Impact Initiative 2022

Bea Perez, Senior Vice President and Chief Communications, Sustainability and Strategic Partnerships Officer, The Coca-Cola Company
Kristina Wyatt, Deputy General Counsel and Senior Vice President, Global Regulatory Climate Disclosure, Persefoni (joining virtually)
Moderator: Peter Vanham, FORTUNE

Impact Initiative 2022  - The Future of Reporting Standards

Conferences

Bea Perez, The Coca-Cola Company
Kristina Wyatt, Persefoni 
Moderator: Peter Vanham, FORTUNE

Okay, welcome back everybody hope you enjoyed your lunch round tables um, and the conversations that took place there. Um I think and I hope you all agree with me that these sessions and our morning sessions as well are really highlighting the benefit of us being in person um and gathering and and you know, discussing and sharing our insights and knowledge for the benefit of the entire impact initiative community, giving us practical skills to implement at our own organizations. Okay. And now onto the home stretch of our program, our next session is going to address how the new sec climate reporting requirements are pushing climate risk and strategy to the top of the agenda for senior executives and for board members. Something that has come up repeatedly in our conversations. But what are the challenges in implementing the new regulations, especially when it comes to scope three emissions to assess the impact of the new rules will tap into perspective from both the public and the private sector's. Please welcome Be Perez. Senior Vice President and Chief communications, sustainability and strategic partnerships officer at the coca cola company. That's all she does just that. Um and joining virtually as well is Christina Wyatt, deputy general counsel and Senior Vice president of global regulatory climate disclosure of Persephone and to know in her previous life, her previous role as Senior Counsel for climate and E. S. G. At the sec Christina helped draft the proposed rule. So could not have to better speakers for this. They're going to be in conversation with fortunes Peter Van. Hello, it's good to be back with all of you and of course would be. And we'll be joined in just a minute or just a moment. Hopefully by Christina. I'm gonna ask Christina. Christina if you can see it, if you might join us on this virtual trip, uh, and join us in taking the virtual revolving door back to the sec. And could you perhaps tell us when you're there, um, what went on into, uh, you know, your own thinking and out of your colleagues when you were making these proposed climate disclosures? Absolutely. And, and thank you so much for having me. I'm so sorry that I can't be there with you in person. It's obviously a wonderful event. And, and I wish I could be there with you in person, but happy to join you remotely. Um, I joined the sec right after President biden was elected. And my, my purpose in joining the sec was to work on the climate rules, to work on climate and the sec more broadly. And the first thing that we did was to listen to stakeholders, principally companies that were reporting and investors that are you using the information that companies report? And we were really trying to understand, what is it? Where are the pain points? And what is it that investors want? And what are the concerns that companies have? And we found that investors really wanted to have consistent and comparable information about companies, climate performance, their climate related financial risks and opportunities and to have that information in a format that would be reliable, dependable and comparable from company to company. And it also happens that many companies were telling us that they wanted to have clearer guidance about what to disclose and how to disclose it because this was still during a time when we were all sort of waiting in this thing that we called the alphabet soup of different reporting standards that will come together and the alphabet soup has been um sort of rationalized and, and and reduced down to some key reporting principles. But at that time there was quite a bit of Of consternation among companies who really didn't have clarity as to what they should report and how to report it. So those were the things that we were trying to address. So you wanted to create some consistency and comparability. Now I want to ask you be, you've been on that journey for quite a long time at the Coca Cola Company you told me to start in 2005, I think that's far before anyone else has probably been doing these disclosures. So tell us about why you have actually decided back then to start that journey of voluntary disclosures and how that has led to today. I think what Christina said is true, which is we wanted common definitions and standards. We operate in over 200 markets around the world and if we're going to report out on our carbon, we wanted to make sure that even our own system and suppliers throughout the value chain had a way to look at it a definition that could be standardized and at the same time would allow for us to have transparency. And so it's for us it's really important because when we set the goal, we set a goal to reduce the carbon of the drink in your hand by 25% 20. So we set that goal. It was in 2010 to 2020 and it was based on the 2010 baseline. So we started with the reporting through CDP and then after a couple of years we said we really need to set a target. That was before we were talking scope one scope two, scope three. We said that when you say the drink in, in the hands of the consumer, so for this drink in your hand, how you manufacture, distribute it included the whole value chain And in technical terms of course that includes so called scope three emissions, correct? The entire value chain scope three. Now, what we found is that that was a great start. It was imperfect because it wasn't what we would define today as our new science based target, which we we've moved to that. So carbon for the drink in your hand could allow you to grow the business, but you would, You'll be growing your carbon, we looked and we said we actually need to be careful that what we want to do is reduce absolute carbon. And so that's why we moved to science-based target to 2030 and we also have an ambition to net zero towards 2050. We said we have to start first. We don't want the hockey stick right where everyone waits till the end. But so why why would you have started that journey so many years before any other company would have done that? There were some other companies doing it. I mean CdP existed because people did want disclosure project and so we weren't the only company were one of the leaders, but we weren't the only company that because if you look at, you know coca cola's business, we sell wondering time to communities. We wanted to be a responsible business. If you go all the way back into our history, water is critically important to a beverage business. It's also important to society. And we looked at what her impact on society since this is the impact initiative summit, it's important to understand what is your impact, good and bad and how do you make sure that you're driving to be a positive, you're adding value to society and adding value to nature and not taking away. And so unfortunate that when coca cola was established long before I was even there, it had a mission to make a difference in society and this has always been a part of our purpose and a part of our D. N. A. So now of course uh were returned back to to Christina. You know, one of the things that at the time the sec has done was to say we are going to include these scope three emissions, but we will only do it if they are material to the business. Could you walk us through what sort of balancing act you were doing at the time to say yes, scope three but only if it's material and where you are on that now perhaps. Sure. So scope three emissions cover a vast array of activities. There are 15 categories of scope three emissions. And you could get really minute in terms of the level of detail that you're getting into for any given company and trying to report their scope three emissions. And so by putting on materiality filter on the requirement that these emissions be disclosed. It's asking companies to evaluate their emissions and their value chain and determine are these really important to our company, to our investors and in which of those categories of emissions are really important because there is a balance between the burden on companies to report and the value to investors of the information. And we really wanted to encourage companies to conduct that analysis and themselves come to a conclusion as to what's that information that's most important to investors and to focus on disclosing that information. Now you made that calculation of course, on behalf of the companies and then earlier this year, the sec said, well now I'm gonna ask directly to companies and other organizations what they actually think about our proposal. And it turns out that, uh, you know, companies weren't really on board with what Christina just said, they were like, well, we actually don't think it's a good idea to include scope three emissions now. Um, he was business roundtable of course, was one of the organizations provided feedback and coca cola company signed that. Now the thing that I don't understand, b is if you are such a frontrunner on scope, three emissions disclosures and reductions, why sign a BRT statement that doesn't start by saying we love this scope. Three disclosures. Well, if you go back and read the letter, it actually gave an indication during the open comment period which we did appreciate and I know the other companies did and actually feedback was requested. So that was the purpose of the letter to give feedback and it outlined what we really want is a little bit more detail. We want the framework to have definition so we can have the comparator ability. We want to make sure that people are assuring their data so there needed to be points within this that outlined here are the things that we would recommend. So it wasn't against it, but it didn't come out and say it was for it either what it said, it would work, the company is in favor of? We are, but what I will say is what was written in the letter is really important Because while 85% of our carbon is um scope three, it means that it's uneven versus where people are on sort of their journey in reporting. So we have suppliers who are very small family run businesses too big multinationals and so to apply the same exact requirement to both of those, it could actually put that small family run business out of business because these are real significant investments that have to be made. And so how do you actually help them get on the journey while you put the pressure on the big multinationals who maybe already have some of the mechanisms in place and the investments in place. So it's about making sure we're looking at fairness and consistency also length of time for implementation. So we're absolutely for the disclosure, it actually helps us to level the playing field. It's just a matter of how do we help our suppliers get to the same place? And I mean, that's that's new to me and I appreciate the clarification Christine. I mean, unfortunately you did join us in virtually taking the revolving door back, but in reality, you're no longer making those disclosures, Would you be able to comment though? You know, if you hear the feedback of of b and others, do you think that's sensible feedback, do you think we'll see that taking being taken on board in the sec proposed disclosures and and is that going to be the outcome that will go with namely, scope three? Yes. It'll be adapted to make it fair and and and the timeline feasible. Well, first of all, I have absolutely no insider knowledge as to what the FCC might do when they adopt final rules. I think what we said is imminently reasonable and is exactly why the FCC puts out proposed rules for public comments because these are hard issues. They're very, very hard and it's critically important that the sec has the input from leading companies like coca cola from the investor community, from all of these various stakeholders who are going to be impacted by these rules ultimately, and I can tell you with certainty that the SEc is taking into consideration very seriously considering all of these comments that were submitted and will incorporate them into the final rules. I do want to highlight something that we said, which is to say that this is a journey. This really is a journey and getting to the point of having good, high quality scope three data. It's gonna take time and I think there is a bit of a misperception out there about how, how one can go about getting scope three data, it's perfectly acceptable within the proposal to use industry average data, for example, and not have to actually go to each and every one of your suppliers. I don't know how many suppliers coca cola has but I would venture to guess, you know, it may be in the millions, it's a lot of suppliers. Right? So to have to go to each and every one of them to get actual data is a bit unreasonable. And what we would expect is that for most companies and particularly large complex companies with complex supply scenes, they're very likely to get actual data from their largest suppliers and then use industry average data for their smaller suppliers. But then over time work to build more real actual measures data further and further into your supply chain, which again, I think reflects this idea of this being a journey that started to improve. So certain inference of scope three emissions for smaller suppliers was already acceptable in the initial proposal. It could be an estimate initially. Absolutely. And that is perfectly consistent with the greenhouse gas accounting framework that the sec proposal is based on and that frankly the various proposals and rules around the world are based on which is the greenhouse gas protocol. It's perfectly fine to use, for example, spend based data to say I'm purchasing X number of dollars worth of this input and there's an emission factor that would apply to that that would give me an estimate of the emissions associated with that input and that's perfectly acceptable. Would you say now that you're at persephone and you've been talking to companies that are going to have to do climate disclosures, Would you say if you go back in time, would you still make the same proposal as you have made earlier this year with the sec or would you change it? No, I would make I would make the same proposal. Um, I mean there there might be things around the edges that could be improved and I think we're seeing that in in the comment letters and I think that the FCC will improve upon the proposal when it goes to adoption, but in broad strokes um, I think that the proposal hits the right point. Well, that's very interesting. I want to see if we have time. I think for one question in the audience, if you if you want to raise your hand that will come to you. So yeah, over there. Thanks. Hello. Ben jones incompetent boards. Um, so we now have seen that the C. D. P um, standards also being used in terms of the the biden administration. How does that relate to to also the sec. And what will that push that we're starting to see the power of procurement that way. Thank you. It's uh sure. So they have C. D. P and T C F D. So there's two of them that are closely related and for us. I think it's if you, I mean, I have not read the full detailed proposal. My apologies, but what I would say is that it actually helps to feed in the data? So it gives indications to what the definitions could look like, how the industry is already reporting. And so for us, an ideal world, if I could wave a magic wand, I would love for the sec to adopt one of these existing frameworks that many companies have already been filling out. I'd say none of them are going to be perfect because it is a journey and things can always be improved upon. But I do think it makes it a little bit easier to actually scale how many companies will start to report if we can look at existing frameworks and take that forward. But you know, the, I know the sec taking their input. They're not done with their comment period right now. So that's all I can say because I am not a fortune teller, I don't know exactly where it's gonna land, but I think it sounds like the two way conversation and the listening is occurring and the corporations have been able to give the feedback which is very encouraging to me, Christina perhaps for you and finally, you know what's next? You know, you you have a good view now, both from the regulatory perspective and from the companies you work with today, what do you expect to come out of this? Are we going to see soon the sec disclosure being voted and enacted as of 2020 for um do you expect, you know, as the land somewhere else, perhaps on international standard? What what do you see on uh in your magic wand? I think the sec will move to adopting the rules that they proposed. I would say to the point about the C. D. P. And to this point about alignment. One of the things that we did at the sec was to really try to build the proposed rules on existing standards that were in place and to work with the international community to align the disclosure rules and standards. So the T. C. F. D. That that he mentioned is really the core framework for thinking about climate related financial risks. That's built into the C. D. P. And it's built into the sec proposals as well as the various proposals and and rules around the world. And that is quite helpful. We don't want to ask companies to start to build something new when they are already reporting in a certain way. Right. And so I think what we'll see is, is the FCC rules going to adoption. We'll see companies really starting to do what coca cola has been doing for a long time, but to get it to gathering the data and really thinking about how they're reporting it. Thinking about how their carbon emissions translated into climate risks, how they're going to set goals and work toward mitigating that climate risk um and the financial risk associated with it. And I think that ultimately this is going to become something that feels much more like financial reporting, that becomes just a norm for companies, once it becomes easier for them to actually calculate their emissions and think about their emissions in terms that are similar to their, their financial statements. And surely persephone will help companies along the way. We've actually heard a couple of companies today work with persephone and perhaps no you from that work already perhaps finally be, you know, I'm not really a big coke zero drinker, but perhaps I might be a coconut zero drinker. I like that. We might have to have that new brand coconut zero. When can we expect coconut zero to be on the market. So our, our vision is 2050. We would love to get there sooner right. Which is why we have these interim goals. The world cannot afford to wait. We're in crisis. I mean, anyone here who is looking at what's happening every single day in our world in terms of how the weather patterns are changing the amount of disasters that are taking place. We all share the sense of urgency. But for you, that's right. The target remains 2050. The target remains 2050. It's an ambition. It's not a target. So I want to, our target is to 2030 in terms of the science based target initiative because it's really important to do it. But for us, we sell our drinks one community at a time. If we're not a responsible citizen in our communities, then we won't be welcomed in. And so for us, it's about taking action today. It might be imperfect. We will absolutely make mistakes along this journey, but we're willing to take action to correct them and to do the right things. And I think that's what the world needs and we all have to play apart together. All right, we'll try to make it all happen. And I look forward to the coconut Zero B Christina. Thank you so much. Thank you.

