Principles of management

(coeb432)
Assignment no. 1

KODISVARAN S/O JAYARAMAN

EE080334
SECTION: 02
LECTURER : MR. MOKHTAR BIN
MAJID
SUBMISSION DATE : 07/O8/09
 Climate Change
Climate change is in theory, the perfect topic for an international environmental
agreement. All countries are affected by, and contribute to the buildup of greenhouse gases,
and should be willing to join in the effort to stop it. However, it is far from easy to agree what
to do and how to do it. The challenge is to use far less fossil fuel energy while increasing
standards of living in developing countries and avoiding the sort of cuts in standards of living
in developed countries that would produce public backlash and political impasse.

The United Nations Framework Convention on Climate Change (UNFCCC) was

signed and ratified by the world’s majority of countries. However, before and since that,
negotiations and meetings have been marred by special interest groups trying to prevent
effective action to combat climate change. In addition, there has been a lack of political will
to take effective steps and measures.

Reactions :
The United States (US) has been vocally against effective action on climate change
due to its reliance upon fossil fuel for its economy. Being a producer of oil and coal, they feel
more threatened by action on climate change.

Europe on the other hand, is calling for stronger action. One reason it does so is that it
currently imports its fossil fuels so has more incentive to reduce this dependency and seek out
domestically grown alternatives.

In both regions, local populations have a reasonable awareness of environmental

issues. However, in the US the business lobbies (mainly fossil fuel based industries) are very
strong and powerful and have been able to affect decisions and outcomes.

Economic Concerns Drown Out Ecological, Social

Justice and Equity Concerns :
Equity Watch, a newsletter on climate change from Southern perspectives by the
Delhi-based Center for Science and Environment (CSE) provides a time-line of climate
change and the political fall-outs. In it, it points out how since the 1980s and 2000s nations
such as the United States and former Soviet Union have in the past been against the notion of
setting specific targets to reduce greenhouse gas emitions.

Other nations and blocs around the world are primarily for strong action as well but
have their own mix of concerns. For example:
  The various island nations are already seeing a rise in sea levels. The Alliance of
Small Island States (AOSIS), as well as the European Union (EU) therefore have
pushed for ecological effectiveness.

 OPEC and various industrialized countries are obviously concerned about their
economic ramifications and are pushing forth more research into creating carbon
“sinks” to soak up carbon dioxide emissions. Such groups are therefore seeking
economic effectiveness.
 Many developing countries are concerned about their right to develop to use their
resources and to not be penalized for climate change problems that are largely caused
by the industrialized countries. They are therefore also seeking social justice and
equity.
 After all the political ramblings and conferences of the past few years as expected, the
interests and influences of the most powerful nations and groups has been the
primacy. As a result, as summarized by CSE, the Kyoto Protocol has focused almost
entirely on economic effectiveness, to the detriment of the other two concerns.

Of course, the above is a generalization as there are mixture of concerns. These do

seem to be the ones that are primarily shown by the various groups in the past negotiations.
As an example though, some Latin American and Asian nations are also supportive of some
sort of forestry program, as it can attract possible investments.

Poor countries face the brunt of the problems caused by global warming, and point
out that most of the current global warming are the results of the rich countries' pollution.
Current consumption patterns also see far more greenhouse emissions per person in the rich
countries than the poorer ones.

Business Interests :
Initially big business has been extremely hostile to action on climate change.
However, some businesses are thinking differently. Largely due to US resistance and the
need to get them on board for any meaningful action, various trade-offs were made to the text
of the Kyoto Protocol. Critics argue that business interests have been a driving factor, while
proponents argue that private innovation is needed and that some of these things have to be
looked at because otherwise the costs to the US economy is so great, that emission reductions
would not be carried out.

As well as the United States, Japan, Australia, Canada, Russia and Norway formed
part of a consensus known as the Umbrella Group that wanted things like the flexibility
mechanisms to have no limits, unlimited use of carbon sinks, all technologies to be counted
in Clean Development Mechanism projects (not just known clean energy projects) etc. Many
of these positions are similar to industry lobby positions too. Business interests have
historically played an important part and had a large influence in the climate negotiations.

