12 January 2010

Pachauri's Conflicts of Interest

When causes are popular it can be uncomfortable and inconvenient to realize that experts who render politically desired advice have potential conflicts of interest. Perhaps this helps to explain why investigative journalists (with only several exceptions), especially those who cover science, have turned a blind eye to the obvious and egregious conflicts of interest present in the case of Rajendra Pachauri, head of the IPCC. The longer this issue is allowed to percolate in plain view, the worse the outcome will be for the scientific community and perhaps also those whose job it is to hold experts accountable to basic standards of conduct.

In India on Sunday, the paper India Today had a detailed and hard-hitting story on Dr. Pachauri's conflicts of interest, revealing some very interesting new details and responses. The paper received a response from Dr. Pachauri which includes the following statement about the organization that he leads, TERI:
TERI is a not-for-profit organisation working for the welfare of society and its revenues cover costs and provide no private benefit to any party.
India Today notes that this response seems "untenable." They are correct. The existence of a conflict of interest does not depend upon what TERI chooses to do with the resources that it receives from interests who are direct beneficiaries of its advice.

A story last month in a newspaper focused on Indian business chronicled on the rise of "TERI, Inc." The story explains that TERI is deeply involved with a wide range of for-profit enterprises, from which it benefits a great deal:
Banwari Lal has a problem with the numbers. He holds a PhD in microbiology and six or seven patents jointly with The Energy and Resources Institute (Teri), but he can’t seem to figure out what will Teri’s share of the profits be if it wins — it is one of the 60 bidders globally — a Kuwaiti government contract to clean up its oil spills. Along with a local partner who has a 40 per cent share, the contract will be executed by ONGC-Teri Biotech, a 49:48 joint venture whose CEO is Lal (he also heads the Environmental and Industrial Biotechnology Division of Teri). . .

The project involves cleaning up an 80x80 km area in Kuwait and is likely to cost around $3 billion. That’s right, three billion dollars. Kuwait got this money from the United Nations as compensation after Iraq damaged its wells in the first Gulf War. The contract will be awarded in January.
The Kuwait project is just one of many enterprises that TERI is invested in:
Lal has got two joint ventures to help Teri make money, his neighbour Alok Adholeya (he has been with Teri for 23 years as compared to Lal’s 21) has five licensees doing the same. Adholeya, who received his PhD from Govind Ballabh Pant University, heads the Biotechnology and Bioresources Division. He says his brief after he joined Teri was to create a bank of microbes that could help plants grow better. . .

Teri gets a 5 per cent royalty on all purchases and Rs 25 lakh in technology-transfer fee. Different species of mycorrhiza, Adholeya says, are being used to clean up ash ponds in thermal power plants, distilleries and so on. Talks are on with various mining companies to use the bio-mining microbes (this helps get the minerals out without damaging the environment). A joint venture for jatropha cultivation has been set up with a German company after an R&D project with British Petroleum on jatropha ended.

Saving carbon emissions
Another eight companies have been licensed to sell or implement Teri’s biomass gassifiers which convert plant and wood residue to gas that drives an alternator to produce electricity. If an Australian government-funded project to develop a solar biomass-based cooling system works out, this too will convert into a series of licences. Eighty to 90 glass units in Firozabad near Agra use Teri’s pot furnace and several brick kilns use its vertical shaft brick kiln. According to Teri, its technologies helped the medium- and small-scale sector save around 350,000 tonnes of carbon emissions last year.

A books division has a turnover that’s already up to Rs 4 crore doing children’s and other books. It plans to do college textbooks by next year and the “Soldiers of the Earth” global environment programme has actor Akshay Kumar offering ideas for attractive comic books.

Whatever the outcome of the Kuwait project, with so many commercial projects coming out of its R&D work on a regular basis, it is clear Teri is no longer your run-of-the-mill, though successful, policy institute.
If you read that last part closely you'll see that TERI is involved with reducing carbon dioxide emissions. In fact, it is a key player in the Clean Develop Mechanism of the Kyoto Protocol. If you connect the dots -- and there aren't many to connect -- you will quickly see that as Director of TERI Rajendra Pachauri's advice through the IPCC and his platform provided by the IPCC on climate change and carbon trading has direct and significant benefits to his own institution. These benefits find their way through a wide range of for-profit enterprises. So when Dr. Pachauri is advocating carbon trading -- a policy doomed to fail if one ever was -- his recommendation will lead to direct and significant benefits to the institution that he directs. Uncomfortable and inconvenient.

