The Estée Lauder Companies Inc. (EL) Earnings Call Transcript & Summary

Hello, everybody. Welcome. It's great to have you here. Welcome to the Opening Ceremony of Climate Week NYC. It's so good to have you. Big round of applause. Thanks again for being here. Thank you. Thank you. And thank you, of course, for your patience, rightly or not, that's something that the client community is used to having, I think, these days. So we appreciate that as well. It's an honor for me to be here hosting today's event. My name is Carl Nasman, and I am a Climate Change Specialist with BBC News, based in Washington, D.C. And thank you, of course, for joining us today from Climate Group. They are the organizers of Climate Week NYC, here in partnership, of course, with the UN General Assembly, which is going on right here in New York City. It's a very exciting time to be here, and it's going to be a fantastic afternoon with some amazing guests and some fantastic panels as well. So really, at the heart of today is we are going to be journeying a bit deeper into what is becoming clear as one of the most impactful, one of the most important decades for climate action. What really I do it and every climate change journalist is, we look at the facts, we look at the data and we look at the science. And what the science is telling us especially this year, 2023, as we all know, as we've been seeing this past week, we'll get into more of that later. The science is telling us that climate change is here that is affecting every corner of the globe. Sometimes scientists say that we are getting closer and closer to what we call these tipping points, right, in different parts of the world. We're talking about rising sea temperatures that could lead to mass bleaching events of coral reefs, mass, thawing of permafrost in the Arctic that could release these enormous amounts of methane gas. These are all these tipping points that could begin to accelerate climate change. And that makes the title of one of our panels today all the more relevant. If we delay we all lose. This year, we have an opening ceremony and we hope that it's a different kind of tipping point, a more positive one. And it's going to be broken up into 3 different parts. So we're looking first at what is a window of opportunity, that is closing fast. We're going to be looking at what we can do to begin to change the course of climate change before we run out of time. We'll be going from there to something a bit more positive, a bit more uplifting, and looking at really a hopeful tone of action that we can and that we will take to tackle climate change. If you've been walking around today, you might have seen the climate change protest, obviously, you also might have seen around Midtown Manhattan, on some of the bus shelters around here. We have some fantastic posters, promoting We Can, We Will. That is the signature slogan this year for the ceremony. And then even more fun, the concluding part of the day, we'll have an evening reception, plenty of food and drinks and refreshment for everybody, and we'll have some breaks as well, that will all be taking place just outside of the auditorium. So we'll be looking forward to that as well. Now anybody joining us online. Thank you so much. We are actually streaming the sessions throughout the day for Climate Week NYC. The website is climateweeknyc.org. So a big welcome again to all of our viewers, not only in the room, but around the world. Thank you for joining us. This may be the only place on Broadway where phones are encouraged. They'll take those in the Lion King, but that's fine here. If you want to tweet or X or whatever you call it these days, if you want to share with Instagram or Threads or Facebook, we do have a hashtag for your selfies, it is #ClimateWeekNYC, so be sure to use that. And another notes, we'll also be leaving time for questions at the end of our session, at the end of our panels. So we want to make sure to include you as well. So take a look at your badge, there should be a QR code there. That's the best way to send in your questions. You can scan that QR code there. But that will take you to the interface where you can put your questions in. We'll do our very best to answer as many of those as we can throughout the day. We definitely want to include you and involve you as well. All right. Housekeeping done. Let's get underway. I want to introduce now Helen Clarkson, the CEO of Climate Group. Helen, come on up.

