Oliver Balch talks to the former McKinsey executive and co-founder of Systemiq about his big tent approach to building coalitions to tackle the world’s most pressing sustainability challenges
Aged 56 and at the top of his profession, Jeremy Oppenheim could be forgiven for slipping into coasting mode. Not a bit of it. Together with former McKinsey Consulting colleague Martin Stuchtey he is the driving force behind one of the most exciting recent entrants in the sustainability field.
In less than three years, Systemiq has built up wide-ranging portfolio together with a team of around 85 professionals, dotted between London, Jakarta and Munich. Among other activities, the firm is involved in spearheading five ambitious global coalitions, advising a hatful of big-hitting corporate and government clients, and investing in some early-stage clean-tech ventures.
Today, there is a need for a really big dose of structural transformation
So what’s his story? Simple, says Oppenheim, who is speaking to Ethical Corporation from his office in central London: the economy needs a full-scale systems’ change if we are to reverse the existential threats facing the planet – and he wants to roll up his sleeves and get involved.
“I used to be of the persuasion that a sensible model of well-managed market economic development could get us to where we need to get to,” he says. “Now, I don't think we can get there with an evolutionary model, [with] a bit of good policy here and a bit more markets there . . . Today, there is a need for a really big dose of structural transformation.”
Just over a decade ago, Oppenheim set up a sustainability advisory team at McKinsey (known as the Sustainability and Resource Productivity Practice).Yet he cites 2013/2014 as a critical year, when he stepped outside McKinsey, his employer for 23 years, to lead a high-profile research project called the New Climate Economy.
The project was the flagship initiative of the Global Commission on the Economy and Climate, a network of very senior academics, business people and ex-government ministers. Its aim was to identify practical actions and policy options that could maximise the opportunities associated with climate change while at the same time lowering the risks, Oppenheim explains.
The process helped confirm his existing hunch: that tweaking the system would not go far enough.
That left him in a dilemma. What next? As innovative as it may claim its solutions to be, McKinsey is not in the business of seriously rocking the boat. As with all the mega consultancy firms, its bread-and-butter revolves around keeping the existing system on track. Together with Stuchtey, an expert in circular economy models and water management, Oppenheim decided it was time to go it alone.
Few have the strategic vision, the business nous nor the contacts book of high-fliers. Oppenheim does
This was late 2015/early 2016. The Paris Agreement on climate change had just been signed. The recently launched Sustainable Development Goals, with their 2030 targets, were galvanising global interest. For a brief moment in time, it felt like the world was willing to “step up and be counted” on the big issues of the day.
But what exactly is Systemiq’s plan? As awareness grows of the array of systemic threat facing the planet, the desire to drive change is increasingly common. The difference is that few of us have the strategic vision to see what needs to be done, nor the business and management nous to act. Nor, to be frank, do many of us have a contacts book full of high net-worth individuals, high-flying policy wonks and senior officials.
Oppenheim does. And he plans to use this rich combination of assets – and those of his growing band of colleagues at B-Corp-certified Systemiq – to disrupt three specific sectors or, better, systems where the rubber hits the road in sustainability terms: land use, materials and energy.
If we try feeding the billions of extra mouths in the coming decades using today’s farming methods, it will spell a planet of exhausted soils and denuded forests. Continue with our take-make-dispose approach to materials or our reliance on fossil fuels for energy, on the other hand, and similar apocalyptic scenarios will be upon us before we know it.
Oppenheim is savvy enough to know that acting the prophet of doom is unlikely to kickstart change, which is why Systemiq always balances its discourse of risks with the more market-friendly language of opportunity.
Better waste management systems could yield $100bn of value from single-use plastics, he cites. Sustainable food and land use business models represent a $2.3tn economic opportunity (plus 80 million new jobs). Shift to a genuinely low-carbon energy system and there’s a $4.3tn windfall in the making.
We've got to make it a big a tent as possible, but without diluting the essential propositions
“The narrative at the heart of what we do is to describe the opportunity that would come from driving a deep change in the economic system and what that could deliver in terms of economic upside and jobs and better social outcomes, and so on.”
Systemiq’s three-pronged focus doesn’t touch the full gamut of systems by any means, but it’s a start – and an ambitious one at that, as the firm’s stated “mission” makes plain: “Systemiq’s singular purpose is to demonstrate that a low-carbon, regenerative and socially just economy can out-compete today’s highly polluting, unequal systems – and this system change is possible at speed and scale over the next decade.”
Again, the key question is how?. How to show such an economy is possible? And, more importantly, how to actually make it happen in the time available?
Here, Oppenheim’s answer is again framed around three main themes. The first is the notion of working though coalitions. No one can change a system alone, he says. It needs everyone in the room, from the big players through to its impassioned upstarts.
