Why are so many energy companies getting into trouble and why is the implementation of infrastructure projects proving to be so hard in many developed countries?

There are several reasons, many connected to the broader environment in which such companies are working.  Some of these reasons have been more discussed than others, but we’ll look briefly at some of them in this and subsequent posts.

The first of these is an epochal change.  We’re living at the end of the so-called Age of Enlightenment, which has lasted about 300 years and which was based on the primacy of fact and reason, rather than faith or superstition; a world which was underpinned by the advance of knowledge based on the scientific method.  In such an Age, feelings mattered less than facts.  Arguments could be won with such statements as “that’s just emotion, the facts are….”.

We’re now living in an age in which emotion has once again become acceptable as a means of reaching judgements and decisions.  The assertion that “your facts don’t change my feelings” is now intellectually respectable in a way that would not have been the case as recently as thirty years ago.

This is a much harder world in which to operate for fact-based enterprises in controversial industries, such as energy companies.  Such companies are typically run by people with very fact-based backgrounds (such as engineers and accountants), for whom “feelings” are typically very subservient to their interpretations of “the facts” of an issue.

Since such people are usually convinced by facts, they assume that others will be similarly convinced once the facts are known and so they communicate in emotionally fraught situations by throwing more facts into the argument.  We know from our personal experience that this is seldom, if ever, a successful approach to dealing with people who are upset about something, but this industry often persists in such behaviour.

It’s not that the facts have ceased to matter, but the route to gaining a hearing for them needs to pass through addressing the emotions of an issue first.  As the old saying goes, people need to feel they’ve been heard before they’re willing to listen and we need companies to develop EQ as well as IQ.

A very instructive example of this, from outside the energy industry, can be seen in the contrast between tobacco and alcohol.  Faced with rising concerns some years ago about the side-effects of the use of their products, the two industries reacted very differently.

In the case of tobacco, their approach to the issue was entirely fact based (and litigious).  The alcohol industry, on the other hand, acknowledged the issue and worked with NGOs such as Mothers Against Drunk Driving to address people’s’ emotional concerns about the damage done by alcohol.

The result, decades on, is that in most of the developed world, people having a drink together remains a widely-accepted social practice.  Smokers, on the other hand, have become social pariahs, banished from polite company.

Next, living in the Post-Modern Age…