Abstract:The Equator Principles (EPs) are a voluntary and self-regulatory Corporate Social Responsibility (CSR) initiative in the field of project finance. The EPs provide a number of principles to businesses to reduce the negative impacts of lending practices linked to environment-damaging projects. The paper argues that the actual impact of the EPs even now as revised version is still limited. This is due to their voluntary nature and their lack of adequate governance mechanisms, that is, enforcement, monitoring and sanctioning. With the help of RepRisk, which provides a database capturing third-party criticism as well as a company's or project's exposure to controversial socio-environmental issues, the paper evaluates the on-the-ground performances of the two 'Equator banks' Barclays and JPMorgan Chase and compares their performance with the one of the two non-Equator banks Deutsche Bank and UBS. The paper shows that the EPs do not have a substantial influence on the broader CSR-performance of multinational banks due to the EPs' limited scopefocusing mainly on project finance -and the (still) existing various loopholes, grey areas and discretionary leeway. The paper also gives an overview of the main institutional shortcomings of the EPs and their association and discusses some potential reform steps which should be taken to further strengthen and 'harden' this 'soft law' EP-framework. The paper thus argues in favor of (more) mandatory and legally binding rules and standards at the transnational level to overcome the EPs' 'voluntariness bias'.
In the past, linear extrapolations of strategic plans offered promising guides to the future. Managers tried to categorize well-known problems into boxes with strategy labels, the top of a firm’s agenda was steering clear of potential potholes, and there was a choice between clear-cut future options. These strategies no longer work today, and just repeating what we have been done before is not a convincing recipe. The world has become different with multiple and often fuzzy options. In this article, we suggest that companies in different industries have to become more agile. Naturally, agility is not easy to implement as managers fear chaos and confusion. Thus, we introduce agility patterns with different degrees of change. For instance, high-reliability organizations, such as transportation or nuclear energy, are supposed to engage more in gradual change and stick closer to planning. However, we argue that even these companies have to become agile, albeit on a different level. In contrast, companies that exhibit lower system relevance, such as advertising or arts, may strive for agility that involves transformational elements; they can engage in experimentation and play and are more likely to accept inherent chaos in their change strategy. We use the notion of agility patterns for these different degrees of change and show how they help to mitigate the risks that come from either inertia (as a result of linear planning) or experiential chaos (as a result of full agile transformation). Depending on the industry and the degree of change, we distinguish between resilient, versatile and transformational agility patterns. We illustrate each category with examples and highlight how agility patterns can be applied to create value.
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