In 21st century business, climate change is a factor in every career.
“It doesn’t matter if sustainability isn’t in the job description,” said Daniel Vermeer, a professor of the practice at Duke University’s Fuqua School of Business. “Climate change is relevant to every industry and every function.”
That relevance brought 16 business schools together at Fuqua for ClimateCAP, a conference to address the career challenges – and opportunities – presented by climate change.
“MBA students can’t afford to ignore the impacts and implications of a changing climate,” Vermeer said. “There will be winners and losers, and many opportunities to seize competitive advantage. Industry is talking a lot about the business impact of climate change, but there hasn’t been a place in the curriculum for students to talk about the impact on their careers.”
To that end, the conference pulled in speakers from beyond environmental firms, reaching into supply chain management, real estate, financial services, insurance and food. Speakers came from heavyweight firms including JPMorgan Chase, Goldman Sachs, Nike, Bain & Co., Morgan Stanley, and Levi Strauss.
“We pulled from mainstream businesses because this is not a ‘green’ event,” said Katie Kross, managing director of Duke’s Center for Energy, Development and the Global Environment, which hosted the conference.
"(N)ot about politics or government policy”
Nor was it focused on debating the science of climate change.
“This summit was not about politics or government policy,” Vermeer said. “It was about which businesses and investors understand the risks and adapt, and which will be left flat-footed.”
Scott Jacobs understands. He co-founded McKinsey & Company’s global CleanTech practice before launching his own sustainable investment firm in 2014. In his opening keynote, he said addressing climate change isn’t about philanthropy, but firms understanding that it’s “absolutely in their rational self-interest to pursue solutions to these problems.”
Jacobs said his firm focuses on renewable energy, agriculture, water and transportation.
“The business model for addressing climate change is infrastructure-based,” Jacobs said. “Short-term mindsets make it very difficult to solve long-term problems.”
The event dug into individual sectors but ultimately framed climate change as a leadership issue.
“It’s inspiring to think about the markets we need to set up, the institutions we need to change, the people we need to bring in and the prices we need to set, but behind all that we need to have leaders to make this a reality,” said Professor Aaron Chatterji.
Chatterji ran a discussion on climate change as a consideration in business leadership consideration with Lord Michael Hastings, global head of corporate citizenship at KPMG International, and Jim Rogers, retired CEO of Duke Energy.
"(Y)ou have to get out in front"
Hastings joined KPMG in 2006 and within a year, launched an effort to reduce the global firm’s carbon footprint by 25 percent. It was a hard sell, he said, because the firm’s peers weren’t taking action at the time. It was also tough because the firm wasn’t in the kind of industry that was thought of as carbon-heavy.
“My argument to them was that you have to get out in front because your client base is going to be demanding this,” he said. “We had to persuade people that carbon impacts were not just about transport or industrial production, but buildings and consumers. If we change our building structures, change our energy use structures and change our travel structures, we can achieve meaningful impact.”
The effort exceeded its carbon-reducing goals and also saved the firm millions in energy costs, Hastings said.
At the same time, Rogers was CEO of the 3rd largest carbon emitter in the U.S. Although the industry hadn’t taken an official position on the issue at the time, Rogers said he knew Duke Energy couldn’t afford to be idle.
“A leader’s most important role,” he said, “is to look around the corner and try to see what’s coming.”
As head of an industry group, Rogers said he sought consensus on taking proactive steps to reduce carbon emissions, by allowing everyone to be heard – in an industry where the larger players often dominated the conversation.
“It became clear to me we had a problem so big we had to do something,” Rogers said. “When you’re presented with a problem you have to run to it, you have to embrace it.”
"Any student that is not well-versed in this will be at a disadvantage"
Alex Marchyshyn, a first year Daytime MBA student at Fuqua, said the summit reinforced the need for business schools to prepare their students for climate-related problems business is already tackling.
“Any student that is not well-versed in this will be at a disadvantage, as businesses are already looking for employees with MBAs who understand these complex topics,” she said. “Dan Vermeer said during the conference that ‘we are the people we’ve been waiting for.’ That idea is so powerful to me, because we are the ones who can make a difference and we need to stop waiting for others to do what we can do now to create change.”
Nate Smith is a student at the Kenan-Flagler Business School at the University of North Carolina, which was one of the co-hosts of the event. Smith said the event reinforced his sense of the opportunities that exist for sufficiently bold individuals and businesses, even if they don’t share his desire to help the planet.
“MBAs who recognize the writing on the wall sooner rather than later stand to reap lucrative rewards, regardless of their moral compass,” he said. “What excites me about the message of ClimateCAP is that financial returns could bring efficiency, sustainability, and social welfare into the mainstream. For humanity to survive the next century, we certainly need them to be.”
Vermeer said he felt more hope about climate after the conference than he has in years.
“There’s a ton that’s happening in the guts of the economy,” he said. “Seeing these senior executives, who’ve been working on this for a long time, having a forum to share this with future business leaders, was like a transition to a next generation that gets it, that sees the importance of this work. These students are going to build careers around this. There’s a shift afoot.”