Lecture Four: NGOs - The impact and activities of campaign groups

January 28th 2015

Lecturer: Tobias Webb

Tobiaswebb.blogspot.com

Where do campaigners come from?

• Consequence of rising middle class wealth in the West back in the 1960s

• Arose also because impacts of corporate activity were becoming clearer (napalm, corruption, pollution, human rights etc)

• Gained ground in 1970s and 1980s (rainforests, famines, oil spills, pandas, dolphins and tigers)

• Began targeting companies much more in 1990s• By the noughties NGOs realised they could better

achieve some aims by going after vulnerable brands than disinterested governments

Who are we talking about?

• ‘Green’ NGOs: Greenpeace, WWF, Rainforest Action Network, Friends of the Earth etc

• ‘Human rights’ and ‘community’ / ‘people’ / poverty NGOs: Amnesty, Solidaridad, Human Rights Watch, Forest Peoples Programme, Earthrights, etc

• Corruption, Governance, development NGOs: Global Witness, Oxfam, ActionAid, etc

Many now straddle all three categories…important shift as we realise how interlocked these different issues are…

Is there a business case for being campaigned against?

Well, apparently…but by campaigning investors rather than pure activists. Shareholder activism may have business benefits…

Sarah Soule, professor of organizational behavior at Stanford Graduate School of Business, says shareholder activism by social investors (NGOs in suits) can be good for business, in the long term.

Is there a business case for being campaigned against?

How so?

• Soule, et. al. tracked outcomes of more than 750 shareholder resolutions related to environmental causes and examined interactions between corporate activists and 300 corporations.

• Research found that the more activists protested, the more corporations responded.

• And while activists couldn’t count on winning short-term battles, simply engaging with corporations created change: shareholder activism brings attention to issues.

Is there a business case for being campaigned against?

How so?

• The companies responded in part to help move those issues onto a platform that they can control, such as their own social responsibility committee or publishing a report on a particular topic.

• At the same time, that means the corporations are now paying attention to concerns.

Is this really a business case?

It seems a bit weak, doesn’t it? But…

• This area is under-studied, so we don’t know.• But its clear from many companies that activism, from

shareholder to NGO to individual, has had some benefits.• These are so far hard to measure BUT:• It’s clear companies who engage in stakeholder

engagement are more aware of risks they may not have seen on their own. Anecdotal evidence is strong even though it is hard to ‘prove’.

• It seems likely that non-shareholder campaigns have had a similar, possibly bigger, impact. But the area is under-studied…

Some recent campaigns: Greenpeace vs. Nestle

• Now legendary campaign from 2010.

• Greenpeace broke into Nestle’s AGM.

• Dangled banners from ceiling.

• Released KitKat video, caused shockwaves.

• Resulted in deal between Palm Oil supplier Golden Agri Resources, TFT and Greenpeace.

• Nestle then began sourcing from GAR again…

• A win all round for everyone?

Greenpeace's side of the story...

McDonald’s and Amazon Soy

• Campaign by Greenpeace due to Amazon soy for chicken feed • McDonald’s used purchasing power to catalyse change and helped

create farmer moratorium on Amazon soy development, with Cargill

• Useful background reading here and here. • Success? “Only 115 people out of several thousand soy farmers

have violated the Soy Moratorium since 2006, but over 600 of them have violated the Brazilian Forest Code”.

• “Same group of farmers is five times more likely to violate the governmental policy than they are to violate the private sector agreement”. Scary? Possibly. But it works…

• McDonald’s: “we purchased through our upstream suppliers less than ½ of 1% of soy in the marketplace”

• But used brand power and supplier influence to create a system still in place and still successful.

Live case study: Greenpeace vs. PepsiCo: The story so far on Palm Oil

PepsiCo's perspective

Greenpeace's view

What the media reports

Clean Clothes Campaign vs Retail brands

Rana Plaza factory disaster April 2013• CCC spurred serious collaborative action on

Bangladesh safety standards. The Accord and a weaker US initiative.

• Demanding brands pay more than brands think they are responsible for in compensation

• Accused of breaking confidences after Wal-Mart meeting.

• Consistently maintain pressure on US and EU brands on key issues such as pay, conditions, union organisation, safety and compensation.

