Alliances with NGOs
ESM210
November 7 , 2007
Types of Alliances
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Corporate sponsorship
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Product endorsement
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Firm contributes to the environmental group financially or in
king through becoming involved in specific env causes or
fund raising
Environmental group approves a firm’s product as being
ecologically sound
Task force
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to develop economically feasible solutions for the greening
of business practices
The context that leads to collaboration
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Perceived crisis and shortcomings of adversarial
approaches to problem solving
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Problems that are so complex that they require
multiple actors to solve them
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Disagreement over solution
Disparity of power/expertise among stakeholders in
dealing with the problem
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ex Lawsuits might take years and results in greater costs
Environmental groups have expertise and public support but
lack power of implementing solution
Each of the stakeholders have a vested interest in
the problem
Pros of collaboration
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Firm perspective
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Access to complementary assets
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Credibility
Additional communication channels
Scientific knowledge
NGO perspective
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Direct impact on firm’s behavior, potential ripple
effect within industry
Cons of collaboration
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Firm perspective
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Negative backlash if the project fails
Confidentiality issues
How to retain the Intellectual property rights?
NGO perspective
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Open to criticism that is becomes and ally of
industry (“sleeping with the enemy”)
Open to criticism that it looses neutrality
Issue of property rights
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NGOs: diffusion of practices throughout
industry have incentives to diffuse information
to as many other corporations as possible.
Example: Greenpeace-Foron alliance
Selection of an environmental partner
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Env group should have an established
philosophy favoring market based solutions
Env group should have a recognized,
credible reputation
Ability of the parties to provide
complementary assets
Selection of project
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Keep alliance based on subjects that are far
from firm’s IP (packaging for McDonald’s)
Find organizational attributes that make
Intellectual property difficult to transfer
Strive for early movers advantages
Managing partner relations
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Clear definition of objectives
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Bridge organizational cultural differences by building
personal relationships
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Tasks clearly defined with deadlines
Frequent meetings both formal and informal facilitate
cohesive linkages and build trust among partners
Maintain an arm’s length relationship: formal
contract
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No exchange of money
Set-up conditions for ending up the contract
Confidentiality issues addressed
Exert from ED contract: Expenses &
Termination
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The Project will be carried out by appropriate Alliance and
[company name] staff, and will require priority effort and time
commitment by each of the Parties. The Parties will each bear all
of their own costs and expenses in working on the Project, and
[company name] will not compensate the Alliance in any way for
any such costs or expenses. Meeting locations and other Project
activities will be chosen to equalize the expenses of the Parties
Each of the Parties has the right to terminate the Project at any
time. In such an event, the Parties will be free to comment on the
Project as they see fit.
Exert from ED contract: Confidential
information
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In order for the Parties to work effectively, it will be necessary for
[company name] to disclose certain confidential information to
the Alliance. The Alliance agrees that all information identified by
[company name] at the time of disclosure as confidential will
remain confidential and will not be disclosed without the written
permission of [company name] or used by the Alliance other than
in connection with this Project, subject to the additional terms
and conditions contained in the Appendix. This confidentiality
obligation shall remain in place until [company name] informs the
Alliance in writing that the information is no longer confidential.
Conclusion on Alliances with NGOs
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Work best in following context: Perceived crisis and
complex problems with disagreement over solutions
Provide firms with access to complementary assets
(scientific knowledge and credibility)
Risky in terms of use of information and how
Intellectual Property is protected
Choice of partner & project as well as design of
alliance are key for success
The Use of LCA
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There is not always a single clear answer
Boundaries: intentional vs. national., containers
reuse as an option, etc.
How to compare impact categories, what is
more important
Can the study be used for comparing firms?
Data sources and credibility
Assumptions
Wednesday 11/14
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Meeting in the computer lab at 3:30pm
Sit in groups
Will explain the assignment in more details
Will go over publicly available sources for
environmental performance evaluation
Will be around for questions
Monday 11/19
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Four presentations (10 min each)
Additional presentations as needed
Discussion
Questions?
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See you on Wednesday
Have a great long weekend!