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Sir Dave King, co-founder of the Clean Growth Leadership Network, professor of Chemistry and Foreign Secretary’s Special Representative on Climate Change from 2013-17, recently spoke to Anthony Gruppo, CEO of Marsh Commercial on dealing with the most important challenge of our time, climate change.
The next 5-10 years will determine the future of humanity and climate scientists could not have predicted the rapid rate of change of arctic sea ice melt. We are currently on schedule to see cities like Jakarta and Calcutta unliveable pre-2050 due to sea level rise and predict 90% of Vietnam to be flooded by seawater once a year. This will result in 200-300 million refugees by mid-century – how will the global economy manage this?
Sir Dave King suspects our failings so far have been due to a lack of leadership from the US and China. However, with Biden taking Presidential power in the US earlier this year and appointing John Kerry as Special Presidential Envoy for Climate, and China’s immediate response by reappointing Xie Zhenzua as the new special climate envoy, there is hope on the horizon for collaboration, partnership and agreement. This signals a strong position for progress to be made at COP26 later this year in November.
Collaboration of leading nations has been seen in transformational measures and quickly before. Mission Innovation, set up in 2015 at COP21 in Paris, was a partnership of 20 nations who committed to spending $30bn a year from 2015 – 2020 on replacement technologies needed for the post fossil fuel world to drive clean energy innovation. With another 4 nations now committed including the US, this is expected to exceed $45bn a year by 2025. This is a huge part of the global system and these leading nations represent 75-80% of global GDP. This continued leadership is needed for the rapidly emerging economies, such as India, who also need support to transition away from reliance on coal and into a clean growth economy.
But where should money be spent? Sir Dave King gives the example of the UK subsidising tariffs on offshore wind generation. Government fiscal policies unexpectedly drove the biggest growth system in our economy – the emergent renewable energy economy. It is profitable and employs half a million people. We are now at a turning point where financial institutions are transitioning away from fossil fuel investment focus to renewables, and if they don’t, they risk having stranded assets. Oil & Gas companies need to transition into the new world or else they will die away.
The western world and global leaders are now experiencing a mindset shift from seeing change as a ‘cost’ to an ‘investment in our future’. Naturally, some of the investments need to go into risk management but there is a lot of available private funding waiting to go into good investments.
Regardless of where private companies sit on their growth journey, they require ambitious and committed leaders to take them on the journey to become successful, green companies which have sustainable futures. These leaders must have the vision, entrepreneurial spirit, eye for innovation and ability to take on challenges to drive change.
At the same time, private companies are also being challenged to change by a younger workforce who are committed to strengthening ESG practices. New leaders are emerging today, and they are not unique to the West. However emerging economies and their leaders look to the West as role models, and currently, we are not setting the best example.
As a final point, Sir Dave King touches on the requirements for collaboration between the public and private sector. As a founder of the Climate Change Repair Centre at the University of Cambridge, he remarks that the climate is broken and we need climate repair – a multi-billion pound a year process involving public sector money going into private companies to execute dramatic science-led solutions.
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