The business of Climate Week NYC: a CEO’s diary

Friday 27th September

As menacing category-four storm Hurricane Helene wreaks havoc in Florida, a stark and solemn warning blows in to remind us of what’s to come if we don’t act on climate, now. While the storm surge gathers pace on the east coast, Climate Week NYC is winding down for this year but it’s rallying cry still rings clear.

Getting down to business

The melting pot of political players, policymakers, business leaders and climate organisations that is Climate Week NYC creates fertile ground for meaningful discussion and valuable insights, demonstrating the power of collaboration around a shared goal. The groundwork has been laid but, as the theme of this year’s event emphasised: we need action and business must play its part.

It’s time to look forward and apply lessons learned to accelerate decarbonisation commitments and rewiring business to become ready for our net-positive future.

The good news is that some corporates are already breaking the ground, proving the possibilities and optimising the opportunities that sustainability brings to markets. Better yet, there are approaches and practical steps that all organisations can take to progress in their sustainability journey and start realising benefits, while building resilience for the longer term.

1. The critical role of financial quantification in the business of sustainability

“We know that progress requires actionable transition plans: plans that financially quantify climate-related risks and opportunities to provide a shared language and insights that unify the sustainability and business strategies, and speak directly to the Board. Understanding and demonstrating the connections between implementing sustainability and financial value is key to making the business case.” Dr Andrew Coburn, CEO at Risilience

As the official Finance Partner for Climate Week NYC, we champion the critical role of financial quantification in the transition to net positive. Understanding and demonstrating the connections between implementing sustainability and financial value is key to making the business case. According to the World Economic Forum, there is $10.1 trillion of global value to business from adopting a nature-positive strategy. The impact of sustainability on corporate strategy is value creation.

2. Business as usual is changing

“I think that there’s an opportunity for political will on behalf of government, and ingenuity and the entrepreneurship and the capital of the private sector. We have the makings for a perfect positive storm.” Lori Kerr, CEO at FinDev Canada

Global organisations are under increasing regulatory pressure to demonstrate environmental stewardship and integrate climate-and-nature-related risks and opportunities into financial reporting. Business as usual is changing as companies face new expectations from investors and consumers to demonstrate a genuine commitment to prioritise sustainable practices across their operations and supply chains.

Businesses can no longer operate with impunity. Increasingly, companies are required to look beyond just profit and consider the consequences of their actions for people and the planet. Leading firms are now establishing new standards, which will become the benchmark from which all organisations will be held accountable – giving them the social licence to operate as a business of the future. Businesses that don’t recalibrate will be left behind.

3. Climate action is not about sacrifice; it is about opportunity

“There are some really good signals coming where they do have a climate-based approach. On average, their revenues grow more quickly, they have stronger margins, and particularly where it’s around product innovation that is climate friendly, nature based,” Will Jackson-Moore, Global Sustainability Leader at PwC

The change in the global business landscape also brings opportunity to advance the sustainability agenda internally and make a compelling business case for action. More CEOs are leading the charge: nearly a third, 30 per cent, of global CEOs say that climate change will drive the way their companies create, deliver and capture value to a large or very large extent over the next three years, up from 22 per cent who said it drove company actions in the past five years, according to PwC’s 27th Global CEO Survey.

Managing sustainability-related risks means building a resilient supply chain that can reduce costs of business and enhance long-term profitability. It means access to new streams of capital and, in an era when the consequences of climate-and-nature risk are increasingly visible to and experienced by communities and consumers across the world, the opportunity to protect, enhance and grow brand and business value.

4. Sustainability as a business imperative – unifying the sustainability and business strategy

“Trying to bring more visibility, transfer, traceability, setting the responsible sourcing policies. So for us, this is a very, very close partnership with different teams across the business, so that we’re approaching it as a business imperative and not as a sustainability initiative,” Ezgi Barcenas, CSO at L’Oréal.

Sustainability should not be approached as an add-on initiative to the business. In fact, organisations that integrate sustainability into the business strategy, providing a critical lens for all decision-making, will begin the transformative process towards profitable sustainability. These companies will be best positioned to mitigate against transition risks and optimise commercial opportunities emerging from the net-positive economy.

