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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posted June 19, 2017

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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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posted June 19, 2017

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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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posted June 19, 2017

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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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posted June 19, 2017

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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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posted June 19, 2017

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Fairphone: Organising for Sustained Social Impact

Abstract

With no previous experience in the mobile phone industry, Bas van Abel, an industrial designer based in Amsterdam, started Fairphone as an NGO [non-governmental organisation] awareness campaign in March 2010. He hoped that by inviting the public to design collaboratively a prototype of a “fair” smartphone, the campaign would raise the Dutch public’s awareness of the link between mobile phones and minerals mined in the context of a bitter civil conflict in the Democratic Republic of Congo (DRC). Van Abel did not intend to produce a functional, commercial smartphone; his goal was simply to raise public awareness.

However, by January 2013, through a series of serendipitous events, interaction with industry actors, and encouragement from sections of the Dutch public, the awareness campaign had morphed into the social enterprise Fairphone. With co-founder Miquel Ballester, van Abel wanted Fairphone to produce “a seriously cool phone putting social values first.” Within six months of the company’s founding, Fairphone attracted a large following in the media and among socially-conscious consumers across Europe. In mid-2013, these customers fully financed the production of 25,000 smartphones (priced at €325 apiece) through a crowdfunding initiative—a remarkable token of trust in a start-up that had never produced a smartphone.

Van Abel and the Fairphone staff, consisting largely of “creatives” and “story-tellers,” had to learn very quickly how to produce a high-quality smartphone—a complex product—in a competitive industry while keeping their promise to improve the social welfare of underrepresented mine and factory workers along the mobile phone industry’s supply chain. After experiencing myriad quality problems while manufacturing the phone, van Abel and the Fairphone staff successfully delivered the first batch of “fair” smartphones to customers by Christmas 2013. In February 2014, after all smartphones had been delivered to customers, van Abel felt that it was time to take stock and plan for the company’s future. In order to fulfil its two-fold mission, Fairphone had to scale up production to become a “real” company. How should Fairphone reach a larger audience with its message and product? How should the organisation be designed in order to achieve this mission?

AuthorsOnajomo Akemu and Gail Whiteman
InstitutionRotterdam School of Management, Erasmus University, Netherlands
Competition Year2015
PlaceFirst Prize
TrackSocial Entrepreneurship
Key WordsSocial entrepreneurship, conflict minerals, mobile phone industry, Congo, activism, organisational structure
CoursesEntrepreneurship, business & society, CSR
Target AudienceMBA, executives, masters
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posted June 24, 2015

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Apple and Conflict Minerals: Ethical Sourcing for Sustainability

Abstract

The success of Apple Inc.’s products like the iPhone and the iPad made the company rely on manufacturers in Asia to produce its products at a lower cost. Since these manufacturers were not too particular about checking the origins of the minerals they used, Apple had to face accusations by activists that it was using conflict minerals in its products. These conflict minerals led to the abuse of human rights in the strife torn parts of the world. Extraction and sale of conflict minerals like tin, tungsten, and tantalum extracted from illegal mines in the Democratic Republic of Congo (Congo) and surrounding countries funded armed militia who fought against the government and violated the human rights of people living in the conflict prone areas.

Apple had taken various initiatives to tackle the challenge of conflict minerals since it started facing the heat from some activist groups in 2010. Despite all the efforts made by Apple, the company faced an uphill task. The problem for Apple was compounded by the fact that the supply chain for such minerals was opaque and it was not so easy to determine which refiners and smelters around the world were financially fueling violence in the war-torn regions. There was also the possibility that such minerals could slip into its supply chain through indirect routes.

Going forward, the question before Apple was what more could the company do to ensure that all its products were free from conflict minerals. How could it ensure that the procurement of minerals through its supply chain did not profit armed groups in producer countries? How could it assure stakeholders that their products did not contain any primary commodities that were linked to the funding of conflicts? How could it ensure all these, while also seeing to it that the action taken by the company does not have an adverse effect on the livelihoods of people who work in and around artisanal mines and their communities?