Alan Murray, FORTUNE
Peter Vanham, FORTUNE

Impact Initiative 2022  - COP27: The Work Ahead

Let's go up and look at climate change from the 35,000 ft level with the appropriate carbon offsets and attack. What happened at Cop 27 is the private sector showing more initiative and commitment than national governments when it comes to climate action. Our country shine away from committing to a phase out of fossil fuels and to what extent is the private sector getting behind a blended finance to affect what happened? What didn't happen and what is needed from cop 28 please welcome fortune executive editor Peter van in together with fortune media ceo allen Murray. So the, the cop meeting has been this big disorganize has become a big disorganized mess that is turning out to be pretty important to the world of business. I wonder, by the way, how many of you, anybody in this room was in Egypt for the cop meeting? Great. Any two? I've got three of you and three of you. Okay, I'm gonna, I'm gonna call on you guys in just a minute. I want, I want, I want to get your on the spot. Let's get microphones to the three of them because I want to get your views. But I want to start with Peter. I think everybody's met Peter van and Peter's the, the newest addition to the fortune team came from the World Economic Forum. Don't tell Klaus Schwab. I said what I'm about to say, but he's the guy who actually wrote Klaus is book on stakeholder capitalism. Um, so he knows this topic inside out. And Peter. I know you've spent a lot of time looking at what happened in Sharm El Sheikh, what, what's your big takeaway from this year's meeting? Sure. I mean, first of all, there's the actual outcomes. That means the outcomes of the multilateral negotiations there. The government's talking to each other about what to do about climate action. Two things. There one is they agreed to create a so called loss and damage fund. That means that wealthy countries developed countries are going to be paying poorer countries that are suffering the concept of climate change for the damage that they've suffered. They've agreed on the principle, they have not agreed on the financing. So not really meat around the bone yet. But the principle is there. The second outcome is that there was a big drive to include the facing out of fossil fuels into the final agreement, meaning that everyone would say all the governments around the world would say such a year, no more fossil fuels. This was a big drive for that, but that drive was unsuccessful. So that is the second outcome or non outcome in terms of the agreement. Does that mean that the group has accepted the kind of Vicky holla view of the world that this is not going to happen anytime soon? Well, listen, yesterday's session to me was a revelation and I think that for many people, including governments, it would be a revelation to hear this point of view on the, on fossil fuels and the role of fossil fuels. There is a cynical point of view that says that there was a big oil lobby there um you know driven in part by the next cop hosts in Dubai and abu Dhabi in the Middle East. And that they were just against any uh decrease of fossil fuel use at all. But my senses and I'd love for you to talk more about this. That the other thing that happened was You know, the cop was a cop began as a governmental meeting in Glasgow. You started to see more and more companies show up in sharm El Sheikh. It really turned the corner. Yeah. I think that estimate started there were about 30,000 people in total. I don't know if people here in the room can confirm that in terms of their impression. But what you would have seen is that you know, imagine that this room was the room where the negotiations took part. Now in this room there would be no business participants because this is for heads of states to negotiate. But in every other room there would be business participants. And so what you would see is that for the first time ever, you really had almost a majority of private sector participants or at least private sector presence at a meeting like this. And now you can have all kinds of opinions about whether that's good or bad. That was that was my next question. Is that a good thing or is it a bad thing? Um is this uh, is this a force for good in the world? Well, listen, we like to believe that it is right that you need the private sector to execute on a lot of these commitments, Right? And so I think that's the perspective that I would take. But of course there are those cynics that say, you know, they're there to lobby against climate action. Was that the case? You know, maybe some of the people that are here can can talk well, let's let's do that. And I'm sorry Peter and I have have spotlights in our face so we can't see very well, but I think it's kristen back there uh, yes, can I put you on the spot? I just did, I don't think you gave me a choice there. Um, I think a lot of it's what you said, Peter, I think that um as we talked a lot of general motors, it is about everybody in, right. We we can't do it alone from a private sector. I'm sorry, a public sector. It it needs to be public and private together. I think what I took away from Coppin as I talked earlier, I'm relatively new to the overall climate space, I was in Glasgow and and now in Sharm El Sheikh and I think the collaborations and um a lot of what comes after is what's so important and the value of us being there, you know, I talked earlier about our focus on equitable climate action and so we had a lot of discussions, you know, with other companies with N. G. O. S about how do we bring more into, you know, our climate collaborative and and more work in that space so that we are bringing others along with us, I would say the other thing that I walked away with um is one of the panels I was on was with a gentleman from the Smithsonian and he was talking a lot about um optimism and and looking for optimists, and it reminded me of the mr Rogers, if those of you have heard the story, he said told the story when he was little that he was worried when there was tragedies. And he said his mom always told him to look for the helpers. And I walked away from that thinking, look for the optimist, because optimists are the doers, and it's like we I said earlier, we won't get to 2040 today, but we can do a lot to get there and a lot of progress can be made. And so I walked away thinking, you know, we've got lots of opportunities from an innovation standpoint, there's a lot of opportunities to continue to make progress and if we can focus on the optimistic view, we'll get more done than if we focus on what we can't get done. So it's it's a worthwhile gathering, you'll will you do it again next year? Absolutely in Dubai, Yeah, uh somebody over here. Yeah, but thank you for going first. Thanks Dave Summers with P. M. I. Project Management Institute, uh and we were there as guests of the host country Federation of Egyptian Industry um hosted us for a panel to discuss about that very topic of implementation. How do you get from the problem? We see now to actually achieving the targets and there's still so much confusion about the how, um but it's probably no accident that this being the implementation cop um was where you started to see private sector come and attend and it will be very important for the private sector to continue to contribute to the effort and and really drive the change. So your big takeaway is the same that this is increasingly that the private sector's involvement in this is growing. They have to be there, we have to be there, you'll go back, we'll be there in Dubai and then there was great Kristin Sullivan with Deloitte. I know kristen we had the opportunity to to join a session together. Um I was there for the first week, so very much focused on Finance day and and the role of the capital markets in particular and I think my key takeaway um led by the world economic forum and some of the activities and the World Business Council. I don't know if Peter bacher is still here. Um it all comes down to data and the rapid acceleration we're seeing in that capital markets infrastructure? That that the you know, the standards infrastructure. So we have a common language, a common taxonomy so that we can actually improve the supply of comparable, consistent timely information to unlock the capital needed to finance this transition, the governance and accountability. This word accountability has become really critical of U. N. Came out with that uh their their report on integrity and and the greenwashing risk. And what's going to constrain the ability to make progress rapidly towards Net zero. Is that that gap between the ambition versus action and then at the end of the day, we need all of these working together to to to rapidly accelerate the pace. Um and so tremendous involvement by every participant in the capital markets and really just that reinforcement that we're making progress rapidly, but we need to get to a place and the policy and regulatory interventions are going to be essential. Yeah, it's interesting. I mean, it sounds like a metaphor for the environmental challenge itself. You have lots of participants, everybody there, you know, trying to figure out how to make progress, but there's no organizing frame. Well, you see some progress also at cop so for example, the CdP formerly the climate disclosure project that is assisting many companies of course in their disclosures threw its weight behind the I. S. S. I know this is a lot of uh a lot of international meetings are great for acronyms threw their weight behind the I. S. S. B. Proposals on on disclosures, so what does that mean? This is the international sustainability standards boards? I think I hope I got, I hope I get that right, led by the former Ceo of Danon, um Emmanuel Faber, and there, of course, the ones that are saying, we gotta get to the scope 123 disclosures and really sort of the expansive view on on on emissions. So you can see that at an event like that, you get that buy in for these kind of, let's say, leveling up of your disclosures, that's on the one hand, and I think that you're really seeing coalition building happening at a meeting like that, and people creating that buy in. And then on the other hand, you know, what also happened was that a lot of people through in the way behind things such as the First Movers Coalition, so basically companies joining together to create technologies, you saw them basically creating future demand for for green technology as well as things such as of course the the G fans, uh if everyone knows that Akram and um this is in Glasgow, they created sort of the financial alliance for Net Zero. And so a lot of companies also joined that Net Zero pledge, so these are a couple of the things that happened and you can really see the needle moving at a meeting like that, you know, it listening to you talk about it, it sort of sounds like what your former employer always aspired to be, the World Economic forum in Davos, if you get the right people in the room and get the conversations going, the coalition's begin to build. Uh, and I think that's a really interesting observation because it seems to me that this cop meeting is becoming what so far the world Economic forum has been, which is to say the place to be globally for the public and the private sector to meet. And so if they are now coalescing around, let's say the climate agenda as being the thing that ties us all together the whole fabric, globally of the public in the private sector. That's really interesting because it almost means it's a paradigm shift and you cannot not be part of it. Yeah, yeah, interesting. And one of the things I'd love to talk with all of you about is is how this new initiative that that were uh, creating here the fortune impact initiative can be a part of that conversation. How can we help you provide you with the tools, the things you need. We have, uh, we surveyed all of you by the way, prior to this meeting and I've got a slide here that shows these are the things that you all said were the most important goals that this community, uh, would focus on and by the way, number one, there is 96% said this is growing, this is increasing, nobody sees falling back, nobody sees pulling back. I think we've heard that repeatedly over the course of the last two days measurement, number two measurement continues to be a very big issue. How do you have consistent measurements that that are comparable across industries uh and and create accountability, rapidly changing landscape? Um It is a, you know, the world on all of these topics is so different than it was three years ago, four years ago, five years ago, uh stakeholder engagement. And then the and then the scope three conversation which we've uh we've had in many ways, I think peter the scope three issue is really interesting because I get on the one hand that unless you address scope three, you might as well forget it. I mean it's company after company in here has made it clear that the majority of its emissions fall into the scope three category. But the second piece is some of the stuff that falls under scope three is, is absurd. You can't measure it. And by the way there's double counting because my scope three may be part of your scope three. And so do we both have to take uh take accountability for the scope three. How do you think that's sorting out? Well, of course it's impossible to say at this point where this is going to land. But what you do see is that there is sort of a groundswell, there is a movement of organizations that are trying to make scope three parts of the mandatory disclosures. We talked about this morning about whether that will be successful in the U. S. Or in europe, but the moment that you have a critical mass for this, both in terms of how you go about the measurement of this and a regulatory environment where this is going to be mandatory, then of course it could become something that is almost like a snowball, right? And that will snowball from wherever it started to wherever it wasn't yet before. And and when that happens, of course, then those places and those organizations that have started with their scope three emissions, um measuring and and reduction. They will have a competitive advantage and those that did not have a competitive disadvantage. And you hear more and more examples of that, Kathleen McLaughlin of Walmart, that the fact that more than 70% of of Walmart suppliers have already signed up. Are there other issues that you all think that we should be focusing on as we build this impact initiative? Because our goal here is to be valuable to all of you. I don't know if anyone has thoughts on that or wants to contribute to it. I see a hand back there. Uh, but peter I know you have thoughts on that. Yeah, I mean, I I think it's really amazing to be part of this. I hope you all enjoy the enthusiasm that I feel. I definitely get really energized from from our time together so far. And so for me it really feels like this is the start of something great. And I definitely hope that we can sort of, I wouldn't say piggyback but be part of that global movement that we see emerging and and possibly also uh meetings such as cop. So I definitely think it's something that is a global conversation and it's important for us to not forget about. And I hope everyone signs up. I think by virtue of being here, you probably get signed up for Peter's newsletter, which is one way to that we can begin to help keep this community together. So, uh, so Peter thank you very much, great having you as part of fortune. Thanks Alan

Bernice King, Chief Executive Officer, The King Center 
Interviewer: Lee Clifford, FORTUNE

Impact Initiative 2022 - Continuing A Legacy

wow. Well that, that gives you something to think about uh, for the rest of the day. Uh yeah, keep going, keep going, keep going and, and by the way, I hope I'm going as strong at 90 years old as, as ambassador young is is today. Uh, thank you so much. So from Atlanta to the rest of the world, the name King obviously conveys the power of how non violent protests can achieve dramatic shifts in society, extending the legacy of Dr king and his wife has been the work of their youngest child, Dr Bernice King. We are very, very pleased to uh, some of you may have had the opportunity to tour the King center yesterday, but for all of you were very pleased that she's here today to share her critical efforts to reduce systemic inequities like affordable housing and the racial wealth gap, please welcome to the stage Dr Bernice King, chief executive Officer of the King Center in conversation with fortunes lee Clifford. Alright, so we said at the beginning of this conference yesterday that there was a very specific reason we chose Atlanta because it is such a vibrant business hub. Tell us about what what Atlanta means to you and how it's changed over your lifetime. Wow! Um, obviously Atlanta is my birth city. Um, I've left it maybe a couple of times but came back very quickly after attending college, my first semester um at Grinnell in Iowa. Um and I realized then that Atlanta is probably the best place for me to be. I think it's the best city in the world because we have found a way um, to really work together across a lot of lines, especially when crisis happens. We do, I think we do an excellent job of that. Um, but I'm disturbed. You know, I've seen incredible growth. I was telling somebody the other day, I was driving down the highway, I said, Wow, that's not the midtown I've known even in the last, you know, 10 years, it has shifted drastically, um beginning to look a little bit like New York these buildings are taking over. Um, but um, you know, with all of the growth and, and I'm proud of that, I'm proud of Atlanta um being very progressive economically, but I'm very saddened that we also have an incredible wealth gap here income inequality that we haven't seen to um really address. And so, um, you know, we, we, we still have a lot of work to do here in Atlanta and has the needle moved at all on the wealth gap? Uh, no, it hasn't really moved. It's a persistent problem that we're gonna have to really dig in and address and ask them very important questions. We're kind of moving things around on the board here. Um, but we're not, we're not, we're not, you know, addressing, you know, the dislocations that occur, you know, we call it here gentrification. Um, and how that has impacted so many communities, especially communities that look like me and I know that you as part of your mission, you have a nonprofit that's taking the affordable housing part of the well know the nonprofit that I'm a part of is the the King Center, which is the official living memorial to the life work and legacy of my father. The other part that's dealing with housing uh, is a for profit. Oh, tell us about that. You know, it's a Fintech company. Um, I joined forces forces with my class mate from leadership Atlanta, um started a fintech company to address um, the racial wealth gap and to also began to move renters into home ownership. And you know, when you look at the fact that most people, especially in the black community have a difficult time with home ownership has a lot to do with credit. You know, there's a lot of bias and discrimination and, and credit scores. Um, there's a lot of bias and discrimination. Um, just, you know, and a lot of our financial systems. Uh, and so you know, it's about thinking outside the box. So we said, hey, why don't we create the credit, You know, your credits on us? If you prove that you can consistently pay your rent on time because we should consider that. I mean, you know, for years, it's like, why hasn't anybody thought about including rent as a part of credit um because many people do pay their rent on time, they want to make sure they have a roof over their head. Uh, and so we decided to to do that and if you do that consistently. Um, and, and on time for 69 months, 12 months. Um, then you know, we will qualify. You get your home were also um working with investors who are helping us to help with some of the down payment. So, um, yeah, it's it's important work and it's work that I hope will inspire other people to begin to really think outside of the box. That's fantastic. What I know a lot of people in this room are people who maybe went into corporate jobs hoping to make money, you know, gained some prominence and then shifted into a field where they found a purpose and I'm wondering how did you find your calling? Well, I was born in the purple. You all are laughing, I'm serious surrounding me. You know, um, you know, I lived in a household of of a woman, an incredible woman that I just have to say when you think about martin Luther King, Jr going forward. Please do not forget Coretta scott King because we would not know him as the icon that he is without what she did. Um, after he was assassinated, this legacy is expansive. It's one of the most uh prominent social change legacies in the world. Um, and, and so she was responsible for that. So growing up around that, seeing her build the uh founder King Center, you know, build it from the ground up. Um, you know, it it influenced me and inspired me. She talked a lot about in our household about service to humanity. Um, but she lived it. So I got to see examples. Um, and so in, in my life, you know, it's kind of been weird because even as I wanted to try to run away from some of this stuff, um, you know, I ended up back like, I don't, you know, I appreciate being the daughter of such phenomenal people who not only changed the world, but in their death still changing the world, but it was like, God, well, I have my own identity. You know, I wanted to, I wanted Bernice to stand out. Um, and, and so I ran for a long time trying to do a lot of other things that, you know, I got called to ministry and I was like, oh man, I'm gonna be like, daddy, nobody's ever gonna recognize me, the shadow is gonna be here. So it took me eight years to answer that. Um, you know, but I went to law school because I said, if I can just go to law school, maybe if I can practice law, I can prove that I did something different than my parents never practice law. You know, I'm barred. You know, I'm a certified mediator, but never had an opportunity to practice I did serve as a law clerk. Um, but you know, on this journey, you know, I just discovered one thing really, Maybe two years ago that God called me to really continue a legacy that the world needs. You know, it's 55 years now since my father was assassinated and the world still is craving and looking to that legacy for answers. And so I now understand that I don't have to figure out why I'm here. What is my legacy? You know, I have people around me, they they are on legacy pursuits. But I was born into a legacy and it was just a matter of adjusting, shifting and getting comfortable with the fact that this thing is so large and there's so many other pieces to it um that you have a part to play. And one of the major parts that I play Has a lot to do. What my father said in his 1965, Nobel Peace Prize lecture, not the acceptance speech, but the lecture that he did the university, he said that I suggest that the philosophy and methodology of Nonviolence immediately become a subject of study and serious experimentation in every field of human conflict by no means excluding relations between nations. And now that was what um 58 years ago, I guess. And now this past year, in january, we at the King Center that I served as the ceo of um was able to launch with the help of the y um and online Nonviolence experience for everybody around the world. I mean, most people think about it as oh, that's for the people out there, fighting for social justice, you know, or those people protesting. But daddy really talked about it and personally embodied it as a way of life. He didn't get a chance to delve deep into that. Uh my mother took it further by institutionalizing the non violence and the work through the King Center. And now I have an opportunity to tell the world, hey, you can use this in your workplace. You can use this in your home. Yes, you can use it as we face these difficult, you know, challenging social justice issues because it applies in all aspects Nonviolence for us is a love center way of thinking, speaking, acting and engagement at least personal cultural and societal transformation. That's what it is and who would fight against a love centered way of doing things. We think love is weak, but love is powerful. Dr King embodied the power of love to confront injustice. He embodied the personality and the spirit of love that was able to bring transformation to an environment and allow people to be treated with dignity and respect. You know, and that's what's needed in every place around this world. People want to be respected, they want dignity, they want to feel like they belong, you know, they want to be treated with compassion and and they, you know, they want equity and fairness. So that's that's a large part of my my work. Do you feel that the business community is doing enough speaking out enough on the issues? You know, let me say this. The answer would be knowing yes, no. In the I mean yes in the sense that finally, but it took such tragedy and travesty to happen in our nation, you know, for this to happen and that's unfortunate. It should have been the case all along. I mean, corporations are a part of communities. Corporations comprise, people are part of communities. And for many years corporations acted as like as if they were in a silo separate and apart from the community, not understanding the responsibility to really not just give back to the community, but sure the community is secure and safe and and enriched and many cases, corporations were self focused, self interested about building up the corporate, you know, coffers and not, you know, empowering and uplifting the community. But I see some of that shifting today. So you know, that's the yes, but the but the know is there's always so much more to do. I think there's a commitment, I think corporations have to start being more conscious about developing an agenda around how do we really shift what's happening in our nation um to make an impact uh that kind of um balances off what's happening in Washington, which is nothing from average people. I mean it's it's happening for corporate America because corporations have, you know, um lobbyists there. But the average american doesn't have real representation because it's been intercepted by corporate interests who buy off elected officials. And then the people end up suffering. So that's why corporations have responsibility. If they're going to be there doing that, they need to be thinking, I'm not just here for shareholders, but I'm here for the people that work in my company. I'm here for the people who purchased my products and my services. I'm here for the people that the communities that, you know, I built my headquarters in. I'm here to make sure that those communities have fairness, that they have equity, you know, and they have justice. And so, you know, speaking of our non violence experience, I wanted to say in january, it's an 18 hour experience online. People can go to the King's Center Institute dot org and sign up for it. But working with the y we just will be launching a three hour experience. So corporations can now um embrace the way of Nonviolence so that we can begin to think more about being a person centered and not just profit center. Absolutely! If there are questions in the room, please raise your hand and we'll get a microphone over to you. Um I wanted to ask, I've, you've said before that sometimes being a consensus leader can be dangerous because you have to wait until there's consensus to take a stand, what uh what advice would you give to corporate corporate leaders who are thinking, gosh, this issue really matters to me. Should I put myself out there? Well, you know, it really is about courage, you know, and and conscientiousness and and compassion mixed together. Um I think too many people try to remain likable um when at the end of the day our responsibility is to do the best job that we can do to make sure um that the right thing is done. Uh and so you know, my challenge to corporate leader is you know, if if you dare to lead the way instead of tone, yeah, you're gonna get resistance that that comes with leadership. I don't know any leader that everybody agrees with 100% if there is one, I don't want to follow them. You know, my father was a great leader, we all know that you know, people didn't recognize it then, you know, but at the end of the day, he had people you know, who were challenging his leadership, his motives, calling him all kinds of things. Um but he had the courage to say this is the right thing to do and to embody what he was really, you know, promoting and I think it's about embodying those those principles and values um that are important to making companies very powerful and significant and purpose driven, but at the end of the day, there's a generation coming along now that corporations are going to have to shift, and so I suggest being proactive so they don't find themselves, you know, really in a bind, because, you know, a lot of young people now, it's like they don't they don't want to work for corporations who are not purpose driven in terms of really dealing with these, these issues. So they're looking for leaders that are heads of corporations that are taking these courageous stances when it comes to inspiration. I know you inspire millions of people who inspired view, wow, you know, that's a good question. Um and it's a hard question because, you know, as much as I try to look, you know, outward for um inspiration, and I'm not saying none comes, I will say that I'm always inspired by the next generation um when I see them rising up, standing up speaking up and doing um things that baffle your mind um coming from a from a young person. Um but most of my inspiration honestly just comes from, you know, my parents, you know, I I rely heavily on things that, you know, my mom shared with me, um things that I read of my father's, you know, one of the most incredible things, very simple, but it's been very helpful in my, in my life and my mother shared with me, is that the darkest hours always before the dawn, and um when you think about where we are now, Yes, it seems like it's a very dark times, but she was trying to convey to me that there's a dawn, you know, and if you keep your mind on the fact that there's a bond and keep doing the good work that you're doing, it will come, you know, But I forgot to ask her, how do you know when it's the darkest? Because it's like, it's more dark. But I keep in mind, you know, it's, it's the dawn is coming. So her teachings, you know, even about, you know, the expectations, There are a lot of expectations being the daughter of these great, um, individuals and I have to manage those expectations and, you know, carrying their legacy. Um, but she helped me so much when she would often say, look, and she said it to me and my siblings, she said, look, you don't have to be me. You don't have to be your father. But whatever you're doing this, like be your best self that has relieved so much pressure. When external expectations come my way, It's about being Bernice is best help. I'm not trying to be martin King or Coretta scott King, even though some people will look to me that way or you should do like they did. No, I'm trying to incorporate their values. But I'm gonna do it in this generation. I'm not gonna do it the best that I know how to do and then I get peace. That's amazing. We are down to our last minute and a half. And I wonder if you have a room here of uh, executives at some of the biggest corporations in America. We've had two days of meaningful discussions about how to change the world and make it more equitable. Just place. What do you want to send them off with? Well, I mean, I think I want to send you off with, um, understanding that this is hard work and it's a life, lifelong work. There's, there's no easy answers, no easy solution. Um, but we've got to challenge all of the elephants in the room and we have to do it in a loving and compassionate way. We've got to bring back to the environment that we work in. You know, um, a focus on how do we really create more equity, you know, in our environment? You know, how how do we do that work? How do we get to know even the people that we don't know so often change doesn't happen because we are ignorant of the other, whatever the other is. And we have to be courageous enough to connect with the other, understand the other and find out how we can align not allies though. Because allies suggest I'm helping you with your problems. Please note these are not somebody else's problems. These are humanity's problems, racism, humanity's problems. Um, inequity, humanity's problem. Uh, and so we get together and understand our sisterhood or brotherhood that we are family. We're in this together and we are going to stay committed for life and find a solution together to be able to address these inequities and challenge things when we see them and say we can do better and we will do better and we will make the necessary changes and work on the biases that we have. I feel like we truly saved the best for last. Thank you so much. That was amazing. And with that inspiring conversation we're wrapping up our Not Girls gathering of the fortune impact initiative. Thank you to all of our speakers and discussion leaders for sharing their knowledge and everyone who weighed in during the sessions. I also want to give my heartfelt thanks to Lindsay Stansbury, my co chair for this conference and all of my Fortune colleague who hosted conversations and last but not least, thank you to our community members and all of you who gathered and participated. As we build on the discussions and exchanges we've had over the last two days. Please keep an eye on your inbox is for information about our next meeting. Probably a virtual meeting uh set to happen in the first quarter of 2023. That's all for now. We wish you a wonderful holiday season and safe travels home. Thank you so much for joining us

