Corporate social responsibility

There are some of you that think I am a rabid Hayekian free marketeer and there is some truth to that in the sense I believe that well-formed competitive markets with relative ease of entry/exit tend to offer better outcomes than monopoly or oligopolistic models – regardless of the good or service in question.

However, when it comes to the environment, I think that any environmental-related costs to the broader community from a specific industrial development project should be carried by the company. I remember long debates in MBA school about who should pay for ‘externalities’.

For me, in 2007, environmental considerations need to be front and centre in any site location calculus. The more the environmental cost is abstracted, such as carbon emissions which don’t have much of a local effect but in the aggregate are having a collective effect, the more the issue needs to be part of a provincial, national and even multinational framework. But when the environment cost is local and impacts the community, that cost must be considered by all parties before the project goes ahead and addressing it should be part of the economic business case for the project.

For example, there are reports that the potash mine in Penobsquis has led to problems with the local water supply. Rob Moir, an NDP Candidate for Fundy Royal, has written an open letter to the Potash Corp. asking them to consider funding the installation of a municipal water system to homes in the affected communities. I agree with this, wholeheartedly although his recitations about the royalty reductions, excess profits and rising commodity prices will like just aggravate them.

Doing this is the right thing to do – regardless of profitability or any other factor. Companies are intimately embedded in the local community. They do not exist in a vacuum.

Consider this a vote in agreement.