Among one of the most popular activities of environmental NGOs is the issue of demands for corporate accountability. I don’t think that that’s a bad thing. Corporations, like any organization, can at times run roughshod over the rules. Just as the American system of government with its checks and balances on each branch of the public sector inspires accountability and transparency, having a similar system, albeit informal, in the private sector can prove beneficial. It can prove beneficial, though, only if those doing the oversight are ethical, open, and transparent. To whom are the eNGOs accountable?
Let’s use one major eNGO as an example. Friends of the Earth US (FOE-US), about which I’ve written frequently on this blog, is one of the largest eNGOs in world. A recent visit to the Web site of FOE-US (foe.org) revealed no information which would indicate how this eNGOs governs itself. Such information would be in the organization’s bylaws.
But my search on the foe.org site for the word “bylaws” yielded no results. Hmmm. I searched more deeply.
There was no bylaw information posted on the site, but they did post a collection of annual reports. I reviewed them.
My review of their annual reports, from 2003 through 2010, although filled with much glitzy and flashy information about their various campaigns (perhaps published there in an effort to induce donations) showed no information about organizational governance, not a whisper about the bylaws. (Speaking of 2003, please see my related post “Friends of the Earth Received Narrow Support” which demonstrates that for the years 2003 through 2006 FOE-US received almost 60% of its funding from only 11 donors.) Concerning governance, the closest thing I found in those annual reports were simple listings of the board of directors members and listings of the staff. I already assume they have a board of directors and a staff, but telling me their names doesn’t tell me how the organization is run.
How are those members of the board of directors elected? Are they even elected? Or are they appointed?
If the members of the board of directors are elected, who votes for them? The donors? The rank and file members? The staff? Other members of the board of directors?
If they are appointed, who appoints them?
If the donors vote for them, how many votes do the donors get apiece? Do they get one vote per donor, or do they get one vote per dollar donated? Sort of like shareholders in a corporation.
The answers to all of these questions, and others I haven’t taken the time to pose, are critical in assessing whether this corporate monitor, this organization that regularly calls for corporate accountability, is itself accountable and therefore worthy of doing the job that they appoint themselves to do.
Just as any organization can run rough shod over the rules, eNGOs are no exception.
If FOE-US made its corporate bylaws accessible on its Web site or reprinted them in their annual reports, their accountability would become more apparent.
Continue reading Why Are FOE’s Bylaws So Difficult to Find?
Today I’m going to discuss one of the lesser known, but still highly influential, activist groups in the environmental campaign business.
For readers who aren’t familiar with Friends of the Earth US, this organization is the American arm of the worldwide environmental non-governmental organization (eNGO) Friends of the Earth (FOE) and is one of the largest environmental advocates on the globe. Strategically speaking, FOE US differs somewhat from its eNGO cousins such as Greenpeace and Rainforest Action Network. In campaigning for the environment, the latter direct much of their actions directly at corporations while FOE US chooses to direct much of their campaigning effort at American legislators.
A few months ago I performed research which looked into the financing of Friends of the Earth US. The findings of the research were reported in a White Paper entitled “Friends of the Earth Received Narrow Financial Support from 2003 through 2006.”
The research I performed used information from publicly-available U.S. government documents and found that FOE US, for the period of 2003 through 2006, received almost 60% of their contributions from only 11 contributors. Given that FOE US spends much of its campaigning effort on American legislators, the implications of such narrow support are readily apparent.
The White Paper was published by The Kahuna Institute and if you would like to receive a copy of the White Paper - ”Friends of the Earth Received Narrow Financial Support from 2003 through 2006,” you may download a copy for free by going to this link.
A government that does an end-run around the spirit of its own laws? And by exploiting green activists in the process? Impossible, you say? Then perhaps you believe that there was no gambling a Rick’s Café Americain?
A recent opinion column, titled “The Multinationals’ Dilemma — Gratify the Greens or Protect the Poor?” and written by James M. Roberts of The Heritage Foundation, made these very assertions, but without the tongue-in-cheek suggestion of disbelief. In his article, Mr. Roberts discusses many different issues, perhaps too many for the space allotted him, the foremost of which is the issue of how multinational corporations may actually damage economic progress when they acquiesce to the protest demands of various activist groups. This is a complicated and controversial issue, one which I have often discussed on this blog. But, this issue is not the topic of today’s post.
