One of Europe’s most visionary industrialists identifies three components needed to optimize for impact.
The topic of climate justice is a topic that requires our full attention. And I’m super excited to see the leadership from all Imagine participants and the many real examples - this is not just theory, this is real.
I am a concerned optimist. I do believe we have the solutions for a better and sustainable future. But I’m concerned because I am very convinced that we need much more action. We need a dramatic acceleration in order to convert all our intentions into the impact we need.
The latest IPCC report was very clear. Climate change is happening much faster than expected. The impacts are very severe. We’ve seen floods in Europe, we’ve seen heat waves all over the place. We now have the tornadoes in the US.
This will affect all of us. But worryingly enough the poorest on this planet will probably suffer the most. The consequence of that in terms of lives and livelihoods but also climate migration is going to be a huge challenge unless we make the impact we need.
When climate change is made by human beings, human beings can do something about the problem.
What can corporations bring to the table?
What can we do? That's easy to answer. I am involved in very large companies, chairing Siemens and Maersk. I’m also involved in technology companies - an AI company called c3ai.
For the last 150 years we have burned fossil fuels to create electricity. 80% of energy production is based on fossil fuels. But in energy we are at an inflection point like in so many other industries.
The production of one kWh is now cheaper using solar and wind at the right locations than with coal. This is important because it’s becoming good business. We can use that to transform all the other businesses as well.
How to convert shipping and airlines to green energy? It’s not likely to be with batteries.
In 2018 we made the bold commitment to make our shipping carbon neutral by 2050. Some felt that that is way too far into the future. But to do it we still need the first vessel to prove the technology by 2030. Then we need to replace 750 ships. So, it was a daunting task.
Now, only three years later, we know how to do it and we have ordered the first 8 vessels that will be able to sail carbon-neutrally in 2023. This is seven years ahead of plan.
My conclusion is very clear. If we can make shipping carbon neutral, we can make any industry carbon neutral.
The question is not if we need to do it. It is “how we get there” and “how we get there faster”. Thus, the focus of this Imagine Tomorrow is optimizing for impact.
Three components needed to optimize for impact
Change of mindset
We need to change our mindset about sustainability being a cost. Just think about how much money we spend producing oil and gas. Imagine what will happen if we were to spend that on sustainable solutions instead.
Sustainable solutions are no longer a philanthropic exercise. It’s a business opportunity. And it’s good business. 40% of Siemens’ total revenue is based on solutions that make customers more sustainable. And it’s the fastest growing part of our portfolio.
At Maersk, we have a chance to differentiate ourselves with our green cargo. We’re earning more money when we have a green product to offer and we have a much bigger demand than supply right now, meaning good business.
This is not a zero-sum game. The Stone Age didn’t end because we ran out of stones. It ended because we got better technology. Sustainability is the biggest opportunity for most companies that realize the challenge at hand.
Effective cooperation between leaders
The other thing needed - besides a change in mindset - is leadership. As leaders, we’re not always good at imagining a better future, hence this conference being so important, Imagine Tomorrow!
I think we need leadership from three different stakeholders all at the same time.
1. We need leadership from policy makers. They create the rules of the game. We need a prize on carbon accelerating the race to become carbon-free, making it good business. We need investments in public infrastructure to be carbon neutral. And, of course, we need international cooperation. No nation can solve this problem alone.
2. Business leaders are those who need to create the solutions and make the investments to get us there. We need big dreams from business leaders like the one we had at Maersk in 2018. We need innovations to reduce the cost of green solutions.
3. Finally, we need leadership from consumers as well.
Buy electric vehicles, isolate your house, eat less meat. Creating demand and accelerating the green transformation through supply and demand.
Converting negative conversations into positive
But we also need to change the conversation. The media bombard us with concerns, limitations, and failures. We need good examples; we need inspiration just like this conference has identified.
What is my advice? We have the solutions needed. We need the leadership to accelerate. That means: be ambitious. Have the courage to dream big. And get into the details in the areas that need most attention. Form partnerships so we can scale faster together, talk about the progress and share the value.
I think it’s that simple. But it’s a daunting task. So, we need more leaders to step forward.