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How businesses are implementing the energy transition
24 Plays3 years ago
During this episode we speak with leaders from different sectors about how they are thinking about and implementing the transition to low and zero carbon energy. What are the challenges they face? How are their business operations evolving in light of the transition? And, how is it all being financed?
To find out how HSBC is supporting businesses on their sustainable ambitions, click here.
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Transcript
Introduction to Podcast
00:00:02
Speaker
Welcome to HSBC Global Viewpoint, the podcast series that brings together business leaders and industry experts to explore the latest global insights, trends, and opportunities.
00:00:13
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Make sure you're subscribed to stay up to date with new episodes.
00:00:16
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Thanks for listening.
00:00:17
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And now onto today's show.
Financing Transitions for COP27
00:00:23
Speaker
Welcome everyone.
00:00:25
Speaker
I'm delighted to talk today about financing the transition, presenting you with key outcomes and key expectations ahead of COP27 and COP28 coming from the Middle East.
00:00:37
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So today we're really going to dig into some of the concepts that business is thinking about and talking about in terms of financing the transition.
Meet the Panelists
00:00:47
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I'm delighted to welcome four fellow panellists,
00:00:50
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distinguished in their corporate and in this topic to hear their insights around what they're doing in terms of their corporate strategy, how they're financing it, and really what they're thinking about in terms of regulatory drivers.
00:01:04
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First, I'd like to welcome May Abdelhaim, who is president for GE based out of Cairo, so for Egypt.
00:01:14
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Welcome.
00:01:15
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Christian, who is part of the team at AHA Horizons.
00:01:21
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Dieter Volkamer, who we welcome from Siemens Energy.
00:01:25
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And Greg Feuer, who is the CFO of ALDA, the real estate company here in Dubai.
GE's Climate Commitment
00:01:31
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So thank you for joining me.
00:01:33
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And I'm going to kick off the conversation by talking straight with you, May, and looking at GE.
00:01:39
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So we've had the pleasure of working with GE on numerous occasions.
00:01:44
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And you're a true solutions provider for the energy transition.
00:01:49
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Can you tell us a little bit more about how your products fit into the transition story and what you're working on?
00:01:55
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Sure.
00:01:56
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Thank you, Zoe.
00:01:57
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So at GE, we believe that climate change is an urgent global priority.
00:02:03
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And we are taking serious actions to address it.
00:02:05
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We set our emission goals for 2020 and met them ahead of schedule.
00:02:10
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And now we have also set goals for being carbon neutral in our own operations.
00:02:16
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Given that one third of the world's electricity is generated by GE equipment and almost 90% of the world's transmission utilities are equipped with GE technologies, we are focused on playing an essential role in the global energy transition.
00:02:35
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So we believe that cleaner energy future will be achieved through a combination of lowering emissions today and innovating in breakthrough technologies for the future.
00:02:49
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We are working with our customers and partners to prioritize a decade of action to lower emissions near term while securing a path to lower carbon future.
00:03:03
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And we are doing this through growing renewables by accelerating the expanded deployment of renewable energy infrastructure, as we are a renewable energy company, and through leveraging gas power as a force multiplier to help accelerate decarbonization in the near term with more efficient technologies.
00:03:27
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For example, coal to gas switching is such a good one.
00:03:31
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Also through modernizing the grid, through modernizing both physical assets and digitizing the grid, we can help make it more resilient and capable of transmission from diverse sources of power generation, such as renewable energy.
00:03:51
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And on the innovation side, we are working on multiple technologies, including hydrogen, carbon capture, utilization and storage, superconducting generator technology, small modular reactors and sustainable aviation fuels, to name a few.
00:04:11
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We have implemented solutions in all of these areas around the world.
00:04:17
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Look at the SAF blend, the head flight from London to Abu Dhabi last year, for example, or the small nuclear reactor technology that we will be deploying in Ontario, Canada.
00:04:31
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These are just a few of the examples we have of solutions that are already out there in the world working
00:04:40
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toward the energy transition.
00:04:43
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It will not be one solution or one approach.
00:04:46
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It will take a diverse
Siemens Energy's ESG Strategy
00:04:47
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array of technologies, solutions, and players to move the needle on the energy transition.
00:04:54
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It's a really important area and I'm so interested to hear about the sustainable aviation fuel part.
00:05:01
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It's something that is really close to my heart.
00:05:04
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Being here in Dubai, but traveling everywhere to go and visit family back in the UK, etc.
