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a new environmental activism?

Pounding on political doors with stacks of scientific fact or shrill moral argument has proven a remarkably ineffective way of addressing the issue of climate change.

While Science stands in the middle of the jungle of Commerce screaming at the natives in the languages of Politics and Science, the natives speak only business.

Perhaps it is time for an approach executed in the language of commerce. I do not pretend that this proposal is flawless, without risk or even that the tools necessary all exist today, but nothing if not first a dream.

The value of a business is the value in today’s dollars of future profits, adjusted for the risks associated with generating those profits.

What if a model could be built to translate specific predicted effects of climate change into a probability/risk-adjusted range of impact on the future cash flows of say, a specific publicly held corporation?

A reasonably sized “what if”, but we are talking about probability adjusted risks (not scientific or accounting risk) and their impact on a specific business activity.

A shareholder in a corporation showing a meaningful modelled financial risk would have a legitimate right to ask the Board what they are planning to do to mitigate the risk. If like minded shareholders were sufficient in number and volume could the trading value of that corporation be impacted? To what extent could that influence say CEO behaviour?

In short, this is environmental activism expressed as targeted shareholder activism.

The inherent uncertainties are not the point. The point is, if you have been lobbying and placarding and letter-writing or producing environmental T.V. for the last 30 or 40 years, well how is that working out for you? Think we have time for another 30?

If you believe that our fragile eco bubble is in real danger, then in the words of the Connery character in the movie "The Untouchables":

What Are You Prepared To Do?

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    Dec 16 2012: There is so much data out there but the models have to be modeled off a previous event to get a measurement? We just don't have a model where a species has and is affecting it's total environment like we are now, more than that is the fact that you would have to know what every particle everywhere is doing in relation to every other particle to be able to exactly give a 100% model of future events and conditions. So, we have a group of models and most of those have predicted conditions close to their model but that's not good enough, it's not concrete enough for most or is it that we tend to look for the easy one tells all scenario? The human tendency to want to choose the one closest to what we think is the truth? The problem is is our pattern recognition system, individually we, without having any knowledge on weather conditions look to those that work in this field and get angry when their results don't work when they say it will. Weather forecasting is what i call real time crunching, we have no idea the enormity of the job those that choose that profession have to deal with. I take my hat off to those people.
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    Dec 10 2012: We can't get the public at large to acknowledge actual, measurable changes in real time, so how do you honestly expect them to understand "probability" as a driving force for change to a status quo way of doing business?

    We don't choose change, we react to it.

    How do you propose to mitigate the psychology behind public apathy toward change to help breathe life into this idea?
    • Dec 10 2012: If I understand your comments correctly I have a couple of points I think.

      Human history is full of examples of people making their own change, so I have to disagree with you there. The alternative is hopelessness which I am not willing to accept. Action begets action and in some cases change.

      I would not worry about attracting public attention, news of shareholder activism will spread through the media with little difficulty. That existing shareholders would pay attention is as close to gauranteed as you can get.

      No, the real issue is not public apathy, it is the pedantic and tunnel-visioned nature of the scientific and environmental research communities who think international agreement and measuring the perma-frost one more time, gathering more data, are the solutions.

      Personally, I believe that to be very near the definition of obsessive comnpulsive disorder. Obsessively repeating the same actions with the expectation of a different result. Its nuts.

      So, do I really expect anyone with an environmentally focused scientific or computer modelling backgrounds (clearly the project would be multi-discipined) to step up and say 'hey yeah, lets build this thng'?

      Well really that is my point. It is there. It could be done. Even the act of trying it would be useful, success aside.

      But will it?

      Only if there is still some imagination and passion to be found in the communities who must build it. And that was my challenge, not to the public but to those communities :

      What Are You Prepared To Do?

      If your personal answer is "nothing that others are not already doing", thats ok with me. You will certainly not be alone.
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        Dec 13 2012: Public apathy does play a role in what you propose, for two reasons:
        1. Corporations react to consumers - Public apathy toward an issue will shift corporations' priorities to things that the public actually care about. Corporations want to reach as many consumers as they can. The way they do that is they target specific issues that consumers care about. Environmental activism is not currently something that the public cares about as much as, say, boosting the economy.
        2. Public will disregard environmental data - Psychology states that people focus on things that are more important to them in the current moment, not something that is long-term. If people don't care, no activism of any kind will produce successful results.
        • Dec 13 2012: Jerry - somehow I feel this has gotten off-point. I'll try to restate here, but for the original less condensed version see my blog:

          First, although posted publicly my challenge was not really to the public at large but to the environmental activist and environmental science communities who presumably are already very much interested in solving the problem and ar not apathetic. David Suzuki is retired but lots of others are filling in.

          My view is that they are and always have been spekaing the wrong language and to the wrong people. Difficult to make progress yelling in Engliish (or 'science') if the listeners only speak an obscure click dialect (e.g. that of business) and in any event are not in control.

