Posted in: thought leadership

12th October 2022

Europe's Energy Earthshot

By Halla Tómasdóttir, CEO of The B Team

This essay featured in the October 2022 edition of The Catalyst, The B Team's monthly newsletter. Learn more and subscribe to receive leadership insights, advocacy opportunities and conversations between business and civil society leaders exploring a better way of doing business for people and planet.

I’ll embrace inspiration wherever I can find it. And last month, inspiration arrived via the extraordinary gesture of a reluctant businessman.

Patagonia founder Yvon Chouinard and his family transferred ownership of the company to a trust and nonprofit. Valued at around $3 billion, the outdoor clothing and gear designer will continue to operate as a private business — only now, its profits will go toward fighting the climate crisis and preserving undeveloped land around the world.

“Instead of extracting value from nature and transforming it into wealth for investors, we’ll use the wealth Patagonia creates to protect the source of all wealth,” Yvon said in a statement.

“Earth is now our only shareholder.”

Talk about shattering the status quo. Yvon is truly one of a kind. His decision is the boldest action I have seen from a business leader, anywhere.

“If we sold the business to give even a vast amount away, but the business then became like any other, we would have destroyed the lighthouse for doing capitalism differently,” Patagonia chair Charles Conn reflected in a recent Fortune commentary.

Patagonia is raising the bar for all of us — redefining what’s possible, given what’s at stake. As global temperatures rise and extreme weather events impact nearly every corner of the globe, leaders like Yvon have internalized an essential truth: A healthy planet preserves the balance that makes prosperity possible. As B Team vice-chair Sharan Burrow often says, “There are no jobs on a dead planet.”

The pursuit of wealth matters little if we fail to serve this singular, existential purpose: protecting our shared home, the planet, and securing the future for generations to come.

How we got here is straightforward: human activity is responsible for our changing climate and threatened ecosystems. Specifically, I am talking about the burning of fossil fuels, deforestation and unsustainable agriculture practices. Absent bold, collective action in this decade — to end our addiction to oil, gas and coal; halt and reverse nature loss; and redesign our food systems — the world will cross certain thresholds, or tipping points, causing irreversible changes to planetary systems and threatening all life on Earth.

Thankfully, there’s some inspiration to be found in recent actions. ​​“At last, government has stepped in decisively,” writes Justin Worland in TIME. “The Inflation Reduction Act in the U.S. will spend hundreds of billions of dollars to push the country closer to decarbonizing. The European Union’s REPowerEU initiative will do the same across the Atlantic. Finally, countries are building a global green economy.”

A new study by researchers at Oxford University projects that the transition from fossil fuels to renewable energy could save the world as much as $12 trillion by 2050. “Our central conclusion is we should go full speed ahead with the green energy transition, because it's going to save us money," said professor Doyne Farmer, one of the study’s co-authors. The way forward is clear.

And yet governments continue to spend more than $1.8 trillion each year on environmentally harmful subsidies, revealed a B Team-commissioned study back in February. It’s insane that governments are spending public money on the destruction of the natural world.

Today, hope and inspiration sit alongside a number of very harsh realities. In Europe, a surge in energy prices following Russia’s invasion of Ukraine has created a crisis for families, businesses and governments alike. Russia’s weaponization of its fossil fuel resources is driving a nine-fold increase in gas prices, plunging more households and small business owners into energy poverty.

People are struggling, and political leaders are understandably focused on the short term. Inflation and cost of living are up. Europe faces a few bleak winters; EU states are scrambling to ration gas until the spring to get through the first one. Irrespective of the continent’s ambition to lead the global fight against climate change, the clean energy transition will not happen overnight.

Decisions are being made in European capitals that will move the continent closer to, or further from, a clean energy future. Short-term decisions with long-term implications.

We have the tools to transition to clean energy and preserve the beauty and function of our natural world. The solutions exist, and the capital is there to fast-track development and scaling of emerging technologies. We have the capacity to act. But do we have the will?

I believe we do. I also understand that we must.

On October 26-28, The B Team — in collaboration with a coalition of fearless female leaders from business, politics and civil society — will virtually convene diverse stakeholders to catalyze an urgent and just transition to clean energy in Europe. We’ll dream bigger, lead with our strengths and act collectively. This is Europe’s Energy Earthshot, and I invite you to be part of it. Please register your interest by completing this form.

Each of us has agency to claim and a role to play. And we can all draw inspiration from Yvon Chouinard’s status quo-shattering example: “If we have any hope of a thriving planet — much less a business — it is going to take all of us doing what we can with the resources we have.”