5. The power of innovation and technology in the transition to net positive

“We know that clean technology is going to play a critical role in the race to decarbonise, but we’ve got this puzzle about how we get the seeds of innovation to be adequately backed by finance and encouraged by legislation, and create that circle,” Helen Clarkson, CEO Climate Group at Hub Live

Technologies that have passed the ‘green discount’ stage and are now cheaper than the traditional alternatives are making a significant difference in the areas they are deployed.

But the tech landscape is a mixed bag with financiers expressing confidence that the capital is available to fund entrepreneurialism in climate tech but, in the same breath, warn losses will be part of the picture in the rush for bankable technology. While there is much focus on the potential of AI, there are also concerns and no one technology provides a silver bullet. Tech does and will continue to play a part in decarbonisation but it is only one part of the solution.

Driving better business results

While the transition to net zero and nature positive brings challenges, business leaders are increasingly seeing the value of sustainability; in a recent IBM study 75 per cent of executives agree sustainability drives better business results.

It really is time to get ahead in the race to decarbonise, integrate financial and transition planning, unify sustainability and business strategies and prepare to thrive in the net-zero economy.

As Helen Clarkson, CEO of Climate Group, said at the Opening Ceremony for Climate Week NYC: “What we’ve achieved in the last decade is remarkable, but we cannot stop here. We must aim higher, be bolder, and keep pushing forward. How the future will judge us depends on the action we take right now, it’s time.”

 

• To learn more about how Risilience can support your organisation’s sustainability journey to net positive, get in touch: contact@risilience.com.

 

 

Thursday 26th September

“It’s a tough issue for a lot of businesses and investors to engage in. There’s a lack of data and, in many cases, the best practice is still being thrashed out,” said Simon Mundy, the FT Moral Money Editor, setting a realistic tone to the discussion of the role of business and investors in protecting natural capital, part of the FT Live sessions for Climate Week NYC.

The business of sustainability must be attended to. While there are increasing examples of companies making impressive progress in decoupling carbon emissions from growth, the transition required to oversee a strategic approach to becoming profitably sustainable, requiring both capital investment and institutional change, is truly challenging.

Business as usual is changing

But business as usual is changing with outside forces at play. Pressure to balance the commercial value of the organisation with nature, climate and people is coming from global regulation, investor expectations and consumer demand, all driving corporates to demonstrate a genuine commitment to reducing their environmental footprint and prioritise sustainable practices across their operations and supply chains.

The call for strong leadership to drive change in the way business operates has surfaced repeatedly throughout the week. Jennifer Morris, CEO Nature Conservancy, didn’t mince her words: “I want to make sure that we don’t forget to talk about government leadership. Whether it’s at the sub-national level, at the national level, or, quite frankly, the international level, it is critical, because you’ll have some companies that will come to the table and they’ll do the right thing, but others won’t.”

Santiago Gowland, CEO of the Rainforest Alliance, talked directly to nature highlighting the problem of business practices that add to the problem of deforestation and the pressing need to accelerate the shift in how companies and markets can play an important part in reverting damage: “The Rainforest Alliance for 37 years have been working through certification, landscape and community projects, system change and integrated landscape management to reduce that harm and we realise that it is very difficult because in the business model of these agriculture companies you have built in free nature… so for companies to really change that extractive, almost colonialist business model to a different one is hard.”

Sustainability as a business imperative

The challenge is real and making change can be tough but sustainability is firmly on the business agenda. As Emiliya Mychasuk, Climate Editor at the FT put it talking to conditions that enable sustainable finance to have the greatest impact: “I just think we have to accept that as a reality and then figure out what to do. It doesn’t help to pretend this is easier than it is. That’s where we are today.”

Of course, we must face reality but it’s certainly not all bad news. We’ve heard from many business leaders at Climate Week NYC who have shared their lived experience of marrying business priorities with the global drive towards sustainability, providing practical examples of what has delivered the right results – for the environment and the bottom line. The Independent newspaper’s inaugural Climate 100 List, officially launched in New York today, celebrates business leaders, including Boris Gamazaychikov, senior manager of emissions reduction at Salesforce, Eva Zabey, CEO of Business for Nature and Lisa Jackson, VP of environment, policy and social initiatives at Apple, among climate activists, innovators, scientists, policymakers and entrepreneurs from around the world. Business can make a difference.

