Tag Archives: technology

Dialogue at the Rock

Wisconsin Department of Natural Resources aerial photo of Flambeau Mine, after reclamation.

Wisconsin Department of Natural Resources aerial photo of Flambeau Mine, after reclamation.


Bill Rose, Professor Emeritus at Michigan Technological University, hopes the big rock brought over to the university from Eagle Mine — three and a half tons of nickel-copper sulfide, suffused with platinum and rare elements — will be a site for respectful gatherings. Rose says he wants to get beyond divisive and fruitless “bickering” over mining, and hopes for “constructive dialogue about mining, its opportunities and threats.” That’s a conversation many people in the Upper Peninsula have been trying, and mostly failing, to have for more than a decade.

Building dialogue about mining is notoriously difficult, even in the friendliest jurisdictions. Part of the trouble — but only part of the trouble — is that companies come to the table having invested enormous amounts of capital (and usually in a panic to service their debt and start delivering for shareholders). They are focused on the short term and the near horizon. It’s not surprising they often refuse to listen, listen badly, or try to co-opt the dialogue from the outset; and that puts people on guard. Public participation usually gets kettled to “public comment” periods overseen by a government agency or sham community forums (like the ones Rio Tinto tried to stage in the Marquette area back around 2012 and 2013). Before too long, ordinary people realize decisions about the place they live are being made elsewhere, without them.

Professor Rose says he wants “the public to participate,” but it’s unclear from his remarks (as reported) exactly he means by that, or how far beyond gawking at the big rock and marveling at new mining technology he and his colleagues want public participation to extend. Where does his invitation lead? The dialogue about mining seems to be already set within a familiar public relations narrative that is rushing toward conclusions.

This narrative features the idea that sulfide mining can now cover its tracks through reclamation and water treatment, leaving no lasting effects. So Dean Wayne Pennington (who was on hand to announce the revival of a mining engineering as a degree program at MTU) expressed confidence that new mining methods will “ensure that no legacy situations are left for future generations.” In this context, “legacy” is code for water pollution. Examples of sulfide mining’s toxic legacy are not hard to find. Some examples of “no legacy” mining would have helped Pennington’s case.

The stock example from Eagle Mine public relations — which has also been used in promoting the Polymet project in Minnesota — is the Flambeau Mine near Ladysmith, Wisconsin. Flambeau is a Rio Tinto/Kennecott project advertised as a sulfide mining reclamation success story, despite repeated litigation over less than satisfactory water quality results. The mining company won in the courts, but Flambeau remains controversial.

For his part, Rose likened “mining with environmental responsibility” to dentistry. That is not supposed to make you squirm in your chair; it’s meant to reassure people that new technology will be sufficient to address environmental concerns about sulfide mining. It also goes further, portraying mining as therapeutic — an extraction necessary to relieve pain and maintain health. Before the conversation even gets underway, we are being asked to accept technology as a proxy for responsibility and to see mining as a way of caring for the earth.

This is the story created around the big rock at Michigan Tech: the greening of mining and the benevolent power of technology. Mining is being naturalized here — made part of or partner to nature; nature, the earth itself is being remade and reclaimed by new mining technology. This theme emerged again with a new twist at the dedication ceremony, when Michigan Geological Survey Director John Yellich stood beside the big boulder to push for a new geological survey.

Yellich started out praising the “infrastructure” of the UP: “we have electrical, we have internet access and we have roads better than what [they] were.” But in a confusing turn, he moved quickly — in the same breath — from talking about mining-friendly infrastructure to talking about “people coming in and enjoying what we have here in the UP.” Yellich was obviously trying to find a way to finish his statement for the TV cameras, and end on a positive note; so he played the Peninsulam Amœnam card, and talked about mining in language ordinarily reserved for tourism.

For a brief moment, we were asked to imagine that haul roads (a continuing source of controversy and litigation around the Eagle Mine project) were scenic lakeside byways for Sunday drivers or winding paths through a quiet wood, and that UP tourism would benefit directly from further mining development.

It appears this new dialogue about mining is already off to a confusing, false start.

Did Werner Herzog Just Produce The “Red Asphalt” of Our Day?

Werner Herzog’s new documentary-style PSA against texting while driving, From One Second to the Next, is beautifully shot and edited. Its four stories, which revisit tragic accidents and ruined lives, are presented simply and compassionately, with an eye and an ear for telling little human details.

Still, I have to wonder how this film — which Herzog’s sponsor, AT&T, will distribute to “more than 40,000 high schools, as well as hundreds of safety organizations and government agencies” — will play with teen drivers. From One Second does not wag admonitory fingers and avoids the good-cop scare tactics of old California Highway Patrol road-safety movies like Red Asphalt or Wheels of Tragedy, but its emotional range is limited enough that after watching 3 of the 4 stories Herzog presents here I felt I had had enough of the same tones and colors.

