Tag Archives: Economy

Starting from Zero

14 Jan

There are, as you might imagine, many enduring traditions at a university like Oxford. For example, you can be refused entry to write your exams if you are not properly dressed in formal academic dress or sub-fusc as it is known. You can read more about sub-fusc at exams on my classmate’s FT blog here.

A slightly more subtle tradition is the numbering the weeks of term.  This was also the custom throughout my elementary and high school experience, so there was some happy nostalgia when I rediscovered the practice.  Less obvious however, was the need for a Week 0 or ‘Nought Week’ as it is sometimes known. This week was Nought Week here at Oxford. There are no classes, but students are required by the rules of the university to be present. It’s an official part of the calendar and school rules, and there is one every term.

So what happens in Week 0? I like to think of it as built-in ‘brain stretching’ time – that transitional period between vacation and work that we have all found ourselves wishing for on the Sunday night at the end of a vacation, right before heading back to work on Monday. This week, we’ve attended presentations about electives we’ll be able to take next term, and several classmates have been participating in the VCIC venture capital competition.

My particular ‘brain-stretching’ moment came in a small seminar room, where about 20 of us gathered to listen to a presentation about a community wind farm project in Mexico.  There are many unique features about the project, a partnership of the Yansa Foundation and a local indigenous community in Ixtepec, which has designed as a social enterprise.  Perhaps one of the most exciting things about the project was the plan to formally quantify and verify the social and environmental impacts, beyond GHG emissions reductions, that the project will deliver.  These certificates will then potentially become a traded commodity, as companies and potentially countries, look for ways to meet their commitments to support GHG reduction and climate change mitigation.

But how do you measure something that doesn’t have a convenient scale, like dollars or megawatts or milligrams? It’s the ultimate ‘starting from zero’ kind of problem. Economists and accountants traditionally branded these things as ‘externalities’ that were conveniently left off the balance sheet because they were so challenging to measure. But times have changed. Imagine my complete delight when an hour later, the very last elective presentation of the day introduced a new course on impact valuation – the technical process of defining social, financial and environmental metrics and quantifying them, with a view to fully integrated triple bottom line assessments.

Clearly, we have some way to go before this approach to valuation of resources, and products and companies is mainstreamed. But it’s encouraging to think that ‘zero’ is not really nothing, but may be the start of a really big something! Here’s hoping you too can find a ‘zero’ in your world that becomes a brain-stretching moment for this year.

Rethinking business

12 Nov

It’s absolutely unbelievable that the previous post is dated October 6th! If I didn’t know better I’d say some blog-bug hacked in and changed the date.  But it’s probably fair to say things have been a little bit hectic!  As I hinted in my last post, the beginning of term has been a storm, characterised by a whirlwind of assignments, group projects, careers events, guest lectures, MBA class elections and more! And that’s just the weekdays!

Despite the controlled insanity, it’s been very interesting to reflect in some quieter moments with a few classmates on how the things we are being taught really could play out in the real world.  One emerging theme is the concept of “rethinking business”.  What is a business for? This question came up in our first week of classes in just about every course.  Some of the concepts hinted at the traditional – to make money, to create and capture value, to innovate – but others also acknowledged a broader sense of purpose – to do all those things with an eye on the big picture of society.

I’ve been very fortunate in the past several weeks to attend events with an incredible list of speakers, two of whom resonated deeply with me personally by capturing different facets of this concept of greater responsibility.  The first was Stephen Green, the chairman of HSBC Holdings plc, speaking at the first Pears Business School Partnership lecture.  You can read more about the event here, but the key takeaway for me was his assertion that companies must transition from treating corporate social responsibility as a solely philanthropic or “do good PR” issue to using it as a core business strategy tool that selects investments in social and environment issues as a component of a successful business model.

The second speaker was Bob Dudley, the newly appointed CEO of BP.  The Confederation of British Industry’s Annual Conference was the location for Mr. Dudley’s first public appearance since taking office on October 1, 2010.  While much of his discussion centred around the in-depth internal analysis and stock-taking within the organization following the Gulf oil spill, he also clearly acknowledged that BP has had to completely rethink its role as a business, and is working on forging a very different relationship with areas like the Gulf where it does business.  Regular readers will know that I’ve written more than once about BP, and I still believe those opinions were founded and appropriate for the time.  Time will tell whether BP actually is able to achieve their objectives under Mr. Dudley’s leadership, but I will say that his personal commitment through his speech is not in doubt.  We can only hope that the new BP that emerges from this disaster will continue to be fully engaged in its broader responsibility as a global company.

So what is a business for? No doubt this will be a central theme revisted in posts to come, but I can say that we are working on defining this for ourselves in a way that centrally integrates the idea that perhaps a better question may turn out to be “Who is a business for?”

Ready to change how we think

28 Sep

Going to business school is a personal decision, based on all kinds of things.  What you do now, what you’d like to do next, what new ideas you have, how interested in business you are, and a host of other factors that shape your thinking through the application and acceptance process.  Notwithstanding this very personal vision, many of the experiences my classmates and I have shared so far have been somewhat “broad strokes”, touching on the traditional areas and sectors that the “typical” business school student is likely to be interested in.