Hello, everyone, and welcome to Climate Week NYC 2023. It's an honor to stand here today at the start of what will be an incredibly important few months of climate discussions. And I'm thrilled to welcome plenty people here in the Times Center, and even more online determined to speed up the change we so desperately need. Before we kick off, I'd like to thank all Climate Week NYC sponsors and partners, especially Saint-Gobain, our headline partner; and McKinsey Sustainability, our opening ceremony partner. Without their support, the events we're hosting this week would simply not be possible. As I said, I was it's an honor to stand here before you. But there's also strange standing here in this year of contradictions. We're living through a solar boom that this year, Canada's forests were reduced to ashes, forcing people right here in New York to stay indoors. The Inflation Reduction Act in the U.S. triggered a renewables rush. But in Hawaii, we saw daily wildfires destroying communities. And the EU responded to the U.S. with its own plans to attract clean industrial investment, while at the same time, sea temperatures rose to an all-time high going off the charts. And then there were heat wave in Sanbao in China, Catalonia in Spain, Phoenix in Arizona. It's like every time we think we're going in the right direction, the planet kicks us right back in [ totality ]. You are not even close to where you need to be. So how do we counter that? There's only one answer: relentless determination. We have the means, we have the scale, and we largely have the solutions. And now it's up to our determination. And that's why this is battle cry for Climate Week NYC is We Can, We Will. We can because we know the change we need is entirely possible. Just a couple of decades ago, solar was one of the most expensive energy sources in the world, keeping the lights on with wind power was seen as a pipe dream. And people said that renewables would never be able to compete with fossil fuels. That it would never make business sense to go green. A handful of people ignored those as [ demon's ] warnings and kept working towards a future powered by clean energy. And then nations jumped on it. China started ramping up its production of solar panels, subseas across Europe accelerated the boom, and look where we are now. And today, we're standing on the shoulders of those early visionaries. Some of our very first early 100 business members were corporate front runners. They committed to 100% renewable electricity early on, and drove up clean energy demands with energy providers and governments. And we saw the price of renewables plummet. And now, the International Energy Agency called solar the cheapest electricity in history. A decade ago, electric cars were novelty enjoyed by a few clean tech enthusiasts, and now sales have climbed to 14% of all new cars globally. And we're seeing phase out dates for diesel and petrol cars being set across the globe. By electrifying their fleets, our EV100 business members help speed up this change, and they put hundreds of thousands of electric cars on the road. And they've also demanded policy change and influence conversations, again, driving demand for 0 emission cars. And together with our industry members, we are pushing for change and we're shaping the narrative around decarbonizing steel and concrete. Now that's collective power and that's determination. And then the planet takes us in the shins again. You're not even close to where you need to be, not even close. So yes, we can, but will we? And that's where determination comes in. This is why we need to hold the line together because we are an extremely challenging moment in time, what I'd like to call the messy middle. Progress is going head-to-head with vested interest. Clean energy and clean tech has become a real threat for companies that are fossil fuel based. They're pushing bites back like there's literally no tomorrow, and making huge profits while they can. In fact, we're seeing it across the whole economy. Instead of fortune favors the bold, fortune mainly favors the old. Super profits are being made by protecting the status quo, and industries and governments who said they support climate action, are so entrenched in outdated economic thinking that are slow to adapt policies and regulations to a new world and a new jeopardy. But make no mistake, change is happening. State from regions of the under 2 coalition are accelerating local action and thereby pushing national ambition and playing a greater role in achieving global progress. More and more business giants are not just committing to go 100% renewable, they're asking their supply chains to do the same, and they're asking governments to change policies accordingly. When I was in Singapore in June for our Asia Action Summit, Asian companies told me that already RE100s going 100% renewable is becoming a condition to international trade. When business giants speak, governments at all levels had better listen. The market is taking action and all of a sudden, jumping on the energy transition is about business survival. So it's up to government to act on that, not just by promises, but by tangible steps like facilitating international interconnectors to make sure there's almost always wind or somewhere on the grid by stimulating policies for storage innovation. So for example, using vast national EV fleet, the distributed mega battery, to mitigate peaks and troughs electricity demand. And that by allowing but also regulating AI to manage energy demand, ensuring we only use the energy we really need. That all needs well planned and integrated action, not next week, not tomorrow, but now. Businesses want to survive. We want to survive. And that's why I'm confident when I say "We Will." But yet again, and all the while, the planet keeps tapping us on the shoulder, you're not going fast enough. You're just not going fast enough. And for me, that's where the "We" comes in, We Can, We Will; it's the people in this room, online and millions across the globe who need to demand change and drive a clean energy future with greater prosperity for all. And we can only achieve this by pushing together in the same direction at speed and at scale. And that's the very reason for Climate Week NYC. The very reason we bring together decision makers and action takers from the world of politics, business and civil society here in the city of New York to be transparent, push each other to do better, exchange ideas and drive time action. And let's be honest, it's governments and the private sector that have the scale and the means to do it. So it's time to double down on climate action. That means phase out fossil fuels, break down barriers to clean investments, speed up the transition to net 0, where we have the solutions and look for solutions where we don't. There's no cavalry coming. There's no night in solar clad armored charging in on a white electric vehicle to rescue us, or rather since we're in New York, there's no Spiderman sweeping down to save us. We are all the cavalry. And the responsibility rests squarely with all of us, their safety and power in numbers. It's no longer a few visionaries. It's all of us, and We Can, We Will. Thank you.