More importantly, the film’s pacing and duration (it’s 35 minutes long) are not exactly suited to a generation that thinks even texts can be tl;dr. I have trouble imagining an auditorium or classroom full of sixteen year olds getting through it without — well, texting or tweeting or checking social media.

So it remains to be seen whether this beautiful and sometimes very moving document can also create an effective intervention. Herzog himself senses the difficulty, but he talks about the problem as a distant observer: “There’s a completely new culture out there,” he told the Associated Press. “I’m not a participant of texting and driving — or texting at all — but I see there’s something going on in civilization which is coming with great vehemence at us.”

I can’t help but be reminded here of the refain from “Ballad of a Thin Man,” written when Herzog was just 23 years old: “Something is happening here / and you don’t know what it is/ Do you, Mr. Jones?” But this isn’t just one generation griping about another, and Herzog is right to suggest that there’s much more at stake in all this than the hazards of texting while driving. It’s about the “new culture out there”, which is taking its toll on human life — a deadly and threatening “something” that’s “going on in civilization.” It’s coming at us, with great vehemence, bearing down on us.

Where it’s coming from and what it is Herzog doesn’t say, or at least the Associated Press does not report; but it’s precisely that “something” that From One Moment misses, and never asks us to confront or better understand. I am not so sure AT&T would have sponsored a film that did.

The Social Costs of the Hardware Revolution – A Postscript

For now, this can be only a short postscript to what I had to say earlier today about the CNN Money article by John Hagel and John Seely-Brown on “the hardware revolution.” It has to do with a question that occurred to me as I read, and to which I don’t yet have anything like an adequate answer. That will take some research. But I at least want to articulate the question.

Startups and smaller companies can now play in the hardware space in part because the barriers to entry have been lowered, Hagel and Seely-Brown observe. There are a number of factors at work here. New and cheaper technologies from 3D printers to more user-friendly software put the design and manufacture of hardware within reach of smaller companies. And “a new class of factories” will produce the smaller orders that new entrants and entrepreneurs typically require:

New infrastructural elements have also helped new hardware products move from the hobbyist’s basement to the startup garage. Before, to get a contract manufacturer’s attention, you had to commit to producing high volumes (say 50,000 or more units). But a new class of factories — mostly in China and Mexico — will manufacture batches as small as 5,000 units. By filling low-volume orders, these factories have filled an important structural hole in the market: They allow entrepreneurs to launch new products for small consumer groups with little investment.

My question is whether conditions and, for that matter, sourcing practices in this new class of factories, and the more fluid hardware market they serve, are not going to be terribly difficult to monitor. We’ve seen how challenging it is even to ensure fair labor practices in large-scale manufacturing facilities in China used by major global technology brands; now, as smaller-scale manufacturing facilities proliferate and Mexico becomes a technology “quicksourcing” destination for American companies, the problem will no doubt be aggravated.

The reasons for this are probably obvious. I would frame the issue in a few ways. First, how much visibility do these smaller players actually have into their supply chains? Second, how much leverage do they actually have with their manufacturers, since they are only placing small orders, and, depending on their success, may or may not be repeat customers? Third, there’s a question about whether these small businesses — the small hardware startups placing orders and, for that matter, the manufacturing facilities taking them — have the capacity to take on the human rights challenges that seem inevitably to accompany outsourcing.

In other words, the social costs of the hardware revolution deserve some careful consideration.

Some Thoughts on Gilshan and Jackson’s Call for Face-to-Face Dialogue Between Independent Directors and Shareholders

To make this long post a little easier to navigate, I’ve divided it in two. The second part deals directly with the article by Gilshan and Jackson posted on the Harvard Law School Forum on Corporate Governance. The first part explains how I came to that article and provides some context. I could have published only the second part, but in the first part of this post I explore some ideas and make some connections that are important to me — maybe only to me. So I kept it.

1

The frustration of Rio Tinto shareholders meeting – which I blogged about here — had its source in what I described as a lack of serious engagement with shareholders, or at least certain shareholders, by the Rio Tinto board. Shareholders who brought a broad range of social, human rights and environmental issues to the board’s attention – and took pains to describe the business risks they posed – were met with polite indulgence, a touch of condescension and a deaf ear.

Looking back on the meeting, I wonder if the board would have treated these people differently if instead of bringing questions for the board they had put resolutions to their fellow Rio Tinto shareholders. Given how these resolutions usually go, I wonder, too, whether environmental and human rights resolutions would have really gotten a fair hearing, or a very warm reception, at the London gathering.

