The Fall of SunEdison – A Solar Eclipse?

Abstract

In 2016, one of the largest renewable energy companies in the world, US-based SunEdison Inc., filed for bankruptcy when it couldn’t service the debt it had raised to achieve aggressive growth. SunEdison had had an illustrious past; it had grown to become the largest solar installation company in the US and a global  renewable energy giant. By 2016, solar power had attained grid parity in some parts of the world and solar was reaching its peak growth in the developed world. Governments from the developed world, which were boosting solar power through tax rebates and subsidies were rolling back their incentivization schemes and resorting to stricter guidelines for green project funding.. On the other hand, there was tremendous growth potential in the emerging markets where millions still lived in the dark.

By 2016, one of the most contrasting features of the solar industry was that there was little innovation and differentiation and the market was still defining its business model. The industry had gone into consolidation mode and SunEdison preferred to grow inorganically. To tap the opportunity in emerging markets and win projects, SunEdison started offering rock bottom rates.

When SunEdison’s balance sheet got heavier and the company couldn’t raise further debts, it decided to form subsidiaries called Yieldcos. Yieldcos were essentially energy asset holding public listed companies which assured stable dividends (from sale of electricity which the solar assets generated). Yieldcos issued shares to raise capital using which a completed solar asset was bought from its parent (SunEdison). SunEdison used the capital for further growth.

In an industry where technological innovation was rare, financial innovation became the norm. The case describes SunEdison’s fall from grace. It throws light on the economics of the solar business and the need for robust sustainable finance for renewable projects.

AuthorsAlok Kavthankar & Indu Perepu
InstitutionIBS Hyderabad, IFHE University, India
Competition Year2017
PlaceSecond Prize
TrackSustainable Finance
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergrads
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A Burrito without integrity: Is this Chipotle for me?

Abstract

This case, developed primarily from secondary sources, describes the founding of Chipotle Mexican Grill (Chipotle, hereafter) in 1993 by Steve Ells and its rapid ascent to popularity as a fast-casual restaurant based on its unique socially responsible Food with Integrity strategy. Under the leadership of founder-CEO Steve Ells and co-CEO Montgomery Moran, Chipotle outperformed the S&P 500 as well as its rivals since its IPO in 2006.  However, in 2015, the multiple food contamination outbreaks reversed its course, plunging its stock price to an all-time low. In spite of the prompt actions taken by Chipotle’s leadership, the company’s stock price did not regain its pre-scandal highs in the stock market. However, on September 6, 2016, news of activist investor, Bill Ackman’s purchase of 9.9% of Chipotle’s stock gave a much-needed boost to Chipotle’s depressed stock. This case gives students the opportunity to step into the shoes of a young individual investor, Michael Jacobs, to assess the potential impact of Ackman’s investment on the company’s strategy and performance and decide whether or not he should divest his Chipotle holdings.

AuthorsVijaya (Narapareddy) Zinnoury
InstitutionsDaniels College of Business
University of Denver, USA
Competition Year2017
PlaceFirst Prize
TrackSustainable Finance
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergrads
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‘Enrich Not Exploit’: Can New CSR Strategy Help Body Shop Regain Glory?

Abstract

This case looks at some key challenges before Jeremy Schwartz (Schwartz), CEO of The Body Shop International Plc. (Body Shop), and its International Director of Corporate Responsibility and Campaigns, Christopher Davis (Davis), as they try to re-establish the company as a leader in ethical retail and maintain its distinct image amid tough competition and boost sales.

Body Shop was regarded as a pioneer in modern CSR practices and was strongly associated with the social activism of its founder, Dame Anita Roddick (Roddick). The case discusses how since its inception, Body Shop had endorsed and championed various social issues such as opposition to animal testing, development of community trade, building of self-esteem, campaigning for human rights, and protection of the planet. Through these initiatives, the company had cultivated a loyal base of customers. The case goes on to discuss the acquisition of Body Shop by the beauty care giant, L’Oréal SA (L’Oréal), and how its ethical image suffered after the takeover. Customers and activists felt betrayed by the deal as Roddick had previously been vocal in her criticism of companies like L’Oréal on account of their alleged unethical policies. According to Schwartz, after the death of Roddick in 2007, Body Shop’s fortunes reportedly took a sharp downturn and its ethical message faded.1 Moreover, with a host of new competitors making their way into the green cosmetics market, the sales of Body Shop plummeted.

