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00:00:01
Irrational Sustainability
83 Plays1 year ago
Karthik, Anthony, and Mike catch up on the news and learn about the one simple fix that will solve the issue of ESG.
For more insights on innovation, check out the Lux Research Blog.
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Transcript
Introduction and Podcast Renaming Jokes
00:00:10
Speaker
Hello, and welcome to Innovation Matters. It is the Sustainable Innovation Podcast brought to you by Lux Research. I'm your host, Anthony Sciavo. I'm a senior director here at Lux, and I'm joined by my two colleagues, Mike Coleman and Karthik Subramyan. And we're super excited to announce that the Innovation Matters podcast is renaming itself as the rational innovation podcast in order to depoliticize.
00:00:35
Speaker
in order to depoliticize the podcast, which we think will solve all the problems with it. Mike, how's it going? No complaints. Excited for the name change. That's a joke, by the way. To be very clear, that is a joke. We're going to eat our vegetables first, but then we're going to come back and talk about some rational sustainability at the end of the episode and just a little treat for dessert. How are you doing, Karthik?
00:01:00
Speaker
Yeah, I'm doing all right. I mean, this is not a video podcast, unfortunately, but I'm supporting my Liverpool shirt in support of Jurgen Klopp, who is leaving the club after nine long years. Again, it has ties to the Innovation Matters podcast because, you know, FSG, the owners of Liverpool Fenway Sports Group are from Boston. They own the Boston Red Sox as well. I didn't know that because I know nothing about football. Yeah, so a bit disappointed, but quite excited for the name change.
00:01:27
Speaker
Well, there has been a lot of innovation news happening. And one of the first things we want to start with was a pretty interesting story.
Coca-Cola's Water Initiatives
00:01:35
Speaker
Coca-Cola has announced that it is forming a kind of a venture accelerator partnership with Deep Science Ventures to really focus on water and water, really all things water it seems like, but especially water saving technologies,
00:01:54
Speaker
potentially some water recycling technologies, a pretty wide range of different approaches to address water scarcity. I think what's so interesting about this, first of all, is that it kind of seems a little bit late in the sense that Coca-Cola and these companies have been, you know,
00:02:11
Speaker
especially I think like Nestle, right? Gets a ton of flag for being this like evil water consuming corporation. Of course, like stuff like bottled water doesn't really compare to agriculture, right? So there's a lot of public misperception about the actual sort of nature of water consumption, but it's undeniably becoming a more and more broad political issue, a fraud technology issue. So it's kind of surprising to see like, oh wow, it took until 2024 to get this kind of action from a major group like Coca-Cola.
00:02:39
Speaker
Of course, they've been doing a lot of water saving stuff for years. But I think what's most surprising is that we haven't seen other industrial companies jump in. I'm thinking a lot of the semiconductor industry where there's a huge amount of water-related challenges there. I'm thinking of mining industries, right? Obviously, it's a significant cost, particularly water remediation. But I think there's a growing consensus that you need to actually tackle that type of issue in order to be a continuing operation that has a license to operate.
00:03:08
Speaker
So it's something I expected is more up on forward. But Mike, I'll kick it to you first. What did you think of this? Yeah, I mean, it wasn't surprising to me either. I think one of the things that we've been seeing just in our work at Lux in general is more interest in sustainability issues beyond carbon and emissions. A lot of the biodiversity and land use and so on are all a part of that. But water, I think, has really been at the head of the list of
00:03:37
Speaker
of other sustainability issues where companies have maybe had a little bit of tunnel vision or at least been clearly most heavily focused on climate and reducing carbon emissions or where relevant looking at plastic waste. Companies in the plastics industry and companies in food and beverage and other industries that use a lot of packaging materials, that's been a big issue also. But we're starting to see, I think a lot of companies take a broader look at sustainability with water being a really big part of that.
00:04:06
Speaker
And it is something that affects a lot of industries, food and beverage and beverage, I guess in particular, since it's, you know, mostly water affects that, that, that is one of the most, uh, the most salient ones, you know, in, in, it's certainly an issue for the energy industry in, in general, pulp and paper. There's, there's a lot of segments that, that, that have these challenges around it. And I do think you're right. We'll start to see more of these, more of these types of consortia and initiatives, uh, that are focused on this issue in particular.
