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HFSY357 Environmental Management And Sustainable Development

tag 0 Download 10 Pages / 2,409 Words tag 05-07-2021


The Charge:

The Private Sector

You have been retained by Wilmar to help them develop a strategy for moving forward on palm oil. You have interviewed many of the players involved and you have examined the documents. Based on your review you have observed the following (from the introduction):

For the companies that signed IPOP, criticism of the pledge pressured them to reassess their plans. Wilmar, in particular, faced difficult choices. The company was the largest trader of palm oil in the world, selling in Europe, China, and India. Wilmar had been the first trader to adopt a NDPE standard for all of its suppliers. The pledge and the government’s reaction to it had created three sets of challenges for the company. First, Wilmar had to find a way to police its supply chain, identifying violators and determining ways of dealing with them, especially in the face of continued NGO pressure.

Secondly, some groups had indicated that they might try to bypass Wilmar and sell their CPO directly to China and India; countries which had shown no interest in sustainable palm oil. Finally, the Indonesian government’s displeasure with IPO and the NDPE meant that Wilmar might lose portions of its concessions that it decided not to develop to uphold the pledge. All of these challenges could represent substantial hits to Wilmar's business if not handled correctly.

Your task is to write a memo to Kuok Khoon Hong, the CEO of Wilmar, advising him on how to manage both Wilmar’s sustainability commitments and the IPO collaboration. Specifically, be sure to address:

  • Whether Wilmar should continue to honor its commitments to the NDPEstandard;
  • If Wilmar does continue to pursue its NDPE commitments, identify and evaluate strategies that the company could adopt to handle the policing and enforcement of the NDPE requirements in its substantial supplychain;
  • How Wilmar should handle the fact they are falling behind schedule on their implementation of the NDPE pledge? Should they announce new milestones andsignposts?
  • Strategies by which Wilmar can protect its market share in China and India; and
  • Strategies to manage the variety of pressures that Wilmar and the IPOP are feeling from different elements of the Indonesian national

Here are some ancillary questions you might want to consider:

  • Have you considered all the hard costs associated with yourplan?
  • Have you considered the soft costs (e.g. additionallabor)?
  • What do you tell the shareholders about any losses and/or increased risk that the company isincurring?
  • At what point should Wilmar throw in the towel?
  • What are the company’s fall back options?
  • What will be the blowback if Wilmar exits IPOP itself? What might happen the company’s western markets? What effect on the environment?

The Public Sector

You are among a small group of expert policy advisors supporting President Joko Widdodo in the national government. He has asked you to develop a strategy to address the government’s approach to the palm oil industry. However, he also directs that whatever strategy you develop must be consistent with broader national government initiatives on government corruption, international sovereignty, and economic development. As you develop your advice, be sure to address the following issues:

  • What is the best way for the country to guide the industry toward meetingthe nation’s palm oil production goals?
  • What can the government do to ensure that the benefits of the industry reach the low income and smallholderpopulation?
  • Is there a way to improve the country’s economic performance while not endangering its international standing (perhaps even improving it)?
  • How can the President’s office best address the endemic corruption that seems to underlie much of the deforestation problem? How does that relate to the decentralization ofauthority?
  • How can the government best respond to the pressures from both the environmentalist and consumer productmarkets?
  • Whatever you recommend, given the fractured nature of the Indonesian national government, how should the President implement (sell) your

The NGO Sector

Greenpeace is getting new leadership soon. The organization has just announced not only its first female International Executive Director, but two – Jennifer Morgan and Bunny McDiarmid – who will assume responsibilities as co-directors. The Board of Directors has commissioned you, an expert in the field of palm oil, to provide guidance for the new leaders as they assume their new positions in April 2016.

The Board is particularly interested in how Greenpeace can continue to have a deep and positive influence on the sustainability of the palm oil industry. They have asked you to provide Ms. Morgan and Ms. McDiarmid with guidance on a possible strategy for Greenpeace to pursue over the next few years. As you develop your advice, be sure to address the following issues:

  • How effective has the Greenpeace strategy been over the past several years? How would you characterize their strategy?
  • How does the Greenpeace strategy compare to strategies adopted by other environmental and human rights organizations? Try to describe an “ecosystem” of environmental organizations.
  • What are the weaknesses of the Greenpeace strategy? Is it sustainable over the longrun?
  • Should Greenpeace continue to oppose the efforts of theRSPO?
  • How should Greenpeace engage the government ofIndonesia?
  • If IPOP folds, what should Greenpeace do?
  • What changes, if any, should Greenpeace make in its palm oil program, either at a strategic or tactical level? Be sure to address the issue of resources (funding) as you consider this
  • Do you recommend any adjustments to the Greenpeace interaction with otherNGOs?
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