Sarah Me – Thanks for the great post on the digitization trends in K-12 education. The same tensions are evident at the university level with Barnes and Noble Education (“BNED”) and Follett, the two largest third-party college bookstore operators in the U.S. BNED, for example, had been investing ~$26mm per year over the last three years in its Yuzu educational technology platform to position itself for the eventual digital transition in educational content delivery. Due to slow adoption rates at the university level, BNED recently wrote off its Yuzu investment and decided to partner with a third-party developer instead. In fact, it appears that both students and teachers are slow to change, making the timing of the digital transformation difficult to predict (according to a recent study, 90% of college students prefer reading paper books over e-book). 
How do you decide how much to invest in an uncertain digital future? As we saw with BNED, investment timing really matters: start too soon and you waste shareholder capital but start too late and you could lose relevance in a fast-changing market. Given the dynamic education market, how do you know?
AT – Thanks for the post. I completely agree that the financial outlook for Time is challenging. Media executives have long argued that consumers will continue to ascribe value to the curated, well-researched articles that print media publishers offer (e.g., Time, WSJ, NYT). Based on this line of argument, the problem that print media companies faced was primarily distribution. Thus, most media companies have focused primarily on broadening their distribution channels (e.g., mobile, social, web) to facilitate the purchase and consumption of their unique, valuable content. Companies have done this by putting up digital barriers to ensure that non-subscribers can’t access their valuable content.
I worry that media companies are avoiding addressing the real risk that their business faces: content commoditization. Today, the proliferation of free content online means consumers (especially Millennials) can find the information they want without paying to subscribe to a magazine or newspaper. Time is now competing against free alternatives such as Yahoo, ESPN, and Facebook. If media companies like Time fail to break down their walls and embrace the competition, they risk losing relevance with consumers. In June 2015, for example, Reuters announced that it would start offering news content free-of-charge to other digital news aggregators, the first time that Reuters has done this in its 160-year history. Given Time’s fear of risking its attractive monthly subscription revenue stream, however, I worry that Time is relegating itself to a future as a “melting ice cube.” While consolidation may lead to cost savings in the short-run, if Time wants to be a viable business 50 years from now, Time needs to challenge the conventions of its core content distribution and subscription model by making content more freely available.
Tom217 – Thanks for the interesting post. Multiple startups are focused on perfecting smart billboard technology. Immersive Labs, for example, has focused on technology that instantly tailors billboard advertising to viewers based on video identification (most smart billboards already have webcams used to identify age, race, and gender) and other environmental information. Based on company tests, targeting advertising using Immersive Labs’ technology resulted in a 60% improvement in consumer engagement (as measured by time spent looking at the ads based on the billboard’s video analytics system).  While this technology appears to significantly improve user engagement, doesn’t it feel uncomfortable to have a billboard watching and analyzing you? I understand that we allow Amazon, Facebook, and Google to collect massive amounts of information on our daily browsing habits and to determine the advertisements we see based on that data, but I wonder if consumer perception of privacy is different in the physical world. What do you think? Should the OOH advertising industry worry about privacy concerns?
AlexShirley – Thanks for the article. In many ways, the robo-advisory trend is a continuation of the broad shift towards passive investment strategies by large investors. Pension funds, endowments, and 401(k) retirement plan have flooded into passive investment funds that track general market indices. In fact, according to Morningstar, over the last 3 years, investors have added ~$1.3Tn to passive mutual funds and ETFs while removing ~$0.25Tn from actively-managed funds. 
Robo-advisors represent the advisory equivalent of passive investments. Similar to advocates of passive investments, robo-advisors tend to cite superior performance over time (eliminating human biases and misaligned incentives), lower fees, and simplicity. But given these characteristics, why do only 1/3 of consumers say they are comfortable using an entirely digitized service as their primary investment advisor?  Do you think robo-advisors can completely replace the role of the financial advisor?
For me, the role of the financial advisor is more than just an allocator of retirement savings (which is easy to digitize). For many savers, the financial advisor also plays the role of life coach and planner. Robo advisors, for example, work great for simple savings plans, but what does a saver do it they need to balance the demands of a growing family, multiple savings goals, and development of an estate plan? I believe that the most successful digital platforms will recognize that technology isn’t the only solution and that there continues to be value in the balance between the efficiencies of technology and the personalization provided by the human touch.