00:05:09
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We really want to know that we're doing this on a sustainable basis.
00:05:13
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So GE central to the transformation.
00:05:17
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And we'll come back to some of those themes.
00:05:19
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So moving now on to Siemens Energy, Dieter.
00:05:22
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So you've been working on this for a while.
00:05:25
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Tell us a little bit more about your approach to ESG and transition and how it's been developed into a successful growth strategy.
00:05:32
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Because I think that's what our audience wants to hear about.
00:05:35
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It's how to generate a successful roadmap on the sustainability agenda.
00:05:40
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Yeah, thanks, Zoe.
00:05:42
Speaker
Before I come closer to your question, maybe it's worthwhile to spend a couple of seconds on what is Siemens Energy, actually, because, I mean, Siemens, everybody knows Siemens, but maybe not everybody knows that Siemens Energy is a startup, more or less.
00:05:56
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I mean, we operate in 90 countries.
00:05:58
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We have a revenue of roughly...
00:06:01
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So it's a larger startup, but it's founded via a spin-off in 2020 from the Siemens Energy.
00:06:08
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And since then, we are independent company stock listed Energy Pure Place.
00:06:13
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And having said this, I mean, we had a very good foundation when we started our sustainability journey, having the legacy from Siemens and some of the targets
00:06:23
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we directly copied, to be very honest.
00:06:25
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I mean, for example, becoming climate neutral in our own operation, that was already invented or started by Siemens in 2015.
00:06:33
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And we clearly said we will continue this path.
00:06:36
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On the other hand, it was also clear that we need to understand what is the requirements in terms of sustainability for energy pure play.
00:06:44
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So we went through a lot of discussions and honestly, it was very fruitful to discuss also with the finance industry.
00:06:50
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And we had a lot of contacts during the phase of the cough out to really understand what will investors in the future seek for in terms of ESG program, but also in terms of ESG performance indicators.
00:07:04
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So that helped us a lot to understand where we need to target at.
00:07:08
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And in the end, we came out with a very comprehensive sustainability program focusing on responsible operations on the one hand.
00:07:15
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So how are we doing business with elements of
00:07:19
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health and safety, of course, diversity is super important.
00:07:22
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And also given the fact, this is only a few examples, but also given the fact that we are in huge infrastructure projects, also the topic of human rights compliance are very important.
00:07:35
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But given our portfolio, and we cover the entire value chain with conventional power, renewable power, transmission, also hydrogen businesses in our portfolio and the decarbonization of industries.
00:07:49
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And we said we need to come up with ambitious targets and they need to be approved and we choose SPTI, the science based target initiative, and we choose the science based target initiative.
00:07:56
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And we also have a lot of the data that we have in the future.
00:08:06
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who approved our decarbonization targets being in line with Paris.
00:08:11
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And this is, I think, a very important sign.
00:08:15
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And it helped us also to integrate decarbonization clearly into our company strategy.
00:08:20
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And this is, I think CO2 is a kind of a business indicator.
00:08:26
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Like we have revenue, like we have EBIT and profit.
00:08:30
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Also we discuss about CO2 in our projects.
00:08:33
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This is very helpful.
00:08:34
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And I can name a couple of projects which clearly show that this is super important also for the Middle East region, for Egypt, where we, for example, with our daughter Siemens Gamesa, we are helping Egypt with a large project
00:08:49
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on their ambition to become a renewable energy hub for Africa.
00:08:55
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And this is closely connected with a memorandum of understanding which we signed with the Egyptian Electricity Holding Company who want to be, who want to develop a hydrogen based industry and also in the end export green hydrogen, which I think is also an excellent element because I mean hydrogen everybody sees it as one of the major fuels in
ALDAR's Sustainability Leadership
00:09:17
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the future.
00:09:17
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And you're mentioning the aviation industry, I think hydrogen
00:09:22
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will play also a huge role here via e-fuels and last but not least we are closely working with the ARENA with the International Renewable Energy Agency in Abu Dhabi also here to jointly focus on the energy transition based on renewables and drive the energy transition so as said sustainability decarbonisation clearly part of our company strategy that's great thank you for running us through but now moving on to Greg so Greg
00:09:50
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You're both the chief financial officer and the chief sustainability officer of ALDAR.
00:09:55
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And you're in a different sector from GE and Siemens.
00:09:59
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Can you just tell us a little bit about your view on transition and how that's being implemented throughout the organization?