Approaching sustainability as a must-do rather than a nice-to-have is critical and effective. Interviewed today by CNBC at the UNGA Salesforce event at NYC Tower, I spoke of the benefits to organisations that unify their business and sustainability strategies. And I am not a lone voice in this debate; Ezgi Barcenas, CSO at the global beauty brand, L’Oréal, called out sustainability as a business imperative, saying her approach was to ‘multi solve’ for the company: “I think this is exactly how we should be approaching it,because if you don’t think of it as supply security and business resilience, then you’re only solving for one thing and maybe leaving other pieces behind. We are trying to multi solve, not only for climate but nature and social equity as well.”

Becoming profitably sustainable

When a company gets it right the results are impressive. Karen Pflug, CSO Ingka Group, IKEA, a company that is reducing emissions and growing, made the case for taking the long view. “When you initially look at something, switching out a raw material for something that’s either recycled or renewable, it can look like it doesn’t make financial business sense. So, it’s how do we work together with the design development teams and the whole supply chain? We are large enough that we can use our size for a force for good and switch whole supply chains to be more circular and more renewable and so on. So that’s something that when you do the maths initially on just pure numbers… we don’t want to raise the prices, we want to keep our sustainable products a lower price. So then you take a margin hit but, if you look at it longer term, you reduce waste, you drive efficiencies, you smooth out production challenges… so I think, in the end, you actually will make more money.”

There may be more thrashing out of ideas and best practice to come but while the challenges are real, the business opportunities presented by sustainability are ripe for the picking.

 

 

Wednesday 25th September

Is technology a blessing or a curse? No doubt a critical enabler in addressing the climate crisis but navigating the possibilities of our digital landscape requires leadership, courage, collaboration and caution.

Tech brings risk and opportunity

‘Unleashing the power of innovation and technology to thwart the climate crisis’ is the promising focus of today’s final Hub Live flagship session. Jaclyn Whittal, storm chaser, climate-change journalist and meteorologist at The Weather Channel, kick-started discussion by laying out the stakes: “Clean technology innovation and bold leadership are poised to play a critical role in the race to decarbonise. But the real tests lies ahead. It’s not just about setting policies or creating new technologies, it’s about making them work at scale in every corner of the world and ensuring that this green transition is as equitable as it is effective. The challenge is enormous but so is the opportunity.”

Many companies are relying on tech to complete their decarbonisation goals but chickens cannot be counted before they hatch. Trials and tribulations of implementing well-proven technology, such as PVs and windfarms, are well documented, and horizon scanning on hydrogen technologies and battery breakthroughs is ongoing. Some of the challenges of using existing tech include the mundane but frustrating processes of securing permits, approving land zoning and the practicalities of land availability for renewables. Who knew the local Fire Departments approval is required to install an EV charging station in the US?

Gold rush for bankable technologies

The good news is that several technologies have now passed the ‘green discount’ stage – they are cheaper than the traditional alternative, including rooftop PVs, electric scooters and solar cookers. Affordability means these products are attracting fast uptake in many countries around the world. Steve Capanna, Director of Technology Policy at the US Dept of Energy brought both pragmatism and optimism to the discussion: “People want cleaner, cheaper, better products and services. It’s available via these technologies. And, as an investor, you can get behind these companies, do tremendously well and really achieve profit with purpose.”

But there are two sides to this story. Other technologies are barely getting started and some require big R&D investment before they can be scaleable. There are thousands of carbon-capture start-ups but only a few are likely to attract the investment and take-up to make their offer affordable.

The allure of what technology could deliver for climate action is real and talk turned to progress in finance, market building and creating a ‘multiplier effect’. Government funding is partnering with private-sector funding to seed experiments in emission-reduction tech; the US IRA ensures that, for every $1 of government funds, $6 comes from the private sector. But the outlook from financiers is a mixed bag; they are confident that the capital is available to fund entrepreneurialism in climate tech but warn losses will be plentiful in the new gold-rush for bankable technologies.

AI is coming, ready or not

While AI evangelists have faith in the technology’s ability to crack the climate crisis, no-one is unveiling great breakthroughs yet. Perhaps AI-improved load-balancing algorithms are helpful in making power grids more efficient but we don’t yet see AI solving key challenges like nuclear fusion in the way that expectations have risen around AI helping with, for example, new drug discoveries. The killer AI app for climate remains elusive.

