Moves from Renault, the European Union and all the latest from other brands in corporate responsibility and sustainability this month.
Spy scandal
Renault’schief operating officer Patrick Pelata fell on his sword in April, resigning in the aftermath of an industrial espionage scandal that never was (see Ethical Corporation, April issue). Renault alleged in January that spies were targeting its electric vehicles programme, and fired three executives it said were involved. But the company later backed down and admitted there had been no spying. Pelata’s resignation follows an audit into the scandal, which uncovered “serious dysfunction within the company’s management”, according to French industry minister Eric Besson. Other Renault senior executives are also likely to be axed, while the three managers fired in January have been offered compensation and reinstatement.
What the tide brings in
Some of the €600m the European Union spends on fisheries subsidies each year could be redirected to fishing for litter. Commissioner Maria Damanaki says the Mediterranean sea in particular is choked with garbage, leading to “negative effects in the whole ecosystem”, and fishing vessels could be used for “decontamination”. A French pilot project, starting in May, will bring together fishermen and the plastics industry, with trash retrieved from the sea being sent for treatment. Researchers have estimated that there are 250bn small pieces of plastic floating around in the Mediterranean, Damanaki says.
Palm oil plan
The World Bank Group has said it will resume lending to the palm oil sector, following the adoption of a new strategy that will govern its future palm oil investments. The bank suspended palm oil lending in September 2009 in the wake of a critical audit report, which found that its private finance arm, International Finance Corporation, had invested in Singapore-based Wilmar Group, despite Wilmar being accused of a range of dubious practices, such as the clearance of primary forest without permits, and the seizure of land from indigenous peoples. The new strategy was developed through extensive consultation, the bank said, and its palm oil lending would now “benefit the poor and protect the environment”.
Copper bottomed
The Peruvian government has put on hold a controversial copper mining project by rejecting an environmental impact assessment conducted by the giant Southern Copper company. The $1bn project would have seen reserves close to Arequipa in southern Peru exploited, with production scheduled to start in 2012. However, the project has faced fierce and violent opposition from local farmers concerned about water contamination, with three people dying in clashes in early April. Southern Copper, which is owned by Grupo Mexico, says it would consider whether to continue with the project. The rejected environmental assessment “takes things back to square one,” the company says.
Nunder pressure
Goldman Sachsis preparing to face a protest about excessive executive pay at its annual general meeting in May – from nuns. Sisters from Boston and Philadelphia will put their weight behind a resolution proposed by the Interfaith Centre on Corporate Responsibility asking for a review of pay levels. The resolution has little chance of being voted through but the nuns hope it will put “sinful” levels of pay in the spotlight. One nun said that the median pay of the top 200 company managers in the US was more than $9m and this “meets no social justice criteria”. Goldman Sachs, whose chief executive Lloyd Blankfein famously said he was “doing God’s work”, paid its top five directors about $70m in 2010.
Green value
Companies should do more to assess their environmental impacts, according to the World Business Council for Sustainable Development, which has published guidelines for carrying out Corporate Ecosystem Valuations. The CEV, according to the WBCSD, is “an innovative framework designed to enhance business understanding of the benefits and value of ecosystem services like fresh water, food, fibre and natural hazard protection”. The new insights from conducting a CEV can benefit companies by “creating more alignment between [their] financial, ecological and societal objectives”. The process has already been tested by a number of multinationals, including AkzoNobel, Hitachi and Syngenta.
No more cash for coal
Loan finance for big fossil-fuel energy projects could become more scarce, if the World Bank Group adopts a draft energy strategy that would see funding granted only to fossil fuel power plants in the poorest countries. Under the strategy, the only countries that would still receive support for coal-fired electricity plants would be those that are energy poor and have little access to investment beyond the multilateral financing institutions. Concurrently, members of the European parliament have asked the European Investment Bank to phase out its fossil-fuel lending. However, campaign groups have expressed concern that a reduction in finance for carbon-intensive power could mean more, large hydropower projects, which have their own environmental costs and can displace indigenous peoples.
Governance review
Company governance might need to be regulated more by Brussels, to ensure a level playing field and to improve standards, the European commission says. Opening a consultation on corporate governance, the commission says that new laws could cover incentivising longer-term shareholding, promoting employee share ownership, tighter controls on executive pay, and “meaningful” monitoring of corporate governance codes. Also on the agenda are quotas for women on company boards. Companies with more women on their boards “tend to perform better”, the commission says. The consultation is open until 22 July at the EU’s website.
Dealing in death
American executioners are struggling to secure supplies of sodium thiopental, an anaesthetic used in administering lethal injections, after an Indian company, Kayem Pharmaceuticals, pulled out of the trade. There has been a supply squeeze since early 2011 when one of the main US manufacturers stopped making the drug. Kayem, which sold sodium thiopental to the state of Nebraska, had come under pressure from anti-death penalty group Reprieve. But the company said it had taken the decision because capital punishment goes against the “ethos of Hinduism”.