00:10:08
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Thank you Zoe, pleasure to be here.
00:10:10
Speaker
So for ALDAR, and maybe just the first bit on who ALDAR is for the people that aren't aware on the call.
00:10:17
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Aldar is a large master developer based in Abu Dhabi.
00:10:21
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We have about $15 billion of real estate.
00:10:24
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We have a market cap of about $10 billion.
00:10:26
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We're a master developer.
00:10:28
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And in our country, which is only 50 years old, the real estate sector is very young.
00:10:33
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and companies like us in Aldar and Abu Dhabi, like EMR in Dubai and other places, government-linked entities were invented to help the city build itself.
00:10:43
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So over our 15 years of existence, we've probably had a hand in building about 15 to 20% of our entire city-state, and we have 65 million square meters of land, which means we have another 50 years to go.
00:10:55
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So people like us sit at the top of the real estate food chain and operate from a leadership perspective in our market.
00:11:03
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So when it comes to sustainability and ESG and the energy transition, our strategy at Aldar has been simply to lead.
00:11:13
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And that perspective really came from this market leading incumbency, this market position that we have.
00:11:18
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We build about 80% of all new off-plant homes in Abu Dhabi.
00:11:23
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When you're that large and this issue matters so much, you really need to take it seriously and you need to take a leadership position.
00:11:33
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For us, that has meant having advocacy, not just at the board, but at the chief executive who owns this topic by definition, but also that chief level
00:11:41
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advocates for it so I became actually for a couple of days I became the chief sustainability officer of Aldar and at one point our organizational structure actually had the CFO reporting into the office of sustainability.
00:11:55
Speaker
We decided not to brand it as such at that time because we thought maybe the market wasn't ready yet to have a public listed company without a CFO but just to give you a perspective of how we lead and how we manage
00:12:07
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We view sustainability to be that thing that ensures we are future-proofed and sort of around forever.
00:12:13
Speaker
But it needed top-level support before it had real grassroots engagement and we were ensuring that the culture of sustainability was built within the organization.
00:12:23
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We've really taken that leadership position seriously and are keen to move our supply chain forward really with the decisiveness and with the leadership that a top of the food chain industry
00:12:36
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actor like ourselves has to do and progress for us means engaging with the supply chain as a developer we own land and have a brand and have capital and everything else in between turning sand into land into a home that someone takes over is the supply chain
00:12:52
Speaker
And the supply chain needs a lot of conditioning and a lot of work and without proactive engagement from people like us to trial technologies to lobby regulators to ensure that suppliers know that there is offtake and that there is a keen, you know, top of the food chain developer willing to cure on a green sustainable basis.
00:13:14
Speaker
you won't move your industry forward.
00:13:16
Speaker
And I think that's a similar kind of perspective that should also exist with other top of the food chain, animals, auto assemblers, airlines, people like that.
00:13:25
Speaker
You're absolutely right.
00:13:26
Speaker
And there are several issues coming out from your comments that really kind of resonate with us at HSBC as well.
00:13:34
Speaker
One is, you know, taking the agenda seriously here on transition without taking it seriously and having a very top level governance and perspective on how these things are going to play out.
00:13:48
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You can't adjust your business model in order to embrace them and to embrace the opportunity that they present.
00:13:53
Speaker
And similarly,
00:13:54
Speaker
this point around the supply chain, you know, there is so much engagement activity to be done in the supply chain to help move the agenda forward
AHA Horizons' Decarbonization Approach
00:14:04
Speaker
quite fast.
00:14:04
Speaker
And so delighted to hear that you're working on that topic in particular.
00:14:09
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So brilliant.
00:14:10
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Moving on to Christian.
00:14:12
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Christian, you know, you've heard about some of the approaches from fellow panellists
00:14:17
Speaker
Net zero is clearly important in terms of the business opportunity for you, but equally how you partner with your clients and how you partner throughout your value chain.
00:14:30
Speaker
How is your approach going?
00:14:31
Speaker
differing or similar to Siemens GE and Alder.
00:14:35
Speaker
Can you just tell us a little bit about what you're up to?
00:14:38
Speaker
Yeah, sure.
00:14:38
Speaker
Thank you.
00:14:39
Speaker
So just a bit of background.
00:14:40
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AQUA Horizons was set up in 2020 as the broader AQUA group's spearhead on tackling climate change.
00:14:48
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We develop and invest in technologies projects
00:14:56
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industries.