John Hope Bryant, Founder, Chairman, and CEO, Operation HOPE 
Ambassador Andrew Young, Chairman, Andrew J. Young Foundation
Moderator: Alan Murray, FORTUNE


Impact Initiative 2022 - Untapping Excellence

John Hope Bryant, Founder, Chairman, and CEO, Operation HOPE 
Ambassador Andrew Young, Chairman, Andrew J. Young Foundation
Moderator: Alan Murray, FORTUNE



Impact Initiative 2022 - Untapping Excellence


Jasmine Crowe, Founder and CEO, GOODR 
Interviewer: Lindsey Stanberry, FORTUNE

Impact Initiative 2022 - Feed More. Waste Less.

okay, we'll answer the next session, feeding the hungry rates quite high on the ladder of social impact especially. So if you also combine it with minimizing food waste, our next guest does just that Gooder. Think of it as and this is quite a stretch, but think of it as a food delivery app, but in reverse, see if you can uh make that mental exercise. The founder of Good is here with us today, Jasmine Crowe Houston and she will explain how the firm leverages its new technologies such as Blockchain to make a dent in food waste and help the food insecure. Gooder does all this while generating rigorous metrics on environmental and sustainable impact. Please welcome to the stage, Jasmine Crowe Houston, the founder and Ceo of her and her own Lindsay Stansbury. Hi Jasmine, thanks so much for joining us. Thank you for having me so great to have you here. So I was hoping you could just give us a little bit of background on your experiences and what better is. Yeah. So you know, I started Gooder in 2017, truly organic start for me. I had a pop up restaurant series called Sunday Soul A. T. L. That I started when I moved here in 2013. It's crazy to think I'll be in, I guess an official atlantan next year. They say you have to be here for a decade. So I moved here and I just saw hundreds of people experiencing homelessness. It was really kind of driven to do something. So I started to pop up restaurant where I would bring out tables and chairs and linens and you know, cook meals for 3 to 500 people and I was doing that for almost four years. And a video of one of my restaurants went viral and I woke up one morning to just millions of views. It's really kind of scary going her own at the time on on facebook and one of the reoccurring questions that people kept on asking me was who donated the food And the truth was nobody. I was couponing. I was price matching. I always found the reason, you know, walmart doesn't price match anymore because I was just trying like, get the best prices that I could and when I saw that question, I was like, I need to get this food donated. And so I googled what happens to extra food at the end of the night from businesses and like how to get donations, I'm just doing. And I fall into this really deep rabbit hole around food ways and was blown away with how much perfectly good food goes to waste in this country while so many people go hungry and I think that is how good or got started. That's amazing. So you recently raised $8 million dollars in a series a funding and I read before that you were just bootstrapping basically. I think I was surprised that maybe other people in the room would be surprised that an organization like yours would raise like a startup. I'm just curious what made you decide to go and do that? And what was that experience like? Well, as I was doing the research, one of the very glaring things that I noticed is that businesses already are paying waste companies to throw perfectly good food away every single year. And so the trash bill never goes away. Um you know, there's not a facilities or operations person in any enterprise corporation that says like we're gonna just keep onto our trash and it's really something that is a big spin. And so I, I thought I am a diversion company. You know, we are gonna help these businesses keep perfectly good food out of landfill and that's how we started. And so I am like we're a social enterprise were a waste diversion company. They're already paying to throw it away. I, my background was in non profits, you know, feeding people, I was doing this for a long time and I wanted to get to work and I felt like as a nonprofit, I would probably still right now just be proving the case and trying to get donations and trying to kind of make it happen. But there's a real business case. I was bringing a technology solution. I'm bringing metrics that are real that customers can use in their CSR and sustainability reports. So there was, it was very, just to me it was the business, there's a business opportunity here. That's amazing. I want to open it up for questions if anybody has any. Um how are you using technology to help run your business exactly like you know, what we do is we were all food waste now. So we started with edible food only in 2019, we became a certified B corporation and really said that we were gonna stand equally for people in for planet. And as we were taking edible food, we were really leaving a lot of non edible food behind and it was still ending up in landfill. So what we do is we inventory everything it is that a business sells, we have both an app as well as a portal. Um it's a very easy user experience. They click on the items that they have, they request to pick up, we deploy a driver and real time they get that food picked up right away and then delivered to the nearest nonprofit that nonprofit signs for. Almost like they would a ups or Fedex package and their signature automatically generates a donation letter and our technology tracks everything that's been donated um what's not edible, it also attracts what's gone to compost what's gone to animal feed if we've turned this waste into renewable energy or gas. So it tracks all of that for them and really rolls it up into these compelling repo showing them every pound of food kept out of landfill. What that means for C. 02 emissions and it helps them drive down the narrative that so many companies have set for themselves. There's very few hotels, you know, large businesses who haven't made a claim that we are going to be more sustainable, we're gonna be carbon neutral, we're gonna cut our food waste in half, and what we're doing is helping them do that, that's amazing. Uh you've got a lot of sustainable leaders in the room. I'm curious how um how are you working with SGS to, you know, to help them achieve their goals while also cheating your goals? Yeah, I mean it's it's been a really good time for us. I will tell you when I started this company in 2017, no one was talking about food waste or sustainability. I I remember going and meeting with a really large corporation here in Atlanta and trying to get them to just test test out and they were like, oh no we'll never do this. You know, you guys aren't a nonprofit But I don't see how this could work. And this year they like emailed our general inbox, you know, there was like the gravel ng several years ago and it just shows you that there's like this tie that's changing. So we're working with large hotel change, like IHG hotel groups who has said, you know their journey to tomorrow promise is that they want to have no food waste by 2035 and so we've rolled out with them across all of their own locations and we're doing that. We also are rolling out nationwide. I'm with Dunkin donuts. Uh, so tons of donuts go to waste. We saw actually a Tiktok video um they had an employee throwing away all these donuts, We sent that to them. They came and met with us from boston and the rest is history. And so now we're rolling that out. So those are just some of the ideas of how we're working on the sustainability side, um, as it relates to social, we work with really great corporations. So everybody from the NBA to the Atlanta hawks to State Farm. And we are help tell them we think how we solve and address food insecurity in this country. We believe that there's a big difference between access to food and access to meals. And the traditional model is usually like I give you £10 of onions, I've given you 10 meals and we look at that is very counter active. And so when we produce our pop up grocery stores, um we are introducing the first mobile grocery store to the state of Georgia in january. We also have freestanding grocery stores that are free that sit inside of title one middle schools and high schools and elementary schools as well as inside of low income senior housing. And we're basically making this food available for free with our partners, uh, covering us that sponsorship costs and it's just been a real innovative way to guarantee people 7 to 10 days of food every time we touch them. That's amazing. That's the best job ever. It sounds like it. Any questions from the audience. Yes. She's coming with a microphone. Hi, I'm Gina J. Diva had a V. S. G. At Guardian life. So, so glad your organization exists because I think we've been talking about this for many, many years for smaller companies. I think sometimes there's this like risk hat that gets put on, right? So when it, even when it comes to food waste, so what are some of the, what are some of the pushback that you've heard from? Maybe some of the smaller companies and how have you overcome that? Yeah, I mean, even the larger and smaller companies, I think liability was always a big fear early on. And that was another reason why I set this up as a business. So what we look at this as a business to business transaction, um, just like a waste company provides a waist spin Gooder provides all good or branded packaging materials. So when we work with a customer, they package any food into our materials, the nonprofit's never know exactly where that food is coming from. We also have a very extensive vetting process with all of our non profit. So they have to sign a hold harmless agreement. They can't hold good or any of our partners liable. Um, they can't barter the food, They can't make someone work in exchange for resell it. So we have a pretty extensive policy there and then we also ensure it, I think that's the biggest thing. So we have a really large liability insurance policy that covers all of the food that we move. Um, and so that's really how we set out to do that. So we really wanted to take that factor away from them. And so we do have a waiver of segregation as well in our insurance policy which essentially says what's good or takes on the food. We own it. And so we make the assertion of like this food isn't good enough to be donated. It needs to be composted. That's our liability. And so that's how we operate. I'm curious how big is your team these days now full time? We're at about 40. Um we're headquartered here in Atlanta and then we have like part time contractors all over the country, you know, drivers. So yeah, you're not just in Atlanta these days. You have outlets that post, Yeah, we're about 34 cities. Atlanta. Denver Dallas are probably our top three markets, but the tri state area is starting to become a really big new york, New Jersey. So Adelphia and then even Delaware, so those are kind of some big expansion efforts in California and are there areas that you're not yet that you would like to be. Yeah, I mean we want to be everywhere. I think we're not really. Um I would say like in the Northwest, you know, I think that that's another goal for me like Seattle Portland, there's a lot of need there and then you know really like the midwest, like we're in Detroit, we're in Chicago, but but that's pretty much it. Like there's still a desire, I'm wanting to work backwards. I think it's good or I want to be able to say for good er you know, we've reduced hunger 15% in american is just feeding this many people and and so I'm looking at the states that have the most hunger and with that sometimes the states that have the most hunger don't have the most ways. And so we've seen that, you know because they don't have them, they're not really big enterprises there, there's not a lot of organizations. So you think Mississippi west Virginia Kentucky, lots of hunger in these in these markets, not a lot of big corporations that are based their headquarter their operating and so we don't see as much waste but there's still waste everywhere. You could think from the smallest restaurant to the college corporate campus. I mean it's just everywhere in between. There's food waste. Yeah, interesting. Any other questions I just want to make sure. Hi, I'm Susan. Excuse me? Susan Mcpherson Mcpherson strategies. I absolutely love what you're doing and you know, as we've talked with other speakers, you have a room full of influencers, important powerful people, how can we all the outflow? Thank you, I appreciate that. You know, really just letting people know that good or exist. I mean we have all seen food waste and so there's, there's not anything you go to the gala, you see 20 tables that are empty and there's all this salad's already on there. Like just telling people about us is a big opportunity letting people know that we have solved the biggest problem in it, which is the logistics. We look at hunger not as being an issue of scarcity if we are way £80 billion 42 million people will go to bed hungry, wake up tomorrow and not knowing when and where their next meal is coming from. And so we are really just trying to make more inroads with companies who against Susan have set these goals like that's the thing you're saying you're going to cut food waste in half by 2025 and you haven't gotten started, we are a real solution. We also are an MBE in a W B E certified business. Um, so those people that are also trying to hit those diversity supplier diversity marks, we really are like a one stop solution for a really big problem. So just referrals, you know, letting people know about us, um, reaching out to us if there's opportunities that we can work big and small, you know, we're available. We work with small one day festival that say, we want to say there's no food waste at this festival, at this conference all the way up to college campuses, like Emory University who we do all of their waste on their entire campus. We're helping Emery drive down to zero waste. And so they'll be the first college in the nation that has nothing that goes to waste. And when we do their animal bedding, their recycling, we will manage all of that for them. That's amazing. Um, what are some of the biggest challenges? You know, funding was definitely a big challenge. I think we all know we're in this serious like market correction phase. And so there were, I think when I went out to fundraise in 2021 I remember one of my investors, like you guys are doing so great. You know, the market so easy right now, you're gonna raise in two weeks and we didn't raise in two weeks. It really took us like almost nine months. So it was really, you know, the tough piece of that just where the market is right now. Um, I do think we're star starting to see a lot more customer adoption and customers coming to us. Uh, so that's a positive. Um, but you know, we, we needed to grow the team. We needed to do a lot of the fundraising was a challenge. I think getting customers to also give new innovations opportunities, especially because hunger to be honest with you has always been solved like with the food banks, it's always been like, we're gonna take a big check, our whole corporation is gonna come and we're gonna take a picture, we're gonna pack boxes and you know, we're fighting hunger and that's not how it needs to continue to be like if we want new solutions, we've got to try new ways and, and so I think getting past the old guard is a big opportunity. Do you find corporations don't want those photo opportunities? I find corporations are resistant to just change sometimes when you're checking the box, it's like, what's the point of changing it? So I think that's sometimes where some corporations, but, but I'm inspired because there are new, like sustainability leaders that are coming in and saying like I want to do different, this, this needs to be done differently and that's inspiring. Um, so I'm excited about the new people coming in and kind of shaking the table a little bit. Yeah, I think most of us have been in those situations, but the photo opportunities kind of wondering really accomplishing anything. Any other questions from the audience. Okay. Just making sure I didn't miss anyone. So what's next global domination? I would hope. Yeah. Um, we're opening a lot more of our free grocery stores. So you'll see, we are opening, I think two or three next week here in the Atlanta area. Fulton County as well as Cobb County schools. Um We're opening in Memphis Tennessee which is going to be really exciting for us. Tennessee is actually one of the top 10 hungry states. So it's exciting to see us to that our mobile grocery store which is really going to address global. I'm sorry rural hunger which is a big opportunity. Um A lot of people don't know that about 28% of this country lives in a food desert, meaning that they are more than 10 minutes away from being able to access fresh and healthy food. So they end up shopping at places like dollar tree, dollar general, the local guy gas station. And so we are bringing food directly to people again on the logistics space. You're gonna see a lot of the big rollouts that I've talked about. The Dunkin donuts, the I. H. G. Hotel groups bristol Myers Squibb So just seeing a lot of new companies that we're working with that are coming on board to say let's end this thing and you know let's do it. So we're really excited about that. That's amazing. I have to ask do you still cook used to cook for 300 people? Are you still hosting those kind of dinner? I'm not doing those dinners. I mean I cook for thanksgiving. I think my biggest problem is like trying to cook small because I'm so used to cooking for, like, a lot of people, so it's just me, my husband and my daughter and I just was like, I made way too much food, but how many pies? I made? Two different, That was a lot, Yes, but I froze everything, of course, so nothing will ever go to waste, and we'll just kind of go back in and revisit you find yourself bringing those um you know, the public facing a good er no food waste into your own home. Oh yeah, we compost and we're like, yeah, if you ever go to Gooders Office, like you're gonna be really for like, there's no trash cans in the office, like no one has a trash can by their desk, it's very much like nothing goes to waste in this office, and my team, I have like this really great team who's all about sustainability, like, we're a really young team, so lots of like, recent graduates from Georgia Tech and, you know, Spelman Morehouse, and people come in and they're really brought into this vision and we don't want it, I mean we're really like, we really walk it, like we're talking and so we offer free composting to all of our team members, so we can they can bring their compost from their house in, we compost it for them um Yeah, so if you ever come, you know, don't bring your track, I love because we're hearing it, yeah, bring that compost in, so yeah. Um it's good. I mean, I feel really, I feel good about where we're going, great about where we been for certain and I'm happy about where we are right now and I just think we still are really at the beginning of a long journey ahead to disrupt two big industries. Um, and that's waste and you know, the food, the food industry, like how it's traditionally been solved and we are, we're just excited about it. So please, you know those of you that are here, um, myself and Kristen ward from our team here at google. We're here today during lunch. So see us if there's ways that we can work together, um, we would love and be honored to partner. Amazing. Thank you so much. And this has been really interesting and inspiring.