In 2016, to reinvigorate the brand, position itself as a more ethical business, and reassert its position as a trailblazer of positive change, Body Shop unveiled its new global CSR campaign. The new commitment entitled ‘Enrich Not Exploit’ outlined 14 sustainable targets with a focus on people, products, and the planet, touching all areas of the business, to be delivered by 2020. The initiative was aimed at supporting Body Shop in its aim of becoming the world’s most ethical and sustainable global business. But will this help Body Shop regain its past glory?

AuthorsSyeda Maseeha Qumer & Debapratim Purkayastha
InstitutionsIBS Hyderabad, IFHE University, India
Competition Year2017
PlaceRunner Up
TrackCorporate Sustainability
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergrads
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Ten Thousand Villages in Crisis: Can the Fair Trade Pioneer Survive and Flourish in an Economic Downturn?

Abstract

This two-part case examines a major reorganization process which took place at Ten Thousand Villages Canada in 2013, as a response to severe challenges from the aftermath of the 2007-08 global financial crisis. Ten Thousand Villages is one of the oldest fair trade organizations in North America, whose history can be traced back to craft sales in 1946. The case was developed in close collaboration with managers and volunteers of Ten Thousand Villages Canada, as well as their producer partners in Kenya.

The Part A case provides an overview of Ten Thousand Villages (e.g., history, producer partnerships, operation in Canada) and the financial challenges faced by the organization in 2013. Part A facilitates the discussion of how the organization could be revived at the verge of bankruptcy, specifically from the perspective of a senior manager who must develop a plan to reach a break-even point within 12 months. The Part B case presents the actual decisions of the leadership team and what happened afterwards. By studying this case, students are expected to gain an in-depth understanding of real-life challenges faced by social enterprises and develop strategic decision-making capabilities for achieving financial sustainability at the same time as pursuing social mission.

AuthorsAnna Kim & Cécilia Renaud
InstitutionsHEC Montréal & CHUM, Canada
Competition Year2017
PlaceRunner Up
TrackSustainable Entrepreneurship
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergrads
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Bridge International Academies

Abstract

Bridge International Academy (Bridge), the world’s largest and fastest growing private school chain, is known for its radically innovative “Academy-in-a-Box” model, which is a scalable and easily replicable model that offers low cost unique solutions to the problem of quality education to children at the bottom of the pyramid. With the mission of providing ‘Knowledge for All’ Bridge has enrolled more than one hundred thousand students in Kenya and other developing countries. The unique model revolves around the developing of rigorous course content by expert teachers from around the world and the “Scripted Instruction Methodology” to ensure standardization of delivery in the classrooms. The model that delivers affordable education at about $6 a month needs to scale up and enroll half a million students to break even.

While May and Jay, the founders of Bridge, were well on course to achieve their goal of enrolling 10 million poor students by 2025, they faced resistance from teachers’ associations which felt that encouraging Bridge would lead to privatization and commercialization of education. The governments also brought in new legislations that seriously hampered its business model by increasing costs and stalling its scalability. May and Jay now have to take a decision on how to rework the existing model to overcome regulatory hurdles and opposition from educators in order to achieve their goal. The case has important decision points and ramifications for all social entrepreneurs who have built or are building a sustainable business model to offer quality primary education to the poorest of the poor.

AuthorsManish Agarwal and D. Satish
InstitutionIBS Hyderabad, IFHE University, India
Competition Year2017
PlaceThird Prize
TrackSustainable Entrepreneurship
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergrads
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Dharani: Nurturing the earth, fostering farmers’ livelihoods

Abstract

Timbaktu Collective is a non-profit organization in southern India, working for the sustainable development of rural communities with an emphasis on ecological principles and social harmony. One of the core areas of its work is with small farmers in the region who remained marginalized in a fiercely competitive market dominated by large players. Inspired by its success with organic farming and in collectivizing rural people Timbaktu Collective promoted a business enterprise for procuring, processing and marketing the organic produce of farmer-members in the district of Anantapuramu.

In 2008, Dharani Farming and Mutually Aided Co-operative Society Limited (Dharani) was started as a farmer owned, cooperative enterprise that procures and sells the members’ organic produce. This case discusses how Dharani not only developed external markets for small farmers’ organic produce but also articulated an ethical model of local production, distribution and consumption. For nearly a decade, Timbaktu Collective and Dharani have worked together to increase membership in the cooperative from only 70 in less than a dozen villages to 1800 in 35 villages in 2015. Dharani recorded net profit of over Rs 15 lakh in 2014-15, despite repeated droughts in 2014 and 2015. Besides financial benefits to members, land fertility had also improved substantially: acreage of certified organic land had grown from 80 acres in 2005 to 7500 acres in 2015. With a network of 246 retailers, bulk buyers and direct consumers, Dharani’s brand of products, “Timbaktu Organic” had also been firmly established in 40 towns and cities of South India

But Dharani’s operations had to expand significantly if they had to benefit all the farmer-members of the cooperative. For this Dharani has to (1) increase procurement of farmers’ organic produce from the current level of 300 tons to 1500 tons,  (2) increase value of the procurement from Rs 1 crore to Rs 5 crore and (3) increase net profits from Rs 24 lakh to Rs 50 lakh. How could Dharani continue its growth as a business enterprise while remaining a socially responsible and ecologically sensitive, famer-owned cooperative?

