⚡Midlife Crisis
Happy Friday! Today wraps up our second week of writing daily. To all our consistent readers, thank you 🙏. We want to improve what we’re doing so we would love some feedback from you.
For those who missed any of our conversations this week:
Monday - covered sustainable finance and the war in the auto-industry
Tuesday - covered global migration and gender equality in media
Wednesday - covered health, oceans, and new climate tech
Thursday - covered impact startups and a perspective that wants climate to be a legal right for future generations
Would Salt Bae cook a PLT? (Plant, lettuce, tomato)
I remember a time where I couldn’t even order fries at McDonald’s because it was supposedly cooked in animal fat. Times have changed quite a bit. McDonald’s is going to test a Beyond Meat plant-based burger in Canada. (Plant, plant, fruit).
Shell hits a midlife crisis
In May 2017, the chief executive of Royal Dutch Shell, Ben van Beurden, gathered a group of top executives to discuss what one of the world’s largest oil and gas companies should look like several decades into the future. He posed the question:
What do we want to be? What do we want to be known for?”
Two-thirds of Shell’s free cash flow is tied to its oil business, but the company hopes to eventually split its focus between oil, gas, and clean power equally.
As the world’s largest dividend payer (an eighth of the total FTSE 100 payout), it has a lot of pressure to keep the status quo, but Shell has worked the last few years to develop wind and solar power projects, encourage the adoption of hydrogen electric energy, and has invested in low-carbon startups.
Dissident views: Is this greenwashing? Does it fail to move the needle?
Supporter views: Shell seems to be making bolder decisions than its peers.
Mr van Beurden’s daughter: One day his daughter returned from school in tears because somebody said oil and gas companies were destroying the world and only Greenpeace could save the planet. “So why don’t we give [all of our] money to Greenpeace, papa?”
Our take: Shell’s circumstances and decision making show the complexity of shifting from the old framework to the new one. If you return billions of dollars back to the owners of a company, regardless of what you do, it’ll be very hard to fail. Even pro-climate shareholders would argue that a complete shift would destroy Shell’s ability to sustain their current cashflows. When one way of doing business is so profitable, it is difficult to let go. This probably means we should focus on propping up new companies who aren’t burdened by potential loss.
Takeaways from UN Climate Week
Environment is hot: It’s the easiest to measure so far out of all the SDGs and also has found the most global support. Climate changes also can really impact the way companies operate and how the owners of those companies make money.
UNGA isn’t optimistic: Many are not ignorant enough to think we’ll hit the SDG goals by 2030 with our current way of operating. Fortunately, a lot of people also believe we’re at a turning point and things will start to accelerate.
Our take: Demand for experts on tracking SDGs and how to operate in line with them will increase. There still isn’t enough credible standards, processes, and frameworks to support the SDG work.
Business Avengers are ready: Private sector is moving from “why” to “how,” which is a stark difference from a few years ago when executives didn’t like the idea of getting associated with the UN and SDGs. Companies such as Google, Salesforce, Mastercard, Nike, Mars, Coca-Cola, etc have made pledges.
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