Davis Smith, Founder and CEO, Cotopaxi 
Interviewer: Ruth Umoh, FORTUNE

Impact Initiative 2022 - The Uncommon Path

Kathleen McLaughlin, Executive Vice President and Chief Sustainability Officer, Walmart Inc., President, Walmart Foundation 
Interviewer: Alan Murray, FORTUNE


 Impact Initiative 2022 - Leadership In Action with Kathleen McLaughlin


Impact Initiative 2022 - Leadership In Action 



Impact Initiative 2022 - Leadership In Action with Kathleen McLaughlin


So when you're the largest company in the world by revenue, the moves you make with suppliers can bend markets and set an example for others to follow walmart walmart project yucatan involves over 4500 suppliers. It aims to eliminate one billion metric tons of greenhouse gas emissions from product supply chain by 2030. We're going to sit down with the firm's chief sustainability officer to assess the project's progress and discuss walmart's broader climate policy. Please welcome Kathleen Mclaughlin, executive vice president and chief sustainability officer of walmart and president of the walmart Foundation for a conversation with fortune Media Ceo Allen, Murray, Kathleen, Thank you for being here. I think it was around two years ago that I first heard your Ceo Doug McMillon say we're going to be a regenerative company. That was a new one for me and said, okay, well now there's another word, I've got to figure out what does that mean that walmart, the largest company in the world, is going to be a regenerative company. Yeah, well, it's an aspiration we're working toward and to regenerate, means to restore to renew, regenerate. And it means regenerating the resources that we rely on for our business to operate our business and that's people and planet. So, um, you know, anybody who's been working on circularity for awhile has heard about shifting from this, take make break, you know, kind of economy, um, to one that's circular, same idea. So how do we replenish restore renew And that means elevating people and the resources that we use as a retailer for the products that we make and source and supply to our customers. So that's what it means. It's an ambition, we're not saying we're there and it's an ambition for society. This is a big systemic transformation that we're talking about. Not just for one. Yeah, it was really impressive. I I'd love to focus in a little more. I know you've got a lot of different things going on in this area, but I'd love to focus on project gigatons because I think with the conversations we've been having about scope three and how do you engage your supply chain? It's a fascinating example. So explain what gigatons is and how it came about. Well, back in 2016, we had been working on energy efficiency and renewable energy for a while and working quite closely with folks from Environmental Defense Fund and World Wildlife Fund and C. D. P. At the time, which the carbon disclosure project and they were forming along with World Resources Institute, a new initiative around setting science based targets for emissions reduction and translating those targets into business targets by sector. And they said you really ought to do this. You know, you ought to set a target and we said, okay, that sounds great, but how do we even get started. Um and of course back then. Um really, especially in terms of the emissions from our supply chain and so on, it was hard to know where they came from or how to even get started on it. So, um, what we did know was our scope one and two emissions? The emissions from our own operations are electricity, our trucks are on site, fuels frustration, pretty straightforward, pretty straight, but you know, we could measure that more or less and the scientists said, look, we don't know what the emissions are from the production of your products or how they get used by consumers. But let's assume like 90 95% of your emissions come from that. So we literally just took our scope one and two emissions and multiplied by 20 like we didn't know, but that's what we did and came up with the number and then we did the math with them that said, okay, so we're gonna reduce in line with the paris agreement to stay within at that time, the two degree um, world it's 2.5% reduction per year of those emissions. And when we add it all up, compounding, you get to a gig aton a little over a gigatons by 2030. So we said, okay, well let's call it project gigatons and that's our scope three science based target. And what um, those advisers said to us at the time is, look, the most important thing you can do is get started practical action that makes a difference on d carbon izing the most concentrated emission sources in supply chains with suppliers, but getting started now making it feasible Easy, compelling for people to do. So that was project yucatan and we designed it to do that. And so how did you get started? So we did some of the math around where we thought the emissions were and these are pretty gross estimates and we came up with six different arenas of action. So energy product use, waste reduction, packaging, agriculture and forests. So avoiding conversion, divorce station conversion of critical landscapes. And we worked with the scientists to identify actions that companies could take beef suppliers, apparel suppliers, shoe manufacturers. So depending on the category, different concentrations in those six areas, practical actions, they could take energy efficiency and a factory converting to renewable energy, reducing food waste upstream with farmers changing packaging, reducing packaging, designing laundry detergent to be used with cold water instead of hot water, which was something PNG really leaned into. So practical actions that companies could take that would change the way products get manufactured, grown, harvested or used. And then we created calculators like mad Libs. So if any of you guys have kids or you know, have birthday parties or wedding showers, these mad Libs right where you fill in the blanks in a sentence. So we took these actions and had blanks that suppliers could fill in and literally just press a button and it tells them what the emissions impact is. So for example, I have a factory in Iowa or Albania or Arizona. Um it is um sourcing energy from the grid or I have my own wind farm, so which is it, I'm converting to this energy source, that project will be for 10 years. Here's how much electricity I draw from that, press the button, here's the emission savings. That alone was a huge intervention because it allowed small suppliers as well as big ones to engage and that was one of our goals. We wanted to democratize climate action, drive innovation, get emissions down to zero across all categories, but focus the action where it matters and make it really easy for people to do. Um so we did that and then we said, well how can we support people? So we started off with just workshops to even explain all of this and make the business case and you know, we had some folks show up to our first workshop and they said, you know, I came because you asked me to but I don't think this is relevant for my business because I don't have any greenhouses. Remember this is 2016, 17. Right, So we wanted to help them build the business case for their C. E. O. S and their boards and then also how do they get started? And then we've, over the years added programs, resources tools to help people go faster in each of those arenas is a requirement. No. So this has always been a debate at walmart do we require, what do we require? What do we just make an invitation? So, because this was so new and such, um, You know, there's a lot of skill building to do and a lot of make the business case to do. We said, Let's just start out, make it voluntary and see how far we can get. Well, you mentioned, I think in the intro we have 4500 suppliers as of a year ago, we'll be disclosing our new number and it's even bigger And those suppliers represent over 70% of our business. So you have, you have more than 70% compliance on a completely voluntary basis. So, so, um, Walmarts relationships with its suppliers are famous, right? I mean when you're as big as Walmart, it's an important role and, and for years, I mean, this was sam Walton's mantra everyday, low prices for years. What they've been feeling was pressure from you to keep prices down, to keep margins down to innovate to provide less expensive goods. I can imagine some of your suppliers saying, hey, I can get cost down or I can save the world, but I can't do both. Don't ask me to do both. Do you have those conversations what happens in those conversations? Yeah, of course. And so a good merchant, the way that you get cost down on a product is by focusing that product and the supplier on what's relevant for the customer. So only, including the specs that matter and not all the bells and whistles that don't and eliminating waste from production and that's really the mindset around everyday little cost. Um, there's a notion of everyday low true cost, right? So how do you do that in a way that can be carbonized And what we found is a couple of things first of all in the early days, especially most of the interventions save suppliers money. That's one of the reasons we have such high participation energy efficiency these days. Even trans transitioning to renewables. That's a creative eliminating packaging, that's a creative shifting to a better packaging material. That's good. By the way, the famous example that I love that happened many at the beginning of your journey was convincing Procter and Gamble that you could make concentrated tied in smaller packages, save on packaging, save on transportation costs. Yeah, not ship water around essentially, you know. So, yeah, agriculture fertilizer is a massive cost for farmers. So fertilizer optimization reduces emissions and reduces costs for the farmer. It was one of the earliest things we went after that actually gave us confidence we could do this. So part of it that there is some very creative steps that people can take. Second thing then is just innovation. Right? So if you've got something you're like this, it's too high cost right now. Okay, well how do you do it differently? What's the innovation And and to me that's one of the big, valuable impacts of a project like this is, it's accelerating innovation in the sector in the industry and that's what we want. These transitions were talking about energy, transportation, agriculture, these are societal transitions. This isn't just walmart and our suppliers. So innovation has been the innovation requires investment. Do you help them with the necessary investment sometimes? Yes, in different ways. So for example, we have a partnership with HSBC and HSBC provides favorable financing terms to suppliers that are engaged in gigatons working on projects disclosing their progress. Um, we've done something similar with Schneider Electric around renewable energy where our suppliers came to us and said, well we want to participate, but we don't have a procurement team that does renewable procurement. So Schneider offers an aggregate power purchase agreement vehicle to suppliers. We have our first cohort doing that. Now. It's levi Strauss smuckers, you know, a number of suppliers where that's a benefit to them. Cool. So you pull this target kind of out of a hat. The gigatons target are you're gonna make it 2030 by 2030 based on what you know, today you're going to get there. I think we will get there as of last year reporting we were at 574 million metric tons. So, well on the way, we won't stop, right. We had to pick something and again, the focus was, let's get going now, let's not wait till 2040 we're gonna keep going really as a society, we're trying to transition to net zero. Um So I think we will make it, but then that won't be the end. Like we're going to continue. We've had a lot of conversations here over the last day about the political pushback on corporations, csg etcetera. You are in in many respects a a red company, you're in a Red state, you have, you serve customers in Red states. How do you deal with florida or a texas? That's saying, oh hey, all the csG stuff is Bs and and and don't talk to me about it. We don't want your woke agenda well, we really serve America. It's true. We are headquartered in Arkansas but our customers are all across the U. S. And other countries as well. Our suppliers are all across the country are associates span the political spectrum. Um so we really in many ways reflect the country for us as a company. Our priorities at the intersection of business and society are those things that pass three tests. One um needs to be relevant for our business. So when we're working on energy efficiency or packaging or trying to improve agriculture for surety of supply of our products, there's a business case that we can clearly articulate and that's really where we focus second these issues um that we're working on are ones that our customers, our associates, our suppliers, our communities have asked us to work on, they expect us to do it. And third their issues where we believe are getting involved in it will make it better and not worse. So for us it's a matter of being able to explain, like why would we pick an issue like this? What's the benefit of us working on it? How does it serve community and being really true to that case? Um inarticulate so, so you've been at this for quite a while, probably longer than a lot of the people in the room. What's your advice to people who were earlier on their journey to figuring out how to get large corporations to have a proper impact on E. S. G. Matters. My advice is whatever your organization start with, what's your core mission and then of all the things that are out there. Environmental issues, social issues, governance things. You're being asked to do which ones passed those tests? I talked about what's most relevant for your business, stakeholders, expect you to do it and you have capabilities to make a difference. Start with those and set it up in a way that you have concrete measurable steps early on. You can have the long term target, we need that. But what can you do immediately start with the things that are a creative and do the innovation to expand that aperture and make more and more of an impact over time. Good advice, Kathleen, thank you very much for being with us. Thank you

Tom Davidson, Founder and CEO, EVERFI
Interviewer: Alan Murray, FORTUNE


Impact Initiative 2022 - Leadership In Action with Tom Davidson

Impact Initiative 2022 - Leadership In Action 

broad based education is the foundation of a sustainable economy and thrive in society. The pandemic worsened existing inequities in America's education system with the learning progress of poor communities suffering the most. How can we improve the effectiveness and equity of our public education system? How do we impart practical knowledge like financial literacy? How do we support the communities most in need to discuss new approaches and how digital delivery can help? Please welcome to the stage Tom Davidson, founder and Ceo of ever five for a conversation with Fortune. Media ceo Allen Murray. Thank you. So, so tom everybody here has been bombarded with your brand. They sure as good here. They got it on their vest, they got the videos. So, so so tell us whatever five does. So ever five picked a series of problem sets that we think are highly underrepresented in the education system. So you think about health care, equity and understanding and navigating the healthcare system, financial education, mental health for kids around digital device, use, sexual assault prevention, other areas. So these are things that have been left out of the system for a long time. So we build out these fully digital programs that go into Tens of thousands of schools across the world. And uh, we do that in partnership with the private sector, pays 100% of the cost for 100% of the cost. So you don't charge the school systems, anything for the zero. Um, it really came out of in a former life. I was a state legislator, I spent a ton of time in the education system and I knew no matter um what I was gonna do in my life, I was never gonna show up at the West Ankeny School district and ask for, you know, $30,000 to fund something in a school district. So, so I love west Anthony by the way, you know, I'm sure, but you don't expect them to write you a check, right? Right. So, you know, so much has happened during the last three years. The pandemic people refer to it as the great accelerant. We saw e commerce accelerate, telehealth accelerate, so many sectors. I can't tell you how many ceos have said to me, we did things in six months that I thought would take three years, um, or some version of that, but the one sector that doesn't seem to have advanced and if anything fell backwards is education, Um which obviously is at the root of many of the social issues that we've been talking about here for the last 24 hours is your field. I mean, what is it gonna take to get the technology advances into education that have affected basically everything else in our society. So it's a great question. I think it's representative. I always tell people, I say um one of the saddest things about this work and I'm an enormous optimist um about what's ahead. One of the saddest things about this work Is that I tell people it's taken us 400 years in this country to so perfectly disadvantaged kids in so many parts of this country. It's taken a long time to get us here and um and it's a symphony that has happened, it's compounded for a long time and it starts with hunger and readiness and funding of schools and everything else. That's the foundation that we're building this on. So when you have something like a global pandemic that hits a lot of these kids, a lot of these teachers, they're starting from an absolute standing stop, right? And um, so what you had was school districts coming online for the first time, whatever. Now, there's been a lot of um great work and a lot of, by the way, bipartisan work on wiring schools, one of one laptop initiatives providing the access, but what you found in a lot of communities in this country is you were still at the infrastructure stage and not at the layering of like software and learning in these other areas, LMS systems and learning management systems and um it took people a long time to ramp up, I think the good news coming out of this, it was a blast um, in a lot of parts of this country of infrastructure investment, you're seeing more of that every day and I'm really optimistic of the fact that the Foundation was laid, it's gonna be really powerful for kids and we talked about this a little bit yesterday, but how important is the role of the private sector in, in driving this well. So here's the message that I would bring to folks. Um there are, you know, what, what you have to realize. This is one of the things that you learn along the way is this is a number one. It's a ground game. It's a, it's a hand to hand combat game district by district 16,800 unique school districts, the United States 188 of them in Alabama alone, making unique decisions on curriculum, making unique decisions um, in partnership with parents and others around what is being taught in those schools. And so what's um, the place that the private sector has a really interesting place to play is in these areas of what I call these like exoskeletal areas out of the core. So it's crazy to me that we enter, I mean who in the world understands how to navigate the healthcare system um in this country, when they get out of school, who in the world understands truly how to navigate the financial system. I mean, it's dynamic, It's changing. I mean, imagine what's coming at a 16 17 year old in the world right now is they're trying to navigate web three crypto payment systems Venmo, you know, traditional banking and beyond. So we teach, um I always say we teach driver's ed in schools for a specific reason. We'd like to not have crashes on every street corner. Um, it's amazing to me that we don't teach these things and um, and so where the private sector can come in as private sector can step in and actually, you know, whatever if I've done is we gonna network together 38,000 schools, mostly in very high poverty areas in the United States. Um and you can layer again and again on top of that network and go at these areas, so teachers and parents and others don't have to go harvest the parts of these things. So we've decided to start from kind of the outside in eventually you want infrastructure that will go in and reinforce the core, but right now you have to also respect the fact that education has been a local, localized system, a localized approach for the entirety of this country. My bet is it's always gonna be that way, and so you have to play within that system. Yeah, it's wild. It's crazy. Uh by the way, if anybody has questions or wants or comments for tom, please raise your hand now and we'll get a mic to you and I'm, I'm happy to get you in, but I wanna, I wanna ask about not just the what you're teaching, you're teaching all these life skills that people need to be successful that aren't traditionally taught in schools, but how you do it, um and the importance of technology and the importance of data because we've had a lot of conversations here over the last 24 hours about measurement measuring impact. That's a big part of what you're doing. So a couple of different things. Um you uh this is a pretty um I've never seen something that's more of a sprint in the marathon at the, at the same time, you know, so I'm a dinosaur and I, you know, I go into schools and every quarter I go and you know, I'm in schools all the time, but every time I go in I'm kind of like, wow, we're behind again is meeting the kids in the places that they were, want to be, where they live, the types of technology that they utilize, how they want to learn. So what used to be long form and short form, what used to be um done in front of the classroom is done on devices. Um and so number one, you have to constantly understand how to meet truly. It sounds kind of cheesy but truly continue to meet kids where they are and that's a faster clip than it's ever been. Um So number one is um just recognizing that you can't put somebody down, just have to be clicking through the kind of nightmare training that we all go through in our corporate learning side. It's got to be um multi platform, It's got to be um using audio video, it's got to be accessible. Um It's gotta run through a wringer of privacy standards and schools that are unique and changing and different every day. So I always tell people it's a pretty simple but not easy approach, but it's, it's got to be fully technology enable. It's got to be able to be done in the classroom, but more importantly, be carried anywhere um because of broadband issues and other things in school, kids need to be able to do it at home, parents need to be able to engage with it. Um and that's ever changing and tougher every day to keep up with it. And how about the metrics? How do you, how do you, if, if if someone in this room decides to partner with you to uh on mental health issues, for instance, how do you show that you're really having an impact? Sure. Um one of the things that we've done is engaged, um third party uh third party analysts and others who have come in and done and be testing around this stuff, We have to measure one of the things that we like to measure. For example, in financial literacy is just starting to actually build financial infrastructure kids after they finish our program. So can you open savings accounts? Can you measure whether their credit was different over time? Can you measure whether they compounded that savings over time? And so I think one of the things that we've learned in financial literacy is you just can't teach it. You have to kind of follow with the Yeah, yeah, fascinating. So the, the, you talked about, I forgot the number number of school districts, 16,800 in the US and how many in Alabama alone that have to do that again, But, but 187 in Mississippi, there are a lot of, of school systems out there. And, and one of the things that has clearly been happening over the last couple of years is is that those school boards, school system conversations are becoming more politic, they're becoming polarized just like everything else that has to, if you're teaching something like mental health or diversity equity and inclusion, you have to be caught up in the middle of those political debates. How do you deal with it? Yeah. Um, it's, it's been both a very, you're smart called out. It's um, it's, it's a big reality that we've had to come to in the last couple of years. Um, it's also pretty sad in some areas. I mean, we've had places where we've had firefights on like our basic, you know, we built one of the, I think it's just an amazing course on african american history that we've had in schools for 10 years and never had, um, uh, one word about it. And, and um, and now it's been caught up in some of these issues. Um, you know, at the end of the day, what I see about the really, really active politicization, um, politics has been put into this and I recognize the politics. Part of everything now is um is that it's really at the end of the day, really disrespectful to teachers in a lot of ways. I mean teachers are having to just whip saw back and forth around these parent debates and I think teachers um we don't understand what teachers face every day. I think that's been the most amazing reality that we face is that teachers are the ones who are calling out whether kids are getting their ears checked, whether kids are getting fed every day, whether kids are arriving in a position that they can learn every day now, they're navigating um you know, the crop dusting that's going on in a lot of places by parents coming in and out of um decisions around curriculum and what's being taught. So um it is what it is, we're gonna have to navigate it. Um but it's certainly something that's making us think state by state, almost county by county, in a way that we never have had to ever before. Um So in the conversations over the last day here, uh what has emerged for me is a sense that the e part of E. S. G. Is really got some texture and structure around and people are beginning to figure out the metrics and how and how you do it, but the s is still a kind of an undefined blob, um what's your advice to this group on how to think about their social impact? So one of the things that's really interesting around some of our partners, like a mass mutual Foundation or Edward jones, like interesting thing about what Edward jones is built is they've built this um growing national program around understanding like how marketplaces work for kids in places that, I mean literally this instruction has never been been built before, so you're seeing the scale that they're reaching, like they're gonna reach a million students in the coming year on that, I mean, so it's just this compounding fix. And when you think about something like the nightmare of F. T. X. Or the nightmare of, you know, these things that we're seeing um you see this under you see this girder being built underneath kids where they're learning the instruction of how marketplaces working these things. What I tell people all the time is there's an art of the possible to all of this that you can scale these things in a way that you never have before. It's incredibly powerful and optimistic for the country. It's great. Great to have that optimistic message. Thanks for partnering with fortune on the Yeah, that's great, I appreciate it. Thank you very much

