Double business standards: the ambiguous fruits of Italian-Moroccan industrial collaboration

Roberto Cantoni, ICTA, Universitat Autònoma de Barcelona

Introduction

In 2009, the government of the Kingdom of Morocco developed a futuristic energy strategy, which envisaged generating 52 % of the country’s electricity from renewable sources by 2030. This strategy envisaged the installation of 6 GW of renewables by 2020. In particular, between 2009 and 2010, the government launched the Moroccan Solar Plan and the Integrated Wind Energy Program. The first solar power plant built as part of this strategy was Noor Ouarzazate (510 MW), completed in 2019; the first wind power plant (300 MW), in Tarfaya, was completed in 2014. These projects, like those currently under construction and those planned, have seen the participation of foreign companies, within joint ventures with Moroccan companies: in particular, Nareva, owned by the holding company of king Mohammed VI. In this post, I focus on one of the foreign companies most involved in the implementation of the Moroccan wind power programme, Italy’s Enel Green Power (EGP), which is Nareva’s main partner within the joint venture NEGPM for the construction of new solar and wind power plants with an overall capacity of 850 MW. I analyse Enel’s corporate social responsibility (CSR) programmes related to the construction of two wind farms in Midelt (Morocco, 210 MW) and Boujdour (Western Sahara territories under Moroccan occupation, 300 MW). The construction of the Midelt wind plant started in 2019, and the plant entered into commercial operation in 2020; the Boujdour plant was commissioned in 2021, and it is pending completion at the moment of writing.

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Boujdour Wind Farm, Western Sahara’s Occupied Territories (source: https://www.leconomiste.com/sites/default/files/eco7/public/onee_-_parc_eolien_-_boujdour.jpg)
Midelt Wind Farm, Morocco (Photo by Author)

In my analysis, I emphasise how Enel’s CSR fits into the policy of ‘creating shared value’ – namely, the practice of creating economic value in a way that also creates value for local social actors by addressing their needs and challenges. At the same time, I argue that these programmes are based on a double moral standard. On the one hand, the CSR strategy is enabling the development of a range of impactful local projects in Midelt; on the other hand, by claiming to implement similar projects in Boujdour, EGP’s approach crucially disregards the legal status of Western Sahara, considered by international legal bodies to be a non-self-governing territory under Moroccan occupation. The analysis is based on a critical examination of Enel’s sustainability policies using the concept of energy justice, which is outlined in the next section.

Theory and Methods

Over the last decade, energy has increasingly been developing into an object of interest of scholars operating in the social sciences. Inspired by a longer tradition of studies in environmental humanities, students in the energy humanities have started reflecting on possible applications and adaptations of theoretical and empirical tools developed in that older tradition, to their own domain of expertise (McCauley et al., 2013; Sovacool and Dworkin, 2014). In this respect, Sovacool and Dworkin (2014) have identified eight principles of energy justice: availability, affordability, due process, information, sustainability, intergenerational equity, intragenerational equity, and responsibility. In this article, I focus on the principle of due process – namely, countries should respect due process and human right in their production and use of energy – to assess the assumptions and implementation of EGP’s CSR strategy.

The method used for this study consisted of 1) an analysis of academic and grey literature (mainly NGO reports, reports of the companies involved) and 2) in-depth, semi-structured interviews with EGP’s executives, as well as with members of the Sahrawi community (especially, activists opposing Moroccan occupation) in Western Sahara, Europe and the USA.

Results and Discussion

The CSR plan created by NEGPM consists of a wide range of measures to be implemented at the local level. Sustainability projects were started in favor of the surrounding communities, focused mainly on health, training, and education. While I was not authorized to speak with the local authorities or community members, and thus must rely on information provided by NEGPM, the outcomes of these projects appear to have been generally positive with regards to the company’s stated aims, by stimulating entrepreneurial activities, helping a few students pay their university tuition fees, and improving the health of the local community through medical caravans. In its 2021 sustainability report, EGP affirms that “We are applying the same approach of a sustainable construction site also for the site of Boujdour” (p. 189). In addition, it states that:

“The results of the due diligence were also considered […] for defining the consultation process for the representatives of the Saharawi population, which is an activity carried out independently by an external qualified company and with proven experience in the area of sustainability. The consultation process included vulnerable groups, all belonging to the Saharawi population […].”

However, the very activity of Enel – and Siemens Gamesa (which is the turbine constructor) – in Western Sahara raises a crucial problem: namely the legal status of the region as a non-self-governing territory under occupation. In 1975, the International Court of Justice affirmed Saharawi’s right to self-determination through a referendum that Morocco committed to get undertaken, but which never took place because of opposition by Morocco and its geopolitically powerful allies, France and the USA. In 2016, 2018, and 2021, the EU Court of Justice clarified the Front Polisario’s legal personality as the internationally recognised representative of the people of Western Sahara and again confirmed that Western Sahara has a status that is separate and distinct from Morocco and, as such, should be regarded as a third party to any EU-Morocco agreement. “Extending the territorial scope of any such agreement to the territory necessarily requires the consent of the people of Western Sahara through their representation,” the Court stated.[1] The Front Polisario was not consulted by NEGPM, before authorizing the construction of the Boujdour wind plant (on which, by international law, Morocco has no decisional power).

The two cases hence raise two straightforward questions: How can the Italian government (as a 24 % shareholder of the partly publicly owned company Enel[2]) act against the verdicts of the EU Court of Justice? And does EGP’s neglect of the fundamental ethical value in land use – namely, the recognition of a land’s legal constituency – compromise its well-meaning CSR strategy?

Conclusion

EGP has developed a CSR strategy that is considered among the most advanced in existence, based on the concept of “creating shared value.” This concept claims to create added value for society. But which society? In the case of Midelt, it seems clear that the different segments of local society were consulted to arrive at the formulation of a strategy that considers local needs, both from the point of view of economic development and the improvement of environmental and health conditions. In the case of Boujdour, where a similar process was followed, however, the claim of shared value creation is crucially vitiated upstream, by the company’s disregard for the legal status of the territory: although there may be favorable spillovers to the local populations (which includes mainly the Moroccan colonial population), there may not necessarily be any for the Saharawi population. Even if the Saharawi population benefits from EGP’s CSR strategy, decisions about the strategy remain lacking consultation with the Polisario Front, i.e., the Saharawi people’s representatives. Arguably, this CSR strategy without consultation of the official representative is the company’s attempt to follow a path of compromise, involving elements of the Sahrawi community in the elaboration of its strategy, but ignoring the Polisario Front because of its ties with the Moroccan king’s company. The Italian state should have executed its duty and prohibit this energy project – as should have other national (construction) partners, such as Spain and Germany – but preferred to turn a blind eye due to the anticipated major profit for the Italian company. As it stands, EGP’s Boujdour renewable energy project, is, unfortunately, a prime example for a fundamentally ethically flawed business.

A street in Laâyoune, Western Sahara’s Occupied Territories

References

McCauley, D.A., Heffron, R.J., Stephan, H., Jenkins, K., 2013. Advancing energy justice: the triumvirate of tenets. Int. Energy Law Rev. 32, 107–110.

Sovacool, B.K., Dworkin, M.H., 2014. Global Energy Justice. Cambridge: Cambridge University Press.


[1] “The EU court cases”, Western Sahara Resource Watch, 28 October 2021. https://wsrw.org/en/news/the-eu-court-cases.

[2] Enel’s shareholders, Enel webpage, undated. https://www.enel.com/investors/investing/shareholders.

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