AuthorsJoseph Satish V & C Shambu Prasad
InstitutionsUniversity of Hyderabad, India & Institute of Rural Management Anand, India
Competition Year2017
PlaceFirst Prize
TrackSustainable Entrepreneurship
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergrads
Permission rightsThis case is part of the oikos free case collection. Download a free online copy below. If you are a faculty member and you are interested in teaching this case, you can request a free teaching note by sending us an email to freecase@oikos-international.org.
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Refugee Labor Market Integration – An Impact Investment Case Study

Abstract

The dislocation of millions of people in various conflict zones of the Middle East and Africa is one of the greatest humanitarian catastrophes of our time. Given the complexity of the issue, various ways of solving the associated challenges have been implemented; reaching from emergency camps in conflict zones to innovative integration services in host countries. With overloaded government processes and too little funding, it is of utmost importance to fund and scale up effective integration services. Successful integration depends to a large extent on promoting the required abilities to build a self- sustained life. As such, labor market integration of refugees becomes of crucial importance first and foremost for themselves, yet successful integration also bears major upsides for the broader society.

One example of a successful integration service is SchlaU Schule, located in Munich, Germany. By providing young refugees with an education that is acknowledged on the German labor market, young refugees can integrate faster and build self-sustained lives through the improved facilitation of labor market integration. Today, organizations like SchlaU Schule often lack funding to operationalize and scale up their services. Hence, identifying successful services that generate social impact and implementing smart ways to allocate funding to those organizations, while generating financial returns, are urgent issues to be solved.

Students tackling this case will work at the intersection of social impact and financial return. Students are encouraged to design an impact investment case targeting refugee labor market integration that not only creates social impact, but also financial return for investors. Thus, entrepreneurial thinking is combined with rigorous financial modelling to align both financial and social returns in a meaningful way. The goal of the case is to allow students to think entrepreneurially, conceptualize financially viable and socially meaningful solutions, and identify ways to implement these in the real world.

AuthorMarc Haßler
InstitutionMaastricht University School of Business and Economics, The Netherlands
Competition Year2017
PlaceThird Prize
TrackSustainable Finance
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergraduates
Permission rightsThis case is part of the oikos free case collection. Download a free online copy below. If you are a faculty member and you are interested in teaching this case, you can request a free teaching note by sending us an email to freecase@oikos-international.org.
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Tongwei – Sustainability Entrepreneurship through Market-Political Ambidexterity

Abstract

Tongwei Group (China) (hereinafter referred to as “Tongwei”), started as an aqua-feed (fish feed) producer in the 1980’s when the country was just beginning the economic opening up policy. The company’s world-leading technologies in aqua-feed and pet feed earned itself international reputation and political spotlight, and it was entitled as the country’s “Key Leading Enterprise in Agricultural Industrialization”. However, even with such a leading position in aqua-feed market, Tongwei decided to enter the photovoltaics (PV) energy industry in 2006, when solar energy industry was advocated as a booming strategic new industry in many regions in China. Did Tongwei, like many other Chinse private enterprises, simply rush to this industry with blindness? Or did it enter it with calculated purposes? How could Tongwei, with its competitive advantage in the seemingly non-related aqua-feed industry, diversify into an innovative and influential PV energy company? The riddle lied in the company’s ambidexterity. On the one hand, Tongwei cautiously exploited the ‘red ocean’ PV energy market as a follower; on the other hand, Tongwei audaciously explored the tremendous potentials in the ‘blue ocean’ market by actively engaging in corporate-political activities with long accumulated political connections and appointments of Hanyuan Liu, the founder and board chairman of Tongwei. Although Liu is an active entrepreneur with experienced government connections at different levels, he did not seek business opportunities by bluntly capitalizing on the ‘institutional void’. Rather, Tongwei’s successful diversification into a sustainable business relied on its proactive engagement in and noticeable contributions to filling an institutional void, i.e., creating opportunities by making institutional contribution.

