Economic Development & ESG: the two of you need to talk. Now!
Written by Michael Grella for Medium
For the past seven years (6 years, 11 months, two weeks to be exact), Amazon’s Director of Economic Development has been my title. I started the Amazon Economic Development Team in March 2012 and in November 2016 launched the Amazon Web Services Economic Development Team. It has afforded me opportunities to travel the world, acquiring invaluable wisdom, feedback and knowledge from diverse cultures, officials at all levels of government, entrepreneurs, NGOs and civic associations, while building public-private partnerships to support the global expansion of the Company’s physical infrastructure.
Along my journeys, I identified common threads that brought people together without regard to geography, language, occupation, income level or political philosophy consistent with principles of Environmental and Social Governance. The vast majority of these threads would be filed under the category of common sense rather than proprietary intellectual property.
Protecting the environment is critically important (I’ve yet to meet someone espousing an opposing view) and much more often than not it is not a politically partisan issue. There is an intrinsic desire to leave the world in a better place than you found it and while opinions may differ about how we get to that ideal state there is little argument that bold changes and commitments are required today if we are to fulfill this promise to our children and future generations to come. A critically important step in the right direction is to acknowledge, quantify, and work constructively to solve for both the direct and indirect environmental impacts of investments and operations. Technologies and solutions exist today that are making a material difference in reducing these impacts: zero emission public transportation fleets, shortening the supply chain, microgrid, battery storage, smart metering, adaptive reuse, water reclamation and reuse, LED and sky lighting, rooftop gardens, rooftop solar, environmentally friendly concrete. Much respect to a true pioneer in this important space, Karl Heitman.
A desire to build a broad and resilient economic base that will provide job opportunities for the next generation. Building a diverse economy that can withstand economic downturns and headwinds and planting the seeds for tomorrow’s in-demand occupation will help solve the “brain drain” dilemma where a community’s most talented and promising youth and graduates are forced to move hundreds or thousands of miles away, further eroding the economic, familial and social fabrics of communities.
Yearning for next generation, disruptive technology to improve quality of life. Improving access to broadband in rural areas will open doors in countless areas, including medicine, education and small-business incubation. Harnessing the power of 3D printing, cloud computing, Internet of Things (IoT), Artificial Intelligence, and big/open data will improve the speed, quality of goods and services delivered by governments and businesses while reducing cost.
Transparency, openness, and a willingness to engage naysayers and critics, earns trust and pays long-term dividends. While there may be value to be derived from maintaining anonymity throughout the process of determining where to make a transformational investment, it comes with an opportunity cost. It’s reasonable to expect communities, e.g., individuals, school districts, labor unions, small-business associations, environmental groups, faith-based and civic community association leaders, to be curious and wanting to engage in the details, timing, intent, outcomes and externalities associated with a project that has the extraordinary potential to reshape the economic and social DNA for many years to come. By engaging, there’s always the opportunity to change hearts and minds. Even if hearts and minds are not changed, you often earn respect for being candid, engaging, and attempting to reach common ground. I believe there’s an innate desire within everyone to be heard, to feel like your opinion is important. In engaging in substantive dialogue with those whom you may not agree, you satisfy that need to be heard and demonstrate respect for diverse points of view. Talking with each other instead of over or around each other is how bridges, rather than walls, are built.
An expectation that the private sector will take an oversized role in advancing positive outcomes in the regions and communities where they locate and do business. Paying a fair share of taxes and providing quality jobs with benefits, while recognized as important contributors to stable economies and communities, are the floor and should not be the ceiling. Corporate philanthropy can be very significant contributors to improving communities’ quality of life, yet there is a desire for business leaders to engage and exchange feedback and ideas with their neighbors and customers on a regular basis. Don’t be a stranger.
Demands for quality education, which requires bar-raising instructors and administrators, cutting-edge STEAM curriculum, fully funded arts, nutrition, extracurricular programs, and technology in the classroom requires a robust and sustainable tax base. Businesses seeking tax abatements of school taxes as well as governments offering long-term abatements must deliberate whether such agreements will be a catalyst for improving the quality of education and be mindful of the externalities resulting from under resourced and or overcrowded schools.
Reskilling and retraining today’s workforce for today and tomorrow’s jobs can transform lives, families and communities. Innovation stemming from the Third Industrial [Digital] Revolution buoyed the fortunes and economies of many cities from Austin to Boston, San Francisco to Seattle but also left many metro areas behind with an eroding qualified labor pool, dwindling tax bases and vacant buildings. Let’s not repeat that same mistake. With the Fourth Industrial Revolution arguably still in its nascent phase there is incredible opportunity for those communities making bold investments in human capital and education. Such commitments must include not only K-12 and our college classrooms but also harness the vast potential of our community, technical and vocational college system, Workforce Investment and Development Boards, and Apprenticeship programs. It is unacceptable to dismiss an entire generation of workers as having missed the boat or at a stage in their career where they are relegated to underemployment for a lack of technical skills when countless employment opportunities exist with living wages and benefits for in-demand occupations.
Diversity is important, highly valued, and not optional. The benefits stemming from organization diversity are too many to mention. An employer whose workforce, notably including its leadership, resembles the population at large will earn the trust and respect of the entire community.
Bigger, bolder commitments to local vendor procurement, local hiring, working with SMEs and M/WBEs. When large construction projects and employers are welcomed to a community, it’s typically accompanied by high expectations that local businesses and workers will experience an uptick in activity. Especially when that project is subsidized with local tax dollars. It’s not uncommon for those dreams to be dashed when it’s discovered that construction contracts were awarded to non-local (sometimes national) vendors that have a long-standing relationship with the developer and/or company, as well as preordained restrictions regarding the types of goods and services that can be procured locally. Making the extra effort to contract with local craftspeople and businesses, including women- and minority-owned businesses, creates a positive “flywheel” effect, enhancing local tax revenues (spent on public infrastructure and education) and employment levels, increasing the pool of skilled workers, improving the competitiveness, efficiency, morale and corporate reputation.
These are just a few of the threads embedded in my DNA from my Amazon experience. The time is now for candid dialogue about the respective obligations and role of governments and business enterprises when “game changing” Economic Development projects are undertaken. Old paradigms are now being shattered creating opportunities to build new paragons.
After thoughtful consideration and incredible support from my family [and several close friends, partners and confidants to be named later] over the past several months, I have decided to embark on a new adventure. An adventure that has incredible meaning to me, representing my DNA and my vision for supporting communities, organizations and economies that are resilient, sustainable and tech savvy, and that fully embrace the challenges and opportunities to create lasting, inclusive prosperity.
An official announcement will be made in March of this next venture. I am excited to share those details with you in a few weeks. Stay tuned!
Best,
Mike