Grant Canary, Founder and CEO, DroneSeed
Avra van der Zee, COO, Elemental Excelerator
Moderator: Nick Lichtenberg, FORTUNE

Impact Initiative 2022 - The Intersection Of Technology And Community

The Intersection Of Technology And Community

Welcome back everyone hope everyone enjoyed the networking, but we have some terrific conversations ahead. So we're gonna get right to it. One of the prominent themes at this year's cop 27 was the importance of climate adaptation and funding is starting to flow into technologies which help us thrive in hotter wetter or drier conditions. In our next panel, we're going to hear from an investor at the forefront of this effort. We'll learn how her accelerator is boosting climate impact and speeding progress in our energy transition. We'll also explore the inspiring tech at one of their portfolio companies which uses drones to recede fire damaged forests. Please welcome Abra Vander Zee Ceo of elemental accelerator Grant Canary founder and Ceo of drone seed for a conversation with fortunes. Nick lichtenberg, thank you so much for being here today. Um so Abra I wanted to start with you um, elemental is uh such an interesting firm, can you tell us a little bit about elemental and its purpose and your journey there? Yeah, absolutely. It's so nice to be here in person Grant and unique. Thanks for convening us. Um so elemental is a nonprofit investor. We invest in transformative climate solutions with a focus on social impact and we invest across the climate spectrum. So, you know, transportation, food and act water, energy, circular economy, nature based solutions. And we're really looking for big ideas and transformative technologies that have commercial potential. Um so we're looking, we're looking for the idea that as social impact scales as commercial success scale scales. So too does social impact. Right? So we have now invested in 100 and 50 portfolio companies. Those 100 50 portfolio companies have gone on to raise seven billion in follow on capital. We have our portfolio companies have operations and customers in all 50 states and almost 100 countries. Um, one of the portfolio companies, somebody earlier from, from the fortune team made a joke about carbon negative concrete, you know, we have a carbon negative concrete company in our portfolio. So, um, we're really looking for commercial viability and then embedding social equity. So as a nonprofit, we're able to do things a little bit differently. So two things we do differently. One is we invest in first of a kind appointments and we provide wrap around holistic support. Um, and first of a kind might mean a new customer, a new business model and then to, we work with our companies to embed social equity and community impact into the design of the text appointment and we do that through a framework. We call equity in and equity out. So Equity in is building capacity internally within an organization, within a portfolio company for diversity initiatives and inclusion processes and Equity out. Looks to deploy technologies with a focus on community benefits and what that looks like might be workforce development. It might be incorporating community feedback into both the design of the product and the project. Um, and actually grants and drone seed is a perfect example of this. You don't often get pitches like I'm going to use drones to plant trees. Yeah, that's, that's the first of its kind example. Yeah. First of a kind, Grant was first of a kind in that it was drones to plant seeds. Uh, he wanted to deploy a project that involves carbon credits and he was working to think about increasing workforce diversity. So it's sort of a triple novelty. Yeah. Grant, can you talk about the triple novelty there? And I mean the name is, it says it all drone seed. Um, well yeah, I can, I can start there like as far as kind of what we do and how we got started, it's really as many are aware of size and severity of wildfires is increasing Less aware. Maybe is that natural regeneration where forest burns, forestry grows? Uh, that, that, that is something that is significantly decreasing. So it used to be forest regenerates 90% of the time. We're down to 60%, 40%, 40%. And on the supply chain side it's the, where the materials come from is extremely stressed. So it used to be that the industry had 10 years to respond to a 10,000 acre wildfire, uh, that's obviously no longer the case. So needing technology to be able to respond to that in a much bigger way. We started off with drones and seed. Um, however, it's not very useful to have drones if you have no seed and so going from there, like what we what we've been built out is a one stop shop for reforestation. So if you can imagine a reforestation as a, as a garden hose, uh there are four kinks in that garden hose today. Where does the seed come from? Where does the greenhouse grow space come from? Uh Where does the labor and the tools come from? Which is where we started? Uh And then lastly, how do you pay for it all with carbon offsets? Um So where, what in that process for that first of a kind project where we really wanted to do was demonstrate where where is the capital gonna come from with carbon offsets, but then also how do we, how do we work with communities and not just uh steak, not just our immediate land managers, but also the stakeholders and communities around there. So we hosted a tree seed summit, um that was part of our product development and it's a really good thing we did because we missed the step, we missed the step in our development of how do we collect seed from the wild and then how do we utilize it after a wildfire? And that was a not there was a non obvious step that we missed. Uh and that really changed how we thought about developing our product and our software to be able to increase the supply of seeds. Uh And that wouldn't have come about without convening, uh local travel nations, uh, convening uh private sector consulting foresters that have been working on this problem for decades. Uh, the public sector, uh, that's been continuing to support with academic research and their own work. So without those pieces that that conversation, um, we would have missed a step. And I think like what I can say is that from thinking about it from from uh, from as a Ceo, sometimes there is a drive to have a financial outcome. And then there doesn't feel like there is a permission to work outside of that outcome by having an investor or project funder and a convener with elemental accelerator. We in it was actually sort of because there was light accountability around like this needs to happen. This is one of our metrics, like there was permission to spend time to focus on that and that was really powerful. So making sure that you're gonna hit your target basically. Yeah, it's in less of like less of a less of a oppressive way and much more of a like, hey, this is really important. We've seen this in other portfolio companies that when these steps are not taken, things do get missed. And so like, talk to me about what you're doing, talk to us. And so that's something that having that, it's not like fill out your reports, do the thing, it's more like have a conversation and I'm going to ask you about that and if you know that you're gonna get asked then you're able to, you're, you're able to think through that process. And then there was a lot of tools and support for how do we convene that Tracy summit? Where do we go from there? And that is, you know, you described it once, which I love as friendly accountability and that is exactly what we're hoping to do is provide the framework and then you sort of prove that this is the right way to scale. This is the path to, you know, incorporate by incorporating community voices. You're risking your project and making for better commercial outcomes and better social impact at the same time. So it's exactly what we're hoping for is to provide startups that are earlier in their scale journey, this kind of cover to do that excuse or accountability will call it to do that to do that hard work and show how it works because this is all hard, like everything we're talking about and here we have a video with you today that is this related to what we're talking about or is it more about something else? Yeah. So this is the most powerful thing that we can show which is our land manager customers are landowner customers speaking about how important carbon offsets were to making reforestation possible. And so if the, if the timber resource that was being cultivated Burns, where's the capital come from to reforest. And so this is and that's really coming now from offsets. And so without offsets response to wildfires is does not have a funding source and nature is decreasing so it needs support and it can't be relied upon 100% as it used to be. So alright. Um, so here we have a video. Let's take a look. We lost over 80% of the trees on this property and it was a devastating loss. Land managers who have been affected by fire are looking for solutions when you see your life's work disrupted in a way that you didn't think was possible. It's really, really difficult in that initial moment to think, oh, how am I going to accomplish a task? How am I going to reforest this? And that's where, whether it's seeds, seedlings, drones or being able to pay for it, that's where we can plug them in and help them while doing reforestation better with drone feed, we were able to have a plan of drone application of pucks then to have hand planting seedlings the conventional way. But the other very, very important thing that they did was they brought some carbon financing to the equation. Reforestation is really expensive. It can cost thousands of dollars an acre to really execute on a reforestation project, drone seed partners with landowners to develop a carbon offset projects to finance that expensive upfront cost of reforestation, it feels really good to provide a path forward to forest recovery to let the landowner know that they aren't alone that we're here to help them finding a solution is really what inspires me to come to work every day and do what I do. How many did you do today? 40,060 oh bien bien. I mean how does it feel to see that uh the the part where where the loss every time hurts a little bit So, but as far as what we're able to get out there and accomplish um I mean those drones are those are very large aircraft and so looking at that like it doesn't do it justice in size or about eight ft in diameter. Um, so not something you can get at best buy uh something that we, you know, we fly groups and that's that's one part of the process. Um, so yeah. Yeah. Um I'd like to open it up for questions if anyone has a question about how you plant trees with drones were here. Hi steve Boyle at Rubicon carbon. Um question about the reforestation efforts in the permanence, Have you guys sort of quantified the permanent aspects of these projects? And what is that sort of association would be helpful to know? Yeah, we utilize climate action reserves methodology. Um that methodology we do really good reforestation. Um we utilize for this project here. We utilize eight species their native obviously, but it goes so much more than that. Um We collect seed from what the U. S. Forest service has as seed zones. They're about the size of a county. And so we spend all of that time figuring out how to collect and utilize seed from as close to a fire as possible. So if you can imagine a game of battleship on the west coast where we work Oregon Washington California when there is a fire, there's a county map. And then do we have seed in that in that seed zone or that county uh sort of geographic area. So I may have lost a couple of you, but basically it's very much like we utilize seed from as close to the source as possible. Um And then as part of the project, uh there's a conservation easement that's placed on the land. Um So this is really stringent. Uh it basically allows for monitor funded monitoring for the next 100 plus years uh and utilizes the same accounting that any timber company is used for the last 150 how many tons of carbon are going to be captured as the trees grow over that time period. Um And that's instead of utilizing how many two by fours am I going to get off of an acre? Uh Which is what most timber companies would look at. Instead we're utilizing, we're swapping out two by fours and board feet per hour for tons breaker. So again, I may have lost some of you on that but effectively 100 plus years of monitoring by nationally accredited land trust and uh, that's something and some very, very solid 150 year uh backed projections about what will be captured over that time period. The last thing I'll hit is that it's much lower density. That's what we target. Um which is for fire risk very important. Um, and then climate Action Reserve has an insurance buffer pool. So if there is a reversal in the future and offset buyer knows that it's either coming from that insurance buffer pool, uh and every project contributes to that just like medical or auto insurance. Um there the the offsets are coming from our project or it's coming from that insurance pool. Yeah, I mean, I have a question for you again, abra which we talked about the importance of first of its kind investments and basically you have to come up with a whole new metric for each new company you're investing in. So, um, you know, you have to come up with this map of the wildfire zone that grant was talking about. So what is that process like coming up with a bespoke? Yeah, measurement. Well, it's a great question but you know, we this is where we partner and part of our theory of change write our unit of changes, working with entrepreneurs to scale these much needed technologies. So Grant, unfortunately not me the expert on all of this, these questions. So what we're looking for is is, you know, is the technology transformational, um for a number of reasons, we have an extensive diligence process, you know, we probably look at 1000 portfolio or potential portfolio companies a year and ultimately select between 15 and 20. So um we have an extensive diligence process but it's really about um finding partners that are looking to make the type of transformational change, have the commercial viability and opportunity and have the willingness and to to embrace the equity and equity out framework. So we do some customizing in terms of project deployments, but the customizing is more along this framework of equity in and equity out and we have a number of kind of areas we focus on, it's almost like a internal sort of checklist to think about how can we provide support to this company that might be, you know, working with shipyards um and want to do workforce development there or um it could be a company that's trying to grow and scale right rapidly. How do they build diverse hiring practices into their framework, knowing this sort of meteoric scale that they need to achieve in short order. So we have a number of sort of processes and it grew over time, you know, initially when we started in hawaii and doing business in Hawaii, you need to incorporate the community voice and think about local partnerships and then as we expanded to California and now globally we've created more frameworks to enable us to scale some of these solutions and there's never one size fits all, not even close, but asking the questions, hopefully develop the space for the creative, you know, entrepreneurs to say, well maybe we should think about convening this fairly unique sort of summit and gathering of different voices to help us really understand how we scale this technology. It's a relationship with this is all about how you to talk about this and the other the other stakeholders involved, I'm sure. Yeah, yeah, very much so, having attended the ceo summit in Hawaii, um I think what we're really excited about is like with forestry science, we've got 100 and 50 years of prior data. There are other companies with other carbon capture, whether ocean based or otherwise, that are really exciting. And I think we're, what we're really able to do is utilizing that data chart a course for others to follow. Um and that, you know, from from my perspective as someone who's deeply driven by climate and uh very strong concern for our social, political and economic institutions um in a failing ecosystem. I look at that and it's like this is something where there is a community that way I can talk to, but also we're charting a path for others and then we're learning from them as well in the process. So uh beyond the video that we show. We also have a QR code that you brought with you today and that's gonna have a link to a report. Right? Could you talk a little bit about that and what's going to be available on there? Yeah. So what you see there is like what we've talked a little bit about um, of course there's, who are the project stakeholders. Um we've got a little bit about the methodology that's being utilized and the monitoring, reporting and verification systems, uh, the project timeline, how that, how that is thought through as far as by Climate Action Reserve, how they think about the forward looking offsets and what that program looks like. So, some of the pieces there. Um, and then we've also got a little bit about the elemental accelerator process in there as well. Great. I think we have time for a final thought from each of you. Uh, how would you want to sum this up? Exciting challenge. Oh my gosh, okay, so I'm feeling actually tremendous optimism. Um I feel that we're in this unique moment in time. Right? So the innovation is there, you know, like I said about 1000 companies a year. We're seeing technologies are really solving the hardest challenges of our day issues, one of scale and we have the funding, The federal funding, unprecedented unparalleled levels of federal funding um with a focus on community, which is amazing. Um unparalleled levels of private funding. There's now over 180 climate VCS when I cut my teeth as an entrepreneur about 10 years ago, I can name the number of VCS on one hand that were focused on climate. Um plus new forms of capital, right philanthropy is playing a huge role. Um so you've got the innovation, you've got the funding and then you've got this crew, I am having conversations with super senior leaders who are driving sustainability initiatives at the highest levels of, you know, really important corporate and we have a corporate program we developed over time at elemental because we realize the incredible role, the powerful role corporate can play as part of the process of scaling technologies either by creating demand pull as customers, um also as purchasers of carbon credits. And so it's an exciting time based on all of us, it feels really like the time is now. Well, thank you so much for joining us today.