00:14:57
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Today we have three main pillars of decarbonization, renewable energy, hydrogen and carbon capture.
00:15:05
Speaker
We also have a fairly broad mandate to widen that to new areas.
00:15:10
Speaker
Some said that we had an unfair competitive advantage compared to other smaller startups by being a part of the larger industrial group.
00:15:21
Speaker
And being part of the ACA group provides us with technology, competence, and not least capital.
00:15:29
Speaker
The engineering capabilities found within ACA solutions and the industrial digitalization expertise in the group is key for commercializing technology and bringing down cost, which is crucial for a successful energy transition.
00:15:45
Speaker
The ACA group also provides us with a global network of industrial partners.
00:15:50
Speaker
And working in partnerships is one of the key levers for us to generate value.
00:15:55
Speaker
Through the aqua groups ecosystem, we have access to leading industrial actors across the segments we operate in, such as our partnership with Shell and Statcraft on hydrogen, BP and ocean winds on offshore wind, and Siemens Energy on carbon capture and storage.
00:16:15
Speaker
Our business model is set up so that we look for partners across the value chain from securing renewable energy feedstock for our projects to partnering with developers on the actual industrial project and partnering with industry majors on offtake.
00:16:30
Speaker
This gives us access to attractively priced feedstock, industrial and strategic expertise and new markets as well as long-term capital.
00:16:41
Speaker
Partnering is something that is really coming out quite significantly through the rest of this, the conversations that we're having.
00:16:48
Speaker
It seems like for those of us that have been working on climate for a while, we know that we know that the pure play solution of scaling up renewable capacity to be able to provide that supply side part of the energy system.
00:17:04
Speaker
But the demand side part that needs to move in harmony to be able to get emissions down
00:17:11
Speaker
is has has different solutions in terms of hard to abate sectors what you can actually do ie you can't just use renewable power some of the time you need to sort of think about how you shift your business model a bit but equally you need the incentives to to be able to commercialize the available technology and this partnership idea
00:17:32
Speaker
is really mission critical to be able to get those markets moving fast.
00:17:37
Speaker
So I'm glad that you've brought up the concept in our conversation today.
00:17:41
Speaker
You know, we've touched on this a little bit in terms of the thematics that are important for transition, carbon capture and storage, hydrogen, and a little bit about how we make that work.
00:17:52
Speaker
But I'm really keen to dig into some tangible ideas now, especially with Egypt hosting COP27.
GE's Initiatives for COP27
00:18:01
Speaker
May, I'm guessing that it's getting busy for GE in terms of your conversations with the Egyptian government and others.
00:18:10
Speaker
Tell us a little bit more about some projects that are going on.
00:18:12
Speaker
So actually, we have been in the region since the early 1930s.
00:18:16
Speaker
And since then, we have served as a strong global partner, providing innovative solutions to our customers across the whole Middle East and Africa.
00:18:27
Speaker
And with COP27 fast approaching, we recognize the opportunity we have by working toward implementation.
00:18:36
Speaker
And we are already
00:18:38
Speaker
supporting our partners in the region around the world to realize net zero ambitions.
00:18:44
Speaker
For example, in Egypt, where all the action is taking place later this year, GE Digital in partnership with Bakhtel, Baker Hughes, MB Petrojet, HSBC, and the National Bank of Egypt signed an MOU to support the decarbonization of downstream facilities in Egypt.
00:19:07
Speaker
So this collaborative initiative seeks to lower emissions across critical industries like the oil and gas industry, which will be key to realizing Egypt's vision for decarbonization.
00:19:22
Speaker
So GE is bringing software solutions to this coalition of partners.
00:19:29
Speaker
GE Gas Power also has signed two agreements with the Egyptian electricity holding company.
00:19:36
Speaker
to promote efforts for decarbonizing the electricity sector in Egypt.
00:19:40
Speaker
And that's zooming into Egypt, but broadly in Abu Dhabi, for example, GE is already developing roadmaps for decarbonization with partners like Emirates Global Animalian and Abu Dhabi National Oil Company, ADMA.
00:19:56
Speaker
So we are looking at hydrogen and carbon capture, utilization and storage and other solution.
00:20:04
Speaker
We also support Egypt across the healthcare and aviation sectors, providing solutions for patients and passengers across other critical industries.
00:20:15
Speaker
Of course, looking ahead to COP27, there will be a lot that will unfold.
