Green Capitalism: The Mitsubishi Corporation and Green Energy

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The Mitsubishi Corporation is an autonomous Japanese multinational trading company that is part of the Mitsubishi Group of Companies. In positioning themselves as a ‘green’ corporation, the Mitsubishi Group of Companies abides by their Three Corporate Principles — the basis on which their Corporate Standards of Conduct are written — namely, “Corporate Responsibility to Society”, “Integrity and Fairness”, and “Global Understanding Through Business”, similar to the Triple Bottom Line covered in Savitz (2015) covering the Environmental, Social and Economic aspects of sustainable businesses respectively. Under the first principle, Mitsubishi claims to “[contribute] towards the preservation of the global environment” (Mitsubishi Corporation, n.d.-c), and their Environmental Charter states that the Mitsubishi Corporation considers “the Earth itself to be [their] most important stakeholder” and they are “continually working towards the realization of a sustainable society” (Mitsubishi Corporation, n.d.-b).

These principles can be observed through their business investments and products. Mitsubishi owns businesses in several energy sectors, producing and trading liquefied natural gas and other forms of renewable energy. Mitsubishi targets to generate at least 20% renewable energy by 2030, with investments in almost every continent (Mitsubishi Corporation, n.d.-d). Additionally, the corporation conducts research on lithium-ion batteries and other energy sources for electric mobility devices and automobiles (Mitsubishi Corporation, n.d.-a).

Figure 1. Chart showing the renewable energy economic potential for power generation in Mexico by 2020 (Gielen, Saygin, Wagner, Gutiérrez, & Torres, 2015)

A specific example of their investments in renewable energy is the Energía Eólica del Sur wind park located in the Isthmus of Tehuantepec in Oaxaca, Mexico. The isthmus is a hotspot for wind energy, with 62% of Mexico’s wind energy being produced there due to high-speed winds that blow through the narrow strip of land (Howe, 2014). The 132-turbine wind park is said to offset roughly 567,000 tonnes of carbon dioxide emissions yearly (Morais, 2019), and is heavily supported by the Mexican government with the hopes of positioning the nation as a regional leader in clean energy (Howe, 2014) and to abide by its commitments in the Paris Agreement to produce 35% of its electricity from renewable sources by 2024 (Baverstock, 2019), with wind energy playing a major role (see Figure 1). Constructed on indigenous lands, developers promised the locals long-term land contracts to compensate them for their land alongside improvements to infrastructure and their economy, including new jobs, schools, hospitals and cheaper electricity (Howe, 2014).

However, with the Mitsubishi Corporation being a large conglomeration, one must be cautious when assessing the true intentions behind their ‘green’ efforts. In reality, the seemingly-generous land contracts were duplicitous and exploitative (Howe, 2014), and like with many other farms, the energy produced from the wind farm does not go to residents (Burnett, 2016) but external corporations (Navarro & Bessi, 2016). The project also took a toll on the environment, with heavy turbines being built on the narrow sandbar placing pressure on the soil (Howe, 2014). The clearing of vegetation for the turbines in the semi-arid environment also reduces the soil’s capacity to retain moisture, which would eventually result in the desertification of the area (Navarro & Bessi, 2016). Moreover, the project was assessed to have negative impacts on populations of marine fauna, jackrabbits, bats and birds due to both danger from the turbine blades as well as noise and water pollution (Navarro & Bessi, 2016; Dunlap, 2016).

This case study brings to light the interesting tension between discourses of global climate change mitigation and local environmental concerns, similar to Sage’s (2015) example of the utilisation of crops for biofuels in the United States and Brazil that is causing a decrease in food supply for locals. This also seems to be a common strand in ‘green’ energy, since wind, solar (Shellenberger, 2018), nuclear (Vidal, 2019) and hydroelectric energy (Romero, 2012) all face similar problems of local social and environmental damage under the banner of climate change mitigation. That said, their merits must be acknowledged, having provided many countries and corporations with cleaner sources of energy.

The Mitsubishi Group is no stranger to environmental controversy — in the 1980s, a company owned by Mitsubishi Chemicals opened a rare earth refinery in Malaysia which resulted in eight cases of leukaemia and seven deaths due to radioactive pollution from the mine. After more than 20 years, they have yet to finish cleaning it up (Tan, 2019). Yet, few outside of the affected areas know of the case, thanks to Mitsubishi’s rapid response in closing the refinery and starting to clean up the site without a legal order, and proceeding to reach an out-of-court settlement with the residents without admitting responsibility for the illnesses (Bradsher, 2011). In contrast to IKEA’s slow reactionary approach to social and environmental controversies (Maon, Swaen, & Lindgreen, 2010), Mitsubishi’s proactive action helped banish this case to virtual obscurity, ensuring that their ‘green’ reputation remained intact. This is vital for Mitsubishi that has strongly promoted themselves as a ‘green’ group of companies, as “organizations engaging in the most [corporate social responsibility] often are those criticized the most” (Maon et. al., 2010). Hence a blunder of that magnitude was likely to attract significant amounts of criticism from stakeholders and ruin their ‘green’ image.

Although it is not clear if the duplicitous dealings with locals were instigated by Mitsubishi itself or the Mexican government — especially since Mexico has a reputation for loose enforcement of human rights (Human Rights Watch, 2019), and the government is heavily invested in the wind farm’s development (Howe, 2014) — but it is more than reasonable to assume Mitsubishi’s awareness of the social and environmental damage done locally in Oaxaca. Yet, they remain complicit in their investment in the Energía Eólica del Sur.

Moving forward, besides the global-local tensions in the renewable energy sector, it is important to address the question of whether there have been attempts to establish a global legal framework for renewable energy. While there has been research done on building a foundation for international energy law, there has yet to be much substantial effort in establishing such a legal framework. Perhaps the closest that any international body has come to doing so is the United Nation’s Sustainable Energy for All initiative that set a global target for renewable energy, with 118 countries having domestic renewable energy targets. However, it falls short of having legally-enforceable obligations, with countries historically averse due to concerns about sovereignty over natural resources and energy security (Bruce & Pottenger, 2013). This limits the power of international bodies such as the International Renewable Energy Agency (IRENA) to merely supporting, promoting and encouraging governments to transit to renewable energy sources (IRENA, n.d.).

The implications of this gap in international law are severe, leaving it open for international energy companies, not bound by any international law, to exploit loose renewable energy regulation in developing countries like Mexico to profit at the expense of disenfranchised communities and the environment. In light of this and other issues we have been grappling with in our seminars, perhaps the true focus of this module should not be about ideas of ‘green’ and ‘capitalism’, but that of how we can uphold social and environmental justice with the rise of ‘green’ capitalism.

[Initially written for the module UTC1102R: Green Capitalism at National University of Singapore.]

References

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Bradsher, K. (2011, March 8). Mitsubishi Quietly Cleans Up Its Former Refinery. The New York Times, p. B4. https://www.nytimes.com/2011/03/09/business/energy- environment/09rareside.html

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