LR – Thanks for the article. The growing role of technology and automation in mining is a fascinating industry-wide trend. For miners, this digitization trend was catalyzed by (i) dramatic declines in commodity prices (e.g., iron ore prices fell ~60% over the last 5 years) and (ii) increasing costs of extraction. Gold is particularly interesting, however, given that technology is impacting both the supply and demand sides of the equation. As you note, on the supply side, technology is increasing the efficiency and reducing the cost of gold mining. Technology, however, is having an equivalently large impact on the demand side of the equation given shifting consumer preferences, in particular for gold jewelry. Gold demand for jewelry production has declined from ~2,500 net tons to ~1,000 net tons per year from 2000-2014.  In fact, gold jewelry production declined ~14% year-over-year in Q2 ’16, with end-market demand growth seen only in gold investments.  While this trend is partially explained by rising gold prices, jewelers (e.g., Signet Jewelers) have also noted shifting demand preferences away from the jewelry category (which represented ~56% of gold demand in Q2 ’15).  This is particularly evident with Chinese consumers and U.S. Millennials, who are increasingly forced to prioritize between technology spend (e.g., iPhone, iPad) and jewelry (e.g., gold necklace, bracelet). While the future remains uncertain, technology could either be the next boom or bust for gold miners globally.
Anthony – Thanks for the comment. Vail’s strategy of taking a ‘soft-spoken approach’ to climate change appears to be a deliberate decision rather than its inability to garner public attention or as you put it “Vail’s voice carries less weight.” Vail’s much smaller competitor, Aspen, has proven that if a resort is willing to actively align its brand and marketing with environmental awareness and education, even a small company can make a measurable difference. Vail, on the other hand, has deliberately decided not to take this approach and rather has focused internally on (1) adapting to climate change and (2) minimizing its carbon and water footprint via technology investments
In case you are interested, I posted a response to Caroline’s article here (https://d3.harvard.edu/platform-rctom/submission/christmas-in-july-think-again-climate-changes-impact-on-the-ski-industry/) discussing this tension in Vail’s climate change response
Juan – Thanks for the article. StarKist is a great example of how a large player in an industry can use their market position to combat widespread industry ills, which would otherwise be difficult to address given the tragedy of the commons (impacts both overfishing and climate change). StarKist, for example, has been able to raise awareness about the importance of purchasing sustainably harvested tuna and was the first company to adopt a dolphin-safe policy (incorporating a Dolphin Safe logo on all products so that customers recognized that StarKist condemned the used of indiscriminate fishing methods to trap dolphins, whales, and other marine life alongside the intended tuna catch).  Similar, StarKist was a founding member of the ISSF and only purchases from vessels that share an anti-shark-finning policy.  These market actions have had a measurable impact by establishing standard within the industry and differentiating StarKist’s brand versus competitors.
Within the tuna industry, StarKist can uniquely justify investments given its leading market share and ability to shift public awareness thereby creating a competitive advantage. Given this proven strategy, I agree that StarKist should explicitly incorporate sustainability efforts into its social and environmental initiatives. The industry has adopted many of the standards that StarKist was the first mover on (e.g., Dolphin Safe, bycatch policies, fish stock management), meaning these standards no longer represent competitive differentiators for StarKist versus the industry. While there is clearly more to be done in terms of fishery management, incorporating an explicit climate change pledge offers StarKist a unique opportunity to push the industry forward along a new dimension of sustainability, doing well for both StarKist and the world.
Kerrin – Thanks for the article. You pose a very interesting question especially given the broader environmental controversy around Chemours. Chemours clearly has positioned itself favorable both from a sustainability and profit maximization perspective given its early investments in Opteon (in advance of the Kigali regulations). Opteon is a great example of the benefits of incorporating environmental, social, and governance (“ESG”) considerations into the product development pipeline. Hopefully, the price of Opteon falls with scale and Chemours is successful at both reducing the impact of HFCs and generating an attractive return on its investment (demonstrating the win-win of ESG investments).
As mentioned, the choice of Chemours is particularly interesting given the controversy over its manufacturing of C8 – also known as PFOA or Teflon. The product has been manufactured since the 1940s and persists indefinitely in the environment as a toxicant and carcinogen. In fact, Dupont (former parent company of Chemours), 3M, and other PFOA manufacturers have had ample evidence for decades that PFOA contaminates the blood of 95%+ of the U.S. population. [1,2] Despite these risks, Chemours has been dumping PFOA byproducts into the environment for over 60 years, leading to hundreds of lawsuits from consumers that claim they have developed cancer because of exposure to PFOA . In fact, in June 2016, Chemours became the target of an activist short-seller, Citron Research, claiming that this environmental liability could be as high as $5bn.  While Citron’s claims are likely exaggerated given their investment bias, the PFOA controversy is a poignant example of the risk of NOT incorporating ESG considerations into a company’s operations.