00:20:23
Speaker
And as a head of GE's global COP27 team, I'm on the ground in Cairo and I'm so excited about the progress I see ahead of the November event.
00:20:38
Speaker
It's really interesting to see how governments and companies are collaborating for the greater groups.
00:20:45
Speaker
I also really appreciate the emphasis this COP has on implementation, something, of course, GE is passionate about as well.
00:20:56
Speaker
So the whole event will be focused on a just and ambitious plan for the energy transition, one that looks at sustainability, reliability, and affordability.
00:21:10
Speaker
We call this the energy trilemma and we believe that all three must be balanced as we work toward solutions as one global community and particularly for the 750 million people without access to power.
00:21:28
Speaker
And we believe that it will take much more than one company, one government or entity to succeed with these goals.
00:21:37
Speaker
Thank you.
00:21:37
Speaker
It's really exciting that COP is almost here.
00:21:40
Speaker
But equally, having been through the COP process sort of several times and worked alongside the UN since before Paris back in 2015, there's always a kind of a year of excitement, but equally a year of rollercoaster sentiment as work plans come together and as the collaborative approach takes shape.
00:22:05
Speaker
And it really does then kind of have a crescendo at the COP event itself.
00:22:11
Speaker
So we're looking forward to seeing that.
00:22:13
Speaker
And you're right in that implementation is really the name of the game right now, right?
00:22:18
Speaker
Which is why we wanted to have corporates like yourselves discussing what you're up to because...
Innovative Projects in Carbon Capture
00:22:25
Speaker
I think our investor community and fellow corporates want to learn because the partnership element and the radical collaboration bit is the way to speed up action.
00:22:35
Speaker
And that's what we're looking to do.
00:22:37
Speaker
Christian, just in terms of your projects, you talked a little bit about collaboration already in the Nordic countries.
00:22:44
Speaker
I think there's some specific things that our listeners might find interesting around hydrogen and a flagship projects that you've got in Norway.
00:22:54
Speaker
What would you like to tell the audience in terms of the challenges and benefits of partnering and how you've worked on that project?
00:23:01
Speaker
I think our projects in general are often quite pioneering.
00:23:06
Speaker
We're either entering new markets or utilizing new technology.
00:23:10
Speaker
And our broader project portfolio is global with key projects spanning from Latin America to Asia via Africa and Europe.
00:23:20
Speaker
And I think some examples are including the big hydrogen projects in Norway.
00:23:25
Speaker
We are currently installing the first 4K scale carbon capture facility on the Heidelbergs
00:23:35
Speaker
which has the capacity of reducing the CO2 emissions by 400,000 tons per year.
00:23:42
Speaker
This is a technology that has been developed within the ACO group for more than 20 years.
00:23:48
Speaker
And as you mentioned, we have a flagship project in Norway
00:23:53
Speaker
You don't know the small town of Norway.
00:23:56
Speaker
It's a place in the northern part of Norway where we are developing an industrial scale green hydrogen project.
00:24:04
Speaker
So the starting point for that project is the fact that there are big differences in the power prices of northern and southern Norway, where you find European prices in the southern part of Norway, whereas you have abundant green energy to primarily hydropower in the north.
00:24:22
Speaker
So power is quite cheap.
00:24:24
Speaker
So that led us to sort of find a way to utilize that power in a way that we can export that to markets that has a need to maybe reduce their power consumption and decarbonize that at the same time.
00:24:39
Speaker
So we are building large scale green hydrogen facilities that will lead into ammonia production and also looking at doing direct reduction of iron
00:24:53
Speaker
There is a large amount of iron ore flowing through the port of Narvik every year.
00:24:58
Speaker
So in this way, we can help decarbonize the shipping industry by selling and exporting the ammonia.
00:25:05
Speaker
And we can also help decarbonizing the steel industry by reducing the iron using green hydrogen rather than coal and coke, which is the natural way of doing that and the most emitting part of the coal or the steelmaking industry.
00:25:22
Speaker
I think again back to the partnerships and the importance of that, when you look at both carbon capture and storage and hydrogen, you can always just focus on the project, but there is really a sort of a need to actually lift the whole value chain at once.
00:25:38
Speaker
You can't just focus on that one project because you need to have power and grid connectivity coming into the hydrogen production.