Charging ahead

Battery technology is developing fast. Some of the key assumptions and constraints that hinder land freight distribution logistics may soon need to be rethought, with last-mile and middle-mile solutions becoming increasingly affordable and practical. But no one has yet found the holy grail of an electric Class 8 tractor-trailer truck with a 30-minute recharge time. That is a blessing yet to come.

Tuesday 24th September

They say: ‘People in glass houses should not throw stones’, an expression everyone needed to be mindful of today as Climate Week NYC gathered business leaders and government officials in The Glasshouse for its Hub Live event. And I’m happy to confirm that no stones were cast, rather a meeting of minds and desire for collaboration was evident as leading corporations took the floor to showcase the work they are doing in implementing their plans – echoing the theme of it’s time.

When a plan comes together

ABC Meteorologist Ginger Zee kicked things off as host, empathising with the audience in her opening remarks: “Everyone who’s going to speak today has their own natural disasters. They are big corporations, they have a business to run”, quickly following up, adding: ‘But it is time. Climate is a priority… I hope we hear more about honesty today from everyone that speaks.”

Companies like Nike, Estée Lauder, Asahi, Danone, Kraft-Heinz and Nokia were given the stage to showcase the measures that they are implementing, reeling out a long list of initiatives, ranging from switching transportation from air freight to shipping, investing in windfarms that sell energy back to the grid generating revenue for the business, electrification of operations and cracking down on efficiency drives.

These are companies that have completed their planning, aware that the clock is ticking, and are putting into practice the strategies they have been preparing for the past several years. The list of initiatives is impressive but trying to find common patterns across them to define best practices with a standardised playbook for the next wave of companies is yet to emerge.

“What we’ve really tried to do in the company is create a climate-aware muscle”, explained Estée Lauder CSO Nancy Mahon, evoking a strong, action-led approach within the operations of the beauty giant. But, as we know, the road isn’t easy, as she added: “A friend of mine said that what we’re trying to do is work our way out of a job. I guess, fortunately or unfortunately, it keeps getting harder, so I still have the job.”

The number of European accents on the stage is noticeable, perhaps echoing where these experiments are taking place, with some notable exceptions around US innovation, technological invention and government-backed Inflation Reduction Act (IRA) funds having impact.

The tipping point

The key challenge is whether and how fast the rest of the world’s corporations will implement similar programmes to these pioneering companies. Interesting work was showcased by Professor Tim Lenton from the UK’s University of Exeter, promoting a recent report on Positive tipping cascades in power, transport and heating – thresholds of reinforcement feedback loops that help solve climate change.

Tim enthused: “It’s a cultural thing and it’s good to see that the winds of change are shifting towards reigniting that sense of ‘this is a huge opportunity to seize together’. This isn’t just for the climate… there’s a lot to seize in this, which brings us back to that word positive.”

Getting the early and late majority of companies to implement sensibly-costed transition plans could be the positive tipping cascade that the world needs.

A question of finance

Attendees are finally discussing how much to spend and justifying CapEx for decarbonisation. Convincing finance departments that the funds are worth committing is still an acknowledged problem for companies. Financing and justifying cost is a critical issue – a sentiment echoed by panellist Ambroise Fayolle, VP, European Investment Bank: “We need to do more to industrialise more and to accelerate the investments in the green transition.”

Risilience is the official Finance Partner for Climate Week NYC. Quantifying the financial consequences of climate change sets a clear baseline that helps organisations estimate the value of mitigation and adaption.

An interesting example from Kraft-Heinz is that they received a $170m grant from the US Department of Energy to apply technologies ‘not commonly used in US factories today’ like heat pumps, electric boilers and PVs at ten plants. They get the grant if they achieve reduction targets.

Let’s hope this rolling stone gathers no moss.

Monday 23rd September

“Climate action is not about sacrifice; it is about opportunity” – sage words from the Hon. Philip E Davis, Prime Minister of the Commonwealth of the Bahamas, providing the rallying call to a full-house audience at the Opening Ceremony for Climate Week NYC: Intent has been loud and clear from the start.

The business of sustainability

Business plays a critical role in advancing climate action. Many firms have spent the past few years assessing the magnitude of their financial exposure to climate change, ensuring they comply with regulations through their reporting of it and planning their decarbonisation programme. The message from Climate Week NYC is that it’s time to put these plans into action.