I love that image of somebody just swooping in, in a white Tesla to save us all. I mean, wouldn't that be great? We are the cavalry. Helen, thank you very much. So just to further kind of set scene for you, we want to do something a little bit different. We're really proud to bring you now this next production, and really for the very first time, we're going to be showcasing a curated video featuring 4 of the most well-renowned climate scientists in the world. We're going to be hearing from Emily Shuckburgh, the Director of Cambridge Zero with Cambridge University. Is Emily here actually in the audience? Is everyone -- Emily's back there. Hello, hi, welcome. You're here in more ways than one. We'll also be hearing from Naomi Oreskes, the Henry Charles Lea Professor of the History of Science and Affiliated Professor of Earth and Planetary Science at Harvard University. A third expert for you taking part is Professor Petteri Taalas , the Secretary General at the World Metrological Organization; and then Rose M. Mutiso, the Research Director for the Energy for Growth Hub. Together in this film, they've joined forces, they're going to be sharing the scientific evidence, getting us up to date and helping us just underline why every fraction of a degree truly does matter. And this is, as we heard Helen say, really the stark reality of what we're facing. Let's take a look. [Presentation]

Please welcome to the stage, Chair of the Intergovernmental Panel on Climate Change, Professor Jim Skea.

Okay. Good afternoon, ladies and gentlemen, and it is indeed great to be able to address the opening session of Climate Week NYC as the new Chair of the Intergovernmental Panel on Climate Change, the IPCC. This is the decade of climate action, and I want to use this opportunity to set out some clear messages from the IPCC and the scientific community. And I can sum it all up in 3 words - Urgency, Agency and Equity. And just to say, I have not seen this film before I prepared this speech. And believe me, there will be some echoes of the messages as we go through. On Urgency, it is very clear that climate change unequivocally caused by human activities is already on us. And the speakers we've just heard have provided striking examples of impacts that are ready are touching people's lives. Now climate policies have begun to bend the trend on emissions, but we've yet to put global emissions on the steep downward path needed. Unless the world as a whole gets to net 0 carbon dioxide emissions, temperatures will continue to rise. Above 1.5 degrees warming, new risks are going to emerge % Permafrost degradation, biodiversity loss, water scarcity and dry lands, more extreme weather events and risks to the productivity of food systems and sea level rise poses existential risks for small islands and low line coastal areas. So without immediate action to reduce emissions and adapt to continued warming, threats to planetary health and human systems are absolutely inevitable. And fortunately, as we've heard already, the tools available to take the necessary actions are available, this is a critical message of hope in the last IPCC report; we, humans, do have the Agency to avoid the worst impacts of climate change and shape our future on this planet, We Can. And we have started to make progress. We've heard about the falling cost of renewable energy. Wind and solar energy are growing exponentially and now account for about 10% of electricity generation globally. Electricity is increasingly being used in markets which have been dominated by oil and gas for transport and heating. But that growth has been concentrated in just a few parts of the world. Infrastructure investment in developing countries will be key to continued expansion. We're also beginning to see progress in terms of avoided deforestation and reforestation. So together, energy and land-based opportunities offer substantial mitigation potential in the near term. Now we also have the policy tools and the financial resources. More than half of the world's emissions are covered by climate laws, policies and institutions and more than 1/5 of emissions are covered by some form of carbon pricing. And there is absolutely enough money in the world to undertake ambitious climate action. Enhanced financial flows and policies that leverage private sector finance are needed to unlock the trillions of dollars that are needed. So our message on agency is blunt. We have the technologies. We have the know-how and we have the money to tackle try climate change. We need them to put them to use right now. And this brings me to my final point. The way that we deploy the tools available to us has equity dimensions, the last IPCC report showed that those who are most vulnerable to the effects of climate change are those who contribute and have contributed least to warming, a point made by Rose in the video. Within countries, there are also large inequalities in terms of both emissions and exposure to risk. So ambitious climate action that addresses the needs of the most vulnerable forms part of the pursuit of equity on a global scale. And people will be impacted not only by climate change, but by climate action itself. Low-carbon activities in sectors provide new economic opportunities, but we have to remember those employed in declining sectors aren't the communities that host them. Ambitious climate action needs to pursue a just transition with consent at all levels, and that consent will only come if climate action is and is perceived to be fair. Now what are the future? IPCC is just starting a new seventh cycle, and it is IPCC governments who will decide the shape of the cycle and what reports will be produced, and they will make that decision in the next few months. But already, the key considerations are becoming important, remaining policy relevant, taking into account parallel activities within the UN from Framework Convention on Climate Change and focusing on informing climate action. And we will be able to build on excellent collaboration between IPCC's 3 working groups. So the voice of science is crystal clear, ambitious and determined climate action during this decade is critical. Emissions are half by 2030 in scenarios that avoid the most dangerous effects of climate change by limiting warming to 1.5 degrees Celsius, and global net 0 emissions have reached mid-century. As the new Chair of IPCC, I look forward to engaging with scientists and decision-makers to deliver the latest scientific findings and actionable information for those shaping climate policies and responses at all levels and in all sectors. So I encourage decision-makers and politics and businesses gathered here to build on the best available science in your collective efforts to lead the transition and accelerate and expand the changes already underway. Thank you.