00:04:36
Speaker
Yeah, for me, it's quite interesting thinking about this because, you know, Coca-Cola has been there for quite a long time and I'm sure they've optimized their processes to use as little water as possible, even though making a bottle of Coca-Cola would require a lot of water.
00:04:51
Speaker
So for me the question really is where are the savings going to come from? I'm not sure if forming this venture or not is going to help discover those technologies that's going to really lead to water savings or much more than what they can already achieve. The technology is at hand. I would just look at this and go maybe Coca-Cola has realized that you know water is going to be a big problem when it comes to branding and marketing and
00:05:14
Speaker
This is one way to address that problem, but I'm curious to hear your thoughts as well, Anthony and Mike, on whether tangible gains can be made with newer technologies when it comes to water savings or process optimization. Yeah, I mean, I do think there's a lot of room to run in improvements here, more companies moving to trying to do zero liquid discharge type approach as being able to treat water so that you can reuse it, at least in certain
00:05:40
Speaker
certain ways for cooling and things like that, rather than discharging it. And there's a lot of innovations we've looked into for that.
Collaborative Approaches to Water Scarcity
00:05:49
Speaker
I think there's still, in large part because this area has probably not gotten as much focus as energy and climate and plastic waste.
00:05:58
Speaker
There's still quite a bit of room for innovation. And I think, you know, these kind of consortia or venturing programs are not going to solve all the problems, but it is a really important and useful sort of tool in the kit because these are issues that, as I think Coca-Cola calls out in this
00:06:19
Speaker
in their announcement affect the industry pretty broadly. So there's a lot of opportunity for companies to build up these ecosystems where there's a lot of room for collaboration. And it's an issue that
00:06:35
Speaker
requires companies to, to kind of think about the in a lot of the same ways that like energy and emissions does to kind of think about the problem more holistically require, it's going to require a lot of partnerships, looking not just at water treatment technologies, but how that interacts with, you know, with some of the process technology and, and, you know, as Anthony pointed out, really reducing your impact, I think, in particular, is going to require working across the value chain, because
00:07:04
Speaker
for somebody like Coca-Cola, a lot of water goes into the beverages, more is used in the manufacturing and bottling and so on, processes, washing and all that. But I think probably for a lot of products, the biggest water impacts are upstream and the agriculture that goes into making the sugar or whatever other ingredients may be going into a lot of these products.
00:07:27
Speaker
I think that's right, and I think there is a lot of opportunity there, especially in the context of new ways to really generate water, right? Like one of the biggest challenges is we have these water streams where you pull in from the groundwater, you're putting it in the fields, ultimately it ends up as runoff or evaporation, and you're ultimately depleting this reservoir faster than you can do it, and then you can refill it, right? Then it gets refilled naturally.
00:07:55
Speaker
And so you have to start looking at, okay, what are the sources that we can produce water from? Whether that's, you know, industrial waste runoff, any kind of, I mean, even, I know we've, we've looked at it a lot of times with the years and it's never made a lot of sense, but even things like moisture harvesting, right? In relatively arid regions. It's one of those things where, okay, it's never really made sense in the past, but the technology is pretty well understood and it's deployed and you can basically get these big,
00:08:25
Speaker
condensate farmers that are just these giant screens that are designed to have condensation form on them, gets collected down and it's like, okay, like that's been deployed in remote villages and, you know, areas that have really significant both water scarcity and also huge logistical issues, or you can't actually bring water in.
