We use tech in just about every aspect of our lives. It’s changed how we communicate, shop, travel, to how we get the food on our plate. It’s also changed how companies do business.
Technology like artificial intelligence (AI), sensors and blockchain are enabling companies to provide cutting-edge products and services for consumers – from virtual gyms to smart water dispensers – and increase operational efficiency as they do. But the bulk of companies are missing out on a big opportunity: using tech that’s already at hand to meet their sustainability goals and reduce climate-related risk.
Fueled by a surge in employee, customer and investor pressure to act on climate, and the near universal recognition of how a warming planet threatens the global economy, businesses are stepping up their climate commitments in a big way. This was especially true in September, when hundreds of companies announced their intentions at Climate Week, and in August when the Business Roundtable unveiled its new take on the purpose of a corporation: to “serve all its stakeholders” and “protect the environment by embracing sustainable practices across our businesses.”
The logo for IBM appears above a trading post on the floor of the NYSE. (AP Photo/Richard Drew)
More than five decades ago, IBM CEO Thomas Watson, Jr. stated that “Businessmen are influential leaders in public opinion. That is why it is so important that they be as open-minded and far-sighted in matters concerning the general public need as they are in questions relating to the operation of their businesses.”
Today, Wayne Balta, Vice President of Corporate Environmental Affairs and Product Safety at IBM, is keeping Watson’s commitment to sustainable business practices alive.
I recently spoke with Wayne to learn more about IBM’s sustainability goals – including an effort to procure 55 percent of its energy from renewable sources by 2025 – and how the company is using technology to help solve environmental challenges.
Here’s an edited transcript of our conversation.
Oil and gas companies in the United States are the latest to add their voices to the broad set of stakeholders supporting federal regulation of methane emissions from the oil and natural gas sector. These companies have a major responsibility to reduce methane emissions, a key step in the energy transition. This week in Houston, at CERAWeek, Shell, ExxonMobil and BP took important steps to support nationwide direct methane regulation, with Shell urging the Environmental Protection Agency (EPA) to not deregulate methane emissions and to even tighten standards.
There is more opportunity than ever before to regulate and reduce emissions in ways that work for industry and the environment. As ExxonMobil wrote, federal methane regulation “helps build stakeholder confidence, and provides long-term certainty for industry planning and investment while achieving climate related goals.”
The federal regulation of methane emissions is an essential effort that builds on proven state regulatory models and positive efforts that dozens of companies are already practicing as part of sound business operations.
It’s time for more companies to speak up, because without nationwide methane regulation, industry is only as strong as its weakest link.
Methane has made quite an entrance into climate science in the last few years.
Though long recognized as a potent greenhouse gas – more than 80 times as powerful as carbon dioxide in the short term – its significance in our battle against climate change has only recently been quantified. The oil and gas industry, for example, is among the largest emitters of methane on the planet, and research (including some by EDF scientists) has documented that far more methane seeps out of wells, pipelines, valves and other points in the oil and gas supply chain than energy companies and official emission inventories report.
Business leaders can no longer afford to look the other way on climate change. The recent National Climate Assessment revealed that regional economies and industries dependent on natural resources are increasingly vulnerable to the impacts of climate change – as are energy systems. Warmer climates will increasingly disrupt international trade, prices, and supply chains, and costs could reach hundreds of billion dollars per year by the end of the century. Climate change doesn’t just threaten ecological balance, it threatens corporate balance sheets.
In light of these findings I’m encouraged by a recent survey of corporate leaders, 82 percent of whom said companies need to advocate for or take a stand on environmental, social and governance issues and that “climate and environment” was one of the three highest priorities for their organizations.
Knowing that a company should take action, however, is a long way from actually taking action on climate. While there are a growing number of cases where leading companies and major investors are ahead of the federal government on climate action, it’s simply not enough, and many more U.S. businesses need to step up.
The role that CEOs and companies play in global governance is changing. Leaders and laggards, winners and losers, will all be defined by how they respond to climate change. The leaders will surface based on their ability to take these four critical steps. Read more
The credibility of recent industry methane commitments is under the microscope.
One year ago, many of the world’s top oil and gas companies publicly committed to support methane policies and regulations to reduce emissions from the global oil and gas industry. But today, serious doubts are emerging about whether the companies will keep their promise in the face of extreme regulatory rollbacks in the largest oil and gas producing nation in the world—the United States.
The day before the World Gas Conference – one of the energy industry’s largest – 10 companies competed for USD $20 million to fund solutions with the power to disrupt how methane is managed, measured, and reduced.
The money was provided by Oil and Gas Climate Investments, the billion-dollar investment fund tied to the Oil and Gas Climate Initiative (OGCI) – a consortium of 10 oil and gas companies sharing knowledge and resources to cut the greenhouse gas footprint of their industry.
Last week hundreds of representatives from global companies and leading NGOs met in Bentonville, AR for Walmart’s annual Sustainability Milestone Summit. The theme of the meeting was Project Gigaton, the most ambitious and collaborative effort ever to reduce a billion tons of emissions from the global supply chain over the next 15 years. At the meeting Walmart announced 20 million metric tons of greenhouse gas emissions reductions from suppliers, and noted that 400 suppliers with operations in more than 30 countries have now joined Project Gigaton by setting ambitious climate targets.
One powerful theme that emerged from the meeting was the importance of technology. Project Gigaton is inspiring targets that raise our ambition, but increasingly technology is how we will deliver on these commitments and measure progress.
A new EDF survey of more than 500 executives confirms that game changing technology innovations are empowering private sector leaders to improve business and environmental performance – and to accelerate sustainability efforts across global supply chains.
The oil and gas industry has planted its sights on playing a competitive role in the energy mix of the future. However, oil and gas extraction, transport and use create serious environmental and safety risks when leaked, releasing 8-10 million metric tons of methane into the atmosphere each year in the US alone.
Fortunately, addressing this problem also offers a tremendous opportunity: a 45% reduction by 2025 would have the same benefit as shutting down one-third of world’s coal fired power plants. That’s why EDF set out on a groundbreaking global technology challenge to incentivize new solutions to fix this problem.
The super emitter problem
Methane is invisible and odorless, making leaks hard to detect. EDF-led studies have shown that methane pollution is widespread, pouring out from “super emitters” – the large, enigmatic sources responsible for a big portion of industry’s methane pollution. These super-emitting sources are nearly impossible to predict and can happen anywhere, anytime as a result of malfunctioning equipment that goes unattended or mistakes in the field.