As it happened, Walsh and du Plessis stuck to what was clearly a question-taking strategy to make the board appear gracious and open: they thanked shareholders for traveling from all corners of the earth to address them, complimented people on how sincere and well-spoken they were, and they gave lip service to “respect.” To be fair, they hardly had time to get through all the questions (controversy follows Rio Tinto wherever it goes in the world), and there was no time for follow-up or the give and take these matters require. So they stonewalled where they could, punted where they had to, and got through it.

I’ve been trying to think about ways to make meetings like these better. It’s related to my interest in non-coercive dialogue and the way that language and power work, which I’ve written about a number of times (here,here and here, for instance) in connection with what I call the power of asking. It’s connected, too, with my love of the Upper Peninsula of Michigan, which developed in the course of working on my film, and my concern that the new mining boom there, if it is allowed to proceed unchecked, will spoil the UP and endanger life on Lake Superior. So I have some personal stakes here. But there’s also a side of the issue that goes far beyond my own interests, and is really about the healthy governance of institutions and about the possibility of institutional renewal.

Part of the trouble, as I see it, might be that the Annual General Meeting is the only chance these shareholders get to address the board directly and in person, face-to-face. They may have corresponded and met with company representatives, but it’s not every day that a representative of Mongolian herders or Keweenaw Bay Ojibwe or the NRDC can talk face-to-face with Jan du Plessis or Sam Walsh. The AGM provides that opportunity – or at least it brings everybody into the same hotel ballroom, stages the exchange and creates the illusion that a conversation of some sort took place. It’s a poor substitute for a real conversation – nothing that even remotely approaches a dialogue in which both parties feel heard and heeded; and I would be surprised if most shareholders would not like to see some other format emerge, one that allowed for richer, more continuous and deeper exchanges, or at least something a little more nuanced and intelligent than a question period followed by voting.

This is something both boards and shareholders need to remedy, not just so they can feel heard and listened to – which is not a trivial concern – but also so they can serve the long-term interests of the companies they direct and own. One way to make AGMs more successful might be to extend the conversation and create other opportunities for owners and directors to engage.

2

For Deborah Gilshan and Catherine Jackson, both of whom work on corporate governance issues from inside investment houses, it might even be time to rethink the entire shareholder communications process. Noting that in U.S. companies communication between shareholders and directors often runs “unilaterally through press statements and proxy disclosures rather than in face-to-face exchanges,” Gilshan and Jackson suggest a more “pro-active” approach. In a post that appeared today on the Harvard Law School Forum on Corporate Governance, Gilshan and Jackson “Call On U.S. Independent Directors to Develop Shareholder Engagement Strategies.” They advocate making “independent director meetings with shareholders… a routine part of a board’s approach to outreach with its shareholders.”

Engagement is a two way process and pro-active companies reach out to shareholders in addition to shareholders reaching out to companies. Voting, in itself, can be a blunt instrument and engagement is critical to enhance the voting process, to make it more meaningful and representative of the views of shareholders.

Ultimately, engagement between shareholders and independent directors increases the responsibilities on both parties. Directors are accountable to shareholders as their representatives in the boardroom, and dialogue between both parties is part of that framework of accountability. Engagement with shareholders should be embraced by independent directors as an opportunity to demonstrate their effectiveness and to create long term relationships with shareholders based on mutual respect and understanding.

Face-to-face meetings and conversations should be part of “an integrated approach in which governance matters are addressed as routinely as financial and operating results,” Gilshan and Jackson argue. Of course it will take “appropriate resources to support these activities,” but that’s probably a drop in the bucket, especially when you consider what the alternative — friction, fights, failure — already costs.

Gilshan and Jackson note that in many U.S. companies shareholder communications are delegated to management – which tends to see “investor relations” as an exercise in public relations — and many boards simply don’t respond to shareholder communications. It’s tempting to think that social media, mobile and the internet will continue to transform these activities, but that’s not going to bridge the communications gap. It starts with the board and owners recognizing that they have an important mutual responsibility to one another; and technology doesn’t relieve them of that responsibility. Sitting down together in the same place and talking together, person to person, without the mediation and interruptions of technology, may not resolve all your difficulties: you may not ultimately see eye to eye, but at least you will have looked one another in the eyes. Social proximity allows us to take measure of each other in ways technology – which relies on and creates distance – does not. I would like to think, along with Gilshan and Jackson, that “mutual respect and understanding” will necessarily come out of these meetings. But at the very least, you can meet someone in person just to know how far apart you really are. And I suppose that’s one kind of respect.

In the work I’ve done as a consultant and facilitator on these issues, I’ve learned that the real challenges come when you start to consider engagement “strategy.” One question that comes immediately to mind is how to ensure that independent directors are meeting with a broad spectrum of shareholders, and not just high profile activists, big investment houses, or institutional shareholders (like pension funds). This is especially important when it comes to social, environmental and human rights concerns, which may not necessarily be on the radar of bigger shareholders, but nevertheless represent (among other things) important business and reputational risks for any board to consider.

