Are businesses scared of the coming exponential growth in clean technologies?
To mark edie’s Business Leadership Month, former COP26 High-Level Climate Action Champion Nigel Topping told sustainability professionals that they need to embrace exponential growth and grasp at new and emerging climate solutions, or risk suffering in their markets.
Climate action has become contagious, or at the very least the notion of companies presenting themselves as stewards of the planet through net-zero targets has gone mainstream.
Delivering on these targets, however, is not happening at the pace required to alleviate the worst impacts of the climate crisis. Indeed, research suggests that many companies have not sufficiently built short-term action plans to account for the longer, transformative net-zero journey. Instead, companies seem content to wait for solutions or policies to emerge that can help them plot their course.
The need for action increases as every day on the road to net-zero passes and yet the messages remain the same: We are not moving fast enough!
Some in the private sector will argue that green policy is the answer, or the uptake of new green financing solutions. Others will point to a business mindset that shies away from exponential growth.
At its core, exponential growth is the steady increase of anything, commonly by a fixed percentage, over a period of time.
For former COP26 High-Level Climate Action Champion, Nigel Topping, exponential growth in the sustainability space has taken many firms by surprise, yet the private sector still seems to become jittery around innovations and solutions that are on the verge of exponential tipping points.
Speaking at the edie 23 event in London on Wednesday (1 March), Topping claimed that too many businesses “struggle to believe” that exponential growth in climate and green solutions is possible, and that many were jeopardising their future by doing so.
“[The business community] has struggled for a long-time to believe in the exponentials”, Topping told a packed crowd of more than 500 sustainability professionals at the edie event in London. “We really need to start looking at the early indicators of change [across all markets] and understand that this process is happening exponentially.
“We need to stop telling each other how bad a job we’ve done of something in the past and start believing how brilliant we can be, act accordingly and set targets for exponential growth.”
Topping told delegates that too many incumbent businesses were being outperformed by disrupters because of this mindset. The most obvious example is in the road passenger vehicle space where Tesla caused a disruptive ripple effect in the market that has seen electric vehicle (EV) predictions grow from a small nice portion of the market to being cheaper than other conventional cars by 2027. The energy and hydrogen markets have, or are about to in the case of the latter, undergone similar disruptive evolutions.
It can also be argued that the setting of science-based targets has grown exponentially. Just five years ago, only four companies had science-based targets aligned to the 1.5C trajectory of the Paris Agreement. Now more than 8,300 companies have committed to setting and reaching net-zero goals through the UN’s Race to Zero initiative alone, which Topping helped formulate.
Look at the puck
Topping told delegates of a saying coined by Canadian ice hockey player Wayne Gretzky, who stated he “skated to where the puck is going to be, not to where it has been”.
Topping told delegates that he and the We Mean Business Coalition had been telling countries and corporates for years to “get their skates on” and respond to the climate crisis. Now, Topping argues, the ice rink is full, and asking them to get their skates on is not the right message to give anymore.
“What we need to show people is where the puck is going [on that rink] and that requires a new skill set, a skill set that is not the same as looking back where the puck has been,” Topping added.
“We need to stop saying how bad a job we’ve done up until now and actually make a case that technological transformation has happened in the past and its always exponential, and we’re really bad at being able to see that the puck is moving exponentially into the future.”
Topping claimed that the world needed to develop a “coalition of the ambitious” who say yes to the challenges facing society and, crucially, involve developing and emerging economies that can help facilitate new learnings and deliver growth.
One such example is the UN’s aptly named Exponential Roadmap Initiative – a scheme set up to help companies, cities and nations to back up long-term climate targets with plans to at least halve emissions by 2030.
The Exponential Roadmap Initiative was launched in September 2020, as part of the Race to Zero campaign, with Ikea, Unilever, BT, Ericsson and Telia named among the founding corporate members of the 1.5C supply chain leaders. This scheme, and its other workstreams, are supported by the We Mean Business coalition.
Topping argued that it is only through these types of collaboration and mindset that businesses can grasp the benefits that exponential growth in new markets can bring.
“People tend to think that exponential change and faster transformation is crazy and they’re consider the normal ones,” he added.
“But if you don’t start believing in this change [and act accordingly] you’ll be the one who loses market shares and you’ll be made to look a fool by those who actually believe in the brilliance of human ingenuity. You either get involved in this process, or you’re just another boring bystander telling everyone how rubbish they are when they’ve almost solved a problem.”
Keep up to date at edie 23
March 2023 is edie’s Business Leadership Month, with the edie editorial team primed to deliver an array of action-provoking events, articles and interviews over the next 30 days.
Our biggest event of the month and indeed the year, edie 23, began in London on Wednesday (1 March) in a fitting start to Business Leadership Month. We will be convening more than 100 expert sustainability speakers, plus hundreds of attendees and dozens of exhibitors, for two days of keynotes, panels, best-practice case studies and audience-led discussions across three themed stages – Strategy, Net-Zero and Action.