00:25:46
Speaker
You need to have some sort of way to export it or approach
00:25:53
Speaker
that is easily exported compared to hydrogen in its pure form and and that's that's sort of when we when we need partners to work with them and that is extremely important in in being able to lift these infrastructure and value chain project without having various elements slowing that development down yeah i mean without partnerships we're just going to
00:26:18
Speaker
well, we're not gonna get anywhere basically, but it's also difficult to establish them.
00:26:23
Speaker
And then once you have, you can really scale projects in a particularly effective way.
00:26:29
Speaker
But right now, I wanna come back to you, Greg, and you touched on the supply chain points in your previous comments, and there's a really important one here for the real estate sector generally, and that's the potential for green cement.
00:26:48
Speaker
And, you know, it's a really mission critical topic to address in terms of a decarbonisation journey, but obviously it's very difficult.
00:26:59
Speaker
So what's your sense of how the supply chain aspect that you're thinking about and Green Cement in particular is unfolding and what would help with moving that topic forward a little bit more?
00:27:13
Speaker
Yeah.
00:27:14
Speaker
Well, so green cement is not a bad story in the UAE in the sense that you can actually procure it at relatively good scales right now.
00:27:25
Speaker
The issue is it only takes about, say, 30% of the embodied carbon that's in traditional cement out.
00:27:31
Speaker
And so that industry needs to improve that to 90% plus, which they can do, but just the cost curves aren't quite catching up.
00:27:42
Speaker
too much yet.
00:27:43
Speaker
So again, back to that point of leadership from us, it's important that we engage proactively with the supply chain to ensure that they know that we are buyers, that we will sandbox technologies and innovations with them.
00:27:56
Speaker
We will help enable discussions with our governments around ensuring that innovation in material sciences are buildable and approvable.
00:28:05
Speaker
in terms of building permits and things like that.
00:28:07
Speaker
Again, this idea of the whole ecosystem needing to work together.
00:28:11
Speaker
And more broadly in real estate, you look at cement and then you very quickly move on to other critical items that will involve us getting to net zero in all our homes by 2050, which is low carbon steel, low carbon aluminium, glass, all wrapped in passive design.
Demand for Transparency in Climate Plans
00:28:28
Speaker
And each of those elements in the supply chain, including the services supply chain, architects and engineering need to work as collaboratively and as closely as the cement industry locally has done here to improve reductions in body carbon across all those critical supply and material items.
00:28:50
Speaker
Yeah, that's a really useful explanation of what you're doing.
00:28:57
Speaker
One of the things that
00:28:59
Speaker
the financial sector is looking at is what to ask for in terms of disclosure around cement and steel companies to show that they're on a transition journey.
00:29:09
Speaker
And I think one of the coalitions that's being built around creating that demand and transparency is the first mover coalition.
00:29:18
Speaker
But also HSBC does some work with the Mission Possible Partnership, which provides tangible case studies of how to do this.
00:29:27
Speaker
because this takes me on to the next topic, which is financing.
00:29:32
Speaker
And across the financial sector, there are drivers to get more transparency on what a climate plan looks like from the industrial sector.
00:29:42
Speaker
And the rationale for getting that plan is to know how to be able to support it more effectively, right?
00:29:49
Speaker
To be able to provide effective cost of capital, so low cost cost of capital into the projects that are going to
00:29:55
Speaker
drive emissions outcomes and also set individual companies up well for success going forward.
00:30:02
Speaker
Dieter, what's your sense from how financial institutions are addressing ESG in emissions targeting?
00:30:11
Speaker
And does that really affect you or am I kind of wrong in thinking that the financial sector is really getting hot on ESG issues?
00:30:21
Speaker
No, no, it's really, it's incredible what happened over the last years.
00:30:26
Speaker
I mean, I'm doing sustainability now for a couple of years.
00:30:29
Speaker
And when I started my personal journey, it was, well, it wasn't nice to have.
00:30:34
Speaker
Today, a lot of discussions around strategic discussions, finance discussions.
00:30:41
Speaker
are around the ESG and the requests on ESG data and the questions on how you perform with your ESG programs are increasing.
00:30:53
Speaker
I couldn't believe a couple of years ago and I mean today I think there's no discussion around the sustainability report anymore.
00:31:00
Speaker
It's a must and on top of the sustainability report you have to answer ratings
00:31:06
Speaker
You have to answer questionnaires from customers, but also finance institutions.
00:31:10
Speaker
So obviously there's a huge request in showing your ESG performance.
00:31:16
Speaker
And I think this is very logical because ESG performance or the risk of a bad ESG performance is a business risk.