00:08:45
Speaker
But that technology is pretty well understood. It's like, are we going to get to a point where it makes sense to do larger scale or more enhanced scale water harvesting that's atmospheric, right? And really try to expand the availability of water supply. Probably not in the near term, but maybe at some point. There's just a lot of options out there that haven't really been explored. It's kind of like energy where
00:09:08
Speaker
A lot of stuff is theoretically on the table, but it's just not as cheap as pulling the groundwater up, so it's never really been done. In the same way that natural gas and coal make a lot of clean tech obsolete for a long time until we realize, hey, actually that stuff's bad and we have to stop doing it. There is a lot of potential options out there. I know we have other topics also to talk about, but just one thing, I was quite curious and what interests me the most in this is
00:09:37
Speaker
What they're talking about from a water harvesting standpoint, if they're looking at new technologies, is how they can cause minimal environment damage while getting water. So that also plays a big part.
00:09:47
Speaker
when we are looking at these things. So I would very well watch the space to see what kind of innovations they come up with that reduces environmental impact while also saving water. Yeah, I think I guess the last thing to say about water is that one, it's very sort of geographic. And there's areas where it's really not such an issue to withdraw a lot of water because there is a good sort of natural, renewable water resource from the water cycle that we all learned about.
00:10:13
Speaker
in elementary school and you don't have to necessarily draw from groundwater if there's a lot of, you know, that you're on a good river or, or whatnot. But also, you know, there are a lot of kind of non technology solutions things related to land use and how, you know, how the layout of cities and other built spaces are done to help make sure water is captured and help
00:10:33
Speaker
you know, ensure that groundwater is being regenerated more more rapidly. So I think there's a lot of kind of interesting stuff to look at, which may or may not be sort of venture venture type ideas. But there are things I think to look at beyond just the kind of technology like fancy separations or advanced water capture or atmospheric water capture or whatnot. It's not just the water that's drying up. It is also money for people doing 3D printing.
00:11:01
Speaker
And that's what we call a transition here in the podcasting business.
Challenges in the 3D Printing Industry
00:11:05
Speaker
Because we got some news this week. The company, Arevo, is out of business. Their assets are being sold off. Arevo, if you're not familiar, was a 3D printing startup. I think they raised around $70 million. So decent money, but maybe not the biggest 3D printing startup. There's a couple that have pushed into the hundreds of millions of dollars range.
00:11:25
Speaker
And they were somewhat unique in that they were a composite 3D printed player. They developed this technology that started really, I think, as I recall, with the materials, this carbon fiber composite. And then they ended up needing to develop a actual printer to produce that. And they could do really complex shapes. They were getting more and more involved in 3D printing of bikes. But we've seen this broader downturn in the 3D printing space, as I alluded to.
00:11:56
Speaker
You've got a lot of companies that are really struggling to generate any kind of return and also to turn a profit. And especially the companies who kind of aggressively scaled up. I'm thinking of the desktop metals of the world, of course. But even more broadly, it seems like the
00:12:15
Speaker
the 3D printing malaise has spread not just to these really big over-financed players, but also to the more specialized companies as well. So Mike, I'm curious, what did you think about this? What was your reaction? I mean, to me, it's a little surprising because I always imagined them as being one of the better players and also have some thoughts about their business model that are maybe incorrect based on evidence, but I'm curious as to what you thought.
00:12:45
Speaker
Yeah, I mean, I think 3D printing is getting into this phase, which we've been observing and commenting on for a number of years at Lux, right? It is becoming a more mature and more established technology.
00:13:03
Speaker
you know, less about the the buzz and the future potential and more about what can you actually concretely do with it right now. And I think you can do a lot with it right now. There are a lot of things that people are doing and producing specialized parts, I think, particularly from the manufacturing standpoint, and
00:13:20
Speaker
producing things like molds and tooling, rather than necessarily 3D printing and products. There's certainly some of that that's happening as well. It's natural that there's going to be industry consolidation, that some of these players are not going to make it. I would have probably also expected Revo to do
00:13:42
Speaker
to do better because they they did have an approach that I think was kind of unique and differentiated. I mean, one of the kind of things that you you expect to happen as as an industry matures and consolidates is just I think the kind of the cycle we're going to be going through with with 3D printing here is a lot of the small, you know, a lot of kind of undifferentiated companies are going to either be be rolled up or or end up going out of business. Revo, I think was more differentiated, but they just
00:14:11
Speaker
never, I think, landed on a market that had a really clear, strong demand for their technology and the value proposition that they had. And they were a composite 3D printing company, so it's a higher performance, higher cost type of materials, and there's always a risk with that.
