Business View: Why not pay them not to pump their oil?

Here's an idea. There are billions of barrels of oil left in the ground, much of it belonging to the world's poorer countries. And money from rich countries is pouring into carbon-offsetting projects, many of them of questionable science. So why not just pay countries to keep their oil in the ground and avoid the emissions in the first place?

This is what Rafael Correa, the leftist President of Ecuador, is proposing (bear with me on this one). Beneath the pristine rainforest of the Yasuni National Park lie almost one billion barrels of oil, representing around a quarter of the country's reserves. If exploited, they would generate some $700m (£350m) in much-needed cash for the government's social programmes. But Mr Correa won last year's election promising to be green. So he has come up with a novel, if untested, solution to this conundrum: he wants someone - he hasn't made clear who - to pay the government $350m each year not to start drilling in the national park.

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It's not as crazy as it sounds. Some of the world's oil-producing countries don't take too kindly to those in the West who, having exhausted most of their own oil reserves, castigate them for wanting to do the same.

I was at the Russian annual oil and gas conference in Moscow last year on the day the Stern review of climate change was published. The secretary-general of Opec did not hide his contempt for its conclusions, calling the report "misguided" with "no foundations in either science or economics".

You can hardly blame him. It's not as if the world, even if it really wants to, will stop using oil any time soon. But it's in the interests of Opec and other oil-producing nations to make sure this day is put off as long as possible. And oil revenues don't just go towards kitting out sheikhs with the latest Mercedes. Poorer countries like Ecuador depend on them to improve living standards.

Which brings us back to Mr Correa's dilemma. Can he justify not exploiting the country's oil just to be green? Not really. And he shouldn't have to.

This is where Western businesses come in. Many carbon- offsetting companies are getting pasted for investing in projects that don't actually reduce emissions. Later this month, Channel 4's Dispatches programme is expected to look at a project in Honduras to provide fuel-efficient stoves. This is being funded by Climate Care, a reputable offsetting firm that is used by Conservative leader David Cameron. But the carbon savings from many such schemes are hard to quantify and expensive to audit.

It doesn't have to be this complicated. Why not just pay countries like Ecuador not to pump the oil, the root cause of most of the pollution, in the first place? "Barrels of oil in the ground credits" could become the new carbon credits.

Obviously, this would have to be monitored to make sure the oil stayed put as promised. But surely it's not beyond the wit of the world's statesmen - and entrepreneurs - to come up with a workable scheme, particularly if there's money to be made. This has got to be far easier than cooking stoves in Honduras.

Volvo in the ejector seat

Ford should give up trying to play poker. It has a terrible hand - it lost $17bn last year - but still insists on being inscrutable.

Ford has not publicly admitted that it has appointed Morgan Stanley, HSBC and Goldman Sachs to review its options at Jaguar Land Rover (in other words, sell the British subsidiary), even though everyone knows this is the case. It has already sold Aston Martin, and Jaguar Land Rover is also heading for the exit in a bid to save the rump of the business in the US.

The chief of Volvo, Ford's other remaining European business - the "jewel in the crown", as one analyst put it - was asked last week if the Swedish car company had a future with the US giant. He said: "You should ask Ford about that; I am not dealing with hypothesis." That sounds like Ford-speak for, "we've hoisted the for-sale sign".

Bosses open their hearts

Now I don't want to get touchy-feely here, but some of Britain's most important businessmen talked about something last week that can't be measured on a spreadsheet or given a per-share value - their personal lives. Before you reach for the sick bucket, it made for fascinating reading, showing that personal relationships are relevant to business.

Jon Moulton, head of private equity outfit Alchemy, said that when he was looking at making an investment, "I take a lot of interest in the chief executive's marital status." He added that one divorce was slightly better than none because that made managers more motivated, especially if they needed to rebuild their wealth. "Two is more worrying and three is a catastrophe," Mr Moulton continued. He doesn't usually make investments for those in the latter camp.

Other chief executives, like Standard Life boss Sandy Crombie and WPP chief executive Sir Martin Sorrell, also offered some rare and candid personal insights.

The rewards for chief executives have never been higher - but nor have the personal costs of being expected to be on duty 24/7, Blackberry at the ready. One (anonymous) FTSE 100 chief executive asked whether it was possible to fulfil his promises to his shareholders - and to his family.

Andrew Murray-Watson is away