Particularly active during the Kyoto Protocol, the misleadingly named US-based
Global Climate Coalition formed to actively oppose measures on climate change for fear of
economic repercussions. As PR Watch noted, the coalition had been the most “outspoken and
confrontational industry group in the United States battling reductions in greenhouse gas
emissions.” This coalition contained many big oil, energy and automobile companies.

The coalition was effective at the time, but also extreme. As PR Watch continues,
“Prior to its disbanding in early 2002, it collaborated extensively with a network that included
industry trade associations, ‘property rights’ groups affiliated with the anti-environmental
Wise Use movement, and fringe groups such as Sovereignty International, which believes
that global warming is a plot to enslave the world under a United Nations-led world
government.”

As evidence of climate change mounted, major corporations had to pull out of the
Climate Change Coalition, as it was bad PR for them to be associated with the coalition, and
some accepted the evidence and began to invest in cleaner technologies. But much damage
had already been done, and the influence on the Bush Administration.

Some Businesses Taking on the Renewable Challenge :

While many large energy businesses in particular have been against doing something,
and influential in American politics especially, it doesn’t mean that all businesses from
around the world are against tackling climate change. World Wide Fund For Nature (WWF)
also pointed out in February 2000 that many large businesses are keen to support the Kyoto
treaty.

Ross Gelbspan for example, shows that economic issues can be addressed by
supporting Kyoto; that jobs can be created, not lost, etc. “Globally, subsidies for fossil fuels
have been estimated at $300 billion a year” with the U.S. alone counting for about $20
billion. Transitioning those subsidies to renewable, as Gelbspan also discusses, and helping
fossil fuel companies be part of that transition, would be positive, rather than detrimental to
their concerns. A number of businesses are researching alternatives to fossil fuels, or more
efficient forms, but lack similar subsidies (or conversely, suffer from lack of market
penetration because of the huge subsidies to the fossil fuel industry.)

Some leading businesses urging world leaders to tackle

climate change :
British Telecom (BT) is already feeling the impact of climate change, the company
has revealed, as extreme weather has hit its British operations. Yet BT also fears that the
impacts will be worse for more vulnerable people around the world, and could destabilize the
world economy.

Since the years of the Kyoto Protocol, as extreme weather and more and more data
about climate change has been emerging, a large number of multinational companies have
reversed their previous positions, or raised their voices on this issue. Leading up to the July
2005 G8 Summit, for example, a number of large companies called for urgent action on
climate change.
 A 60% emissions reduction can be achieved by using energy more wisely, without
damaging competitively, a number of British companies said to the UK Prime Minister, the
BBC reports. This would help address a catch 22 that the British government faces: a
backlash from business. A business lobby group have been successful against proposed cuts
using fears of lost productivity, competitiveness, and/or jobs. But now with major businesses
(and polluters) themselves urging for more action, perhaps progress can be made.

Even some major companies in the airline industry (some of the heaviest polluters and
contributors to greenhouse gases) in Britain been part of this chorus urging action. Their
recommended solutions are in emissions trading, rather than aviation taxation (almost
predictably), though they make an economic case for trading emissions based on the
incentive factor. Emissions trading are a controversial topic because of the potential for
misuse and poorer countries could potentially lose out, as discussed on flexibility
mechanisms. Yet, at least some of these big companies are also weighing in on the debate,
rather than trying to derail it, which sounds like a step forward.

In the US, large companies such as General Electric, Dupont, Alcoa, Lehman
Brothers and Caterpillar have launched an unprecedented campaign to call on the US federal
government to step up efforts to fight global warming.

However, some are still trying to undermine climate change action through deception.
As the British paper, the Guardian reports, scientists and economists have been offered a lot
of money to undermine a major climate change report in February 2008, from the IPCC.

Pressuring critics into silence :

As revealed towards the end of January 2006, NASA’s top climate scientist says
NASA and the Bush Administration have tried to silence him.

While NASA said this was standard procedure to ensure an orderly flow of
information, the scientist, Dr. James Hansen disagreed, saying that such procedures had
already prevented the public from fully grasping recent findings about climate change that
point to risks ahead.

