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Written and presented by Gillian Tett, produced by Jamie Han
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What does the trendsetting CEO need today?
Once the answers were things like a flashy business strategy, MBA, fat pay cheque, golf handicap, corporate jet. Today, though, there is something else: a net-zero commitment. That sounds credible to most people, if not Greta Thunberg.
What's that, you might ask? Well, a company or country or individual should not emit any more carbon emissions into the atmosphere than they are removing. That's the basic idea.
Lots of companies and countries are setting these now. Some, like China, have pledged to hit net-zero at a time when most of us will already be dead, which is 2060. The EU, UK, and Japan are aiming for 2050, while Microsoft and Apple are looking to 2030. Either way, setting net-zero targets has become a tool to fight climate change, and a crucial example of how ESG works in practise.
So why does this matter? Well, imagine our environment being like a bathtub that is about to overflow. As we put carbon emissions into the atmosphere we add to climate change, which could be irreversible if the level of global warming exceeds two degrees or so.
Oh my God.
Scientists know roughly how much carbon will start that irreversible process just as we can tell when a bathtub will overflow if the tap keeps running. There are basically two ways to combat that process - slow or stop the taps, i.e., stop adding carbon, or pull the plug - find a way to take carbon out.
Now tech whizzes like Elon Musk and Bill Gates are pouring gazillions of dollars into the second activity. And maybe they will find that magic wand. Who knows? But we need to slow the carbon flow now, hence, the net-zero trend.
Is this good enough? Well Greta Thunberg would say, no, how dare you. And maybe the truth is somewhere between Greta and Elon.
But remember, when Greta first started talking about a carbon budget, golf-playing executives scoffed. Today, even elderly CEOs are finding their inner Greta.
Ladies and gentlemen.
Or at least making the right noises. So if nothing else, that shows that the world can sometimes change in surprising ways within the ESG complex.
And the question is, how much more will society change in the coming years around that E, or environmental issues. After Covid, it seems that nothing can entirely be ruled out.