Thank you, Jim. All right. I'd like to introduce our next speaker, Jennifer Morgan is the State Secretary and Special Envoy for International Climate action at the Foreign Office of Germany. She's also the former Executive Director at Greenpeace and she'll be shedding light on Europe's role in taking the lead on the green transition using climate diplomacy. Please join me in welcoming Jennifer Morgan.

Good afternoon, everyone, and thank you so much to the Climate Group, to Helen Clarkson, for the leadership that you have shown through so many years, the ups and the downs. And I think it's wonderful to be here in this opening of this very important week. So -- and I think that's especially true because we all know, as we've just heard from the Chairman of the IPCC, that the world is at a crossroads, and it's clear that we need a course correction. I think it's also quite clear that we cannot stand by, and watch further as the world literally burns and people lose their homes from extreme storms and from floods. We must act decisively. And I think COP 28 can be, and must be that decisive moment. It is the moment when all countries can and must decide to increase their action to address the climate crisis and to forge a transformational shift. A shift that would allow us to seize the opportunities we see unfolding ahead of us to secure a stable climate. A little bit on the European level. So we are going ahead. The green deal, it's not just a climate strategy, but it's actually our economic development approach because we see the opportunity for future prosperity, for new jobs and shaping new markets together with partner countries through green transformation. And we are accelerating our energy and industrial transition. We are solidifying new rules of the game through legislative underpinnings like the Fit for 55 package. And that's why also Germany is doubling down on our own transition to climate neutrality and climate resilience. We're passing laws. We're cutting red tape to speed things up on the expansion of renewable energy to reach 80% renewable energy share by 2030, and to fully decarbonize the power sector by 2035. And it is really making a difference; policy, cutting red tape, it makes a difference. In May 2023, we had a record-breaking 66.2% of electricity that was generated from renewable energy sources and new renewable energy power capacities. Well, they have now fully replaced both the coal reserve capacities that were temporarily reactivated in 2022 for -- to get through the winter due to the Russian aggression. But at the same time, I think Germany, we aim to reduce our final energy consumption. This is a big part of what we're doing significantly through energy efficiency measures and to decrease consumption by 24% compared to 2008 until 2030. And we're also -- and this is where it gets hard, we're tackling the issues and the transformations that are closer to people's homes and their everyday lives, their heating, their transport systems. And this hasn't been an easy debate, but it shows that we are having those necessary conversations on all aspects of the transition, and making the important decisions, because it's about the decisions that are going to modernize our economy and society in an equitable, that's fundamental and a dynamic way. And we're making decisions every day to make that happen. Internationally, you know, we're in the midst of a tight leadership race on the deployment of the manufacturing of 0 carbon technologies, renewable energy, battery electric vehicles, heat pumps, just to name a few. I think competition is tough because we know that countries who will find themselves at the forefront of this new industrial revolution, where they will shape the future markets, attract investments and create thousands of new jobs. So in Europe, we are working hard to be the driving force in this race to the top, and deliver on our own climate commitments, and we know that the future of industrial competitiveness will be measured by how quickly and comprehensively we can transform our economic model and make it fit for the future because the market of the future will clearly be built on renewables. And with Fit for 55, the European Green Deal, the Critical Raw Materials Act, we're creating those right conditions. And we're proving that modernization and decarbonization, well, they go hand in hand. But we cannot pretend that the transitions at the