January 12, 2023
January 12, 2023
SR Inc Quarterly Newsletter
The Greater the Noise, the Greater the Need for Leadership
In 2022, Putin’s extraction based, authoritarian regime invaded the multi-ethnic republic of the Ukraine. There, a leader for the ages, Zelenskyy put his and his family’s life on the line to inspire his nation to smash the Russian onslaught. Their success so far has reminded the world that leadership matters and might is not right.
Meanwhile, in a bitterly divided U.S., the Biden Administration shocked doubters by signing into law the massive new Bi-partisan Infrastructure and Science Acts as well as the Democrat-only deficit reducing Inflation Reduction Act. This has created a new strategic industrial policy to re-shore the manufacturing of clean technologies, including solar, wind, batteries, geothermal, green hydrogen and modular nuclear. In the Ukraine and the U.S., a frightening disregard for the rule of law is being held in check. But it is part of a rising tide of nativist authoritarianism around the world from Brazil to Philippines to India to Turkey, Hungary and Poland. The post Cold War and even post 9-11 cynicism that saw most political parties as only superficially different is over. The post World War II rules based system in global affairs is being challenged as never before. Consequently, fewer around the world now think leadership does not matter.
It seems that as we have moved from broadcast media to social media shaping our public conversations, we have moved from debates about the relative efficiency of different approaches to broad systems to shouting matches about the status of the individuals participating. As promised, the revolution towards largely free digital communications globally has revealed more of ourselves to each other. But what has been revealed is both beautiful and frightening. Unfortunately, the global discourse shaped by social media appears to emit more emotional heat than illumination. In 2017, a PEW survey found that only 28% of adult Americans agreed with the statement that “climate scientists have a solid understanding of the causes of climate change.” Despite the fact Cornell more recently published a paper demonstrating that more than 99.9% of peer-reviewed scientists recognized climate breakdown as primarily caused by human beings.
In this context of a public discussion that is now regularly all about the status of different individuals, it is important to note that the UN Human Rights Council did vote unanimously before COP26 to recognize the right “to a livable environment” as a human right subject to the UN Universal Declaration of Human Rights. Moreover, also in 2021, UNICEF reported that a billion children now face deadly risks due of the increasing frequency of “once in a thousand year” floods, droughts, famine, wildfires and extreme weather in the 33 most climate vulnerable nations. Which collectively have contributed less than 9% to the GHG dumped into our thin biosphere since industrialization. This seemed to encourage a growing number of global corporate leaders to recast the way they frame and speak about the emergency created by human-caused climate breakdown. Scores and even hundreds of global corporates have stepped past their former reluctance to speak in starkly moral and personal terms and, up to the CEO level, they have been making a moral demand for public policy at every level to be more responsible in responding to human-caused climate and environmental breakdown through groups like Business for Nature and Corporate Knights’ Agenda for Action.
As the cacophony of different voices and demands on different issues grows, those who can lead need to lead. Those who are able by position and/or aptitude to recognize, articulate and inspire action towards top priorities need to serve by leading. The challenge that shapes all other challenges is human-caused climate breakdown and as President Obama noted, “with climate there is such a thing as too late.” Because the UN IPCC Special Report on 1.5 C made clear – although catastrophic change is already occurring – to avoid the “most catastrophic impacts” becoming “more likely than not” it is necessary to slash global emissions 45% by 2030 (in less than 84 months). Unfortunately, 7+ years after the Paris Accord, global emissions continue to rise.
Consequently, now is the time for leadership. Now is the time for SR Inc Members to set a framing of both science and the demand for dignity – which emerging science across disciplines increasingly recognize as a primary driver of human behavior – and make a demand that all the parties they work with commit to aligning with relevant UN guidance on responding to human caused climate breakdown. The best corporations have long been willing to do this on Forced Labor and LGBTQ rights. Who will be the first to step up to help protect a billion children today at deadly risk in the 33 most climate vulnerable nations? Who will follow the Zelenskyy family’s lead?
SR Inc Welcomes New Members
SR Inc is pleased to welcome PTC as a Charter Member of the Sustainable Business & Enterprise Roundtable
PTC, headquartered in Boston, MA is a software and services company founded in 1985. Companies from industries such as industrial equipment, high-tech, automotive, aerospace and defense, life sciences, and more use PTC’s best-in-class solutions to achieve their digital transformation goals and differentiate their business. PTC’s purpose isn’t just to imagine a better world, it’s to give their customers and their employees the Power To Create it—together.
SR Inc is pleased to welcome Cadence as a Charter Member of the Sustainable Business & Enterprise Roundtable
Cadence Design Systems, headquartered in San Jose, CA, enables electronic systems and semiconductor companies to create the innovative end products that are transforming the way people live, work and play. Cadence® software, hardware and IP are used by customers to deliver products to market faster. The company’s Intelligent System Design strategy helps customers develop differentiated products—from chips to boards to intelligent systems—in mobile, consumer, cloud, data center, automotive, aerospace, IoT, industrial and other market segments.