00:14:31
Speaker
you don't land on somebody who has a need that makes them willing to pay for that kind of premium. So my grand theory of 3D printing was that the 3D printing companies had over indexed into printer production, which I think is true. I still think that is true, that they were leaning too heavily on that and printer sales. And the reality was that it's actually quite challenging to adopt 3D printers, especially for any sort of manufactured part at scale.
00:14:58
Speaker
because there's a lack of expertise. It's just a very high-skill undertaking to actually get something to print successfully and reliably, reputably across multiple printers, across multiple locations. When you look at groups like Carbon or desktop metal or even the big 3D printing companies, you know, you're strategists of the world.
00:15:20
Speaker
The scalability of those businesses based on selling 3D printers was always really challenging. The cost reductions that happened in 3D printing were generally not enough to get people to buy in on their own 3D printing systems. And so my grand theory was, look, everyone is going to pivot towards making parts. All the 3D printing companies that are successful are going to end up as being 3D printed component companies or part companies.
00:15:48
Speaker
But that's what that's what a Revo was doing. And they were doing that they started doing that in like 2020. They pivoted to basically bicycle, you know, frame manufacturer, and they built a production facility, I think in Vietnam, in Vietnam, to to produce these frames, right. And that was like, to me, that was like the model. So the fact that they've got a business is definitely a little bit of a wrinkle in the theory here. Yeah, I don't think that the
00:16:18
Speaker
that the theory was necessarily wrong. I think they may have chosen the wrong market or not been able to execute on it because I think the point is exactly right. There's a great Clay Christensen paper called Skate to the Money where he talks about the computing industry, but basically in kind of
00:16:39
Speaker
the early commercial stages of an industry, it's common for it to need to be really vertically integrated for exactly the reasons you were saying. The equipment is not established and standardized as 3D printers. It still requires a lot of specialized expertise to be able to use it really effectively. Hence, in the early days of the computer industry, similarly like IBM and very vertically integrated,
00:17:05
Speaker
players were most successful. And eventually, as things got more standardized with a personal computer and so on, you were able to sort of disaggregate that stack and layers like the software for Microsoft and the chips from Intel. I think we'll see that happen with 3D printing as well.
00:17:23
Speaker
were further from that point, I do think you need that level of vertical integration and that ability to leverage the expertise in the actual use of the 3D printing, the 3D printers, and the software that goes along with it, and really be able to integrate all that to make it effective and economical right now. For me, I'm curious to hear your thoughts on this, Anthony, because you follow the 3D printing space more than I do, is that where's the demand for 3D printed parts? I remember when I used to
00:17:52
Speaker
look at 3D printing during my bachelors and stuff used to make these small Batman logos and small components using polymers. That looks super cool. Nothing really structural. I don't see a lot of talk about structural components using 3D printed parts. I mean, personally speaking, I would never 3D print a bike frame because I really don't see if there's a market for that.
Niche Success in 3D Printing
00:18:13
Speaker
People, at least in the Netherlands, want to ensure their bikes don't get stolen. And anything that's shiny and fancy has the greatest probability of getting stolen. So you wouldn't want it to be 3D printed.
00:18:22
Speaker
and looking cool. I think it's a little different. The Netherlands is maybe a bit of a unique case in the sense that bikes are maybe significantly more utilitarian there than they are. My dad is a long distance cyclist. I don't know if you knew this, but there's these graphene tires, graphene bike tires where they put graphene in the rubber. Oh, no.
00:18:47
Speaker
And this is a Director Plus, their European company. They do a bunch of graphene enhanced sport equipment. And they launched those. And he got those like the moment they launched. That's got to be real family tension in the Skiavo family. Well, it was a good opportunity for a little primary research. I was like, were they different? He was like, no, not really. I was like, oh, OK, great. Thank you.
00:19:11
Speaker
The point, I guess, I would say is like, I mean, we do see 3D printing being used, right, for structural components and for various metals, but it's really in the applications where it saves a lot of money.
