Browne's company became poster-boys for the sustainable corporation. At the same time a policy of reckless cost-cutting led to disasters in Texas and the Gulf of Mexico.

The Scorpion and the Frog

So how does it all end?

 

For Soapy Smith not well. He was shot dead by a vigilance committee.

For BP not much better. The Gulf of Mexico cost them billions and destroyed their 'Beyond Petroleum' image so completely that anything they did to try to recover was just seen and a bribe or utter hypocrisy.

It doesn't look much better for VW either.

So why do they do it?

Why, when all their highly paid CSR professionals in Team B are telling them of the huge risk to reputation, to profits and to everything else, do companies that publicly claim to be on the Light Side of the Force keep going over to the Dark Side?

Well, the answer is obvious: because they're greedy and because they can. The for-profit corporation, if it was a real as opposed to a legal person, would be a psychopath. Psychopaths can live useful and productive lives, but you don't take your eyes off them.

In the fable of the Scorpion and the Frog, the latter reluctantly agrees to give the former a lift across a river, having been convinced by the argument that treachery would doom them both. This though is indeed what happens, and the scorpion stings the frog to death. As they both sink beneath the water to their deaths the scorpions only defence is it's just his nature.

In the aftermath of the VW scandal we should all be minded to remember just what the nature of the modern corporation really is.

Fracking Won't Fix The Climate

Britain should go all 'out for shale' says a report, funded by the fracking industry. So, no news but the old news then.

However the tack has at least changed slightly. The reason, says The Task Force On Shale, is that gas can provide a bridge to a low-carbon future. This is a something of a recurring meme these days from the fracking industry, and it has legs because it's a complicated argument to debunk. But debunked it needs to be.

First, what the Task Force got right. When burnt in a power station fracked gas gives off approximately half the carbon dioxide of coal. This is good, although not good enough to prevent dangerous climate change, which requires use to cut our carbon use by 90% or more. However The Task Force at least admits this and is only advocating shale as a bridge to cleaner and greener technologies.

Now here's the bad news, starting with the length of the bridge. Even if all the anti-fracking groups packed up and went home, and even if the British geology behaves and gives the frackers a clean run, shale gas will take time to develop. It is the fuel of the next decade, not this. New gas power stations will need to be built to burn it. They will have a lifetime of thirty years and there is no precedent for shutting down profitable stations early.

That means four more decades of carbon fuelled power in this country. This essentially 'business as usual' scenario, if followed worldwide, could, in a worst case scenario, see us committed to a global temperature rise of 4 degrees by 2050 according to the IPCC. This is a point that's easy to misunderstand - Emma Thompson recently came a bit of a cropper with it - so let's be clear: we won't see a temperature rise of 4 degrees by 2050, but we will have burnt enough fossil fuels to make such a catastrophic change in the climate inevitable by 2100, even if we don't burn another lump of coal or cylinder of gas in the second half of the century.

Indeed, some say that a 4 degrees rise could occur as early as the 2060s. This is scary as I might still be alive then, although two thirds of the world's plant and animal species probably won't be.

The Task Force would argue that a 'dash for gas' would avert a worst case scenario, but there's another factor they haven't considered. Whilst we might not be burning any more coal - in fact we definitely won't be burning any more coal if we don't build any more coal fired power stations, as the ones we have will be almost all retired by the end of the decade - but, in the absence of a global deal, there's no reason why other people won't burn our coal for us. That's what happened in America. Fracking reduced their domestic coal use, but coal mining actually increased. They just exported more.

So instead of replacing coal, fracking just adds another fossil fuel to the mix to be burnt alongside the black rocks. Dress it up any way you like, this is not good. The solution, as the divestment people will tell you, is to Leave It In The Ground. Fracking is only better than coal if the coal stays in the earth. At present there is no way the fracking industry, or its government supporters, can guarantee that.

The problems though don't stop there. Once of the biggest unknowns about fracking is the amount of the gas, methane, than leaks out, either during production or on the way to the power stations.

Methane is a far more potent greenhouse gas than carbon dioxide, and this is only partly offset by its
shorter life in the atmosphere. Overall the IPCC considers methane to be thirty times more potent than carbon dioxide, so the leakage rate is very important. Industry funded studies show very low rates, but independent studies have produced leakage rates of 12% or more. As a  rate of just 3.6% would be enough to wipe any gains from the cleaner combustion of methane, these figures are worrying.

Incidentally, it's very easy to get yourself confused on this issue to. Methane is much heavier than carbon dioxide, so 3% of a certain amount of methane weighs a lot more than 3% of the equivalent amount of carbon dioxide. The House of Lords committee managed to confuse just about everyone by claiming Greenpeace had got this figure wrong, when it appears it that it was them who were confusing people.

Then there is the very real threat that fracking will up all the money the government has allocated to 'low carbon' energy, leaving solar, wind and energy conservation stranded.

All of this means that even if fracking was clean and safe, and even if there were hundreds of communities queueing up to welcome the rigs, its contribution to climate change would rule it out as a future energy source.

The Task Force would no doubt reply that I'm not being realistic, that the renewable alternatives just aren't there. But I would reply to them by asking: why aren't they there?

Is it because the government prefers to frack the Labour north rather than build wind farms in the Tory south, because it prefers to accept donations from the existing fossil fuel industry rather than pump prime the new solar revolution and because it prefers to risk catastrophe in the long term rather than spend money on prevention now?

It is a funny sort of 'realism' that ignores the physics of the problem in favour of the economics and the politics.