          So yes you are exactly right, I agree, 'people' in general do not pay attention to scientific data. Most political nodes don't either, unless forced-fed.

          Ergo I am suggesting that the only effective conversation can be one had directly with specific corporate boards of governers and their CEOs and further that the speakers must learn the language of business, not the other way around.

          In terms of funding and public apathy or acceptance you may be thinking of crowd sourced financing or other broadly derived funding, which I suppose could happen eventually but its not really what I had in mind.

          I had in mind challenging environmental scientists to say, stop measuring the perma-frost, maybe not investigate which might be the next speices to drop off the planet and to do something more direct with the cash, like building the proposed model for starters.

          As far as the effectiveness of any resulting shareholder activism I'm pretty sure you know exactly who Carl Icahn (et al) is/are and how they go about things but just in case here's wiki on the topic for any interested others:

          Thanks for doing what you do.
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    Gail .

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    Dec 9 2012: Shareholder voices won't help. Although common stock usually entitles you to one vote for every share that you own, this is not always the case. Some companies have different “classes” of common stock that vary based on how many votes are attached to them. So, for example, one share of Class A stock in a certain company might give you 10 votes per share, while one share of Class B stock in the same company might only give you one vote per share or no voting rights all.

    So why would some companies choose to do this?

    Because it’s an easy way for the primary owners of the company (e.g. the founders) to retain control over the business. The company will typically make available to the public the class of shares with the fewest number of votes attached to it, while reserving the class with the largest number of votes for the owners.

    The only way to attack that issues is for people to stop supporting environmental purchases. Do you really need the new smart phone or ipad that not only pollutes, but is made with (tacit) slave labor? Do you really need to drive to the store or even replace that car? Are you willing to buy your own eco-friendly grocery bags? Can you put on a sweater rather than raise the heat in your home?

    I lived for many years in a motorhome. Excluding the travel (that I no longer do), by managing my energy usage using a control panel that houses do not have, I could survive with FAR less energy than my house requires. ie- my house has a 40 gal water heater. The coach had a 15 gal water heater, but it could hold its heat for 12 hours, so I kept it off during the day & turned it on again in the morning or on the occasion that I needed more hot water. The coach was 50 amp, and it controlled appliances, turning certain ones off during peak power loads. I found that hanging clothes to dry was better than the dryer. My house was 3,500 sq. ft. The motorhome? 350. etc

    We can fix this, but do we want to
    • Dec 9 2012: Thanks for commenting, glad at least one person read this :-)

      While you are correct about there being different share types, the vast majority of publicly traded equities are in fact of the voting variety. A little research will turn up dozens of cases of shareholder activism executed in exactly this way for other reasons, such as perceived board ineffectiveness, failure to take a particular action and so on.

      It happens on a fairly regular basis and there are a number of investors well kown for instigating this type of action for their own purposes. In short, with properly executed strategy, shareholder voices matter very much indeed.

      I would also sugggest that, if we use history as a guide, waiting for the general population to change its purchasing or other habits in sufficient numbers to have any meaningful impact on climate change is the same as waiting for their existing lifestyles to be changed be neccessity (i.e. by force of reality), which in turn I would suggest is simply far too late.

      Even though the well meaning C.E.O. may recycle at home and drive a hybrid, when he or she arrives at the office he or she /is/ the corporation and will behave accordningly, and in general so will the corporations employees while at work.

      So, yes we probably almost all want to change it, but some leadership is required to change the culture and as we all know, there is none to be had in political circles.

      Given that, it seems to me that pointing the finger at "the people" is akin to standing in a cross-walk with a truck bearing down and waving at passers-by in hopes that they will somehow stop it, while those folks are all mesmerized by the advertisement on the side of the truck.

      So, for my part, I don't feel especially comfortable watching the oceans turn to acid (which by the way they really actually are, today) and counting on altering consumer behaviour to prevent it.

      That approach has been popular for 30 years as well, so again I ask, "how is that working out" ?
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        Gail .

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        Dec 10 2012: I disagree with you on one great point. You say that leadership is necessary. I say that those who depend on leadership ARE the sheeple who actively support and fight to sustain the problem.

        It is time for people to awaken. The shift is happening, and I am impatient, but not defeated.
        • Dec 10 2012: We agree then that people follow leaders. In this case the behaviour of those people is repeated cinsumption of the products and services marketed by corporations that produce those products and services.

          The whole point is that if we /cannot/ change the behaviour of the populace (which I think is unlikely short of disaster-driven necessity) and the political structure is too coopted or calcified to work, the only remaining choice is to change corporate behaviour.

          In my opinoin, there is one way and only one way to do that. Directly attack the profit motive of the individual stakeholder.

          If there is another way I am all ears :-)