The climate crisis continues to be among the most discussed issues among politicians, business executives, investors, and community leaders, as evidenced by the latest World Economic Forum in Davos, Switzerland.
But it’s easy to talk about what needs to be done to confront climate change. Walking the talk — and taking actions that can halt or even reverse course — can require dramatically reforming business practices and often a sizable financial investment, at least in the early stages.
We’ve written about notable companies taking steps to protect the planet before, but since the beginning of 2020, several JUST companies have unveiled ambitious initiatives that we’ll be tracking closely over the coming months and years ahead, including:
1. BlackRock Pushes Sustainable Investments into the Mainstream
Investing in environmentally sustainable companies is generally considered a noble endeavor — but not one that most investment managers eagerly advocate.
BlackRock, the largest money manager in the world, made headlines in January by saying it would embed sustainability as a central part of its strategy across its many portfolios. In a letter to clients, the company said it would start making sustainable funds core building blocks to its portfolios — including its target-date funds — and take other steps to make sustainable investments “standard.”
Moreover, the company said it would be reconsidering and exiting industries altogether that have a highly negative environmental impact, including thermal coal producers.
“Our investment conviction is that sustainability-integrated portfolios can provide better risk-adjusted returns to investors,” the letter said. “And with the impact of sustainability on investment returns increasing, we believe that sustainable investment will be a critical foundation for client portfolios going forward.”
Blackrock CEO Larry Fink reinforced the move toward sustainable investing in his annual letter to CEOs: “Given the groundwork we have already laid engaging on disclosure, and the growing investment risks surrounding sustainability, we will be increasingly disposed to vote against management and board directors when companies are not making sufficient progress on sustainability-related disclosures and the business practices and plans underlying them.”
Andrew Ross Sorkin, a financial columnist for the New York Times and CNBC “Squawk Box” anchor, explained the huge significance of Fink’s letter in a recent episode of The Daily podcast:
“He’s saying for the very first time, as the largest investor in the world, that climate change has to become an integral part of the investing thesis for companies. And more importantly, that CEOs and companies themselves now have to change and think about climate change. And if they don’t, he’s going to be pulling his money from them.”
2. Microsoft Commits to Being Carbon Negative by 2030
America’s Most JUST Company, Microsoft recently made two bold commitments: By 2030, the tech giant will remove more carbon from the Earth’s environment than it produces. And by 2050, it will remove all carbon it has created both directly and through electrical consumption since its 1975 founding.
To achieve these ambitious goals, Microsoft laid out several new initiatives, including a shift to 100% renewable energy by 2025, electrifying its vehicle fleet at all of its global campuses by 2030, and the creation of technology to help its suppliers reduce their emissions. In coordination with the announcement, the company also signed the United Nations 1.5-Degree Business Ambition Pledge and created a $1 billion Climate Innovation Fund that will invest in new technologies.
Microsoft also said it will begin publishing an annual Environmental Sustainability Report to publicly track its progress toward these goals.
“I think what happens is if you’re creating a lot of profit and creating more problems for the planet or people, I think it’ll catch up with you,” Microsoft CEO Satya Nadella told CNBC about the initiative.
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3. Amazon’s Bezos Pledges $10 Billion to “Earth Fund”
Amazon CEO Jeff Bezos, who’s faced pressure from both climate change activists and Amazon employees to reduce the company’s significant environmental footprint, recently made a huge financial pledge to support climate science.
Bezos announced on Instagram that he plans to put $10 billion of his own money — which equates to about 7% to 8% of his estimated $130 billion net worth — into the “Bezos Earth Fund.” It will make grants to scientists, activists, and nongovernmental organizations (NGOs) for “any effort that offers a real possibility to help preserve and protect the natural world.” The fund will start its grant making in summer 2020.
Though it’s not yet known which organizations will benefit from the funds, Bezos said the money will be used for charitable purposes and not for private-sector investments.
“We can save Earth,” he wrote in his announcement. “It’s going to take collective action from big companies, small companies, nation states, global organizations, and individuals.”
Beyond Bezos’s personal pledge, Amazon has also made strides toward reducing its carbon footprint, and in September 2019, the company announced its plans to be carbon neutral by 2040.
4. Salesforce CEO Marc Benioff Backs Effort to Plant One Trillion Trees by 2030
Planting trees may seem like a relatively minor step toward reversing Earth’s warming trend. However, a recent study published in the journal Science found that planting half a trillion trees could reduce carbon in the atmosphere by about 25% — enough to negate nearly half of all carbon emitted by humans since 1960.
Therefore, when done on a massive scale, tree planting could make a significant impact.
Salesforce CEO Marc Benioff and wife Lynne are financially backing a new platform called 1t.org introduced at the 2020 World Economic Forum that will support an initiative to plant, restore, or conserve one trillion trees over the next decade. So far, more than 300 companies have signed on to the initiative, and Salesforce has pledged to sponsor 100 million of those one trillion trees.
Benioff championed how the plan has drawn the support of government leaders around the world: “Nobody’s against trees,” Benioff told CNBC. “The tree is also a bipartisan issue.”
5. Delta Pledges to Become First Carbon Neutral Airline
Even some companies that still rely heavily on fossil fuels are trying to make up for that by finding better solutions. Delta Air Lines recently committed to becoming the first airline to go carbon neutral with a 10-year commitment to mitigate all carbon emissions.
The company said it will undertake efforts to reduce emissions with a fleet renewal program, more efficient flight operations, weight reduction, and the development and use of sustainable fuels.
“As we connect customers around the globe, it is our responsibility to deliver on our promise to bring people together and ensure the utmost care for our environment,” CEO Ed Bastian said in a news release.
The companies and CEOs taking a lead on climate change aren’t only doing right by their stakeholders by protecting our planet, but they are also mitigating risk and positioning themselves for competitive advantage in our climate constrained future.
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