00:31:24
Speaker
So it's natural that the investors are asking for transparency here.
00:31:29
Speaker
And as I said at the beginning, for me, it is very important to have this regulate change because I mean, also the investors, the financial institutions, I mean, they have also to adhere to the regular regulatory requirement.
00:31:44
Speaker
So it trickles down your reporting requirements might trigger down to the industry reporting requirements.
00:31:51
Speaker
And for the time being, it is a bit of a challenge to answer all these requests and have the clarity in the data and the way how you report.
00:32:00
Speaker
On the other hand, we see moving in the right direction.
00:32:04
Speaker
We have the CSRD coming in place in the European Union next year.
00:32:09
Speaker
We have the EU taxonomy also coming in place, already in place.
00:32:14
Speaker
And I don't oversee all the challenges in implementing these regulations.
00:32:19
Speaker
On the other hand, I think it is going in the right direction.
00:32:22
Speaker
And here, again, partnering between financial institutions and also the industry, we need to also to have a common understanding on how to implement and how to really report on those KPIs, because it can only be in the benefit of
Hopes for COP27 and Conclusion
00:32:36
Speaker
everybody.
00:32:36
Speaker
And in the end, and this is going to be 100% clear that the direction will be at one point in time,
00:32:43
Speaker
investors will value financial information and ESG information on the same level.
00:32:48
Speaker
And this is for us clear that we go this direction.
00:32:51
Speaker
So that all sounds like it's very straightforward.
00:32:54
Speaker
In the last few minutes,
00:32:56
Speaker
Given the fact that part of the rationale for this series is to raise awareness and raise support for Egypt on the COP27 agenda, I'd just like to hear sort of 40 seconds from each of you and what you would like to see at COP that would help you accelerate your own business strategy or generally that you would like to see from COP from a personal perspective.
00:33:20
Speaker
So I will start with you, Christian.
00:33:23
Speaker
What would you like to see from COP27?
00:33:25
Speaker
I think for us, it's important to have going forward sustainable value chains.
00:33:31
Speaker
I think sort of an increased focus on bringing sustainability throughout the whole value chain, going back to the commodities, the mining of those, turning that green and sort of looking at green steel, green cement and having sort of more focus on the value chain is important for us.
00:33:50
Speaker
Great.
00:33:51
Speaker
Greg?
00:33:52
Speaker
Net zero commitments with substance.
00:33:55
Speaker
public-private partnerships to get us there.
00:33:58
Speaker
Collaboration will be key.
00:34:00
Speaker
Governments leaning in are crucial.
00:34:03
Speaker
And with COP28 coming quickly off the heels of COP27, I think you're going to see this region really stand up and take a leadership position on this front.
00:34:11
Speaker
Right.
00:34:12
Speaker
Dieter?
00:34:13
Speaker
Yeah, for me, understanding that the energy sector is maybe crucial for the whole net zero discussion.
00:34:18
Speaker
So accelerate the energy transition in the energy sector by focusing on renewables, infrastructure investment, also in transmission and last but not least scale up the hydrogen economy.
00:34:31
Speaker
Good.
00:34:31
Speaker
And May, on the ground there in Egypt right now.
00:34:34
Speaker
Yeah.
00:34:35
Speaker
So I believe that COP this year is an important milestone to the international climate agenda.
00:34:43
Speaker
And because this year it comes at a very challenging time with the pandemic and the geopolitical changes.
00:34:49
Speaker
So the focus on implementation, the focus on the energy transition, and as we do believe that it takes time for this transition, and there is a short term that needs to be focused on decarbonization while building innovation and building the future to
00:35:08
Speaker
to reach net zero emissions in the future through hydrogen, through renewable energy, through more innovation that will come up.
00:35:17
Speaker
Thank you.
00:35:18
Speaker
So just if I can draw out three points to take away today, the importance of partnerships was a clear one that came from all of you today in terms of scaling the opportunity in the markets.
00:35:33
Speaker
and the series of intent.
00:35:35
Speaker
And both those things will accelerate our action on climate change.
00:35:39
Speaker
Thank you for joining us.
00:35:40
Speaker
Thank you.
00:35:41
Speaker
Thank you.
00:35:42
Speaker
Thank you, Zohar.
00:35:42
Speaker
Thank you all.
00:35:58
Speaker
Thank you for joining us at HSBC Global Viewpoint.
00:36:01
Speaker
We hope you enjoyed the discussion.
00:36:04
Speaker
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