Sophia Kianni, Founder, Climate Cardinals; Youth Advisor, UN Youth Advisory Group on Climate Change
Interviewer: Lindsey Stanberry, FORTUNE

Impact Initiative 2022 - Translating Climate Activism 

Okay, so english, maybe the international language of business and science. But if you're one of the billions of people in the world who doesn't speak english, how do you access uh critical information uh about things like climate uh enter climate Cardinals and international nonprofit with thousands of volunteers that translate climate information you know into over 100 different languages. We're gonna ask the 20 year old founder about the importance of that of getting non the non english word out. And we're also gonna dive into her work as a U. N. Youth advisor, please welcome to the stage. Sophia Kiani, founder of Climate Cardinals Youth advisor to the U. N. Uh in conversation with fortunes Lindsay Stansbury. Welcome. It's so excited to have you here. You are so impressive. 20 you're a junior at stanford. You are on the U. N. Advisory council. The youngest member, correct. Um can you tell us about climate cardinals and what you what you're doing? Yeah, of course. Uh So climate Cardinals is a nonprofit that I founded when I was a senior in high school and it was inspired by my experiences growing up visiting Iran when I was in middle school. So both of my parents are from Iran and I grew up visiting my grandmother's house in the summers and after my sixth grade class on climate change when I went back to Iran, I was really looking at the situation through a new lens where I realized that the air pollution there that was hospitalizing thousands of people was really a symptom of the climate crisis and that temperatures in the Middle East were rising more than twice the global average. Um and even more horrifying was the fact that my relatives didn't know anything about climate change or global warming. They had never heard those terms. And part of it was because there was a lack of resources available in Farsi, which is Iran's native language. So I worked with my mom to translate climate resources into Farsi so that I could teach my relatives about climate change, which is how I came up with the idea for climate cardinals. So you're all over the world translating climate literature into all different languages. How did you get started doing this? How did you mobilize such a huge audience? Well, initially I started out by volunteering with some of the largest grassroots climate organizations in the world. So I worked with Greta's Fridays for future and extinction rebellion and I realized that pretty much all of those organizations only had their resources available in english. Um and with my experience in Iran as well, in my senior year of high school, I decided to work with a few of my friends to launch climate cardinals. Um and we actually ended up launching on Tiktok and on the very first day that we launched our launch video went viral and it reached a couple 100,000 people and we had over 1000 people signed up to work with us. And so now three years later we actually have had over 9000 young people with an average age of six, sign up to volunteer with us, but it was really always kick started because of social media and because we were able to use Tiktok and instagram and all of these organic marketing campaigns, $0. And I'd spent to reach hundreds of thousands of people. That's amazing the power of social media, right? I want to open it up to the audience. Um if anyone has any questions, um you know, the media paints a very wide picture of gen Z, I'll say that lots of different opinions on it, but I think one of the big topics of conversation that I see is that gen Z is so motivated by climate change, that they're even considering not taking jobs or taking specific jobs. What do you think that, you know, the members of this audience can be learning from your generation about the climate crisis? I think really what makes my generation so unique is that we do have a very value oriented way of approaching work in the sense that at stanford, I've seen increasingly, my friends are hesitant to take jobs that they feel like are from companies that are greenwashing or who aren't really true climate champions. Uh and I think it's really setting a precedent for how companies need to start thinking about engaging with the next generation of youth consumers. Uh and I did a lot of work, I worked as a senior partner of social impact of gen Z marketing agencies. So I consulted for a number of different fortune 500 companies and I did find that those that were the most willing to engage directly with young people and to create youth advisory councils to have young people in high level senior positions, they were more likely to be receptive to feedback and act implement and engage with their audience in a way that I think was very beneficial for them. And similar to how the U. N. Has a youth advisory group on climate change, I think that it is setting a precedent where if businesses are targeting gen Z consumers, then it makes sense to actually engage that audience and make sure that you're developing a product or a service that they're actually going to be receptive to. Do. We have any questions in the audience and I have, I have plenty for you. Sophia are there any, you know, there's a lot of criticism of Gen Z2, is there any stereotypes that really drive you particularly crazy? I think there are a lot of stereotypes. Um I guess I think the notion that um young people are lazy and they waste their time on social media is completely untrue in the sense that part of what I think is so different about activism specifically in this new era is I had this conversation with Sylvia Earle who's a hero of mine and has been a pioneer in the environmental movement and what we talked about was that it used to be that you would have a climate scientist or a policymaker go on tv and they would talk about the urgency of the climate crisis and nobody would listen because it wasn't engaging, it wasn't compelling. And now we have a situation where a young person is able to go on Tiktok make a seven second video and it's able to reach millions of people and people are genuinely compelled. And I think social media has completely revolutionized the way that we look at social impact when even, I don't know if you guys remember when that video went viral of the turtle with the straw up its nose and it ended up sparking all of these mass bands of plastic straws and all it really took was one video being shared widely across social media to have that insane impact. And so I think we are the Tiktok generation. That's completely true, but I don't think that it should be held in with this negative connotation. But I do think that the way that young people have been able to leverage social media to push for social impact initiatives has been truly incredible and I think it's revolutionizing the way that we look at activism, What are some of the challenges that you find motivating this audience though? I know that you have so many young people who are signing up, but do you find that they sign up in a moment of anxiety and then don't follow through? How do you keep them engaged? Well, climate cardinals has been able to translate over 750,000 words of climate resources into over 100 languages. And we've grown to 9000 volunteers in over 40 countries. And this has been sustained growth over the last three years. Uh, and so I I would definitely say that young people are enthusiastic, they want to work, they want volunteer service hours. Um, and I think it has not been difficult to motivate people at all. And I get dozens of emails every single day from young people from all over the world who asked me if they can work with climate cardinals, how they can get involved because young people genuinely truly care about climate action. And it makes sense when you look at the science and the research, when it's saying that my generation is experiencing the impacts of the climate crisis at a rate three times higher than our grandparents, of course we're gonna be compelled to want to take action. Of course we're gonna start grassroots organizations that are schools. Of course we're gonna start global nonprofits because we have no other choice, especially when we've seen the lack of action by corporate actors, by politicians. We feel like we want to take our future into our own hands. We've talked a little bit about um fortune apathy. This feeling that that we can't fix this problem. I think that that while it's wonderful to see you and the climate cardinals really like take big next step. We're also hearing from people that you know they don't care about their careers, they don't necessarily care about saving for future because there may be no future. What do you say to people who feel an apathy about um taking action? That's actually been one of my rallying calls and one of my biggest learnings at the U. N. Is that we need to get more people from being apathetic towards the climate crisis towards becoming activists. And that's another thing where I think the word activism has gained a lot of negative connotations over the last few years, but I truly believe that everyone can be an activist and there is no specific definition attacked the term in the sense that I didn't wake up one day and end up advising the U. N. And having a global nonprofit. It was a series of steps in an iteration. And I think similarly all it really takes for someone to begin their journeys and activists is to take that first step to evaluate how can I change my corporate culture in a way that I think is better for the younger generation or better for the planet. And I think about it often through the lens of how my friends look at it. Which is that my friends who are studying fashion for example, they're looking at how they can engineer more sustainable textile. And then my friends were studying computer science and engineering. They're looking at how they can improve modeling for making solar panels more efficient for example. And so across all different disciplines there is the potential and power to make impact. It really is about identifying what is your specific cause initiative and how can you make, how are you best positioned to make the biggest difference where there are dozens, if not hundreds, of thousands, of climate organizations. And I never wanted to duplicate the efforts of another organization, which is why I started climate cardinals because we're the first and only organization that's working to translate climate resources into now over 100 languages. And I I often also say if a group of ragtag teenagers that congregates through social media can do this work with very little budget, imagine the impact that a concentrated effort by governments policymakers, scientists and corporate leaders could have, especially with so much more money and so much more influence. And so we've been able to mobilize this global movement just from my childhood bedroom and I very much expect that a similar momentum and similar impact can be achieved if not to attend fold scale from corporate boardrooms. But I think that it comes with having a level of accountability but also having a vision and being in tired. I had to be inspired by schooling through my Tiktok feed to feel like I can make an impact and I think similarly, it really starts with feeling like you're in a position to make an impact and then taking those first steps and hopefully be power of young people and what we've been able to accomplish can inspire you guys to also feel similarly that you can be poised to make an impact. I always say never underestimate the power of a teenage girl, they really are going to rule the world one day. Um question Well, thank you so much. I, I am deeply impressed, like everyone else I see you on online etcetera. So I educate board of directors, executives etcetera. And from time to time I hear, well look at all these young people, they got all the ideas they will come and they will save the world. Should we just wait for you guys or should we do something? Well, I don't know why you would wait for us when you have an opportunity to directly engage with us, which is something that I've been really adamant about championing in the sense that if I, as an 18 year old have had had the opportunity to be appointed to advise the head of the United Nations and I'm now 20 almost turning 21 then I think every single Ceo should also be taking up the same mantle of realizing that we are not just the future, we are now and we're already making such a tremendous impact and I think there's also a lot of value that bringing young people into conversations can have. I mean I'm invited to conferences like this all the time and so often I have people come up to me afterwards and say, oh I'm so inspired, like this has really changed the way that I'm thinking and I counter that by saying, well imagine the impact that this sustained conversation would have. And that's why it helps to establish the different youth advisory boards and different youth initiatives to actually directly have people engage with young people. Because I do think that there is a sense of urgency that is created when it comes to sitting down and talking to someone who could be your daughter, who could be your granddaughter and hearing their legitimate concerns. But then also in addition to concerns, hearing about solutions. I mean so often I talk talk to companies and I talked to them about the potential of social media and Tiktok and they're like, oh we, we never even thought about making a Tiktok account and things like that are actually really important. I mean look at dueling, go look at some of the more recent successful examples of companies successfully leveraging social media to really resonate with gen Z. And so much of that comes with having like a young intern or having a youth advisory group that's able to give that strategic guidance, Maybe fortune needs a youth advisory group. Another question, Yeah, Ross wants Ceo Athena Music wellness, I'm focusing wellness education. So I like to hear what James's thoughts and what James's actions in terms of mental health. Thank you. Mental health is such an important topic specifically within climate because increasingly psychologists are saying that young people are suffering from a phenomenon known as eco anxiety, which is a debilitating fear about the state of the climate crisis. And I do think that when you look also at what companies are doing, rare beauty has made mental uh impact, for example, a core pillar of what they're doing and I think it's part of the reason why they have become such a fan favorite among young people. Uh and also when we look at telehealth services, for example, that's another really big thing where young people are increasingly attending on line therapy and looking for more accessible ways to improve their mental health. So I do think it's a really huge emerging space and mental health and conversation surrounding mental health are really a priority to young people because I think it also comes along with a sense of increased transparency and accountability that we're increasing, looking for uh in companies, but also in our day to day conversation. Sophia, thank you so much you, this is so incredible, you're such an inspiration, I really appreciate you coming here. I don't you're such an amazing representative of gen Z, I'm not sure when you sleep. Um I definitely don't think I get enough sleep, but you know sometimes you have to give and take, but life is about balance. Thank you so much. Thank you. Well now we all have to do list um and it's time to take a break, so this is the perfect timing. Um we're gonna take a break from the main stage conversation. You'll have 25 minutes to catch up with old friends. Make new ones, have some coffee, coke products. Um we'll see you back here at the main stage at 12:00. Thanks.

Michelle Nunn, President and CEO, CARE USA 
Jonathan Reckford, Chief Executive Officer, Habitat for Humanity International 
Moderator: Ruth Umoh, FORTUNE

Impact Initiative 2022 - Partnering For Impact

Kristen Siemen, Vice President and Chief Sustainability Officer, General Motors 
Interviewer: Nick Lichtenberg, FORTUNE

Impact Initiative 2022 - Leadership In Action with Kristen Siemen

Impact Initiative 2022 - Leadership In Action

So, General Motors underlined its green credentials with its announcement to only sell electric vehicles by 2035. In our next conversation, we'll sit down with GM chief sustainability officer and explore the transformation underway at the corporate giant will also learn how the company is helping expand E. V access and developing new infrastructure to support their mission. Please welcome to the stage, Kristen Seaman, vice president and chief sustainability officer of General Motors for an interview with Fortune's executive editor, Nick Lichtenberg. Hi Kristin, thanks for being with us today. Thank you for having me here. Yeah, so it's exciting to talk to you because the electric future is really here. Um, you're one of the world's largest automakers on track to create a world with zero crashes, zero emissions, zero congestion. Um, you're planning to sell only electric vehicles by 2035, I think we all know about this. It's, it's ambitious but it's exciting. Um, it creates business opportunities. Um, so can you talk about how you shift an entire product offering in that amount of time? So what types of strategic organizational operational changes you have to make and you still have to make in the future? Yeah, so as you mentioned that we're very proud of the goals that we set the, the vision around 0000 crashes, zero emissions, zero congestion actually was set back in 2017 and I was saying last night, you kind of go from wow, that was five years ago to wow, that was only five years ago and what we've accomplished and what we said and then the ambitions that you mentioned around, you know, we've set a carbon neutral goal for 2040 and our products and operations and our plan to eliminate tailpipe emissions from new like due to us vehicles by 2035. So a lot of big bold commitments um, based on science. So we do have science based targets approved as well um, for those. So, you know, it really is a cultural change. I would say in the company, we talk a lot about everybody in that this transition. We cannot do it alone. It's going to take public and private. It's going to take our suppliers, our employees are really working together to come up with solutions to make this transition. But it's reality, it's happening fast. I mean I think you can see some of the, you know, certainly proud of the products that we've introduced and and seeing those on the road is, is exciting. Yeah. So we know you're going to get to all E. V. By 2035. How long do you think global adoption will really take? How long until the whole world has electric cars? Oh, that's a great question. Um, you know, I think it's about a lot of, I think a lot of these goals are big and bold and it's hard to see how you get to the end game today and you know, I'll use my our renewable energy goal as an example. We set Our renewable energy goal back in 2016 to be sourcing, 100% renewable for our operations, original goals for 2050 and when we said that it was kind of like, I don't know how we're gonna get there right? Yeah, I mean I wasn't involved in that specific goal back then, but then in 2021 we looked at it and we said, you know what, we can get there by 2035 again, not exactly sure how everywhere, but we can accelerate. So I accelerated it 15 years by the end of last year. We said, you know, we can get there in the US by 2025 we actually announced just about a month ago that we completed our sourcing and are now meeting that goal. We have all of our projects sourced to be in it. So, so here it is. You know, we sent out of course an announcement internally and, and one of the employees responded and coming in and they said you skipped a generation, you know, and when you think about it that way, you're like, wow, we really did. But so I think it's really about setting those goals, making the steps every day to see how you can get there and a lot of times you can get there faster than you anticipated. So if you set a long distance goal and then you check up on it, you'll realize, hey, 15 years, they just disappeared off exactly. I want to ask about the stuff you need to make electric vehicles, metals, minerals, I mean, some of you have probably heard about the rare minerals that are needed to, to make an E. V. Um how are you ensuring that this doesn't wind up with a new version of the fossil fuel climate challenge with these rare minerals? I love your description of stuff, there is a lot of stuff that we have to do to put in there. But um, you know, it, we've, we've got um supply agreements in place to meet our um our plan of having a million units of E. V. Capacity in the U. S and china by 2025. So we've already got those agreements in place, you know, and I think it's important as well look at the supply, um again, working with our suppliers, but really ensuring that we're looking at it from a sustainability standpoint and so a lot of work to, to localize that, get the supply chain closer to us, particularly in north America. Um, you know, and making sure that as we work with those suppliers that they have sustainability goals as well in in making sure that we look at it and, and then even things like circularity, you know, there's a lot of focus on the batteries and then what we do it in the life to reuse those materials. We've got partnerships with with companies, you know, service solutions is one where we're working with them to take the materials then out of used batteries and put them back into the process, both from a manufacturing standpoint and, and then the life, right. So these are really precious batteries and be very careful how you use and reuse them exactly. Um, we're talking backstage about how, um, You came to engineering, um, and you're also passionate about um, bringing more engineers into GM can you talk about what that what that's been like? Yeah, sure. So, so as I shared, I've been with General Motors almost 29 years, 27 of those were in product development. So I'm an electrical engineer by degree and uh, You know, coming into this space was a little bit unusual. Um, you know, I didn't grow up in the environmental side of the business, but it's really proven to be a great advantage to have that background um, of the company and really understand what it takes to make those changes and what we need to do from our biggest part of our footprint is the customer usage of our vehicles, our scope three category 11. And so it's about 84% of our total footprint. So if you think about how we get to carbon neutral it is by changing over our portfolio and my role previous to this, I was leading our global energy strategy team and really managing g H G from a regulatory and compliance standpoint and worked with my predecessor on setting those goals, you know, and as engineers as I shared, we're trained to solve problems and climate change is a gigantic problem, exactly that we need to do. And so it's really been great to to have the opportunity to work with our, our leaders across the company, you know, purchasing and supply chain and you know, I run into now suppliers that I worked with in my previous roles and talking to them about their sustainability journeys. And, you know, to be able to do that with a sense of understanding of what it takes and how early we need to get those things into the design phase, you know, material selection from an engineer. Um, thinking about not just, you know, how the product performs when it's in use, but now how it performs at the end of life. And what happens to it, you know, is it designed for not just for assembly or force service design for recycling bility. And so all of those conversations, you know, really need to take place across the company and driving it into the overall culture. Yeah, I mean, you told me that you got the call for this job, you came from this, this related background, but it almost sounded like like batman, what was that? Like you got the call? And you ask yourself um, yeah, so we have time for, I think one final word on this, what was that like to to get the call and then to ask yourself, am I the right person for this? Yeah. I mean, I think it's um maybe two fold. Right? I mean we talk a lot about you mentioned the ei as well, you know, I think women traditionally, you know, we talk a lot about how we tend to be second guessed ourselves. We talk about the impostor syndrome. You know, Am I really ready? Am I really the most qualified for that role? Um You know, there's statistics that say if there's a um job qualification out there that a woman will look at it and say, you know, like I meet nine out of 10, I'm not going to apply. You know, and men maybe traditionally would say I got to I'm good, you know? Um so, you know, I certainly went through that and I went through the, you know, do I have the knowledge and environmental and and all of those things. But it really um I I took it as an honor that I was selected and that they thought I could do it and it's really been a great opportunity and advantage to again, to work across the company on the great goals that we've set, right. And then before, you know it, you cut 15 years of your timeline. Um we actually do have time for one final question. I mean, what would you say about the critical leadership criteria about this transition? So the leaders in this room, what what can other leaders navigating this transformation take away from from your playbook? Yeah, I would say one of the things that I I talked about setting ambitious goals and and making sure that you know, you put something out there and before you know what you're gonna accomplish more than you thought you could, one of the big focus areas that we have is really about making sure that this is an equitable transition. You know, these types of transformations, particularly as an industry have in the past had a tendency of leaving communities behind. And so at Gm we've really put a strong focus on equitable climate action and kind of really focused on four key pillars. It's about the future of work. In fact on stage yesterday we talked about, you know, the transformation of the industry and we really we are focused on bringing our workforce along with us and I mean the knowledge and expertise that that we have in the company isn't something you create overnight. We've been around for well over 100 years. And so that's something that's important to its infrastructure action. Um making sure that charging stations are available for communities across the board um products e. V. Access. One of the things we're really proud of is having affordable TVs. So products across every price point and segment, you know that um everyone can live in this future world. And then we also started a climate equity fund to really work with community organizations that grassroots, that are making a difference for this transition. So I would say for us it's important. It's not just about what you do, but it's how you do it and making sure that it's done in an equitable and inclusive way is important. Thank you so much. Thank you. Absolutely. Thanks thanks for having me.