But what if you are not typical? Clearly we all like to think of ourselves as unique, and to some extent we all are. But equally, in a business school setting, there are going to be several people who delight in the idea of 12-hour work days as investment bankers, thrive on the excitement of the trading floor, and leap out of bed at the thought of complex financial modelling.  I’m not one of them, I’ve realised, but figuring out what I don’t want to do early on is a good thing, I think.

What I really want to do is change the way we think about stuff and the people and companies who make it, sell it, use it and deal with it when we’re done.  I’ve written about stuff as a consumer and as an owner, and realised since moving into a small student bedroom that living with less stuff is not only possible, but kind of peaceful.  I’ve been practising my “elevator pitch” to my classmates, and researching companies, organizations and people who already seem to be thinking about stuff differently.

Now, it’s early days on the research front, but I thought I’d share some cool things I’ve found so far.  Some of these may be familiar, while others may spark some new interest.

  1. Look to your right, over there in the side bar.  Click on The Story of Stuff and see with Annie has to say about things.
  2. Check out this blog post by Joel Makower, the founder of Greenbiz.com, and a “guru of green” I think has some neat things to say.  The book he recommends is now officially on my list.
  3. While you’re browsing through the blog roll, stop on by The Clean Bin Project, which chronicles the great things Jenny and Grant did and learned in living “waste free” for a year. I was lucky to meet these two about a week before they took off on a cross-Canada bike tour this summer, and they are doing something special.

So here’s what I’m ready to test through business school, and hopefully get some of the best brains I know (my classmates!) to think through this with me:

  • How do we make better stuff? The kind that’s good for the environment, and for people, and for the companies that make them?
  • Is a stuff vs. services conversation something we’re ready to have? And who should we have it with?
  • How much, and what kind of stuff, is “enough” in a finite world, a closed system with limits on all kinds of resources?

You probably have ideas about your stuff too. Let me know what you think – say it out loud.

What They Want Us to Know

13 Jul

I don’t know about you, but I’m a compulsive reader. I get antsy if I don’t have at least 2 books going, and books waiting to be read are like money in the bank.  Just back from 2 weeks vacation in Barbados,  I’ve had lots of time to read for pleasure, sitting in the sun.  One of the most unlikely things I read however, was sitting in a banker’s office, doing some “in-person transactions” that had been on hold for some time.

CMMB, a Caribbean-based money market brokerage firm, publishes a quarterly magazine, which this quarter posed the question “Are Multilateral Institutions Still Relevant?” A range of highly technical economic policy articles make up the special feature section, covering such issues as the relevance of the International Monetary Fund (IMF) in supporting development, and the various experiences of Caribbean nations who had been involved in IMF-driven policy.

Now, please remember I was on vacation! At the time, it was interesting to note that while much of the analysis seemed to indicate that Caribbean countries performance under IMF-sourced policies had been mixed at best, and poor in many cases, the IMF Deputy Division Chief – Caribbean Division was quick to note how the IMF was “evolving” to support “spending on the social sectors and targeted support for the poor”. However articulated, it was clear that this was the new drum to march to, despite a less than stellar track record across many developing nations who had tussled with the IMF in decades past. That said, I think it was out of my mind by that afternoon, as I dived back into vacation-approved reading (aka the chicklit novel!).

Fast forward to this week, when having received my summer reading list for the upcoming term, there was Globalization and Its Discontents, authored by Joseph E. Stiglitz, a Nobel Laurate and one-time Chief Economist at the World Bank.   Mr. Stiglitz’s book reflects a critical perspective on the policies of the IMF, World Bank and World Trade Organization (WTO), and focuses on how these multilateral institutions have in fact contributed to poverty and economic instability in a number of developing countries, rather than improving those very circumstances as was their official mandate.

Weird how time and space collide, isn’t it? There I’d been on vacation at the CMMB office, thinking how strange it was that the IMF was interested in poverty, when anyone living in the Caribbean in the 1980s and 1990s seemed to equate “IMF” with doom and destruction. And here was Mr. Stiglitz asserting that no, it hadn’t been my imagination.

So, why is this a big deal? Who cares what one dusty economist (no offense Mr. Stiglitz) wrote about some other dusty economists back in 2001? That was like, before Facebook and Twighlight, dude.

Well, here’s why it matters – policy affects people.  Tackling poverty is going to take policy, yes, but it’s also going to take insight, and empathy, and money, and cultural awareness, and local empowerment, and people.  As a result, we all have a responsibility to pay attention to what’s really happening, not just what they want us to know. Many of you who will read this post live in the “developed” world.  It’s your governments and leaders who weigh in on the boards of organizations like the IMF and the WTO.  They help set the policy, and not always in favour of those most in need of help. It’s up to us to pay attention. Get out there and read something, then who knows, maybe you’ll do something.

See you out there!