Dr. Hansen, according to the New York Times reporting this, noted that these were
“fresh efforts” to silence him because he had said that significant emission cuts could be
achieved with existing technologies, particularly in the case of motor vehicles, and that
without leadership by the United States, climate change would eventually leave the earth “a
different planet.” (By contrast, the Bush administration’s policy is to use voluntary measures
to slow, but not reverse, the growth of emissions.)

Furthermore, “After that speech and the release of data by Dr. Hansen on Dec. 15
showing that 2005 was probably the warmest year in at least a century, officials at the
headquarters of the space agency repeatedly phoned public affairs officers, who relayed the
warning to Dr. Hansen that there would be ‘dire consequences’ if such statements continued,
those officers and Dr. Hansen said in interviews.”
 Earlier, in 2004, Dr. Hansen fell out of favor with the Bush Administration for
publicly stating before the presidential elections that government scientists were being
muzzled and that he planned to vote for John Kerry.

The New York Times also notes that this echoes other recent disputes, whereby
“many scientists who routinely took calls from reporters five years ago can now do so only if
the interview is approved by administration officials in Washington, and then only if a public
affairs officer is present or on the phone.”

Furthermore, “Where scientists’ points of view on climate policy align with those of
the administration, however, there are few signs of restrictions on extracurricular lectures or
writing.”

And in terms of media manipulation, the times also revealed that at least one
interview (amongst many others) was cancelled because it was with NPR, which the public
affairs official responsible felt was “the most liberal” media outlet in the country. This
implies a political bias/propaganda in terms of how information is released to the public,
which should be of serious concern.

As another example, the Australian Broadcasting Company (ABC) revealed that some
business lobby groups have influenced the Australian government to prevent Australia from
reducing greenhouse gas emissions. This lobby group included interests from the coal,
electricity, aluminum, petroleum, minerals and cement industries. The documentary exposing
this revealed possible corruption within government due to extremely close ties with such
industries and lobby groups, and alleged silencing of government climate scientists.

The US and Climate Change Negotiations :

Some countries of which the US is the most influential and powerful, have been
accused of being counter-productive during climate change negotiations. When the Kyoto
Protocol was written, it was mainly US and its business lobby that vehemently opposed the
protocol based on economic concerns.

While the Clinton Administration signed and ratified the protocol, the Republican
majority Congress was opposed to this. When Bush came to power, he eventually withdrew
from the international agreement.

President Bush cited a number of concerns, along the following themes:

 Economic concerns;
 That the Kyoto protocol was a political document;
 That it is unfair that countries like China and India do not emission reduction targets.
Policy Strategy :
In a June 2000 presentation, the World Resource Institute (WRI) asked what is fair
concerning developing countries and climate change.WRI noted that there has often been a
strong push by big business lobbies and related interests when environmental regulation is
attempted.

The resulting environmental policy strategy tends to have the following steps:

1. Deny it
2. Fight it
3. Dilute it
4. Delay it
5. Do it
6. Market it

These steps have also applied to climate change discussions:

Step 1: Deny it

With this step, we saw a lot of skepticism initially coming from US-based scientists, many
accused of reporting for big business interests, such as oil and automobile industries.

Step 2: Fight it

With step 2, and with climate change, WRI notes that step 2 has become “blame someone
else for it”, referring to Bush’s attempts to criticize the Protocol for not imposing reductions
on developing countries.

Step 3: Dilute it

With step 3, it is interesting to note that the climate change negotiations that led to the Kyoto
Protocol involved extremely heavy concessions on steps and measures to take, in order to get
the United States in on the agreement. To criticize later the Kyoto Protocol for being a
political document is a cruel irony.

Step 4: Delay it

With step 4, many have criticized the US and others of delaying effective action or in other
ways attempting to derail effective action.

Steps 5 and 6: Do it and Market it

Steps 5 and 6 still have to unfold for the climate change issue. At the same time, while the
Bush Administration has at least admitted it is not against action on climate change (just that
it opposes the Kyoto Protocol), it is spending money on research and technology.
Yet, combined with delay tactics, this may be a way to ensure the US doesn’t lose its position
of power by implementing climate change measures. If its companies can find ways to be
more efficient and clean, then it can gain clout and prestige and recognition of help save the
world.