Martin Whittaker, Chief Executive Officer, JUST Capital 
Interviewer: Lee Clifford, FORTUNE


Impact Initiative 2022 - From Rhetoric To Reality

Good morning, um, hello and welcome to day two of the Fortune Impact Initiative. Um, I hope you were all able to join one of the breakfast round tables. Um, I had the pleasure of hosting the roundtable on meaningful compliance and it was very impressive seeing people so engaged at 7:45 a.m. On the topic of compliance. So hopefully you all enjoyed them and got some food as well. Um, so many of the people who have joined here at our gathering offer great examples of the kind of purposeful leadership we want and need more of in the world. And that is exactly what led fortune to create. Our newest membership community called Fortune connect. It's designed to help prepare those who aspire to become leaders of the future and we're really, really proud of this program. It's seen tremendous growth since its inception just over two years ago. And the goal is to create truly purpose driven leaders to help them understand the dynamics of stakeholder capitalism, what it means and how it works when society is demanding so much more from companies and to understand how to build true, truly equitable and inclusive workforces. The program is designed for mid career professionals who are rising fast on the executive track. I'm sure all of you have some of those in your workforce is in your organizations and I would urge you to consider putting them in this program. So we encourage you to check it out at fortune connect dot com before we dive into our main stage conversations, I want to thank our sponsors for bringing the impact initiative to life. Our founding partner ever fi our premier partner, the coca cola company uh and our partners, Project Management Institute, Rubicon, carbon and china. Thank you all. We could not do this without your support. Um A few very very quick reminders what's said here on stage and then break out sessions is on record what is said at your tables. Private conversations is not unless it's mutually agreed otherwise. If you want to tweet each other, go ahead but just tell each other first basically. Okay, earlier in the year we sent a survey to our member community and I encourage those of you who have yet to respond to share their input. Um We are the new kids on the block made with carbon neutral concrete, that's a sustainability joke I guess. Um And your input is very very valuable to us. I'd also like to invite you to sign up for the Fortune Impact Initiative newsletter which brings you the latest developments in the E S. G. Space and the insightful commentary you hopefully expect from Fortune. The newsletter is edited by Fortune Executive editor Peter Van um and he'll be joining us here on stage a little bit later. Okay on with our program how to advance stakeholder capitalism is a recurring theme that runs across our impact conversations while self interest should play a role mounting data reveals that companies who do right by all their stakeholders do better financially. I think we all know that by now, but there is a disconnect in public perception surveys show that americans think companies prioritize shareholders above workers. Our first guest is going to share some data driven insights on how business should respond as we explore ways to reduce economic inequality and make social progress. Please welcome Martin Whittaker, chief executive officer of Just Capital for a conversation with fortunes lee Clifford. Good morning. Alright, Martin, let's start with the day to convince us that paying a fair and living wage is good for business. I'm not sure I can do that. And how long do we have? 15 minutes? Um I think the data shows us that it's not really me that has to convince anybody of anything, it's in just capital's case, the american public and we do so much polling all around the country about what people want from business, um what kind of leadership they want from business. And we don't, we don't really frame it in terms of uh sustainability or DSG or anything like that. We really just ask them about what issues people care about, and I would say universally wherever we go, there's a very strong sense that people want companies to do more. People expect more of capitalism, they expected they wanted to work for them. Um you know, well into the mid eighties up to the high, high eighties and low 90% of respondents typically prioritize workers, most of us spend most of our waking hours at work. It's understandable, but they I think there's still a very strong sense in this country that is actually uniting us around um the access to the american dream um and wanting to spend one's time working in a dignified way being paid fairly having access to training and other opportunities and all of our data through the polling and survey work supports that. So I I always look to main street America, you know, and the voice of the public to really drive that forward and and companies are responding. You know, we see that in the rankings that we do and all the work we do with large corporations as well. Did your polling show that we're getting closer to people feeling like they can achieve the American dream or slipping away. It's definitely improved. We we were founded in 2014, We did our first nationwide survey in 2015. And um it was sort of a mixed array of results. We found a lot of issues around how companies interact with communities, how they treat their customers, international supply chains, human rights, climate change, things like that. Over the years, though, one group has become much more prominent, which is the worker, you know, our work this year showed that people value uh and this would be Republican, democrat. Um whatever democratic cut we we we take of the data fair pay and living wage is the number one issue by far, and if you're out of all the worker related criteria, um It's almost half the model at this point. So that issue alone, the relationship between a company and its workforce has become increasingly more important over the years. So you've said that in this day and age all leaders are human rights leaders, whether they want to be or not. Talk a little bit about about that. Well, it's about leadership of people. I think I think really what we are learning collectively as a business community is the importance, especially after Covid George Floyd 2020 was a the year where the S. A. V. S. G. If you want to think about it, took took the front seat. And I think we all learned a lot as leaders um about how to do that. What does that even mean? You know, I was in a breakfast this morning, we talked about the changing nature of leadership, uh the importance of empathy, uh the importance of finding leaders throughout your company wherever they exist, whatever level. Um And so I think we've learned a lot, but it was still early in the uh it was still early in this recognition of how human capital is a driver of business performance, uh and how a company uh you know, a company's purpose as it relates to societal impact and how you balance all of that with the rigors of of shareholder primacy and and I think that's really what I mean, I think the human element of business is going to define our future for the next generation. Talk a little bit about some of the big companies that you feel are doing a good job in our workers first. Sure. I mean, well we we uh rank companies on all array of issues, but I would say, you know, we see leadership in so many different places I'm thinking of. Hence Vestberg Verizon I you know, the leadership that I'm I witness on a regular basis from dan Shulman at Paypal, I'm lucky enough to be part of a advisory panel around their worker financial health, uh initiative and it's fascinating, works very detailed, it's very important um but that wouldn't have happened were it not for dan's leadership at Paypal, but there's leadership on lots of different forms as well. I mean I look at leadership in the BR. T. For example and how um what it took to bring forward that change that shift in definition of a corporation leadership of a different kind, you know, at a more a systems level. So I'm not an absolutist about leadership and I don't think that you have to do it this way. And our rankings are the definition of corporate leadership. Um I think it's the start of the leadership conversation, not the end. Can you tell us more about what Paypal is doing well the story goes that a few years ago dan did an employee survey, he assumed that, you know, they're wealthy, successful corporation that everybody would be super happy. And it turns out that a lot of their employees, particularly call center workers around the country were in a position of acute financial hardship and he didn't know that. And if he hadn't done the survey, he would not have known that and to his credit, I think when the results came back, it was like, okay, we gotta do something And he created a 4-point plan which rested on lifting wages, provided stock ownership, lowering the cost of benefits and providing financial education because you have to wrap all of that in sort of a financial literacy and that has been pushed down all the way throughout the organization now and, and uh, it's, it's very, it's very detailed work, its interactions with individual employees on how you manage on a, on a very, very tight budget and what things, you know, things like how health care, health incident can lead to, you know, bankruptcy or worse. You know, there's stories of people who now work at Paypal, who worked at companies previously experienced some, some event, Um, that took them down a very bad path. It's hard to recover from that. So that's life, you know, that's what happens to people in my company as well. Just so, even though we're a small business, but so I think, I think that's a very concrete effort. We actually have a partnership with just with paypal and now there's 13 other corporations that are part of it that are doing, taking that framework and applying it to their workforce in order to lift the financial wellness of their employee base. Interesting. We were talking backstage a little bit about another case study which is Disney where the ceo ran into some trouble. Tell us a little bit about your interpretation of what happened there. Well, it's now become a sort of a Touchstone of how not to speak up and out on on complex societal issues. And of course bob is no longer, you know, in the in the Ceo suite. Um not because of that. Um but but I think it beyond the headlines. I think C. E. O. S. And business leaders are in a complex position when asked to speak up or speak publicly about divisive issues or issues that are perhaps of great sensitivity and whether our, you know, people have very different points of view and what we've seen since then I think is is C. E. O. S pulling back from that public voice, focusing instead internally. I know that that's happening. Disney and other companies were rather than immediately going public with the point of view, companies are intentionally seeking out perspectives, not just from their employee base but from their customers and even from their shareholders in some cases. So, so I think there's a lot more private behind the scenes um level setting of how, how should we handle a complex issue like reproductive rights or like um voting rights. Yeah. You mentioned that a lot of Ceo, the biggest question they have for you is how do I be a leader on these issues and that there's a lot of talking between Ceo. Tell us a little bit more about that. Sure. I don't feel as though the vast majority of businesses that we interact with and and business leaders that I talked to, they don't need persuading that they should be perhaps investing more in their workers or creating value for their customers. I mean, it wouldn't be a Ceo if you didn't believe those things. It's the how how do I do this? You know, um not just how do I the Ceo to this, but how does my team, how does, how does my company balance these issues? And I think that playbook for, you know, how now we have this sense of of what a stakeholder led business might might look like. How to sort of prioritize the different needs of my stakeholders, how to put capital to work to generate value for my stakeholders. Um, and in doing so accelerate my overall business performance. You know, we've done a lot of work showing that shareholders leaving money on the table if if you're really not conscious of investing in your stakeholders. So I don't see stakeholder capitalism as sort of some political vehicle for Ceo exercise their their, you know, their political views. I see it is just a better way to do business and the numbers and all the data to support that, but I think how you do that, how, you know, you're doing a good job of that, what am I, what should I be measuring? What data do I need? You know, the TsG community for many years, I've been part of that now for 25 years, as often, times I've said this before, it's measured what it can, not what it should, and I think we're just now trying to figure out what really should we be measuring in order to know as a board member, as a Ceo, as a member of the C suite that we're on the right track, what what what should we be measuring? Well, um, one thing you could be measuring if you're focused on your employees is your employees, financial, health, you know, um uh, I am I an equitable employer, you know, how do I think about Fair pay? You know, there are not that many companies in the Fortune 500 that have done or made, um, certainly made public that they have done if not released the results of Fair Pay work. So, if you don't know, you can't take action and I think a lot of this begins with knowing and taking the trouble to really understand, you know, how are your stakeholders think about certain issues and how do I know, you know what really matters and then you can take action to see if you're making progress. We'd love to take some questions from the audience, so if you have one raise your hand and we'll get a microphone over to you. Okay, thank you, thank you martin jorgensen competent boards. So when we start thinking about that health of the the finance we have at the moment, also mental health issues, we also have climate change and we're going to probably see that climate change is impacting the health of families even more, which will then have an impact on the businesses, but also the pay to to those people working all of these businesses. How do you see the business leaders? And I talked actually Sudan about this, but how do you see that? How can we, as business leaders ensure not only right now we have just pay, but we also have it in in the future. Well, I I think that's a probably quite a complex answer, but but I would say it begins with understanding, you know, you mentioned mental health issues and the issues in the work force of course all those things are connected, we do tend to think about them in silos, but I think the best companies see the connections between them and are brave enough to explore those connections. Um but I think it begins by asking the right questions and listening, you know, I think of hubert joly a best buy, you know that turnaround began with him putting on the best buy shirt, going, working on the on the floor to get the ideas and how best how the people who are front and center in the customer interface thought, you know, what was their ideas? So you could apply that model in many different ways I think to lots of issues where you feel like you want to be a better employee and you want to connect those dots between those things. Um We just have a little under two minutes left. But I wanted to ask do you feel concerned about the future of capitalism or do you think capitalism is uh on a good track? I am concerned. I think uh the pushback against TsG and stakeholder capitalism is opportunistic, but it's also been quite remarkable to me that the sustainability E. S. G. World has been so vulnerable to that kind of um you know to those criticisms and and those attacks and I think SGS manufacture a lot of its own problems as well. Um I think the real issue here is how do you how do you make capitalism work for more people? How do people who are struggling to get by main street America main street anywhere in the world who wants that system to work for them if you don't if they don't believe that bad things happen. And so I really I'm a capitalist. I believe that business can and should be doing more to both drive forward solutions to systemic challenges that we have, and I think they'll be well paid for doing that. So to me, this is all about the connection. How do you re establish that connection, that faith, that business and capitalism? Free market enterprise is working for more people. We've got to get that right at the moment. That's the bit that I'm not. We tend to work in a very high level way when we talk about these things, but they've got to work at the kitchen tables. Otherwise, you know, I I'm very worried that, um, those ideals will not be, uh, will not be realized. Thank you so much. This is a great conversation. Thank you lee.

Lynn Perry Wooten, Author, The Prepared Leader, President, Simmons University
Interviewer: Lee Clifford, Deputy Editor, Investing and Finance, FORTUNE; Co-chair, Fortune Impact Initiative

Impact Initiative 2022 - Leadership In Action With Lynn Perry Wooten

Lynn Perry Wooten, Author, The Prepared Leader, President, Simmons University
Interviewer: Lee Clifford, Deputy Editor, Investing and Finance, FORTUNE

Michael “Killer Mike” Render, Rapper, Actor, and Activist
Tony Ressler, Co-Founder and Executive Chairman, Ares Management and Atlanta Hawks
Interviewer: Alan Murray, Chief Executive Officer, FORTUNE

Impact Initiative 2022 - Off The Court

Michael “Killer Mike” Render, Rapper, Actor, and Activist
Tony Ressler, Co-Founder and Exec. Chairman, Ares Management and Atlanta Hawks
Alan Murray, FORTUNE

Peter Bakker, President and CEO, World Business Council for Sustainable Development 
Interviewer: Lindsey Stanberry, FORTUNE

