HAZEL HENDERSON: DOING WELL AND DOING GOOD IN NEW ENERGY

“American business has realized,” Hazel Henderson, Founder/President of Ethical Markets, LLC, told NewEnergyNews, “that they can look green AND save energy AND save money…an unbeatable combination.”

Henderson remembers when American business didn’t get it. Operating out of what she describes as “a wrong economic model,” corporate interests were benefiting from their business-as-usual models, raking in the profits, externalizing the costs of things like environmental degradation and negative health effects and ignoring the consequences. “Who was going to stop the party?” Henderson remembers observing.

Things have changed. “First of all, the economic model that we’re using, you might say the GDP [Gross Domestic Product] model where you externalize all those future costs to future generations and onto your tax payers…that model is broken.”

Henderson's most recent book was just awarded the AXIOM "Best Business Books of 2007" bronze medal. (click to enlarge)

That broken model blocked the development of New Energy for a long time. Henderson saw it clearly when she worked at Congress’s Office Of Technology Assessment from 1974 to 1980. “We knew about carbon loading of the atmosphere and we knew that it would lead to tremendous climate variability back then,” she said. She and her colleagues were thrilled when President Carter put solar panels on the White House and upped funding for New Energy research.

They also could see New Energy was up against a powerful foe, fossil fuels industries with huge lobbies and enormous subsidies. “Solar and renewables were trying to compete as if the playing field were level…The faulty economics didn’t support it… if you’re going to subsidize by billions and billions of dollars all of the competing sources of energy, how do you expect [New Energy] to get a foothold…We were all swimming upstream…When Reagan came in he took the solar panels off the White House…cut the very small [New Energy] subsidies that there were and we lost a decade.”

In response to a recent report from the Center for Responsive Politics that the oil and gas industry has made $10.4+ million in political contributions in 2008 as opposed to $500,000+ in 2008 political contributions from the New Energy industries, Henderson observed this actually reflected an improved situation. “It’s only recently that there’s been enough critical mass in the solar/renewables industry that they could even hire lobbyists…”

The continuing influence of money in Washington deeply troubles Henderson. She sees it as obstructing the development of New Energy and a socially responsible economy. “Most of the democracies in the world don’t allow contributions to political campaigns and they don’t allow advertising and most of the political campaigns are 3 weeks and they’re over…”

To begin with, the economic model has flaws. (click to enlarge)

But Henderson has not sustained herself over four decades of work for social responsibility and the green economy by dwelling on obstacles. She founded Citizens for Clean Air in 1964 and then moved to work with Ralph Nader’s “Campaign to Make General Motors Responsible.” That led to her 6 years at the Office of Technology Assessment, which she calls her “alternative PH.D.” in economics. After writing articles for publications like the Harvard Business Review, she moved to books, publishing The Politics of the Solar Age in 1981. She then moved to something entirely new.

It began with an insight she had while with Nader. “I suddenly realized, ‘Why have I been sitting down with public relations executives for the Fortune 500 and trying to persuade them to clean the air when the thing to do was to go to annual meetings as a shareholder…”

That insight led her to The Calvert Group, which focuses on socially responsible investing: “…Corporations…are the puppets of finance so if you can go up the food chain and work at the finance level, which I’ve been doing for the past two decades, that’s where your leverage is. It’s wonderful that consumers and all the activists are persuading these big old companies to go green but the real thing is if you get The Ceres Group, which represents about $3 trillion in the U.S., and you get the UN Principles Group (UNPRI), there’s another $13 trillion, and they all tell the companies in their portfolio ‘disclose the carbon in your portfolio or we’re going to dump your stock,’ that’s the leverage…”

There is a natural synergy between socially responsible investing and New Energy (see, for example, Carbon Disclosure Requirements, Socially Responsible Investing, and Their Impact on the Growth of Renewables). Henderson continues in her relationship with Calvert and its outgrowth, Calvert-Henderson (see Calvert-Henderson Quality of Life Indicators), making socially responsible investments in New Energy as an obvious way to expand the quality of life.

click to enlarge

Doing well from doing good has never been doing better. When she first started with Calvert, the socially responsible sector was $40 billion, most of it church portfolios. Now Calvert manages $15 billion and the socially responsible sector is $2.3 trillion. Through the early days, the mainstream press not only ignored socially responsible investing but actively “dissed” it, reporting that investing in socially responsible ways was financially irresponsible. At the same time, Henderson and her colleagues were proving just the opposite.

She started Ethical Markets TV in 2004 to get the concepts of socially-responsible investing and "growing the green economy" out to television's big audience. Ethical Markets has penetrated half of PBS’ markets but it has not been easy. “If I had known how difficult it was I never would have done it,” Henderson laughs.

Asked if she sees something now shifting in New Energy’s favor, she observes that there is so much happening it’s hard to keep track of it. “The stuff that comes in to me every day…it’s like trying to drink from a fire hose…”

Henderson saw the importance of solar energy a quarter century ago. (click to enlarge)

Henderson lists the collapse of the GDP economic model, skyrocketing world energy demand, peak oil, geopolitical turmoil and climate change concerns as the factors driving the shift to New Energy. As a solution to climate change, she does not like the idea of a cap-and-trade system. She sees it as an overly bureaucratic way to control emissions, not a free market solution. “It’s just the worst example of the old economics,” she says. “The least efficient way of doing it.” But the cap-and-trade approach, she acknowledges, “…is not going away."