Rather, the topic of today’s posts is one of the minor issues as raised by Mr. Roberts in his opinion article. That issue is the financing of activist groups by governments and the reason for such financing. I previously dealt with this topic in my April 2010 post “Nice Work . . . If You Can Get It? Friends of the Earth Does.”
In that post, I noted that in 2008 Friends of the Earth Europe received over 50% of its annual income from a European government grant. Of their €1.5 million budget for that year, Friends of the Earth Europe received €790,000 in the form of a grant from the Directorate General Environmental, the environmental commission of the European government. (Figures per the International Policy Network (IPN). Please see my previous post for full citation.) As I said in the title of that previous post, nice work if you can get it, eh? For sure. But what’s even more interesting is the reason for the awarding of such financing.
The International Policy Network (IPN) is a research organization based in the United Kingdom. On their “About” page they list their mission as to:
Promote the advancement of learning by research into economic and political science and the publication of such research.
Last month, March 2010, they published such research in a report titled “Friends of the EU: The Costs of a Taxpayer-Funded Green Lobby.” In the Executive Summary of this report, IPN states:
Environmental non-governmental organisations (NGOs) have enormous influence in the European Union. However, some of the most vocal green groups are actually funded directly by the EU to lobby it.
Nice work, if you can get it? Absolutely. And it seems that in Europe they can. One of the beneficiaries of such governmental largess is Friends of the Earth Europe (FoEE). On page 8 of the IPN report, in Table 2: Sources of Funding and Lobbying Expenditures, IPN shows that for 2008, FoEE had income of approximately €1.5 million. Of that amount, over 50%, or €790,000, came in the form of a grant from DG ENVI, which stands for Directorate General Environmental, the environmental commission of the European Union. And during that same year, FoEE reported to the EU that FoEE spent €696,000 to lobby the government of the European Union.
Indeed, nice work, if you can get it. And it’s looks like Friends of the Earth doesn’t have too much trouble in doing so.
Implications?
Generally, this means that the taxpayers of the European Union pay advocacy groups to lobby their government for changes deemed important by the advocacy group, and not necessarily the taxpayers.
Specifically, as related to the theme of this blog, this “nice work” means that European companies pay, via their taxes, for NGOs to campaign against them. And with, essentially, all the lobbying budget of FoEE picked up by the taxpayers of Europe, this leaves plenty of revenue left over for FoEE, and other lucky European NGOs, to apply to their online protest campaigns. Theoretically, at least, this means that FoEE’s digital activism is taxpayer supported.
This is an important tidbit of information to keep in mind for the next time that NGOs complain about governmental tax breaks for certain corporations.
While recently reviewing the Friends of the Earth US (FOE) website, I saw that they introduced a new genetic engineering policy campaigner named Eric Hoffman. Congratulations to Mr. Hoffman. Perhaps at a future time, he and I can have some interesting discussions on issues of mutual concern. But I hope that those future discussions would be based upon better writing than that which I found in connection with Mr. Hoffman’s employment announcement.
As part of the FOE US introduction of Mr. Hoffman, FOE used the following lead-in passage:
Friends of the Earth is a fierce advocate of scientific progress, but corporations often seek profit from scientific developments with little regard for human health. We must take precaution (sic) to ensure new technologies don’t do more harm than good.
Now, I’ll put aside the minor spelling error in their second sentence. I’ll also put aside the fact that there was no date on this post, which is really just a “bush league” error when it comes to Website writing and management. Instead of those small errors, I’ll just concentrate on the meaning of the passage itself.
This approach of playing the “anti-corporate card” gets a bit wearisome, and is plainly just bad argumentation. The anti-corporate card to which I refer is the phrase, “corporations often seek profit from scientific development with little regard for human health.” Let’s take this phrase apart to see how it represents poor argumentation on the part of FOE and only weakens any argument that they are trying to make.