Impact Initiative 2022 - Leadership In Action With Peter Bakker

So one of the central themes of this event and and of today is is reimagining corporate purpose beyond just shareholder value. Our next guest believes strongly that business leaders need to shift their mindsets make capitalism more inclusive, build long term resilience and build truly regenerative business models. Most importantly, he stresses the need for companies to oversee the complete transformation of systems to ensure that purpose and profit align. Please welcome to the stage, peter baker, president and Ceo of the World Business Council for Sustainable Development, interviewed by Fortune's Lindsay Stansbury. Thank you so much, peter for joining us. Let's dive right in. We don't have uh we have a lot to talk about. So the pandemic obviously challenging, but it's given us an opportunity to really rethink things. You've argued that now is the time to reinvent capitalism, which is obviously no small task. Can you talk a little bit about regenerative business model and how you want companies, how companies can move forward? Yeah, thanks. Well, thanks for having me. Um as you can tell, I'm from europe, which is an important disqualifier, where we're gonna talk about reinventing capitalism. Uh so, so I think what we've learned in in covid is that if you look at sustainability, there's really three global challenges out there, One is the climate emergency. The second is the loss of nature or loss of biodiversity, and the third one is mounting inequality which threatens social cohesion and predictability of societies going forward, and if you think about these three big challenges, then you really are talking about system transformation. This is not tweaking on how do we get more efficiency out of energy. This is radically rethinking the energy system, the food system, the built environment system and so on. And in order for those transformations to happen at the base that we need them to happen. We really need to talk about what is the economic incentives that businesses have or that investors will will value to make these transformations happen at base. So we published about a year, a year and a half ago now vision 2050 times to transform, we wrote this with 40 global companies, some of them in the room here in which we said there's lots of transformations, transitions need to move to renewable energy to regenerative agriculture, to electrification of mobility. All these type of solutions are there. But the other thing we said is leaders in business need to come up with a new mindset because if you look in the in the world of behavior change, behavior change will only be effective. The mindset of the people who need to change their behaving is changing. And and the three mindsets that we proposed, leaders should embrace. The first one is resilience and we see that you know climate change this year, the young delta river out of water, the rhine River out of water floods, droughts, forest fires everywhere. The resilience of supply chains is entering a whole new phase and will test all companies on whether their risk and risk assessment covers these type of risk. The second area is we need to move to regenerative mindset, we can no longer have these linear models. We need circularity and again we need regenerative agriculture type things. But the third one is and this I'll whisper it in in the U. S. A. We need to reinvent capitalism and this is not a european hippy telling you that capitalism is bad, I am a capitalist. The problem with capitalism is we only have identified financial capital as the capital of capitalism but there is natural capital, their social capital and depending on who you talk to, there's a few more capitals but let's keep it at that. So what is the environmental impact of a business? You know I'm super I actually I mean I shouldn't advertise for fortune I guess but I'm super impressed that the big brand like fortune in the middle of conversations around E. S. G. And and other political voices is putting forward the impact initiative because that's what this is about. What is the impact that your business has on the environment or your business has on the social aspects and what can we do to reduce that impact if it's negative or to be more positive and impact by these big transitions that are coming up there is this this is the shock to some particularly if there's investors in the house. There is no I. R. R. To make the world sustainable. There is low hanging fruit energy efficiency. You'll have a business case quite quickly. But if we truly want to get to a net zero world, if we truly want to move to the deep transitions that the world has, we need to find a way to really look at what do we value and what is the valuation model of the future? So this is where E. S. G. Disclosures come to town. You know, what is the environmental performance or the social performance of your business? What are the metrics that we're going to hold each other accountable for that? That is a growing conversation I know here in the in the U. S. There's a lot of talk about is the sec ruling the right one or not. But give it three years. I. S. S. B. Will become the global baseline by which all companies will be asked to disclose their their impacts. Um Then you'll see more and more comparable materiality based data coming out of business towards capital markets. And then you look at the capital markets. What do they do they value a company based on discounted cash flow analysis which is you know, I've been a CFO in my career for a while. The only book on my desk was to book valuation by Mckinsey in that book. That's the bible for discounted cash flow analysis. But there is no opportunity to say the non financial information like environmental or social impact, how do we get that in the valuation model? We can't do it because you don't have many monitor here in the room. But anyone I would challenge anyone to disagree with the statement that a more sustainable business should attract a lower cost of capital. That's really the long term shot. We're all after anyone in the sustainability space. That's the thing we need to believe, because sustainability is now at the point that it's gone mainstream. It's not CSR at the side of the head office anymore. It's deeply integrated in strategy and transformation plans in in actually holding companies accountable for their impacts and the better you are at managing your environmental and your social impacts to lower the environmental and social risk exposure for the company is, and therefore the lower the cost of capital ought to be. So, I'm curious does anybody disagree with him to put you all on the spot? That would be cool, good. So we all agree that this is a vision, or at least nobody has spoken up to the contrary, but we do not have the language or the economic incentive system to make that vision come true? And that's fundamentally what I mean, was reinventing capitalism. It's not capitalism, capitalism is bad. Something else is better. It is. How can we integrate the environmental and the social impact into the valuation model, into the capital allocation model, because if we're able to do that, then every ceo and top leadership in the world will have an incentive to be more sustainable because it will improve their p. Or lower the cost of that. Do you think that there's any ceo out there who are already leading by example that you point to as really stand out in this space? Yeah there's there's there's a growing number of great experiments out there. I mean the caring group, the luxury brand group I think had offices in Paris. Um they have already since I think 2014 what they call the E. P. N. L. The environmental P. N. L. Where they measure six environmental impacts and have monetized it of course on a non cash basis because mother Nature doesn't send invoices. But they look at the environmental P. N. L. So one of their brands puma made about $300 million. E. B. T. A. The environmental P. And L. Was minus 245 million. Waste leather land use was a big part. They have then subsequently said well if we're gonna look at R. And D. Where we want to innovate, let's not aim at where can we grow faster? Let's aim at where can we reduce the environmental impact of the E. P. And L. Impact? They've now done that for four consecutive years. They've more than half the negative environmental impacts as a result of that. So there are beginning of experiments out there. Uh Other companies a company D. S. M. Food supplements, vitamins that type of business. They they're probably the furthest where the top team have 50% of their incentives linked to their E. S. G. Performance. So that's an experiment where companies are beginning to say okay well these are an E. S. E. S. Maybe it's an impossible name anyway but they have identified in their risk assessment what are the most material impact areas And for those they have set targets and put it for more than 4 50% of the bonus system into the targets of the top X. X. I'm curious does anybody have any questions for Peter? Oh there's a microphone for you and if you don't mind introducing yourself, I'm sure about from captive and I thank you peter, quick question. Out of curiosity. The puma, you talked about the E. P. N. L. Improving what happened to the real Piano during the same time? Up and down as as business does but continue to do well uh continue to do well good growth. Um And in these type of brands what they have, what they are experimenting with but where we see companies be relatively shy is how much of that story do you actually tell to your consumers? So that's that's another interesting area which I'm sure people will talk about in the meeting tomorrow as a lot of sustainability efforts today and companies are kind of, I call them the supply side of sustainability now. How can you Dick carbonized your supply chain. All these things, not so much of the effort is how do we actually change consumer behavior? Um, I don't know who's precisely in the room, but I talked to the ceo of Unilever and Procter and gamble all the time. Companies that spent $8 billion $8 billion dollar do you use to convince consumers to make more sustainable choices in your own product portfolio? And then the answer is, well, maybe 10% of two? Well why not? 100%. Well, we're not into choice editing of consumers. Well, but isn't that the whole point of your advertising budget anyway? That's one I can never win. But I think consumers is a big question that a lot of people have. I have time for one more question. I'm just curious how do we make sure that people aren't left behind at this journey as we make these big changes. Yeah, well there's two types of so the answer to that is by focusing on just transition, which means two things your company depending on the industry you're in, will go through massive transformation your in an automotive company, 100 years of building combustion engines. That business is that stranded assets will not happen after 2030 we're going to build electric vehicles? How do we take people on the assembly line and in the supply chain along with that, How do we re skill them? That's one big question. The other big question, of course, is is more macro climate will get much worse even if we were able to stay below 1.5 to Greece. And the most vulnerable countries in the world will suffer much more than probably in the country like here. That has a big risk of refugees. So how do we get economies to be inclusive? Also there. So also there create just transition. Thank you so much. I really appreciate this conversation. Thanks so much.

Vicki Hollub, President & CEO, Occidental Petroleum
Interviewer: Alan Murray, FORTUNE


Impact Initiative 2022 - Realizing The Energy Transition

oil and gas producers have a central role to play in addressing climate change among them. Occidental Petroleum recently announced a big expansion into its carbon capture program if we're focusing on emissions. A carbon neutral barrel of oil is possible if we're extracting C. 02 from the air and pumping Co two underground as part of the oil recovery process. We'll sit down with the head of Occidental and explore how carbon credits and greater collaboration can help us reach Net Zero. Please welcome Vicky Hello, President and Ceo of Occidental Petroleum for a conversation with Alan Murray. Fortune Ceo. Thank you Vicky. Thank you so much for joining us. I was really eager to have this conversation because as an observer, it seems to me that you're getting hit by everybody, right? The environmentalists don't like the fact that you're drilling oil and feel you're gonna be drilling oil way into the future. Uh, the uh, the the oil industry isn't happy about the fact that you're spending so much time talking about carbon capture and direct air capture and and I think you're alone in the oil industry in endorsing scope three goals in the US oil in the U. S. Uh, so you're getting hit on all sides. Why? Well, I think that we as an industry definitely need to change. We need to evolve and unfortunately we haven't been able to or felt like we weren't able to be as transparent about what we're doing as we would like to be um saying anything in the US usually creates an opportunity for someone to sue you. So we were worried about that, but we get sued anyway. So now we've decided we just need to do the right thing and be as open and transparent about it as we can be. So I talk about a lot and 11 of the things I'm trying to do is help people outside our industry and especially those who, who have a passion about the planet and who are uh really engaged in trying to make sure that we're doing the right thing. I wanna, I wanna help everybody understand exactly what we're doing and why it is the right path for the industry to take and why if we don't take this path that we're on, I don't believe we'll ever be able to cap global warming yet. Um, not only 51.5 degrees, but not even at two degrees. It would be too expensive. It would be almost technically impossible to do, uh, to do it by 2050. So we believe we have the right story, the right strategy, the right pathway to do it. And we're trying to get others to um, to buy into that and to help us with it Past clearly. But let's, let's talk about that story. First on the energy side of it. You see oil, fossil fuels as being part of the energy picture for a long time into the future. Maybe indefinitely into the future. Yeah, I would say that a lot of models are showing that even by 2040, If you tried to do your best in terms of building renewables and other things and alternatives that even by 2040, the demand for oil would still be around 67-70 million barrels were at 100 million today. Um, unfortunately if you don't invest in the oil industry, uh, the by then the supply would be 27. So when we talk about a just transition, we have to remember that there are places around the world that have tremendous oil and gas resources. But if they can't develop those, they're the ones that will get left behind those. They are the ones that will suffer. They're the ones that won't be able to achieve the quality of life that we have today. So we have to figure out how do we continue to develop oil and gas reserves? But doing it stood in a way where we can get everybody focused on the emissions and not the source. For example, only 15% of greenhouse gasses are generated by, By the actual production of oil and gas. That's 15%. The rest is generated by the use of the products. And when I say use of products, there's a lot of things in this room that wouldn't be here today if we didn't have oil and gas. Our company in particular, we produce the products that make the I. V. Bags and tubes for hospitals that make a lot of the medical equipment for hospitals that make the products that go into building cars and building homes and chlorine for water PVC to transport clean water. We do a lot of things that make build a lot of things that make our quality of life a lot better. So it's the it's building those things that causes the basically the rest of the emissions along with the electrical generation. So we've gotta do, we gotta understand what the impact would be too. Is that so hard? I mean you're talking about simple math basically. Why is that so hard to get across the smart people? I happen to have been at the uh Harvard Yale football game and I did not go to either school by the way but I was at the football game where students from both schools sat down in the middle of the field at halftime and said we're not gonna leave until both schools agree to disinvest from any fossil fuel company. Why is it so hard to get smart people to understand that to solve this? Well I think part of it's our fault. Um Part of it is we didn't make the transition start making the transition soon enough. We started, yeah we we should have started years ago and doing what we're doing today and that is trying to find ways to further reduce methane, methane is about 11% of the greenhouse gasses. Um C. 02 80%. So both of those together, the two things that we have to attack the most. Um So trying to completely and dramatically change our industry is something that we're now trying to push and get others to get on board to do uh completely changing the way we we produce it and trying to ensure that it's a closed loop system and um and progressing in terms of ensuring that we do the right things to capture emissions from point sources like from cement plants, steel plants, electrical generation plants. And then we're doing um one thing that Uh that nobody else has done yet and that is to to build a facility that will have the capability to extract one million tons of co two from the atmosphere annually. And that's critically important because right now 37 billion tons goes into the atmosphere annually so that we need to start the process of reducing CO two from the atmosphere. That that's huge. You and it's a big investment for you. A lot of people say never gonna work just a waste of time. You're just doing that to cover up your fossil fuel story. Uh Tell us why you believe direct air capture because that's a game changer. If you can actually take carbon out of the atmosphere, that's a complete game changer. Tell us why you believe it can work. Well I would say we would not be spending $1.2 billion dollars for a greenwashing campaign. I can assure you that uh but we feel like that we have the unique capability to make it work. And a lot of others have said it won't work. So a lot of others have walked away from it. But what what gives us the confidence to do it is that there are so many synergies between what we're trying to do and what we've always done. We're leveraging our core confidence of using CO two for enhanced oil recovery for almost 50 years, were the largest handler of C. 02 for that in the world. So we've got the experience with CO two and the way we'll extract CO two out of the atmosphere is using a a fluid that are chemicals department of chemical business makes. And it's potassium hydroxide and we're the largest marketer of potassium hydroxide in the U. S. Second largest in the world. So that's the synergy. So we'll we'll take these huge radial fans will pull air uh and push it through a contact tower within that contact tower. The potassium hydroxide will be mixed with the air and um the diffuser in there to make that mixing better is PVC and we're a marketer and maker and marketer PVC as well. So those synergies will put it in the premium basin where we already have the infrastructure to put it in a pipeline, get it uh to question either in a saline reservoir or in our enhanced oil recovery uh projects. So if there's anybody that can do this and if there's any then make it commercial, it's it's occidental because of all that experience and all those synergies. And so the way we look at it is it's not something that that we have the choice to do or not, it's something that we feel like we should do and need to do to help the world advances technology and then share it with others. Some of the critics say, oh, but it's a it's a very energy intensive technology, so you just burning up a lot of energy in order to do this. Is that true? That's that's one of the reasons we have now invested in another technology which could which could be game changing for the power industry. And it's called Net Power. It was developed by a company called 88 rivers. And they're a bunch of guys from Duke who are really smart and developed a process that will combust hydrocarbon gasses with oxygen instead of air. And by doing that, you you eliminate all the volatile organic emissions and you capture the CO two as a part of the process because it's actually what drives the turban and to generate the electricity. So some of that CO two is recirculated to drive the turbine, some of it comes off as a pure stream of CO two that we get can then convert to products or saline reservoirs and put in the O. R. So that according to some of the power industry people, I've talked to former Ceo of Nrg told me he believes this is the game changing technology for the industry. So that will be the technology that we use to use our hydrocarbon gasses from the Permian to generate that electricity for our direct air capture facilities. And we'll use solar as a part of it as well. I want to go back to this scope three issue because every I think everybody in this room to some degree is wrestling with scope three. You know, am I how how do I become responsible for my consumers use of my product or for all of my suppliers? Why did you and Occidental alone in the U. S. Petroleum industry agree to take on this responsibility because we think we're going to have the capability to do it, others um you can't have that capability to do it unless you have a way to provide the users of your product and opportunity to get CO two offsets. And we believe that with the technology that we're using will be able to do that. And and the problem with that the world is facing that many of you are probably going to face to is there there won't be enough um biomass to um to offset the emissions that we have today. There's just not enough, there's not enough trees, there's not enough natural sinks. Um And the trees are some of the trees are shorter term but we need that to happen anyway because we've got to have something to help us get to 2050. So we have to have everything happen. We have to have E. V. S. Um solar wind, nuclear uh carbon capture and the by biomass projects to work to make this happen. But there's just not gonna be enough biomass. So our process is like a mechanical tree. It's pulling CO two out of the atmosphere. We're just having to build it to make it do it. The good thing about it it will never decay. So it'll it'll always be it will be able to sequester that Co two permanently. I want to open it up to anybody who has questions or or comments. Please raise your hand and we'll get a microphone to you. Um And I will say I I so appreciate being here because I've never talked to a group like this before and so please don't worry if you about offending me. I really want to know what you think and I really want to know what about what we're doing? You might not like or you might think I should talk about differently. Go ahead right here. Hello. Ben jorgensen from combatant boards. Just a question how much does the board actually discussing this and what's the discussion that you're having with the board? Well the our board has come along on this it's um what their concern was. How do we make sure our shareholders are on board with it. And so you ultimately to to make it work for everybody. We have to make a business out of it too. So we have to at some point uh generate cash for some of the CO two credits that will that will sell to those industries that are hard to to carbon eyes. For example, we already have in place to contract with Airbus. Airbus is going to buy 100,000 tons per year from our first direct air capture facility. They've committed for four years and now we haven't recently announced a contract because right now people are starting to realize that there is a deficiency of CO two credits. So now the prices are starting to go up on C. 02 credits. And so we uh we believe that we can generate value for our shareholders and doing this as well. It's it's pretty amazing to think of an oil company selling uh selling C. 02 credits. Other questions or comments. Peter so peter Peter van executive editor. I just want to know, do you have any fans at this point you're talking about for the director capture. We have the radial fans that will use are used in other industries supporters know those kind of not the big one. Actually I do. We we do. We've had recent endorsements. I will say uh Warren Buffett recently came into our in our stock in March in a big way and and um Berkshire now owns more than 20%. I like to call him a fan. I'm not sure if he would view that to be a correct assessment, but he he's investing in us, he um he's investing in us because we're also really good operator. We have great people and we have amazing people that got us through the the pandemic the transition and all of that to uh to never lose focus on our technical excellence and our ability to make things happen. Hey, it's Kathleen Mclaughlin from walmart. Thank you so much for being here. Um I think the scenario that you've laid out is really interesting and I'm wondering if you've had a collaboration with some of the organizations who specialize in climate scenarios and new climate economy and so on. So like World Resources Institute or Environmental Defense Fund to to put that together with their scientists. Well, we have with the carbon capture coalition with the Clean Air Task Force with the Environmental Defense Fund. We're working with a lot of those agencies who support what we're doing and understand what we're doing and and to to help them become supporters and collaborate with us. We do have to let them in and see the data and we have to be transparent with them and we have them uh and we've worked with the D. F. Two on methane regulations because we believe that um we believe that we've just helped with with their help put together the most stringent, uh, methane regulations that were adopted by new Mexico actually in the, in the US. And so we're trying to do everything we can with with those uh, kinds of agencies that have their expertise to ensure that we're advancing forward. And we have and we have some certification from others on what, on what our plan. Is there another question over there? Yeah, Go ahead. Quick question, Jeremy Hansen from hydrogen struggles. How do you, you have to collaborate across, collaborate and compete across the energy sector. How are you managing that? Uh, you know, across your traditional hydrocarbon, competitors, renewables, the whole sector because it really takes an integrated whole to get where we're going. Yeah, well, we've, we've gained a lot of ground, I would say over the past, um, a couple of years, I'm now the first, um, us chair of the world Economic forum, oil and Gas governors community. And so we, that's a, that's an organization working with West where we're able to collaborate beyond our, our peers, um, here in the US and, and with the Europeans who act quite frankly have been ahead of us for a few years, but they're doing things a little differently. They're buying and selling or buying um, solar and wind companies and, and building that. And what we felt like is we, we didn't want to deviate and get away from our core confidence. and so we're using our core confidence in our strategy, I proud what they're doing, they're pouring capital more capital into the building of solar and wind and we're just leveraging our core confidence to to do a different kind of strategy. But somebody's got to pull the CO two out of the atmosphere because right now we have 50% more C. 02 in the atmosphere than in pre industrial times. Even if we shut down all emissions today, we would still need to reduce CO two from the atmosphere. Vicki last last quick question. Uh you feel the political polarization around all these issues more than most people do, but everybody's feeling it to some degree. Uh you know, as I said, you're getting it from, from both sides, you've got democrats who think you shouldn't exist. You know, the President has been particularly kind of oil companies on on the, on the other side, you've got people who think you're, you're awoke oil uh Baron, what's your advice to people on how to deal with the political situation in the United States in particular. It's the most challenging that I've ever seen in my career. But I would say take the best from all that you can get. I love President biden's commitment to try to reduce emissions and to try to get us in a better place with respect to climate. So that part of it we're talking with the Republic with democrats and we're trying to work with them and the I. R. A. Bill that was pushed through um you know, by Senator Manchin, that was amazing for us. It's gonna be very helpful to to advance our technologies. Um and then we work with the republicans on on other things around making sure that we don't shut down the industry in the United States because we don't want to become your uh we want to ensure that we not only maintain the quality of life here in the United States, but that we maintain our energy security and that's critically important. Remember we're the largest producer of oil in the world and to lose that status, makes us lose leverage. And if you recall, you know, losing, not only do you have the european case study, but in World War Two, part of what happened to uh to end that war was that the evil aggressive back then ran out of fuel and that wasn't the complete reason they lost. But it helped accelerate the end of that war. And if you don't have oil or fuel then in this world, then you're putting yourself at risk. Vicky, thank you. Great to hear someone telling it straight, thank you for being here and speaking

Impact Initiative 2022

Impact Initiative 2022 - The Future of Reporting Standards

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Impact Initiative 2022 - Realizing The Energy Transition