Cap-and-trade allows what Henderson calls “middle men” (carbon market traders, unregulated offset sellers) into the emissions reduction process and, in Europe, led to windfall profits for big utilities when too many emissions credits were allotted for free instead of auctioned. Astutely, she insists the most important thing about any U.S. cap-and-trade system will be seeing that the right proportion of credits be auctioned. She advocates auctioning 100% of the credits and lowering the caps rapidly.

Henderson likes even more the idea of apportioning credits not to emitting industries but to citizens. Citing Peter Barnes’ Capitalism 3.0, she says “Give the allowances to every man, woman and child on the planet and the poor can sell their allowances to the rich…”

As Henderson says, it isn't going away.

Like most economists, Henderson believes the real solution to emissions is a carbon tax. “A really intelligent politician in this country could sell a carbon tax and the way to do it is to say, ‘Look do you want to have a tax on gasoline and keep the money here at home and use it to build energy independence with renewables or do you want to keep on giving it to Middle Eastern OPEC countries so that they can build more madrasahs?'”

Recognizing voters still need to understand such issues better, she’s talking about creating a national teach-in featuring the major presidential candidates discussing issues like emissions reduction measures, health care and trade. Her old friend Ralph Nader told her he’s in and she’s working on Senator Clinton. She thinks Senator Obama will come along if she gets those two. She acknowledges that she might have to substitute Ron Paul for Senator McCain. She wants to do it on a cable news network and get the League of Women Voters to sponsor. “You need about two hours of commercial-free time on a nationwide basis to really punch through…”

The idea is ambitious, really ambitious. Henderson has always had ambitious goals and she achieved many of them. Her Ethical Markets’ slogan is “growing the green economy” and that it is doing. In the 1960s, she started lobbying the federal government to include externalities and quality of life indicators in its definition of GDP. A mere four decades later, on March 12 of this year, a Senate subcommittee began considering the matter.

So as challenging an undertaking as the teach-in seems, don't bet against Henderson. When the Nader-Clinton-Obama-Paul teach-in is scheduled, NewEnergyNews will post the time and network.

HAZEL HENDERSON: DOING WELL AND DOING GOOD IN NEW ENERGY
Herman K. Trabish, March 17, 2008 (exclusive to NewEnergyNews)

WHO
Hazel Henderson, Founder/President of Ethical Markets, LLC

WHAT
Henderson talked about her insights and plans.

WHEN
Henderson chatted with NewEnergyNews March 13.

WHERE
Ethical Markets TV

WHY
From the Ethical Markets website: “Dr. Hazel Henderson is a world renowned futurist, evolutionary economist, a worldwide syndicated columnist, consultant on sustainable development, and author of Beyond Globalization, and seven other books. Her editorials appear in 27 languages and more than 200 newspapers syndicated by InterPress Service, Rome, New York, and Washington DC. Her articles have appeared in over 250 journals, including (in USA) Harvard Business Review, New York Times, Christian Science Monitor, and Challenge, Mainichi (Japan), El Diario (Venezuela), World Economic Herald (China), and Australian Financial Review. Her books are translated into German, Spanish, Japanese, Dutch, Swedish, Korean, Portuguese, and Chinese. She sits on several editorial boards, including Futures Research Quarterly, The State of the Future Report, and E/The Environmental Magazine (USA), Resurgence and Futures (UK). She is a Fellow of the World Business Academy and co-edited, with Harlan Cleveland and Inge Kaul, the Report the Global Commission to Fund the United Nations. She serves on many boards, including Worldwatch Institute (1975-2001), Calvert Social Investment Fund (1982-2005), Cousteau Society and The New Economics Foundation (London, UK). The first version of her Country Futures Indicators (CFI©), an alternative to the Gross National Product (GNP), is a co-venture with Calvert Group, Inc.: the Calvert-Henderson Quality-of-Life Indicators. (See Related Links). She is an Honorary Member of the Club of Rome and a Fellow of Britain’s Royal Society for the Arts.

“In addition, she has been Regent’s Lecturer at the University of California (Santa Barbara), held the Horace Albright Chair in Conservation at the University of California (Berkeley), and advised the U.S. Office of Technology Assessment and the National Science Foundation from 1974 to 1980. She is an active member of the National Press Club (Washington DC), the Social Venture Network, and the World Futures Society (USA). Henderson also shared the 1996 Global Citizen Award with Nobelist A. Perez Esquivel of Argentina.”

QUOTES
-Henderson: “American business has realized that they can look green AND save energy AND save money…an unbeatable combination.”
-Henderson: “…Corporations…are the puppets of finance so if you can go up the food chain and work at the finance level, which I’ve been doing for the past two decades, that’s where your leverage is. It’s wonderful that consumers and all the activists are persuading these big old companies to go green but the real thing is if you get The Ceres Group, which represents about $3 trillion in the U.S., and you get the UN Principles Group (UNPRI), there’s another $13 trillion, and they all tell the companies in their portfolio ‘disclose the carbon in your portfolio or we’re going to dump your stock,’ that’s the leverage…”
-Henderson: “A really intelligent politician in this country could sell a carbon tax and the way to do it is to say, ‘Look do you want to have a tax on gasoline and keep the money here at home and use it to build energy independence with renewables or do you want to keep on giving it to Middle Eastern OPEC countries so that they can build more madrasahs?”