The case portrays the evolution process of China’s private enterprises towards sustainability. It can help decipher how Chinese private firms identify and seize new opportunities through market-political ambidexterity when transforming to sustainable businesses. The primary focus of this case is to highlight the co-evolution process in emerging markets like China where political connections and business opportunities are tightly interwoven and mutually reinforced in transition to sustainability. In particular, this case seeks to answer: What drove Tongwei to engage in sustainability-oriented business? How could Tongwei continuously explore and capture opportunities in solar photovoltaic (PV) industry? How should Tongwei further solidify its “Dual Main Businesses” model to grow into a business leader in leveraging sustainability?

AuthorsXuanwei Cao, Zhuang Ma
InstitutionXJTLU, China
Competition Year2017
PlaceRunner Up
TrackCorporate Sustainability
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergraduates
Permission rightsThis case is part of the oikos free case collection. Download a free online copy below. If you are a faculty member and you are interested in teaching this case, you can request a free teaching note by sending us an email to freecase@oikos-international.org.
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Wind in the Sails: Managing Social Acceptance of Large Wind Energy Projects in Switzerland

Abstract

Shortly after the Fukushima meltdown of 2011, the Swiss government developed an Energy Strategy 2050, aimed to build up renewable energy capacity, improve energy efficiency and phase out nuclear energy. Yet, growth in the wind sector had been disappointing. This case study examines the factors that took the wind out of sails of large wind projects in Switzerland, paying special attention to the risks associated with public policy and stakeholder opposition. Though focusing on Switzerland, the lessons learned from the case study are applicable internationally, with multiple examples of large infrastructure projects being halted or severely delayed by public opposition and red tape.

Staged in May 2017, the case centers around Nadine Haller, who has been developing a large wind project for the last five years. She has just learned the news that the Energy Strategy 2050 has been accepted by the popular vote and she is contemplating what this result means for her project.

The case study is based on interviews with more than 20 wind project developers and permitting authorities. Several teaching options are included. The storyline can be updated as relevant news develops, creating new challenges for Nadine. The case offers an accompanying cash flow calculation model, teaching students that social acceptance and regulatory compliance come at a significant cost. Another option is a role-play game, where students try wearing hats of different project stakeholders: the project developer, the head of municipal government, a local landowner, a journalist, and a member of an environmental NGO, among others. The case also offers a framework to systematically approach project-related risks and develop risk-mitigating strategies. It should be relevant to graduate students from a variety of backgrounds, including communications, finance, law, and economics.

AuthorsAnna Ebers Broughel
InstitutionUniversity of St.Gallen, Switzerland
Competition Year2017
PlaceThird Prize
TrackCorporate Sustainability
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergraduates
Permission rightsThis case is part of the oikos free case collection. Download a free online copy below. If you are a faculty member and you are interested in teaching this case, you can request a free teaching note by sending us an email to freecase@oikos-international.org.
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Coming to Fruition: Fresh Truck Aims to Increase Food Access in Boston

Abstract

Founded in 2013 in Boston, Massachusetts, Fresh Truck is a mobile fresh produce market focused on increasing access to fresh produce and nutrition education in Boston’s low-income neighborhoods. Fresh Truck is a non-profit social enterprise that earns revenue through the sale of fresh produce in various Boston neighborhoods. It has become a key part of Boston’s food access ecosystem, which includes health care centers, the City of Boston, and other non-profit organizations. To date, Fresh Truck has attracted funding through a business plan competition, a Kickstarter campaign and grants that have helped to launch two trucks serving its mission. However, to expand, Fresh Truck faces a number of key management, logistical and operational challenges that affect its economic sustainability and thus its mission. These challenges relate to customer acquisition and retention, finding time to grow, inventory control, parking issues, and measuring impact. Josh Trautwein, co-founder and executive director of Fresh Truck, must make decisions to navigate these challenges and continue daily operations as he develops and executes a strategy for growing the enterprise and helping to solve food access issues in Boston. What should Josh do to chart a course through these challenges so that Fresh Truck can earn revenue and meet its social mission?

AuthorsNardia Haigh, Anya Weber & Jennie Msall
InstitutionUniversity of Massachusetts Boston, USA
Competition Year2017
PlaceSecond Prize
TrackSustainable Entrepreneurship
Key WordsCSR, Socially Responsible Investing, Environmental Performance, Social Performance
CoursesSustainable Finance, Strategic Management, Finance, Business Sustainability, Business and Society, or Environmental Entrepreneurship
Target AudienceMBAs, Undergraduates
Permission rightsThis case is part of the oikos free case collection. Download a free online copy below. If you are a faculty member and you are interested in teaching this case, you can request a free teaching note by sending us an email to freecase@oikos-international.org.
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