This week I’d like to discuss the biggest donation ever made towards climate change mitigation, showcase other recent corporate commitments on the same topic, and comment on where we stand in Mexico.
Jeff Bezos US$10bn climate pledge
On Monday Amazon’s CEO and President and the world’s wealthiest individual, Jeff Bezos, announced the launch of the Bezos Earth Fund with an endowment of US$10bn. The announcement, made on Instagram, mentioned that climate change is the biggest threat to our planet and that the fund’s goal will be to improve and grow existing ways of fighting this as well as exploring new solutions to the problem. Thus, the funds will go to scientists, activists and NGOs.
Since then, a lot of specialists have pondered on how this money should be spent, and if the fund is likely to have a true impact and achieve its objective. Some people have even questioned if the money would be better spent on paying higher taxes or increasing Amazon’s employees’ wages. Others believe the fund will struggle to find enough projects to invest its money in and whether pouring it into politics may be better (to counter the lobbyists that work for some of the biggest contributors to climate change). And some others even discuss whether the commitment is enough to just offset Amazon’s own carbon footprint *
Be what it may, the amount of money Bezos is committing to this fund is pretty material. To put it into context, the Climate Leadership Initiative estimates globally only bout US$7bn goes towards climate mitigation philanthropy annually.
Five recent climate-mitigation announcements across industries
Some other notable corporate pledges towards the same objective that have been made recently are:
- Microsoft pledged to become carbon negative by 2030 and remove its historical carbon emissions by 2050. The company also announced the launch of an initiative to use its technology to help suppliers and customers offset their own carbon footprints and the creation of a US$1bn climate innovation fund.
- Delta Airlines announced it will spend US$1bn over the next decade to become the first carbon neutral airline globally.
- BP announced its objective to become carbon neutral by 2050 or sooner, making it the major oil company with the most ambitious environmental goal.
- Starbucks announced its aspiration to become resource positive – storing more carbon than they emit, eliminating waste, and providing more freshwater than they use.
- AstraZeneca pledged to become carbon neutral by 2025 and carbon negative by 2030 with an up to US$1bn program.
What is going on in Mexico?
According to MexiCO2 (a subsidiary of the Mexican Stock Exchange backed by Mexico’s Environmental Ministry which is focused on developing environmental – carbon – markets to help with climate change mitigation efforts ), the first company to ever go carbon neutral in Mexico was Palsgaard (a Danish company) back in 2017. Since then, a few companies have offset some of their carbon emissions, but no one else has become carbon neutral or publicly committed to do so within a fixed timeframe. We clearly could see more corporate commitment on this front.
All companies in Mexico need to be examining their carbon footprint. While somewhat symbolic in some cases, decisive action shows all stakeholders that the company cares about climate change. This means cutting back substantially on corporate air travel. Use video. Cut back on energy usage in the office (use LEDs). Use renewable energy sources when possible (solar). Ban from the office single use plastic bags and plastic bottles, containers. Make bicycle racks available. End subsidies for corporate cars and subsidize public transport. Ban meat from the corporate cafeteria. And so on.
We believe in having transparent goals and transparent sustainability or stewardship reports. How are you planning to reach your goals? Are you really getting closer to your goals every year? Are your goals comparable to your potential? It might sound like too much of a commitment to go public with something of this nature. But in the end, if a company and its management truly believe in long term sustainability and how climate change affects this, going public will only force everyone involved to be more disciplined in their approach.
Hope this was of use. As usual, if there is anything we can help you with, please reach out. Also, don’t forget to recommend any ESG subject matter that you would like us to research and put in a forthcoming weekly
Partner, Miranda ESG
Contacts in Miranda Partners