00:19:25
Speaker
And there's basically this small circle of 3D printing applications where it's so much better than the alternative. It's like, oh, GE is 3D printing engine parts, and they've consolidated 100 parts into eight printed components. Or, oh, we're printing high-strength titanium components, and we used to have to machine this out, and we would throw away 90% of this material, and the material costs $100 a kilogram. So there's this small circle where
00:19:55
Speaker
3D printing is insanely more valuable than like the next best thing, right? And like, that's in a handful of aerospace applications, a handful of medical applications, right? And then the whole thing has been, okay, well, how do we push 3D printing outside that circle? And, you know, it's not been very successful. I mean, there's been some stuff like dental where,
00:20:21
Speaker
You know, it is, it makes sense. And again, there's like a business model that works and supports it. It's very vertically integrated. Like you said, Mike.
00:20:28
Speaker
My, my daughter is using Invisalign right now. That's 3d printed. Um, but it's not something that I it's, it's, to me, it's only really a single step outside of that circle of like the most high value, uh, components. So, I mean, I don't know, like I have, there's 3d printed cuff links, Lux research, logo branded cuff links. They think they're still on shapeways. Yeah. They're on shapeways. If you want a pair, I have a pair.
00:20:56
Speaker
Yeah, it's just hard to say exactly what is going to drive that. And the cost reduction that has come primarily from material savings and design changes, I think has mostly been exhausted, right?
00:21:10
Speaker
and now the cost savings are gonna have to come from logistics and supply chain. Like, oh, it's cheaper just to ask to print 10,000 things than it is to spin up a mold for that. And it's challenging because 3D printing also makes the molding cheaper, right? So I don't know if we're gonna be able to get there or if we do get there, it's gonna be sort of the next wave of 3D printers and 3D printing companies that really focus on the supply chain elements as opposed to
00:21:40
Speaker
the materials and the printer technologies. Okay, we've talked about the boring stuff. We've talked about the real actual stuff. Let's talk about something that made me really upset and made me prompted a series of angry texts to Mike when I saw this article.
Rational Sustainability and ESG Critique
00:22:02
Speaker
There's this article that was published in Bloomberg.
00:22:06
Speaker
The title of the article is how to fix ESG by changing its name. The moniker has become so politicized that it prevents clear-headed thinking, says a London Business School professor, Alex Edmonds. Alex, come on the pod. First of all, if you're listening, come on the pod. I promise I'll be nicer.
00:22:24
Speaker
defend yourself in. Yeah, you can come on and defend yourself. He proposes the name rational sustainability. Quote, by naming it rational sustainability, this will guard against companies being caught up in irrational sustainability bubbles. And it will depoliticize sustainability, because, you know, sustainability, it's actually good for everyone. So it's really not political. It's just a long term thinking.
00:22:50
Speaker
It's just long-term thinking, so it's not political. It's been politicized, and it's possible to depoliticize it. Because rational sustainability is about value creation, not politics. I'm sorry. That's the stupidest thing I've ever heard in my life.
00:23:08
Speaker
The idea that you can depoliticize ESG, or like, first of all, it is worth noting that he's talking specifically about ESG investing and ESG finance here, right? He's a professor of finance, he's coming ahead from that angle. So on a certain level is a little bit more like, oh, the specific act of ESG investing is like,
00:23:29
Speaker
That should be depoliticized. That's a little bit more, I think, where he's coming from, which is still wrong and not very well-reasoned, but a little bit more understandable. Sustainability, it's like this enormous transfer of wealth. It's this enormous creation of value. It's this enormous destruction of value of existing wealth, like if you own oil assets.
00:23:55
Speaker
you know, and everyone switches to green electricity, that becomes worthless. This is a deeply political issue. This is just like, like the act of becoming sustainable is this enormous political transformation.
00:24:13
Speaker
huge structural sort of upheaval in the political economy. And so like, I'm sorry, but like naturally anything downstream of that like ESG investing is going to be political and politicized. And even if it was somehow possible to depoliticize it, I don't think that just naming it rational sustainability is going to do it. Oh my God. Um, yeah, this guy got written up in Bloomberg. So it really makes me question what I'm doing in my life, man.
