InfoAndInfluence.com -- The New York Times reported this summer that the Trump administration had gutted more than 70 key environmental regulations, with another 30 rules under the knife. No doubt many of these will be re-instituted if the White House changes hands.
In this era of hyperbolically partisan federal and local governments, environmental regulations are no more permanent than political appointees.
Enter the emerging “private regulation” movement.
Relatively small activist investment houses and high-profile individuals have always had a public relations impact as they usually get plenty of love from environmentally-friendly mass media. (Yes, this includes those pesky Fake News outfits that report bona fide scientific evidence as being credible).
They haven’t moved the big needle, however. And they certainly haven’t stopped the often kneejerk-political backtracking of environmental standards in the U.S. and around the world.
But now, some of the world’s biggest mainstream global investment houses and retirement funds -- frustrated by the constant vacuum of zero-sum partisan politics – seem more and more inclined to create a de facto environmental regulatory oversight by forcing the issues in ways that governments can’t. Or won’t.
For example: Following the collapse of a mining tailings dam in Brazil that killed some 300 people, a coalition of 100 investor groups sent a letter to 600 mining companies to which they control more than $10 trillion in assets. The investors group includes top-tier entities like The Church of England Pension Board and Sweden’s public pension fund.
The investor alliance – no formal name, just a letterhead -- told the companies that they they’re creating a global database to track every operation’s mining waste dump disclosures and other data – information that could have possibly helped prevent the Brazil tragedy and other accidents involving toxic waste.
The message to the mining companies was clear: Fail to comply with these new higher standards, say goodbye to our money.
Industry takes positive action after media amps the volume
Its significance underscored by the actions of the investors, the Wall Street Journal launched its own investigation into the Brazil disaster.
The combination of global investors and news media – plus pressure from activist groups and social media – did what government hearings, proposed new regulations, threatened litigation and breaking small businesses windows in Portland could not.
It compelled the mining industry to take meaningful action:
- It put substance over style. Instead of launching a defensive, dismissive “but look at the good we do” industry image PR campaign, mining companies established a plan to address the issues surrounding the Brazil tragedy and other related problems.
- It answered with true, proven expertise. The International Council on Mining & Metals, released guidelines for building and monitoring - mine waste dams.
- It elevated responsibility to the C-Suite by recommending each mining company employ an internal mine waste expert who reports directly to the CEO.
- It added transparency and accountability. The guidelines address potential conflicts of interest in the inspection of dams, call for a mine waste expert at each company and establishment of formal whistleblower channels.
Of course, the mining industry’s guidelines aren’t mandatory. So no doubt there will emerging a spread between companies that embrace a new “private regulation” reality – and those that will make future headlines by testing the willingness of large investors to put corporate responsibility over returns.
InfoAndInfluence.com is written by Steven Silvers and Paul Jacobson, founding partners of SilversJacobson Crisis Management & PR Strategies.
InfoAndInfluence.Com is written by Steven Silvers and Paul Jacobson of SilversJacobson. Please attribute.