AuthorsDebapratim Purkayastha and Adapa Srinivasa Rao
InstitutionIBS Hyderabad, IFHE University, India
Competition Year2015
PlaceSecond Prize
TrackCorporate Sustainability
Key WordsConflict minerals, Human rights, Consumer electronics industry, Sustainability, Sustainable supply chain, Ethical Supply chain, Ethical sourcing, Supply chain transparency, Supply chain risk mitigation, Supply chain mapping, Supply chain audit and reporting, Stakeholder management, Stakeholder tension, Systems approach
CoursesCorporate Sustainability, Business Ethics, Corporate Social Responsibility, Supply Chain Management
Target AudienceMBA
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posted June 24, 2015

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oikos Germany Meeting 2015

This year’s Germany Meeting will carry the title of: (Re-)Thinking Sustainability.

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posted February 16, 2015

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Terra Nova (A)

Abstract:

In three years, a small team of engineers led by a visionary entrepreneur Mr. Christian Thomas has developed a new process for producing iron, aluminum, copper, as well as gold and silver in commercial quantities, from electronic waste. The small team of senior engineers who started this venture had been brutally terminated upon the failure of a big lead processing plant. Out of a job, they developed the idea of recycling electronic waste and tested it, while two associates worked at finding financing and legal authorizations for the developing project. Once all the pilot tests had been conducted, it took two more years to set up appropriate supply routes and to build a plant to do phase I, i.e. extracting plastic, iron and aluminum. The effluent at that stage is rich in rare metals and attractive for the smelters who do the further refining. The rich output is hence sold to the copper smelters until phase II is in place. The case presents an interesting example of a technologically sophisticated recycling operation because it generates positive income with zero emissions and without ultimate residue. Progressively dominating complex chemical processes with a series of innovations, and surviving with some successful consulting jobs for the industry, the team completed the set up by January 2012. This development took place during the financial crisis years, in the competitive environment of five global copper smelters.

This case is part of the oikos Free Case Collection. Instructors can request the teaching note at freecase@oikos-international.org

Authors: Gilles van Wijk and Alireza Ahmadsimab
Institution: Essec Business School
Competition Year2014
PlaceRunner-Up
TrackCorporate Sustainability
Key WordsSustainability, PCB recycling, greentech, entrepreneurship
Coursesstrategic management, sustainability, entrepreneurship
Target AudienceMBA
Purchase InformationPlease contact the authors, Gilles van Wijk for permission rights.
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posted June 26, 2014

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IKEA and the ‘Better Cotton Initiative’

Abstract

The purpose of this case study is to discuss the relation between management and sustainability, paying specific attention to the issue of supply chain and innovation. IKEA, the world’s leading furniture retailer, has a long history of managing environmental and social issues. The company has developed internal procedures to assess the sustainability impact of new products (the IKEA Sustainability Product Scorecard) and has implemented a code of conduct to deal with social responsibility among suppliers (IWAY). The issue of cotton has emerged as a new challenge. To address this challenge, IKEA must adopt an innovative approach that goes directly to the source: the farmers. Through its partnership with a leading environmental NGO (the WWF), IKEA developed a pilot project aimed at influencing farmers in Pakistan and India to change the way they cultivate cotton. The initial results motivated the company to extend its pilot initiative with the goal of mainstreaming Better Cotton as a new market commodity. The development of a new strategy is required.

This case is part of the oikos Free Case Collection. Instructors can request the teaching note at freecase@oikos-international.org

Authors: Stefano Pogutz
Institution: Università Bocconi
Competition Year2014
Place2nd
TrackCorporate Sustainability
Key WordsCorporate sustainability, supply chain management, cotton industry
Coursesstrategic management, supply chain management, corporate sustainability, CSR
Target AudienceMBAs. Graduate, Executive
Purchase InformationThis 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@oikosinternational.org
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posted June 26, 2014

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