00:24:45
Speaker
I have faith you'll get written up in Bloomberg someday, Anthony. So I mean, there's a lot that's, I mean, to credit where due, there's a lot that's sort of right and useful in this, right? The sort of concept of ESG has, it has been politicized, and it's also just not been very effective, right, as we've talked about on here.
00:25:08
Speaker
As practiced, ESG investing has not been very effective at generating. It was a very effective for a while at generating inflows to ESG funds. But it was not, I think, very effective at actually advancing sustainability or societal or maybe even governance goals.
00:25:30
Speaker
And I think, you know, a lot of the ideas in here, like the name rational sustainability, I find kind of goofy, because it's not like, oh, we were just, oh, that was the problem. We were being irrational. Oops. You know, the specifics suggest like, okay, you try to make sure these activities are tied to specific values. And, you know, some of the specific suggestions are, you know, are basically sensible. But I think that
00:25:56
Speaker
to me, the fundamental problem with ESG is a term we need to get away from. And companies do need, I think, specifically to actually think about ESG differently than they have been investors and companies.
00:26:13
Speaker
I think the problem is just that ESG as a category doesn't really make sense. There's these three things, right? It's environmental, it's social, so diversity in community relations and a lot of those things that get wrapped up into their gender equity, things like that. And that's also where I think also by the by, a lot of the controversy comes in from certain political quarters.
00:26:43
Speaker
and governance, which is just good corporate governance best practices. And I think when all of those things were 10, 15, 20 years ago, when those things were all relatively marginal issues within the investor, not a lot of people were focusing on them.
00:27:00
Speaker
it probably made sense to kind of lump them together just to try to get to a little more critical mass. But those are all much more developed today. And I think they're all much, much more of a focus. And they're all important enough issues in their own right. And despite some of the connections, you can draw generally distinct enough issues that you really do need to think about them separately. So I think what's smart
00:27:30
Speaker
Executives and also what smart investors should be doing is looking at sustainability and these climate and waste and so on issues that we've been talking a lot about. That's its own that you need to have somebody who's focused on addressing those issues specifically and developing plans around them and developing a good competency in assessing them and the impact they're likely to have on your investments if you're on the finance side.
00:27:58
Speaker
Diversity, equity, inclusion, all those other social issues, that's something that also deserves its own place in corporate governance and so on. So I think you really just have to disaggregate these and approach each of them in its own sort of more focused way. There are so many ways in which you can improve ESG. Like one of the nice things about ESG is so terrible that offering improvements is like a slam dunk, right? It's extremely easy to do.
00:28:29
Speaker
This guy has completely failed to do any of them or to really offer any meaningful improvements in his piece, which is, and he wrote this long paper, which by the way, he cites himself four times in like the first page. Oh, that's, that's standard operating procedure for an academic. You got to cite all your previous papers. I've, believe me, I've been there. You gotta cite all your previous papers. People gotta know what you've been doing. He's been cooking. He has been cooking, dog.
00:29:00
Speaker
We may have to do a little book club on this guy's book, but beyond the fact that you mentioned disaggregating the ESG, which I think makes a lot of sense, we just need much better data. If you look at credit ratings, right?
00:29:16
Speaker
they're like 99% correlated or 99.9% correlated with each other, like the three big credit rating firms, they almost never disagree. Whereas ESG ratings literally don't even statistically correlate with each other from the three ratings agencies. So it's just like at a baseline, if you're, and you know, again, it's kind of hewing more towards ESG finance, right, is the frame here. If you're trying to actually use any of the ESG finance metrics to like
00:29:45
Speaker
make invested decisions, you're already just completely off base. You're not standing not firm ground, even to begin with, let alone anything else. And so it's like, hey, just standardize the data disclosure. That's an extremely easy thing to call for. And make more rational decisions is not possible even at this point, even if you wanted to make that a central pillar of your argument. And the last thing I guess I would highlight is
00:30:16
Speaker
structurally within companies and within shareholders. You have financial performance, which is everyone is compensated on, every board of directors cares about, all the stockholders care about, all the CEOs are paid in stock. And then you have like, SNG, which like, if you fail to meet them, you know, maybe there's like a bad press release gets put out. But if you fail to meet the financial targets, like you lose your job and the company goes out of business. You know what I mean?