Executive Symposium Takeaways
SBER Q4 Executive Symposium – Part One – Sustainably Strategy Leadership
December 14, 2023. SR Inc held our fourth quarterly 2022 Executive Symposium on December 8th in Washington, DC at the Georgetown University McDonough School of Business, with whom SR Inc has partnered on several student research projects. Attended by Member-Clients in person and virtually, the Q4 Symposium featured two major sessions: “Sustainability Strategy Leadership” and “Getting Net-Zero Done.” This session featured a video from Senator Ed Markey directly for Member-Clients, sharing a message on the incentives and green bank funding included in the recently passed Inflation Reduction Act (IRA). Member Executive Faith Taylor, VP & Global Sustainability Officer at Kyndryl, concluded the session with a presentation and Q&A on her team’s process of establishing a roadmap for sustainable growth.
SBER Q4 Symposium – Part Two – Getting Net Zero Done
The second session, “Getting Net Zero Done,” focused on emerging best practices in global decarbonization. Member Executive Derek Oliver, Director of Government Affairs & Corporate Responsibility at Wayfair, shared with attendees about the company’s “Shop Sustainably” initiative, which will help drive down Wayfair’s scope 3 emissions. Derek also discussed Wayfair’s updated governance structure to support ESG progress, and their pursuit of off-site solar through SR Inc’s Aggregated VPPA Procurements.
Best Practice Executive Guidance
Green Banks and the Greenhouse Gas Reduction Fund
The Inflation Reduction Act (IRA), a landmark piece of legislation signed into law on August 16, 2022, includes a number of provisions intended to mitigate climate change. Many have identified the uncapped wind and solar tax credits as perhaps the most significant inclusion in the bill, as well as the extensive support for tribal communities, but the IRA also establishes a well funded Greenhouse Gas Reduction Fund, focused specifically on financing clean energy innovation and more rapid adoption of green technology nationwide. This fund may pose a strategic opportunity for corporate executives, as the funding is allocated towards establishing a national green bank. This fund is designed to support the development of a national green bank administrated by the EPA that will operate directly and through state and local “green banks” that have already proved successful through-out the U.S., regularly mobilizing 7-8 dollars in private capital for every public dollar used.
Task Force on Climate-Related Financial Disclosures
The Task Force on Climate Related Financial Disclosures (TCFD) first released recommended disclosures on climate risk in 2017. TCFD’s recommendations have changed the reporting landscape within corporate sustainability and continue to influence emerging regulation across the globe. More and more corporations are committing to transparency for investors regarding sustainability information, and are using the process to improve their own climate risk management efforts.
Sustainable Leadership Blog
Dignity First Climate Leadership
November 17, 2022. One year ago, the company I founded and lead hosted a dinner in Glasgow for the Directors of Sustainability at nearly two dozen of the world’s fastest growing global companies, all of whom were participating in COP26. The plaque pictured below hung on the wall of the Board of Directors room in Glasgow’s grand “Merchants House,” where we dined and the British royal family had dined weeks earlier. Its inscription was an understated reminder of the horrors of the Atlantic slave trade that helped fund the palatial building we were in and, indeed, the monumental George’s Square the building fronts in Glasgow.
Towards Sustainable Global Leadership: How the IRA Catalyzes 21st Century U.S. Global Leadership
October 19, 2022. The Inflation Reduction Act (IRA), is a landmark piece of legislation signed into law on August 16, 2022. It reflects a new politics in regarding U.S. national industrial policy and is designed to serve as a catalyst to accelerate America’s leadership in the global transition to a clean economy over the next ten years. The IRA is overfunded (and able to contribute $270 billion to deficit reduction) through a new 15% minimum tax for companies with more than a billion in annual revenues and a new 1% on their stock buy-backs. The IRA fully restores and extends the 30% tax credit for solar and wind projects and goes much further. In all it is estimated the IRA invest $369 billion in clean energy but the number of these credits are uncapped and – for the first time – they are also transferrable. Furthermore, they were expanded to support not only solar and wind but also stand-alone batteries, green hydrogen, geothermal, modular nuclear and much more. All for the longer of 10 years or when U.S. emissions are reduced 75%. Furthermore, the IRA also establishes a well funded Greenhouse Gas Reduction Fund. Which is focused on financing clean energy innovation and an accelerating the adoption of green technology nationwide.
Upcoming Events
SBER 2023 Research Nomination
Thursday, January 19, 2023
2:00 – 2:30 pm ET
Member-Clients meet virtually to review the nominated SBER 2023 Research Agenda
SBER 2023 Research Ratification
Thursday, February 9, 2023
2:00 – 2:45 pm ET
Member-Clients meet virtually to ratify the SBER 2023 Research Agenda
Q1 Executive Symposium
Thursday, March 16, 2023
12:00 – 2:30 pm MT / 3 – 4:30 pm ET
Member-Clients meet in both Boston & Denver & remotely