Experiment team: Giles (FFF), Andrew (IEEP), Sandy (ClientEarth), Aniol (NEF)
Assumption: more transparency can lead to the behavioural change of companies, through multiple strategies (divestment, shareholder action campaigns, etc.)
Assumption: Making information about value at risk; social/environmental performance public can drive change in companies’ behaviour. This change happens via multiple strategies (i.e. campaigns, shareholder action, promoting a blue divestment movement; making fund managers/analysts that some companies face a huge risk and this needs to be taken into account when advising to invest; etc.) which could not take place without this information.
Assumption: It is possible to link marine ecosystem deterioration with companies’ financial value.
Assumption: It is possible to compare multinationals globally on a range of social & environmental criteria.
Note: we use the term “transparency” to mean: bringing to light new information-data about the activities and practices by marine industry/companies. This information might be provided voluntarily or revealed by third parties.
Marine industries often operate in an unregulated environment and if it’s regulated, it’s not effectively enforced. They are hardly ever hold accountable for any env. and social impacts.
The long-term stability (and value) of certain marine industries relies on a healthy marine ecosystem (i.e. fisheries; tourism; etc.). In these cases, the deterioration of the marine environment could have direct impact on the value of the companies
There are other industries whose value or stability is not directly linked to the quality of the marine environment (i.e. energy; extractive; transport; etc). But their value can be affected through the reputation they have with consumers, investors, etc. For example if they are perceived to disregard environment and social factors.
We agreed that the scope of this work should focus on big multinational companies (i.e. companies that are on the stock market or likely to be affected by financial markets) and should have a global dimension. Although it would be worth exploring regional contexts.
We agreed to focus on companies that directly operate in the marine environment (i.e. fisheries, aquaculture, energy, aggregates, shipping, tourism).
We recognised the role that non-marine related industries can play in driving change on marine related companies when directly sourcing from them. But these fall out of the scope of this experiment.
How would you design an experiment to test the Hypothesis?
Experiment (in 2 months) is a scoping strategy that will focus on testing if it is feasible to:
Focus on big multinational companies operating:
Questions to answer in two months:
NOTE: In retrospective it seems that the pre-enactment did not fully capture to key elements of this proposal (above) such as the “value at risk” angle or the “exposing or bringing to light certain practices”.
What is the experiment? Test the feasibility of using transparency of marine industry practices as a lever for change. Find out if anyone has done anything like what we are trying to do, how would we develop transparency set of indicators, information available and evidence of effectiveness.
(How would you know if it has worked? Evidence from similar approaches being successful/effective in driving change; availability of information/data to apply this approach/model to the marine context; environmental-social indicators identified & key marine industry sector identified to put this idea into practice)
I - Scoping existing practices/initiatives (ALL)
II - Learning from similar approaches (Lead: Aniol / Sandy)
III – Shaping up the project (Lead: Giles / Andrew)
By the end of the 2 months we hope to have enough information to decide if – and how – we take this initiative forward.
Summary of discussion 8 JUN 2015
While there is a growing number of initiatives making more data and information available we have come to the conclusion that:
In this context, MarCoLab’s could make the following interventions:
In order to make things more manageable we agreed to focus on two key sectors:
We will structure our work in two phases:
Other key point
The idea of replicating the “Carbon tracker” initiative for Marine related industries (i.e. linking market value of a company with state of marine environment) looks quite challenging and it is probably very difficult to put it into practice with the existing information. We think it is a powerful idea worth revisiting at a later stage.
The outputs of this exercise will inform a more detailed proposal to take forward this initiative.
How do any results collected during the experiment support or refute your hypothesis?