By going its own way, it is ignoring international issues and concerns and so this can be seen
as a political move to ensure economic and geopolitical success on this major environmental
issue without consideration of the rest of the world.

Unfortunately it is often this “go it alone” approach that also creates a lot of resentment
against the US in the eyes of many around the world.

Economic Concerns :
As the WRI also noted in the above-mentioned presentation, climate change would not have
an adverse impact on the US economy:

 80 percent of industrial output and 90 percent of employment is concentrated in

industries where energy costs are less than 3% of the total output value
 People of the developing countries will struggle most with the effects of climate
change.

Furthermore, as WRI notes for previous major environmental issues when international talks
came on regulating harmful activities again big business went on the defensive. The above
steps applied in those situations too. Typically, the environmental problem under discussion
would initially be denied as existing. Once it was not possible to deny it would be faught
using fear such as citing major economic concerns such as job losses or excessive costs that
never occurred.

Such issues included:

 Acid Rain program

 Gasoline lead phaseout

Developing Countries are not subject to reduction

targets :
The US Senate in 1997 voted in favor of the Byrd-Hagel senate resolution, which
demanded the developing countries participate in the climate treaty and be subject to
scheduled commitments to limit greenhouse gas emissions during the same compliance
period for the rich countries.

But as WRI also noted, conversely, developing countries did not want to accept
commitments without demonstrable progress from industrialized nations. That is, if rich
countries (who are responsible for climate change in the first place) will not do something,
then the poor definitely shouldn’t be made to do so.
 It has long been recognized since the Convention document (which the US signed up
to as well) that the poorer countries share global concerns with the rich countries but because
they are not responsible for the climate change and because they have pressing development
needs, they should not be forced into making emission cuts at this time.

Furthermore, as WRI charges, Developing country commitments are not the point;
The real point of the environmental policy campaign is to “undermine any domestic action on
climate change and to sabotage the international negotiations.” That is the developing country
argument can be used to deflect attention away from the US towards the poorer countries.
This was seen in some of the conferences where Europe too suggested the poor countries
commit to reductions before further negotiations continued counter to what they had all
recognized and signed up to in the early 1990s.

Yet, further still key developing countries are already making reductions and
transitions showing rich countries that it can be done.

Possible Geopolitical Angles :

There may be possible geopolitical angles that also explain the support of the business
interests and of fossil fuels in some of the more powerful nations:

That is due to the immense resources and costs involved in bringing fossil fuels to
mass use it is not necessarily something that every nation can afford. Hence, those who
dominate in this area do exert a lot of political power and influence globally.

Being a backbone to the modern world, this is perhaps a crucial issue from power
politics perspective. (The dominating powers used to be the U.S. and Soviet Union. Now it is
primarily the U.S. Other parts of the world though rely on U.S. power, such as various
Middle East countries, some industrialized nations, and some emerging nations, though the
relationships between each other and the U.S. is not concrete. We see for example the E.U.
being open to other forms of fuels and often going counter to the U.S. on many issues. The
Middle East is a hot spot of extremism and despotic leaders and ordinary citizens in the
middle, and so on.)

If alternative forms are readily accessible then all nations could potentially develop it
and be less dependent on a few. Dependency and loss of control for poor nations for example
has been a major issue throughout history including the post World War II global system.

Ultimately, whether from ecological, social, political or economic angle, in the long
run and for humanity and the planet, this is not sound geopolitics either, (because it expends
more resources in maintaining this power, in terms of military and other avenues)
contributing to other issues such as climate, poverty etc.

Yet, relationships of power seems to be one of the ultimate issues, historically and in
modern times, in the arena of international politics and relations. As a result, we have issues
of poverty, terrorism and other related causes and effects.

Addressing this via a climate change program is not going to solve the world’s
problems, but may contribute in removing some heavy dependency on fossil fuel and the
resulting geopolitics of the Middle East, Central Asia and other areas that have led to
insecurity, instability and terrorism.