A world class response?

Oxfam and Unilever

• Worked together in 2003 on Indonesia study• Painful process for both sides: Particularly Unilever! • Resulting in some meaningful insights for both

organisations• Helped Unilever understand its ‘economic and social

footprint’ and Oxfam to understand challenges Unilever faces

• Since then Unilever invited Oxfam to undertake uncensored public audit of Vietnam supply chain

• Findings were challenging for Unilever but helped the company see gaps and issues to be tackled in the supply chain

“Behind the Brands” report

• Produced by Oxfam, ranks FMCG companies on supply chain social issues

• Spurred competition from FMCG firms. Many execs cite it as having major impact on plans

• Companies complained of old data being used, of unfair comparisons

• Nevertheless, has had significant impact as have many other ‘rankings’ and comparisons by NGOs i.e. Electronics, Chemicals, Human Rights (forthcoming ‘ranking’ from NGOs)

Global Witness

• Founded 1993. Ted video here.

• Did the research behind Blood Diamond movie.

• Played key role in Kimberly Process and EITI initiatives.

• Focus on Governments, Companies and Emerging Market players (Beny Steinmetz)

• Also focus on murders of journalists.

Partnership-based NGOs

• Some crossover with campaigners: Oxfam, WWF, Environmental Defense Fund etc.

• Many like to focus more on solutions and on the ground delivery.

• Here’s an example: Anglo American and Care International • Many of them out there. From big NGOs such as Save the

Children and Catholic Relief Services, Red Cross/Crescent/Habitat for Humanity, World Vision, UNICEF, VSO, WaterAid, Grameen.

• To smaller locally focused ones working on local/national issues such as water, microfinance, training, farmer training etc (millions of them, two million in India alone!)

SHIFT: Human Rights NGO

• Extremely practical, implementation NGO

• Came out of the Ruggie Process (UN Guiding Principles on Business and Human Rights).

• Globally focused, non-judgmental.

• Lean, mobile and collaborative.

• Non profit consultancy: What does that mean? Classic consultants sometimes complain about hybrid consultant/NGOs…

“Legitimate” criticisms of some leading campaign groups?

They/some of them: (according to some in business)

• Claim credit for things which they were not 100% responsible for. Things that might have happened anyhow

• Illegally record meetings and break confidences.• Twist some of the facts to suit them, sometimes (GMOs,

nuclear, supply chain power).• Use hammers to crack nuts. • Don’t always think about long term market solutions but

focus on quick wins to keep supporters happy and maintain momentum – but towards what?

• Are often far weaker on practical solutions.

For business: Some NGOs can be a bit odd…

Forest Ethics.

• A Canadian forestry NGO…• …targets a banana company…(Dole)• …to ask them to commit to never use diesel in their trucks

in the USA…• …that has come from tar sands in Canada.

• Ok there’s an environmental benefit, but one might argue, isn’t the time and effort best spent on a) a less obtuse target and b) actually researching either downside of tar sands or upside of renewable technologies? Discuss…

Risks for activists may be growing

Risks for activists may be growing

The ‘reality’ is…

• Having spent 14 years studying NGO campaigners, the reality, as I see it is:

• They have been one of, if not the top, driver of change in large companies.

• Yes they get some things wrong. Some deliberately so, some exaggerate. Some can behave unethically.

• But all in all, they drive positive change because they encourage broader view of the world and they force/encourage stakeholder engagement.

• That can only be good for companies in the long run. • Is the exception to this issues such as GM foods and

nuclear? Depends on your point of view…

Questions for debate

1. The influence of campaigners on business at least, is growing. 2. China is experimenting with allowing them to sue companies.3. Campaigners are under pressure in places such as India and

Russia, for ‘restricting growth’ – is this fair? 4. Campaigners are accused of not representing the ‘average’ view –

does this mean they really represent civil society ?5. Is it right for them to ‘fudge facts’ for the greater good? Who

should decide what that greater good actually is? 6. In the absence of regulatory enforcement in many countries, and

a lack of business voluntarism, campaigners fill the gap. Is this right and fair that campaigners create pressure on brands to drive progress in the face of a governance gap?

7. Should campaigners be more ‘publicly accountable’?