Environmental and Resource Economics, lecture 1

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ERE9 Corporate Accounting

• Why do corporations publish environmental
  reports?
• Three examples
• Axel Springer Verlag
• Otto Versand
• Royal Dutch/Shell

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Environmental Accounting

• Companies increasingly report on their
  environmental performance
• In some countries, this is a legal requirement
• Elsewhere, there is a variety of reasons
• Some CEOs are truly interested in the
  environment, and seek to improve their
  performance
• In other companies, (prospective) employees
  demand a responsible attitude to the environment

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Environmental Accounting -2

• Elsewhere, there is a variety of reasons
• Consumers are increasingly aware, would prefer to
  buy from green companies
• Consumer boycotts can be very expensive
• Investors may be lured by the Porter
  hypothesis Green companies grow faster,
  although more careful analysis shows that it is
  progressive companies that grow faster
• Tax incentives for green investments

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Beautiful Words

• We must deliver, and be seen to deliver in two
  ways. ... Shell companies also accept the
  responsibility to help deliver the economic,
  social and environmental requirements of
  sustainable development.
• Sustainable development underlies our strategy
  and is being integrated into everything Shell
  companies do ... We are committed to delivering
  excellent returns and building value for the
  future for the planet and ist people
• Sir Mark Moody-Stuart

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Schöne Wörter

• Ziel muss es doch sein, den Umweltschutz in den
  Köpfen und Herzen der Menschen so zu verankern,
  dass tagtägliches Handeln daraus entsteht
• Ich habe mich schon in den 70er Jahre mit den
  Gedanken des Club of Rome beschäftigt. Mir war
  schnell klar, dass wir zu Lasten künftiger
  Generationen leben ... dass Wissen allein nicht
  reicht, sondern Handeln gefragt ist.
• Dr. Michael Otto

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Oil Majors

• Compared to BP and Shell, ExxonMobil is the bad
  guy
• This seems to be mostly because of Exxons
  position in climate change, and perhaps a memory
  of the Exxon Valdez
• Exxons operations are as clean as possible
• BP and Shell invest in alternative energy, and
  are active in emissions trading
• Shells change of image is remarkable
• The Brent Spar was only 1996
• Before that, Nigeria and South Africa

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Principle 6 Health, safety and the environment

• Climate change remains on the most important
  environmental issues of our time. We are acting
  to reduce our own emissions and supporting our
  customers, partners and suppliers to reduce
  theirs. We strive to continuously reduce negative
  environmental impacts across our operations. Our
  environmental expectations set minimum standards
  worldwide, which form the platform for further
  improvement. Over 90 of our major installations
  have achieved ISO14001 certification.

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Principle 6 Health, safety and the environment -2

• Reducing emissions to air, water and land is
  critical to our business success and our
  contribution to sustainable development. We set
  tough targets to promote improvement.
• Greenhouse gas emissions 11 below 1990 levels
• Volume of oil spills halved
• Cost of carbon included in major project
  decisions
• Global biodiversity expectations set

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Total CO2eq emissions
CO2eq emissions per tonne throughput
Energy use per tonne throughput
SO2eq per tonne throughput
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CO2 Emissions
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Targets and Reality

• Aim Shift 10 of air transport to ship by 2001
• Status 8 (2000)
• Aim 20 of European transport by rail
• Status none (2000)
• Aim 35 of catalogues by rail
• Status 40 (2000)
• Aim Reduce diesel consumption by 2
• Status 0.2 (2000)