Three Rules to Accelerate Climate Action and Scale

Ladies and gentlemen,
Distinguished guests,
Minister Grace Fu,

I am going to be brief because I can see everybody's ready to talk and everybody's ready to eat. And I don't want to stand between you and dinner.

I think we have had a really interesting first day's discussions today about innovation, about accelerating action at scale. I am going to give you three rules, or I am going to attempt to give you three rules for how we accelerate action and scale.

First Rule: Go All In

My first rule for how we accelerate action is: Going all in.

And two numbers we can think about within that rule.
The first number is zero. Zero is not necessarily a motivational number; we don't usually aim for zero. But net zero is the new normal through government, through business, through investment, and through capital markets. Net zero gives us clarity of long term direction. It is about the elimination of the cost of adding carbon to the atmosphere.

I do actually believe we will end up going for net negative. There's no reason why we have to stop at zero.

The rule of 100% – this is something I have learned through my career. You can set targets like saying “we have a target”. And Temasek has a target of halving our emissions from our portfolio by 2030. But that's set within a long term target of net zero by 2050.

If you just have a target of 50% on something, you confuse the business. More than 50% of the business doesn't want to change. I think Margaret Mead has a quote, which is: “The only person that likes change is a wet baby”.

So, if you set targets of 100%, you create absolute clarity for the business about what success looks like. So, we now know we are on the journey of no carbon in our future.

Second One: Rethink the Possible

My next rule is, rethink the possible.

And I think you could say something from the pandemic and the responses we have had to the pandemic. If you look at the role governments have taken on in the pandemic, we would not have thought that possible beforehand.
But also, the thing that excites me most as I look at entrepreneurs that rethink the possible now: There is incredible innovation in this space, (with entrepreneurs) doing unlikely things.

I'm going to name Decarbonization Partners. Decarbonization Partners is a joint venture between BlackRock and Temasek. (One of) their first investments – I am stealing your thunder or is repetition a good thing – is a company that makes leather from mushrooms. That's rethinking leather. You can grow – you persuade the mushroom it is not going to die – it grows in a large amount. You have a protein, or you have like “calf skin” on the surface. You can grow it in a mould if you want to, which you can't do with a cow very easily. It's climate positive.

And if you look at alternative proteins, there's a company we have invested in which can actually produce eggs, fermented eggs. It basically produces an egg without a chicken. Egg white is just protein and water. It can produce the protein without a chicken. Obviously, some of us had for lunch today, chicken that didn't involve an egg.

We've now got the answer to the question: Which came first: the chicken or the egg? Neither. They both came independently.

This is about entrepreneurs that are leaning in and actually helping to create the future. There's something in rethinking the possible, which is how do we avoid being stuck in the past? And I think it's very easy to have the answers.

Most business leaders now, we know we are going to tackle climate change. We know that it is not a question of the science.
But many of us have a view that our industry is super difficult (to decarbonise). We are unique. We are a special case. We deserve to be treated differently. Actually, when everybody's unique, we all need to reinvent the future.

I remember 14 years ago meeting the Chief Technical Officer of an automotive company, and I realised during the conversation that they were actually an internal combustion engine company that put very nice wrappings around internal combustion engines.

And I said to him: Surely the future is electric vehicles? And he slapped the table and he said: “Never will I, while I am CTO of this company, sell electric vehicles”.

And he was absolutely right, because he is no longer CTO, and they are selling lots of electric vehicles. So, we have to really rethink the possible. We know that we are going to go through a period of scaling new businesses, new technologies at an unprecedented level.

Third Rule: Radical Collaboration

My third rule for this moment in time is: radical collaboration.

I have already mentioned Decarbonization Partners where at speed, BlackRock and Temasek came together to help set up a new business focused on and helping to decarbonise and scale businesses.

We work collaboratively with SGX, with DBS, and with Standard Chartered, to set up a climate impact exchange to help scale high trust, high liquidity carbon markets.

Just yesterday, we launched GenZero, which is a platform that's focused on technical solutions, nature-based solutions and the carbon ecosystem that will be radically collaborative in the way it approaches this.

Conclusion

And if you think about this challenge – this is the race of our lives to decarbonise.

The doom and gloom that I could have focused on, is gloomy. The climate emergency is real. And it is the race of our lives to tackle it.

Fortunately, it is a solvable problem. But it's on our watch. It's our generation. It's our best efforts. And with radical collaboration we can do it. So, I look forward to the next two days of discussions with you.

And we've also got a treat later, where we will hear from Minister Grace Fu. And from the former Energy Secretary of the US (United States), Dr Ernest Moniz. So, enjoy your dinner. Enjoy your conversation. Strike up some radical collaboration, go all in and everything is possible.

Thank you.