The situation is no different than would be the case if the head of a government advisory panel on drugs for heart disease were to recommend that everyone take Acme Pills for heart disease, while at the same time his research center would be the direct financial beneficiary of projects carried out in conjunction with Acme Pills, their suppliers and partners. In such a case the conflict of interest would have nothing to do with the benefits of Acme Pills, the importance of treating heart disease or the integrity of the science advisor. Such situations are of course why conflict of interest guidelines are developed in the first place, and one important reason is to maintain a sense of integrity and trust in advisory processes.

There is no problem with profit, enterprise or investment. There is a serious problem of rendering advice when that advice has a direct influence on money that one's organization receives. Isn't this fairly obvious? Do some people actually believe that the case for action on climate change will be made stronger by looking the other way when climate science advisors have conflicts of interest? Is it possible that climate science will be stronger by holding scientists to well-accepted standards of behavior? If Dr. Pachauri was an advisor on pharmaceuticals, and had parallel interests in drug companies, I'm pretty sure that he wouldn't be getting a free pass.

There is more to discuss. Such as how a venture capital firm associated with Al Gore invested $10 million in a company founded by Dr. Pachauri. TERI was also a primary investor in the company. The company -- the aptly named Glorioil -- is focused on getting even more oil out of seemingly spent wells. The Waxman-Markey cap-and-trade bill references enhanced oil recovery as a potential opportunity for offset credits. Would Glorioil's technology qualify? I don't know (and neither does anyone else, as that is all to be determined, and Glorioil's various technologies are mostly out of sight). Given the various shenanigans associated with cap and trade it is not too much of a stretch to think that it could. Is it worth looking into? Seems like it. But I've already see enough.

The sum total of the above signifies that at a minimum climate science needs to set forth and follow basic standards of conflict of interest. Otherwise, the apparent anything-goes approach is giving opponents of action to address accumulating carbon dioxide emissions plenty of legitimate material to work with. Journalists and others who turn a blind eye are their unwitting allies.


Charlie Martin said...

Okay, this is completely OT and orthogonal to the actual topic, but reading the Business Standard article, we find "Most people associate Teri with policy gyaan".

Uh, what?

Turns out 'gyaan' is a transliteration of the Hindu pronunciation of Sanskrit 'jñana', 'knowledge, wisdom'.

Interesting that with the whole article in English, this word stays in Hindi.

Craig said...

"Jounalist and other who turn a blind eye are their unwitting allies."

Unintentional given the totallity of known facts and circumstances? Don't think so. It's a matter of ethics and professional cred. A wave of the pen doesn't address such a "blind eye."

Maurice Garoutte said...

When confronted with the fudged data of Climategate the AGW believer’s defense was that the science of global warming was not disproven. They were right of course but unstated was that their aura of scientific authority was stripped away by the deceit that was exposed.

Now, when confronted with the conflict of interest at the highest levels of the AGW movement the true believers will again say that the science of global warming is not disproven. They will be right of course but the moral authority of “saving the world” has been exposed as false.

The science of global warming is not settled but the IPCC can no longer be considered as a credible authority or be credited with the moral high ground.

It’s time for the Supreme Court to reconsider Massachusetts vs. EPA where the majority opinion was based on an appeal to authority argument.

MIKE said...

The person that should be getting more heat is whoever RP reports to in the UN.

Richard Tol said...

There are three amazing things about Patchygate and Climategate.

First, many insiders knew and no one blew a whistle. (I knew about the going-ons at CRU. I only knew that Pachauri lives in a very nice house.)

Second, an undercurrent of discontent has suddenly morphed into a torrent of anger.

Third, the incompetence of the response of those at the centre of the controversy.

Interesting times. Will need to work hard to make sure that the pendulum does not swing too far.

Mark Bulger said...

"Do some people actually believe that the case for action on climate change will be made stronger by looking the other way when climate science advisors have conflicts of interest?"

Roger - I assume that this is what is called a rhetorical question. File it under Clothes, Emperor's New. ;-)

eric144 said...