Systemiq is currently involved in five major co-operative alliances, including the Food and Land Use Coalition and the Energy Transitions Commission. All have senior policy makers involved, as well as leaders from civil society and from business.
“We've got to make it a big a tent as possible, but without diluting the essential propositions,” he says.
There’s a recognition that our current economic models are just not fit for future purpose
Oppenheim is not a big fan of spending too much time “polishing” problems. Far better, he says, to establish the end point, determine some sensible pathways to get there, and then clarify the steps required to realise these.
“We ask what it would look like in 2050. But then what we can do is bring that back to 2030, and [inquire] what does that mean in terms of practical policies that could get you taking the first steps in 2020.”
Asked if the world might already have enough sustainability-oriented coalitions, Oppenheim says the more the merrier – as long as they are action-oriented and outcome-focused. What the world certainly doesn’t need, he agrees, is more talking shops.
Were there to be 15 or 20 different coalitions on specific topics springing up over the next two or three years, it would not surprise him, he says: “We are at a point where there’s a recognition that our current economic models are just not fit for future purpose. This, I think, is what is prompting this kind of growth industry in coalitions.”
The second main string to Systemiq’s bow is advisory services. In the spirit of the big tent, the firm has chosen an even spread between government, business and voluntary sector clients. That said, organisations with a half-hearted commitment to systems change can look elsewhere, Oppenheim says.
Client confidentiality leaves him shy about mentioning specific clients, but Oppenheim does divulge that Systemiq is working with leading chocolate brands around the sustainability of global cocoa production.
It's not enough to do high-level strategy and live in the 2030 space. You've got to bring that down to ground
“It's not enough to do high-level strategy and live in the 2030 space,” Oppenheim says. “You've got to bring that down to ground and translate it into products and services and business models that can be fed into channels over the next 12 or 24 months. These companies actually have to do that work.”
Another major piece of work involves a crop nutrition (read: fertiliser) company. Here, it is Oppenheim’s willingness to think afresh about how an established system could work differently that comes to the fore.
In an industry that has profited for decades on a system that encourages farmers to pile fertiliser high and sod the environmental consequences, Systemiq’s co-founder is working with his client to lobby governments for a reduction in chemical inputs.
“When you think about it, here is a company that is willing to do the ultimate thing: to make the case that less is more . . . With this, we're onto something, right?”
The third arm to Systemiq’s change-making strategy is the company’s own investments. Its portfolio remains small, with just four deals to date. One involves blockchain and another centres around artificial intelligence, illustrating Systemiq’s general preference towards tech-based ventures.
Oppenheim is hoping to complete a new financing round presently, which, if successful, will add $10-15m to the firm’s pot. This is in addition to an initial £20m raised from private investors.
Let’s not kid ourselves: 95% of the actors out there would probably rather see change more incrementally
When it comes to investing, Oppenheim admits that he and his colleagues are feeling their way a little. But he sees it as an essential element of his firm’s future offering. This is not just because of the capital that it directs towards change-makers in the market, or because it appeals to Systemiq’s associates, particularly those in the millennial demographic.
Of equal importance, in his view, is what they can learn from dipping their toes into the investment game. It’s not until you actually “get your hands dirty” and “put some money in” that you really begin to understand what adds value and what generates scale – and what does not.
“That we should be willing to commit some capital to try things out and to learn through our mistakes . . . is essential to their sense of how Systemiq can make a difference,” he states.
If time allowed, Oppenheim could wax lyrical about Systemiq’s other strands of work; notably, its commitment to incubate high-potential projects and enterprises, plus its advice to large-scale capital investors on sustainable infrastructure projects.
But he is a busy man. Systemiq’s co-founder has systems to overhaul and a world to change. Organisations of all types are desperate for high-quality advice and support on how to drive deep system change, he says.
Even so, Oppenheim acknowledges that the battle for systems change is only just beginning. “Let’s not kid ourselves: 95% of the actors out there would probably rather see change more incrementally.”
The closer the prospect of transformational change comes, the stronger the resistance
Moreover, the closer the prospect of transformational change comes, the stronger the resistance. He calls this the “whiplash effect”, whereby enlightened consumers, investors and policymakers are pushing in one direction and the regressive incumbents are putting on the brakes.
Still, he is confident that momentum is swinging in favour of him and his “fellow travellers”. “There are enough people out there who have real positions on influence and leadership . . . to get underneath and unpick this thing called system change.”
CV: Jeremy Oppenheim
Systemiq, founding partner
McKinsey, senior partner (Sustainability and Resource Productivity Practice)
1993 – 2015
World Bank, senior economist
1988 – 1993
Masters in Public Administration, Kennedy School of Government, Harvard University
Law & Economics, Cambridge University
1981 – 84