Transcript BA 447 - day 11 & 12

RESOURCE ISSUES
BA 447
Day 11 & 12
RESOURCE ISSUES: Note to
Students
Scan links provided. Consider the
lecture for next two sessions along
with links as a survey to get you
started.
Exercise: Step 1
• Is there a relationship between changes in
the price of crude oil and deaths in a large
city like San Francisco?
Selected Topics
• Global warming
• Sustainable energy use
• Ecological issues
– Conserving natural resources
– Protection of plant and animal life
• Role of NGOs (sometimes referred to as
activists)
• Impact on global business
Global Warming
• Increase in earth’s temperature
• Greenhouse effect - increase in carbon
dioxide and other emissions and effect on
atmosphere
• Most of the warming seems to have
occurred in last 50 years, therefore due to
human activity
• Carbon stabilization_wedges.pdf
Global Warming - sources
• International Panel for Climate Change
• EPA - info on climate change
• http://en.wikipedia.org/wiki/Global_warmin
g
• http://www.realclimate.org/index.php?p=12
1
Efforts to Reduce Emissions
• Alternatives to reducing emissions
– Government mandates
– Free market
• Existing systems
– US: Clean Air Act places a cap on emissions
– EU Greenhouse Gas Emission Trading
Schemes
– UN Framework Convention on Climate Change
Kyoto Protocol
• Kyoto Protocol
• Agreement to reduce emissions 5% below 1990
levels by 2008-2012.
• If they can not do so, country can buy Green
House Gas (GHG) emission reductions.
– Certified Emissions Reductions
• Exemptions – developing countries, including
China
• US objections
Emissions Trading
• World Bank facility:
– http://carbonfinance.org/
• European Bank for Reconstruction and
Development
– http://www.ebrd.com/country/sector/energyef/c
arbon/
A note on sites on global warming
• Most sites are supportive, a few raise doubts
– http://www.lickglobalwarming.org/
– http://www.globalwarming.org/about.htm
– http://www.globalclimate.org/
• Pay attention to who is behind the site
– A good number of sites raising doubts are industry
funded, primarily “fossil fuel sources”
– Key issue is fear of regulation
– Politics tend to cloud the issue also
Sustainable Energy Use
• Nominal prices of crude oil over time
– http://www.eia.doe.gov/cabs/chron.html
• Real price comparison
– http://www.forbes.com/static_html/oil/2004/oil.shtml
• US Gas prices (components and history)
– http://www.eia.doe.gov/pub/oil_gas/petroleum/analysis
_publications/primer_on_gasoline_prices/html/petbro.h
tml
– http://www.randomuseless.info/gasprice/gasprice.html
Some myths about energy
• Are gas prices really that expensive?
• Some myths about energy
– http://dieoff.com/page132.htm
About Oil Prices
• BBC- Oil Markets Explained
Long term prospects
• Hubbert's peak
• Example of debate/discussion
– BBC article on long term oil prospects
Addressing alternative sources
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Amount of crude oil currently consumed
Infrastructure dependent on crude oil
Capacity to produce key raw material
Net change in conversion to alternative
– Amount of crude oil consumed in production of
alternative, e.g. as energy, as raw material
– Amount of energy gained
– Compare apples to apples?
Addressing alternative sources
• Net change in conversion to alternative
– Amount of crude oil consumed in production of
alternative, e.g. as energy, as raw material
– Amount of energy gained
– Compare apples to apples?
• OSU study on Biofuels
• National Geographic - biofuels compared
• Comment on biofuels and land use - NYTimes
Ecological Issues - examples
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•
•
•
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Forest cover
Spotted owl
Dolphins
Sea Turtles
Chilean sea bass
Resource Issues
• Natural resources such as trees and minerals
• Water
– For consumption: human and production
– For transport
• Food production
Discussion
• Environmental concerns/issues, additional
information, etc. based on articles?
• Name an opportunity and/or threat to a
global company given the discussions on
global warming, energy, etc.?
Genetically Modified Crops and the
Environment
• Examples:
– Seeds genetically modified to be pesticide resistant
– Seeds modified to produce organisms that kill other
organisms
• Issues:
– How to increase food production?
– What are impacts on environment?
– Is it a shortage issue or a distribution issue?
Understanding Dissent
• Appreciate that issues are complex
• Different sides will use information
technology to disseminate their message
• Look into science if possible
• Ask questions, investigate
• Check background of sources of
information
Role of Activists
• In general call attention to an environmental issue.
• Use political strategy to call attention. For
example, against genetically modified seeds – In Brazil, filed or caused law suit to be filed to ban the
introduction of modified seeds
– In Europe, lobbied parliament
– In other countries, lobby congress or executive branch
– Target key players as a way of attacking industry
– Good use of the press – public relations
– Need “good publicity” to survive
Other Examples of Political Strategy
• Anti-Global Warming Campaign/
– Intention was to illustrate how an industry lobby group
conducted an effective “political strategy”
– Note complex political process into which a political
strategy can become an important tool
• Campaign to raise awareness on unfair labor
practices: NIKE
• Campaign against Measure 50
• Procurement and Tax Reform Legislation
Components of Political Strategy
• Objectives: pre-empt, create or attack legislation or regulation
• Proponents range from interest groups to NGOs, etc.
– Can draw from a coalition of supportive individuals and organizations
• Craft clear set of messages to be disseminated
– Spin has to be effective, e.g. doubt on science of climate change
• Attract attention to the message
– Sometimes targets entities large or popular enough to attract press
– Use or create events
– Drama
• Advertising
• Effective use of the press
– Talking heads, e.g. think tanks, prominent individuals
– Press releases
Components of Political Strategy:
More direct methods
• Demonstrations, rallies, etc.
• Door to door in the executive and legislative
branches
• Use the court system
Conclusions – implications on global
businesses
• Reality of world-wide movements
– Climate change is supported by both public and private
entities globally
– Response to genetically modified seeds
– Other environment-related movements
• These have spawned “targetting”/legislation
• Direct and indirect costs to global firms including
legal costs, energy costs, etc.
• Indirect costs in terms of negative publicity, etc.