pace and scale needed are not challenging, and that all will naturally benefit. And that's why we're working to make transitions accessible and just in Europe and really all around the world, which is so important. We need to approach the European and global transitions as social as well as economic projects. And I think this is something, if I can leave one message with you. It's one of the key ones. Because I think, for all of our ambition to be the front-runner, it's equally essential that our approach is to shape a global transformation that leaves no one behind. A fair and an equitable transformation that does not close off development opportunities, but on the contrary makes a robust promise for inclusive and sustainable development. And this new industrial revolution, well, it's also a chance for us to learn from past mistakes, to craft trade relations in a different way and partnerships for a global network that increases the resilience of supply chains with raw materials and clean energy, while providing investment for the scaling up of renewable energy and energy access in partner countries. In many countries, this is my experience. It's a very new and forceful way, well, they're determined to make the most of their huge potential for renewable energy, to generate growth, to provide energy access and development opportunities for people. And I've experienced this on my recent trips to the Philippines, to Colombia, to Brazil, to Kenya. And we know, from our own experience in Europe, that transforming the economic system, it is a tour to force. Poor countries will only be able to leapfrog into a green future if they have access to finance. And they need investments to flow into green transformative industries, bringing local value creation for their country. And I think, here, it's key that finance is both affordable and accessible. So that's why we're actively looking where we can be a trusted partner for transformation that unlocks these benefits abroad, as well as at home through renewable energy and green hydrogen projects that take local value creation seriously, through assessing where [ depth ] for climate swaps can make a difference, and through joint efforts to train the professionals of the future. Our experience is, okay, we get the policies, we get the fins. Do we have the engineers to be able to install what's needed for the range of the jobs to the net zero resilient economy. So we need to switch from steps to leaps also on the global level. And so, for our COP 28, we must agree a global renewable energy target. We know that to keep 1.5 degree Celsius within reach, we need to see renewables deliver 2/3 of global electricity consumption by 2030 by tripling renewable energy capacities and doubling energy efficiency by the same year. But what is more, we need COP 28 to be the signal for the global phaseout of fossil fuels. And to achieve that, we're all going to have to work together because I think we can do this. But we need radical collaboration, and that's what Climate Week, I think, is all about. So that we can be sure that we are securing that future for people that they're worried about right now because they see all the change and show that, no, this is possible. And to make sure that we don't leave anybody behind. And I think to fill this road map with life, well, it requires courage, it requires our determination and our leadership and our radical collaboration. And I look forward to doing that with all of you, and I wish you a fantastically successful climate week. Thank you very much.

Thank you. All right. Well, we'll be moving on to the first -- I guess, you could kind of call them emissions-free fireside chats, carbon-free, if that's a thing. We're going to be hearing next from Climate Group's Executive Director for North America, Angela Barranco. And she'll be sitting opposite to Laura Corb, who is the Senior Partner of McKinsey & Company. McKinsey has been a leader on sustainability for decades. It is well known for developing the carbon marginal abatement cost curve in 2007, and landmark reports on transition and physical risks. McKinsey's sustainability is working to help all industry sectors transform to get to net zero, leveraging proprietary solutions, top experts, and knowledge partnerships to lead innovation and sustainable inclusive growth. They're already here. Come on out. Great. Please welcome Angela and Laura to the stage.