Among the business representatives at the Opening Ceremony, Global Sustainability Leader at PwC, the Headline Partner for Climate Week, Will Jackson-Moore, cited the company’s recent survey of 700 CEOs, highlighting that only a third of the survey cohort saw climate as a business issue.

Stressing the importance of acknowledging sustainability at board level, Jackson-Moore spoke to business opportunity, setting out the need to balance the short-term costs of decarbonisation with longer-term rewards, giving examples of simple cost-reduction energy efficiency gains that could save 30 per cent of energy consumption by 2023. He also urged business leaders to see regulation, including CSRD and ISSB, as an opportunity to add business value rather than a compliance task.

Highlighting the importance of weaving sustainability and corporate strategies together, he spoke of ‘sustainable corporate strategy’. This chimes strongly with my message for business during Climate Week NYC, where Risilience is the official Finance Partner; I will be talking to unifying sustainability and business strategies for commercial success, the importance of financial quantification across reporting and transition planning, and how to make your business profitably sustainable in the net-positive economy.

Policy as a motivator for change

Discussion of the business of sustainability was followed by government policymakers from Norway and Ireland who were adamant that carbon taxation motivates and incentivises corporations to decarbonise, while raising a useful contribution to the treasury. Espen Barth Eide, Minister of Foreign Affairs of Norway, made a call for carbon taxation in the United States – a sentiment that was met with stony silence.

The climate-nature nexus

“Climate and nature are interlinked. You can’t solve for one and leave the other behind,” said Ezgi Barcenas, Chief Corporate Responsibility Officer at L’Oréal. There was much made of the interconnection between climate and nature, with water resources being a key nexus between them. Nature-based solutions are integral to sequestration and biomass production, for example, that are essential to decarbonisation initiatives. In short, we cannot address climate without nature; solve both or solve neither. This challenge brings complexity. Rewiring an organisation to address the interrelated nature of sustainability is no easy task, and requires a new approach that unifies teams and data; risks and opportunities; and the corresponding financial impacts into a single, connected view, that I call Sustainability Intelligence.

It’s time, now

“We must aim higher, be bolder, and keep pushing forward. How the future will judge us depends on the action we take right now,” said Climate Group CEO Helen Clarkson. The Opening Ceremony offered much to think about but called for action. The theme for this year’s Climate Week NYC, ‘It’s Time’, is underpinned by five principles: put people first, pay up, listen to citizens, be honest with ourselves and have the difficult discussions about fossil fuels. The clarion call is crystal clear and business must play a part; it’s time to make profitable sustainability business as usual.

Countdown to Climate Week NYC

The start of Climate Week NYC is fast approaching and the eyes of the global climate community will be on the city that never sleeps as it prepares to host one of the biggest climate events in the world to address one of the defining challenges of our time.

Calling for all organisations to make sustainability their business, Climate Week NYC brings together global dignitaries, heads of government and business leaders for a week of discussions, debates and decisions that have the power to move the dial, meaningfully.

As the official Finance Partner for Climate Week NYC, working alongside Climate Group, Risilience will be hosting and contributing to a number of events to talk to the critical role of financial quantification in the business of sustainability. There is no doubt in my mind that, for business, fiscally-responsible decision-making means understanding and financially quantifying the risks and opportunities presented by sustainability, in order that a company can make a robust and actionable transition plan. And it is only by unifying the sustainability and business strategies that an organisation can grow to become profitably sustainable.

There is much ground to cover. My week will start at the Opening Ceremony, on Sunday 22nd September, which will see world-leaders share their global outlook on advancing progress, officially kick-starting a week of over 600 events across the City of New York. These include our own executive events that bring focus to the critical role of financial quantification in the business transition to profitable sustainability.

I look forward to being at the centre of this all-important activity, following breaking business news in real-time and reporting on the ground. If you would like the business-of-sustainability analysis as it happens, I will be writing the Business of Climate Week NYC: a CEO’s diary that will start on Monday 23rd September, and publish here on the Risilience website. Sign up and have it delivered hot-off-the-press to your inbox daily. If you are at Climate Week NYC, do get in touch. It’s time to act on climate, together.