CEOs from the biggest US companies were at the glitzy Global Climate Action Summit in San Francisco pledging 'bigger and better' action to cut their CO2 emissions. Terry Slavin asks whether it marked a turning point for Wall Street
When Interface CEO Jay Gould took to the main stage at the Global Climate Action Summit earlier this month to talk about stepping up his company’s Climate Take Back strategy, he had more than just one tough act to follow.
The Atlanta commercial flooring company is feted globally for its visionary plan to reverse its climate impact with innovations such as carpet tiles that sequester CO2 and production processes that mimic nature. But Gould was one of the very last speakers in a glitzy two-day event that ran wildly over time and had seen a parade of CEOs and senior executives from Salesforce, Kaiser Permanente, Starbucks, the IKEA Group, the Mahindra Group, McDonald’s and others seemingly try to outdo each other with bigger and bolder climate commitments.
And they were just the tip of the melting iceberg. Many of the CEOs who were showcasing their companies’ efforts to cut CO2 emissions to the 4,000-strong audience were also announcing new coalitions to spearhead joint action.
Marc Benioff of Salesforce (pictured) who announced the company’s energy would be 100% renewable by 2022 amid a raft of ambitious climate targets, also introduced the Step Up Declaration, “a new alliance dedicated to harnessing the power of emerging technologies and the fourth industrial revolution to help reduce greenhouse gas emissions across all economic sectors ... by 2020”.
The declaration is signed by 21 companies, including HP, Autodesk, Bloomberg, Uber, Lyft, WeWork and BT, which will work with Christiana Figueres’s Mission 2020 group dedicated to urgent climate action.
Meanwhile, Anand Mahindra, the event’s co-chairman, said that every company in the $19bn Indian industrial conglomerate he chairs has signed up to the Science-Based Targets (SBT) initiative, and will be carbon-neutral by 2040.
He also reported that the tally of companies that have joined SBT now stands at 488, representing $10trn in market capitalization, a 39% increase in the past year.
Dalmia's carbon reduction strategy had already paid dividends, notching up 30% higher profits than its competitors in India
With the cement sector generating more emissions than Japan or Canada, India’s Dalmia Cement Group is an important signatory, and its CEO Mahendra Singhi appeared at a few GCAS events.
He told a side-event by the We Mean Business Coalition and Harvard Business Review that Dalmia was the first company to sign up to both the RE100 and EP100 initiatives, committing to go 100% renewable and double its energy productivity by a target date of 2030. The company’s carbon reduction strategy had already paid dividends, he said, with Dalmia notching up 30% higher profits than its competitors in India.
Singhi foreshadowed Interface's Jay Gould when he said he was confident Dalmia could be carbon-negative by 2040, with the help of innovations such as carbon capture and storage and greener cement.
Other companies to join RE100 during GCAS included Sony, McKinsey & Co, WeWork, and the Royal Bank of Scotland.
Ride-sharing company Lyft is not a member of RE100, but at GCAS it announced plans to purchase enough renewable energy to offset all its operations – not only its rides – and that it would source clean energy directly from local utility partners where possible and buy renewable energy credits to cover the rest.
McDonald’s was also on a couple of different panels, talking about its recently set Science-Based Target to lower greenhouse-gas emissions 36% below 2015 levels by 2030, and programme to integrate sustainably sourced beef into its supply chain. Given that the company’s 37,000 restaurants have a carbon footprint nearly as big as Belgium, that adds up to a substantial deal.
A dozen companies signed up to the Net Zero Carbon Buildings Commitment, launched at GCAS, while the number of multinational companies that have set targets for converting their fleets to zero-emission vehicles reached 23. This list includes IKEA Group, whose CEO Jesper Brodin announced that the Swedish big box retailer plans to use EVs for 100% of its home deliveries in six cities, including London, by 2020, and across the world by 2030.
Climate is a big space this year. There are a lot of political moments
Starbucks CEO Kevin Johnson spoke on the first day, announcing the company’s newly minted Green Stores Framework to create 10,000 more sustainable stores, both new and refurbished, around the globe by 2025.
Starbucks’ new initiative, which will see reductions in water and energy usage as well as programmes to tackle food waste, will eventually be rolled out to all its properties. It is being developed with the help of experts including SCS Global Services and World Wildlife Fund.
“We have the aspiration to be the number one company in the world to be sustainable, from working with farmers all the way through our supply chain to our end product,” Johnson declared.
There were also new supply chain initiatives from both Mars Inc and Walmart, both prominent in the boisterous We Are Still In coalition delegation to the Bonn climate conference last year, when Brown announced that he would host this month’s summit to highlight action by non-actors, both in the US and around the globe, in fighting climate change.
Kathleen McLaughlin, chief sustainability officer for Walmart, announced a new platform in its Project Gigaton climate strategy to help its suppliers to reduce the risk of contributing to deforestation.
Meanwhile, Mars and Coca-Cola North America were on a panel as two of the three first signatories to a new Climate-Resilient Value Chains Leaders Platform, hosted by the corporate sustainability nonprofit BSR.
David Wei, climate director at BSR, said in an interview that Kellogg's is the other signatory to the platform, which seeks to bring a Science-Based Targets methodology to addressing climate risks in supply chains, though it was not present at GCAS. He said not all the US companies that are active on climate issues made it to San Francisco:
“Climate is a big space this year. There are a lot of political moments. Some have saved their powder for [the UN climate conference in Warsaw], and others for Climate Week”, which is now under way in New York.
Every announcement was rooted in a pragmatic and careful consideration of the proven business case for sustainability
Mindy Lubber, who head up the sustainable investment alliance Ceres, observed that the We Are Still In coalition, a grouping of 3,500 from state and municipal governments, the private sector, faith communities and universities that was created after President Trump's decision to take the US out of the Paris agreement, had announced more than 300 new climate pledges at GCAS.
“Every announcement, whether from a retailer, a tech company, or a bank, was rooted in a pragmatic and careful consideration of the proven business case for sustainability,” Lubber said in a column. “They know, like we know, that limiting global warming is not radical. What’s radical is putting our children’s lives and our entire economy at risk due to our unwillingness to act on climate change.”
Ceres is one of seven partners in yet another coalition launched at GCAS called The Investor Agenda, representing nearly 400 investors with $32trn in collective assets under management. The grouping, which includes the Asia Investor Group on Climate Change, CDP, the Investor Group on Climate Change, Institutional Investors Group on Climate Change, Principles for Responsible Investment and UNEP Finance Initiative, said it will provide comprehensive guidance for investors to accelerate the required shift in capital to low-carbon opportunities, and a mechanism to track and report progress.
So what did Interface, whose founder Ray Anderson came up with the Mission Zero carbon neutrality strategy more than two decades ago (see Proof Positive that people and planet equals profit), make of the new recruits to the cause at GCAS?
Was it a turning point for corporate America? Or were marketing departments driving much of the climate leadership on display?
“I do think it went beyond posturing and flag-waving and marketing,” said Erin Meezan, Interface’s chief sustainability officer, saying the commitments she heard were “new and bigger”, not a rehash of previously announced strategies. She was also impressed by the number of new alliances and coalitions.
But she added: “I’d stop short of calling it a turning point only because the corporate vision collectively still seems focused on carbon neutral or net zero carbon – and that’s just not ambitious enough. So, I think a turning point will be the day we have many CEOs saying what ours did: we need to aim higher, go further and state our target is reversal. We’re not there yet, but [that day is] coming and I hope we’re part of pushing the corporate world closer to that.”
GCAS California Interface Salesforce climate change green finance BSR Science Based Targets We Are Still In We Mean Business RE100 EP100