Well, hello, everyone. Hi, good afternoon. Thank you, Carl, so much for the wonderful introduction. And I am just so delighted to be here with Laura today. I know that McKinsey Sustainability has just published this brand-new report. So we're going to get right to it and start talking about that. And you spent quite some time with corporate leaders, really digging into the opportunity to capitalize what it means to be a leader at this moment, right? And how they're all getting to the net zero transition? So tell us, where are we in that net zero transition?

Well as Helen and some of the speakers already said today, if you look in the rearview mirror, you can say we've had meaningful momentum. We've seen solar and wind prices come down, the proliferation of electric vehicles on the road. We've gone from a few executives or individuals even having heard of net zero to now widespread commitments by companies and countries. But the reality is we're nowhere near on track for where we need to be. McKinsey's run many scenarios on the current trajectory, and we see that we're on track for 2.5 to 3 degrees warming by the end of the century. And of course, a 2.5 degree or more world is a really scary one, even compared to today, or a 1.5-degree scenario, one where billions of people are facing extreme weather events, where billions of people are living on land today that is likely going to be virtually uninhabitable in the future. So we really need to bend the curve as fast and steeply as possible. And that means really moving to a new phase of the transition, from a first phase where we established guardrails and the foundations and initial commitments to one where we really get it done, where we drive large-scale transformation at pace. And it's not easy to do. It's complicated. Not only do we need to transform our energy system, but we need to transform transportation, building systems, food and land use systems. And that means that all stakeholders really need to work together to make change happen at a very rapid pace.

And I love that. And I mean you're talking about bending that curve. What can we do? What needs to be done right now in order to accelerate that transition?

Well, a lot needs to be done to accelerate the transition. And in the interest of time, I'll highlight 2 things. One is we really need to unleash the power of the private sector on innovation and scaling. We do have line of sight to most technologies we need. That's the good news. But only 10% of the emissions reduction we need by 2050 is going to be accomplished by technologies that are commercially mature today. So we need the private sector to really lean in with innovation scaling to drive down costs and help accelerate the other technologies out there. So that's one. The second thing we need to do is be careful not to just be too enamored with the shiny, bright objects of new climate tech. And I'm certainly enamored with a bunch of them myself. But we really need to focus on the less sexy, low-hanging fruit of the transition. So by that, I mean things like energy efficiency, supply chain optimization, really reducing methane emissions. The good news is about 90% of methane can be abated for $25 or less for CO2. So we should be doing as much of that as possible. And the good news is when you reduce methane emissions, it has a disproportionate impact because how quickly it dissipates from the atmosphere. So we really need to focus on these less sexy, here and now, levers we have that are in the money and are proven, while we also push as hard as we can on some of the new climate techs that are a little more sexy and intriguing.

And I know we're speaking to an audience that includes many CEOs and folks from the business sector, and I will take a little bit step out and just say, things like quarterly earnings, stakeholders and customers is not always the sexiest part of the work that we all do. But what's the message to our CEOs who are really in it every single day? And how do you help them figure this out?

Yes. Yes. For sure, the past 18 months have been particularly challenging on the path to net zero for CEOs. Business leaders are now facing higher costs, higher interest rates, supply chain disruptions, lower growth environment. And frankly, some are asking, should I step back from my net zero commitments as I face the pressures of the quarterly earnings and near-term performance. The advice McKinsey is giving is not to step back. This is actually quite an important time to position a company well for the future ahead of competitors and for growth. So let's see where the puck's going. We believe that going forward, there will be a real price to carbon, whether it's implicit or explicit, that supply chain imbalances are only going to get worse. So we turn to the lessons of companies that thrive out of post-financial crisis, as well as the early leaders of sustainability. And I point to 3 lessons. The first is to take a through-cycle approach to the downturn in terms of acquisitions, while valuation premiums are lower and reshape portfolios towards higher growth, lower emitting businesses. The second is to really invest in green business building. So we've talked about it before, Angela. McKinsey believes there's a $9 trillion to $12 trillion annual sales opportunity from 40 investable themes related to the transition. So every company should be positioning themselves well for those opportunities. And then the third element of this approach is to address cost and carbon in parallel. And that's the one where we hear the most skepticism. But it's not a pipe dream. We're working with companies across many sectors at an approach that redesigns products and factors in both carbon and cost of procurement. So for example, an auto OEM has found that they can reduce cost -- total cost of a car by about 10% while reducing the carbon 35%, and who won't want that kind of win-win?