“Corporations often seek profit.” Yes. Okay, I can go along with that part. That is the function of a corporation, to seek a profit in its activities, many of which are directed at scientific developments. Thankfully they do that. Without profits, no one would ever get a merit raise in pay. And without scientific developments, people would be dropping dead from what are now, as compared to the past, “easily-cured” illnesses or from complications arising out of minor injuries. Now, let’s move on to the next part of the phrase and talk about “with little regard for human health.”
This part of the phrase conjures up a picture of research & development departments operated by zany, madcap scientists who indiscriminately toss new products out the door without adequately testing them, or at least without testing them to the satisfaction of government regulators within the jurisdictions in which their corporations do business. In my career, I’ve known many R&D personnel, and have found them to be painfully cautious and responsible personalities, almost to the point, perhaps, of being too cautious. I’ve yet to meet one who I would consider as either a businessperson or scientist with “little regard for human health.” If, indeed, these individuals, and the corporations for which they worked, “often” acted as portrayed by this phrase, their mad scientist-like lack of “regard for human health” would produce deadly products quickly killing thousands, drawing the ire of the marketplace, causing the corporation to lose revenue quickly, putting the
Continue reading FOE Plays Anti-Corporate Card
From much of my reading, I can see that the power of the NGO (non-governmental organization) is increasing. With regard to how that power affects business, my research shows that over the past decade NGO-influenced corporations are now becoming the norm rather than the exception. And from the projections I’ve read, it appears that that influence will only become greater over the next decade.
To go along to get along with this trend, multi-national corporations (MNCs) are moving, seemingly together as if in lock step, to establish corporate social responsibility (CSR) programs in order to meet the demands and expectations of NGOs, whether it be on environmental, social, labor, or cultural issues. And to help them craft their CSRs, MNCs now regularly collaborate with NGOs, bringing NGOs to the table as trusted advisors and de facto consultants. And when MNCs do this, which is increasingly often, they seem to do it with a “mea culpa” attitude.
Mea culpa attitudes belong only on the truly guilty. MNCs don’t give themselves enough credit. They suffer from a poor self-image. Paraphrasing Jessica Rabbit, “MNCs aren’t ‘bad.’ They’re just drawn that way.” Their “We’re so guilty” attitude is unjustified. MNCs should not sit themselves in a corner.
Yes, it’s true that MNCs are guilty of doing some “bad” things. Aren’t you? MNCs are operated by humans. Imperfect humans who make mistakes. But I fear their mea culpa is overdone because most, if not all, MNCs indeed do more “good” than “bad.” One doesn’t need to perform extensive quantitative analysis to realize this.
If the MNCs were not doing more good than bad, then such behavior would be obvious to the marketplace, which is not stupid contrary to the belief of many activists. The marketplace is not stupid. We can use the activist’s own thought process to address this issue. Ask any activist how “stupid” the marketplace was in electing Barack Obama to the White House and the majority response will prove this point. So, if the “bad acts” of any MNC outweighed the “good acts” performed to support the economy and society, then the marketplace would know that; the people would “vote” with their dollars, numbering the days of any wayward MNC.
Given this automatic economic voting mechanism, where “election day” for the MNC is every day, is the current and projected level of NGO influence upon MNCs really justified? Which party receives more legitimization?
Yes, MNCs make mistakes. I accentuated the obvious above. MNCs are operated by humans. But so are NGOs. NGOs are run by humans, imperfect humans. NGOs, as well-intentioned as most probably are, are not exempt from making mistakes, and performing “bad acts,” whether by accident, or by intention, or by just plain ignorance. But how is the influence of these imperfect organizations counter-balanced? Unlike MNCs, NGOs are not subject to the same automatic regulatory mechanism of the “vote.” NGOs are not subject to the same daily “election day” as are the MNCs. The motivations and the acts of the NGO are not examined and
Continue reading The Marketplace Is Not Stupid
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About  Here at " Richard Telofski on The War on Capitalism," I discuss and analyze the individuals and groups conducting campaigns against capitalism. In the articles on this site, I provide analysis on lesser known facts about this movement. More . . .
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