Overall, it would be great if corporations could “forecast regulatory changes in order to preempt necessary product line adjustments.” But, forecasting is inherently hard – sometimes you’re right (Opteon) and sometimes you’re wrong (PFOA). Rather, I would recommend that corporations focus on ESG initiatives in everything that they do. Over the long run, activities that are inconsistent with a strong ESG mission will naturally be unearthed and will put the company’s brand and reputation at risk. The best way to position your company for success in the future is protecting your license to operate today.
Taka – Thanks for the article discussing the risks and opportunities posed by emissions standards in the shipping industry. I would add that customers are also becoming an increasingly important motivation for ship efficiency and sustainability improvements. In April 2015, for example, Cargill announced that going forward it would only use the most efficient shipping vessels with an EVDI rating of A-E.  In fact, Cargill had begun chartering cleaner ships preferentially in 2012 using the EVDI Index in partnership with the NGO Carbon War Room. 
Cargill is one of the largest lessees of shipping capacity in the world (~500 dry bulk vessels under charter at any one time), meaning Cargill can influence broader industry behavior by changing its leasing preferences.  Moreover, this announcement allows Cargill to not only help the planet by reducing emissions but also helps Cargill’s customers hit their own sustainability targets. As a result of the announcement, ship owners are facing increasing pressure from charters who are looking to make their supply chains greener, with Huntsman Chemical and Chinese oil trader Unipec announcing that they do not want their goods shipped on F- and G-rated ships (least efficient vessels) 
While ship owners have a long time to comply with regulatory emissions standards (especially for sulphur emissions), customer preferences are changing much quicker. Ship owners must stay in front of these shifts in customer demand if they want to remain relevant in the future.
Caroline – Thanks for the article. Vail Resorts is a great example of a company that has led the ski resort industry in terms of sustainability investments. The primary criticism of Vail, however, has been that, unlike Aspen, Vail has not been a vocal advocate for broader policy solutions. Rather, Vail has focused its efforts on reducing its own environmental impact via practical, on-the-ground initiatives to reduced resource consumption. Some argue that this ‘soft-spoken approach’ to climate change and the company’s role in fighting it means Vail isn’t doing enough, especially given Vail’s scale and heft within the industry. 
Aspen, on the other hand, has actively sought to align its brand with environmental activism, consciousness, and education. Whether via its avid support for the Protect Our Winters campaign (Aspen’s VP of Sustainability is the Board Chairman), partnership with Business for Innovative Climate & Energy Policy, or lobbying efforts in Washing D.C., Aspen has been at the forefront of the public discussion on sustainability and climate change. 
In fact, these differing approaches to addressing public awareness for climate change have created tension between Aspen and Vail. In particular, during the 2012 ski season, Vail ran an advertisement in the New York Times with the headline “The climate has changed,” featuring shots of skiers and snowboarders enjoying deep powder at Vail’s various resorts. Aspen, reacting to the advertisement, noted that “I’m not sure why they’d do that. I think it’s mocking the conversation [on climate change].”  It’s clear that for that advertisement, Vail’s sustainability mission was superseded by a profit motivation decision and desire to drive skiers to the resort (by using a parody of the public’s climate change concerns).
Why do you think Vail has deliberately chosen this ‘soft-spoken approach’ and hasn’t done more public advocacy? Is Aspen only able to take a stand on environmental activism, consciousness, and education given that it’s a family-owned business?
Anthony – Thanks for the article. It’s interesting that often only after facing a crisis is a company sufficiently motivated to focus on sustainability. Coca Cola’s CEO Muhtar Kent, for example, attributes the company’s sustainability efforts to a particular experience in India, which Muhtar Kent refers to as Coca Cola’s ‘water wakeup call.’ Twelve years ago, Coca-Cola’s Indian operations faced public outcry for misusing water during a national drought.  While the company was cleared of any legal wrongdoing, the accusations resulted in various plant closures and damage to Coca-Cola’s reputation.  Following that experience, Coca-Cola made water sustainability a key business priority and in 2007 committed to replenishing all the water the company used. More often than not, companies can point to a particular experience that acted as their ‘sustainability wakeup call’ where management realized that sustainability efforts and corporate profitability are not separable goals.
To your question of to whom is Coca-Cola’s ultimate obligation, I would argue that the ultimate obligation will always be to shareholders. At the same time, however, I would argue that Coca-Cola’s sustainability investments and donations ARE in the best interest of shareholders. Companies (as stewards of shareholder capital) are beginning to recognize that thoughtful management of environmental, social, and governance (“ESG”) issues is smart business and is essential to long-term success in a rapidly changing world. Only by carefully managing ESG risks and opportunities can a business be well situated in an uncertain future given diminishing resources, changing consumer demands, and increased regulation. I only hope that for those companies that have not yet experienced their ‘wakeup call,’ it isn’t too late.