00:30:46
Speaker
There's no, there's no world in which those factors are going to be given any kind of similar weight, right? They're just structurally so unbalanced. There's just no way it's not, it just can't be a useful framework given the fastest situation. Yeah. For me, what I think is more interesting is the basis of ESG as in where it came from. For me, if I think back and.
00:31:16
Speaker
Please correct me if I'm wrong here, but I think ESG was just an evolution of CSR, right? Corporate social responsibility. So I don't even think the basis for ESG was motivated by sustainability. I really don't think it was. I think it was just another way of spinning corporate social responsibility and how companies can do more for the society and things like that. And sustainability is of course a component of that. So, I mean, firstly,
00:31:44
Speaker
calling it rational sustainability. I mean, to think about it, maybe, Anthony, you would say, you know, investing in DAC is a rational sustainability, perhaps. I'm never going to live down the DAC ship, I swear to God. So, I mean, I wouldn't call it that. So I think anything that's motivated by sustainability is going to be rational.
00:32:09
Speaker
So I don't know even if that name would catch on and it's so hard to say rational sustainability versus saying ESG. So I think even there, I think that's 2-0 there already to the author who wrote this piece. But yeah, I think at the end of the day, in terms of investing and financing, I'm sure people know where to invest in and what to invest in and how much to invest in those technologies to help us get more sustainable.
00:32:37
Speaker
as long as they keep sustainability at the forefront and not try to balance it with growth and try to see where growth is going to take them. So if they can do that, I think it can be easily depoliticized and we don't have to talk about what the motivation is. I think if that's sorted, then the name really doesn't matter. Yeah.
00:32:58
Speaker
So much of the whole thing is backwards looking, right?
Closing Thoughts and Listener Engagement
00:33:01
Speaker
Oh, this, you shouldn't make irrational decisions. Well, like, no, no one ever thinks they're making irrational decisions. Right. Like that's how bubbles work. Like this is not a, it always appears rational at the time, I guess is, is the idea. Right. And he like points to like these bubbles of, you know, sustainable investment. And even in the last couple of years, we've seen a big bubble, you know, in the 2020 to 2021, 2022 timeframe.
00:33:27
Speaker
But there were real financial and policy causes of that, interest rates and stimulus, among other things. And there were real incentives for the actors involved. The SPAC sponsors were getting rich. They were getting rich by
00:33:50
Speaker
know, collecting 20% of a company's, you know, stocks when it went public, right? And like, that's perfectly rational. If you're Bill Ackman or whatever, or any of these other SPAC sponsors, like you were just acting in your own best interests, and you're probably fairly successful for a while. And it's not that though, like a bunch of irrational actors were in
00:34:14
Speaker
you know, just making silly decisions. It was like, yeah, everyone, everyone was trying to get rich and they thought that it would get them rich quick to do this. Like, and some of them were very successful, right? And the bottom fell out, but that's not like they just got in, they just ended up holding the bag, you know, like rational, sustainable innovation, rational innovation matters. I tend to think we are rational though. I don't, I wouldn't go that far. So much more than ours, I think is the, is the reality here.
00:34:44
Speaker
Well, look, thanks for listening. This has been yet another wonderful episode of innovation matters. It's the most rational podcast. There is a rational choice now that you're done listening to this and that is to go rate the podcast only in the most, uh,
00:35:00
Speaker
sort of clear headed and intellectual way. Give us whatever star rating you think we deserve, but actually please give us five stars. That's the thing that would help us out. If you want to support the podcast, we'd really appreciate that. Do that. Do subscribe to the podcast. You can subscribe on Apple. You can subscribe on Spotify. It also helps us out. Thanks all. Innovation Matters is a production of Lux Research, the leading sustainable innovation research and advisory firm.
00:35:30
Speaker
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