Then there is the question of keeping the dialogue honest. This is a huge subject, but I will confine myself to a single caveat. That has to do with attempts to “manage” the dialogue from the company’s side. As Gilshan and Jackson observe, “some independent directors are actively seeking input from their shareholders to pre-emptively manage situations, while others are interested in understanding shareholder views on certain matters.” But understanding is one thing; and managing is another. If the objective in meeting with shareholders is to manage their concerns rather than address or at least represent them to the board, then the director is doing everyone a disservice. Sure, meeting with shareholders and talking with them about their concerns will help defuse tensions and make confrontations at the AGM less likely, but the aim here ought to be understanding and above all a deep appreciation of the shareholder’s concerns.

Another question hangs over all of this, and over all opportunities for dialogue: the question of power. How can directors and shareholders meet on equal footing? In some cases this won’t be a problem. In others, it is the problem: the deck is stacked. It’s worth thinking about how face-to-face dialogues might alter that power dynamic. Equal footing can be very hard to achieve but there are a number of approaches that can be taken to ameliorate the situation — establishing a neutral place for the meeting, sharing personal stories, using the services of a facilitator, defining terms and boundaries in advance of the meeting – but these measures would have to mutually agreed upon; and it’s probably best if the rules of engagement for any dialogue are something both shareholders and the board create together, to the extent possible.

The quality of any face-to-face meeting, the quality of any dialogue, is going to come down to the commitments that both sides make and how well they uphold those commitments. Activists can easily demonize companies and boards, especially in high stakes situations; and boards can tire and be dismissive of shareholders who tell them what’s at stake: they seem disruptive (and they are, I would say, but in a positive way) and so removed from the real business at hand – mining, banking, or whatever the case may be. There’s the urge to put them off or direct them to people whose job it is to manage and handle them, through corporate social responsibility channels and community outreach programs. That’s just another way of delegating to management some of the director’s most serious responsibilities.

The grid in my garden

When I moved house at the end of August, I decided to forgo the land line and rely entirely on wireless for my telephone service.

Even the most basic land package from Verizon seems overpriced, the legacy of a bygone era when telephone customers didn’t have many options. Besides, I already do most of my telephone work on my blackberry; the signal in the new place is strong; and I use cable for my internet connection (because it’s faster than DSL, not because I like the cable companies any more than I like Verizon).

Verizon’s wires still run through the place, previous residents and tenants over the past half century having installed a telephone in nearly every room. I’ve traced the wires from their origin on a pole just on the other side of the fence at the far end of our garden. The wires run the length of the garden, through the branches of trees, winding together in some places with creeping vines, weighed down in others by the heavy summer growth. They reach the house at a central hub or switch box, at which point they creep up and across the brick walls, where they find entry, through the brick and into the house. Once inside, the lines follow the trim and molding, angle to mimic a corner, and master the contours of every room’s interior, until they reach a jack.

The lines are held in place with staples. I have already spent some time removing these staples and pulling telephone wires out from the walls, cutting them close to the little holes where they emerge, and generally trying to rid the place of them. (I’ll need to do the same with all the television cables running into the house, with the exception of the one carrying my internet connection.)

We’ve gotten so accustomed to having all these lines and cables and cords creep through our homes that we no longer realize just how intrusive all this old wire technology is. The wires are unsightly. They ruin the molding and get in the way of painting. And now they’re dead: they no longer carry a signal or a voice. In certain moods I see them as reminders of absence, of lost connections, of loss.

I get a certain satisfaction from removing the wires inside the house, but now I’m wondering what it would take to get Verizon to clean up its equipment, take down the line that runs to the house from the pole in the back of the garden, pull down the lines that run up the back of the house, remove the switch box, and get all its gear off the property.

So far as I have been able to determine, Verizon’s ownership of the telephone wires is not really in question, even though regulatory changes from the 1960s through the 1990s have required the telephone companies to “behave neutrally” and to allow other service providers (like ISPs) to access their wires. Yet it also appears that the law of trespass is not entirely settled when it comes to telephone lines.

Airplanes and telephone lines once tested the law of trespass; they required exceptions and accommodations. But things change. A previous property owner allowed Verizon to string lines across and above my property. What if I now deem them a nuisance? And imagine what might happen to those easements and allowances if hundreds or thousands or even millions of property owners were to ask the telephone companies to take down their lines.

Most people probably consider the lines and cables and wires on their property none of their concern. In exchange for services, we’ve allowed the phone and power and cable companies to encroach and build on our property; and we’ve grown used to seeing the stuff everywhere we go.

That is not likely to change. New technologies (like fiber optic) and bundled services will most likely allow the phone companies to convert and upgrade rather than tear down the infrastructure they have in place. But I’m not interested. I want the grid out of my garden.