Pachauri and Gore, the Butch Cassidy and Sundance kid of climate change.

Britain's favourite war criminal, Tony Blair also has his little snout deep in the green stuff.

Blair to lead campaign on climate change

Tony Blair is to lead a new international team to tackle the intractable problem of securing a global deal on climate change which would have the backing of China and America.
He told the Guardian he has been working on the project with a group of climate change experts since he left office last summer, and will publish an interim report to the G8 group of industrialised nations this summer


Tony Blair has taken a second big job with a leading financial player, attracted by the prospect of working on its climate-change initiative.

The former Prime Minister has joined Zurich, the Swiss company, as an adviser. The appointment, thought to be worth at least £500,000 a year, comes less than three weeks after he took a similar role with J P Morgan Chase, one of the biggest investment banks on Wall Street. That was believed to be a package worth about £2 million a year.

He will assist Zurich on “developments and trends in the international political environment”. His key interest, according to friends, was in its climate initiative, announced last week, developing products and research to combat global warming.


charlesahart said...


Is it not true that any scientist (climate, medical ...) who makes claims about the relative importance of their work knows full well that grant money flows to "crisis".

Thus any climate scientist who claims that AGW is a serious/crisis problem has a clear conflict of interest.

This conflict of interest problem goes far below the chair of the IPCC. As a climate scientist do you agree?

Richard Tol said...

There is a difference between (1) me promoting my subject and hence my cause; and (2) me using one position to promote the cause of my other position.

Pachauri has many positions. When he acts as the chair of the IPCC, he should do what is best for the IPCC -- not what is best for TERI. When he acts as the board member of company, he should work for that company -- not use his position to win contracts for TERI.

Geckko said...

One point needs to be made.

Often people equate "conflict of interest" to require a proft motive. This is hardly so.

People are motivated by many things. Anyone involved in the running and management of a "non-profit" organisation almost certainly has a strong personal preference for the misson of that organisation and its underlying beliefs.

Pachauri, or anyone else, requires no involvement in profitable activities outside his IPCC role in order to be exposed to or possibly succumb to conflict of interest. His interest might be ideological, personal advancement, notoriety, or simply ego.

Stan said...


The verdict on journalists came in a long, long time ago. The evidence was so overwhelming that the judge issued a directed verdict. I don't know anyone, liberal or conservative, who puts any credence in the reporting of the mainstream news media. I had lunch the other day with a very liberal college administrator. We spent an hour and a half laughing over personal war stories we had of journalistic incompetence and bias.

Michael Crichton nailed it years ago with his "Gell-Mann" effect (newspaper stories where we know the facts are always wrong). http://www.crichton-official.com/speech-whyspeculate.html What's changed since his speech is that we know longer foolishly give credence to those stories about which we lack personal knowledge.

charlesahart said...


Scientist have yelled crisis before to attract funding. Here is one example I found. I am certainly not saying climate science is unique in this respect.

"After World War II, the details were released of the A-bombing of Japan. Studies of atomic bomb survivors from Hiroshima and Nagasaki, showed a linear relationship between cancer mortality and high doses of radiation as a result fallout hysteria became one of the themes of the times. The situation was not helped by lurid stories of several high dose incidents reported in the press. Health Physics and Genetics were supported lavishly by radiation fears, and Radiation Biology became the most intensely researched science in history. Health physicists soon learned that their livelihood depended upon scaring funds out of governments and science became irrelevant if the paymasters wanted to mislead the public about the hazards of radiation. If a particular study failed to find evidence of radiation’s ill effects, the data was simply forced into the LNT model. Yet some of these studies are among the best evidence for radiation hormesis because the authors were not looking for it, and effectively denied that it existed."


eduardo said...

When Pachauri was elected chairman of the IPCC back in 2002, he was hailed as the Bush candidate against Watson. Actually, Pachauri's election was considered a coup by the Bush adminitration and fears were expressed that the IPCC would no longer be comitted to the AGW warming cause.

In the CRU mails, we can see Mike Hulme supporting Pachauri agianst Jones' suspicion.

It looks ironic today

Richard Tol said...

What does more damage? An IPCC chair who is not a zealot, or an IPCC chair who is gaffe-prone, overstates his claims, violates the IPCC mandate, and has conflicts of interest?

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