Absolutely. I think -- and so much of what you're saying also picks up on this element of workers and people and communities and the impacts of all this work. How are you also working with companies, to really dig into that question, how are you really thinking about that?

Yes. Well, I'm glad you're raising the human element because this transition is only going to be successful and is only going to happen if we make people's lives better, not worst in the process. And of course, that's the whole objective function. But we have to think about how we get there, that does so. So whether we're talking about a family in the global south or a family in the global north, we need to be striving for affordable energy, affordable transportation, affordable housing solutions that are low carbon. We need to make sure that we have reliable energy solutions so that people get the power they want when they need it. And of course, jobs. We need to make sure we're providing opportunities for individuals to support their families. So if you think about jobs, for example, the headline out there that the transition will create a net increase in jobs relative to those that will be lost actually doesn't help an individual and a community that's going to be a net loser of jobs, a community where industries, the community has relied on for years are going to go away. So what that means is all stakeholders, the public sector, private sector, social sector, really need best of the creative problem solving to design a transition that works because if we lose the hearts and minds of the people, of the voters, of the workers, we'll just slow down the transition. And that's not going to work for anyone.

No. And it's funny you say because I think that's something that definitely keeps me up at night, is sort of that collective action, that collective feel of how we make this a transition for all. What else keeps you up at night? What are we not thinking about? What do we all need to keep in mind moving forward?

Well, one thing we're certainly not talking enough about, I believe, its nature. So we're facing twin crises. We have the greenhouse gas emissions crisis we've been talking a lot about. And we have a nature crisis with a lot of planetary boundaries being threatened. And so we also really need to focus on water, biodiversity, soil health, ocean health, pollution from chemicals and plastics. And we, of course, depend on nature for pharmaceuticals, for the food we eat, for the water we drink. And nature-based solutions that actually capture and store carbon and help with adaptation and resilience for extreme weather are as close as we have to a silver bullet in a climate transition. But the impact of destroying nature has huge repercussions. So deforestation, of course, releases a ton of carbon into the atmosphere. It destroys animal and plant species. And it also hurts resilience in extreme weather events. Ocean acidification impairs or hurts fisheries that communities depend on for food and for livelihoods, and it also impairs the ability of the ocean to act as a carbon sink. And it's pretty amazing to think that 30% to 40% of the carbon emissions we've created since 1850 have been absorbed by the ocean. The challenge is that there's no one simple metric for nature, the way there is for emissions, and we don't have that 1.5-degree goals. There are a lot of objective functions. And that might be one of the reasons why corporates and others are less quick to get behind nature goals. So 86% of Fortune 500 companies now have a climate target and commitment, 25% have a freshwater target, and only 5% have biodiversity targets. So there's a lot to be done. The advice we're giving to CEOs and executive teams is not to view these 2 focus on emissions in nature separately or sequentially, but to focus on them hand in hand, to design your net zero pathway in a way, that's nature positive. What we mean by that is understanding the impact on ecosystems and resources and crafting solutions that take into account that are regenerative and sustainable. And fortunately, I think we are starting to see institutional investors, some central banks, some companies starting to focus on nature, but we need a lot more.

Absolutely. I think it's such a complex time for business leaders as they're navigating all of these different challenges. I know tomorrow, we'll be spending some time on this nature question and really thankful for your time. My apologies, we're out on time. I know we have so much more to talk about. But thank you, Laura, and thank you McKinsey Sustainability for taking part of our first fireside chat of the day, and also for supporting all the mission and the work at Climate Group. So huge round of applause for Laura.

Thank you.

Well done. Thank you. All right, well as you all know, this is quite the day and quite the week here in New York City. There's -- I was just told there was actually another parade going on, but there was also the climate march, obviously, everything going on with the United Nations General Assembly. Our next speaker was actually just coming from the UN, got a little bit delayed, but she is now here. She's certainly in demand this week. Marina Silva. Now Marina has dedicated her life to protecting the Amazon Rainforest, standing up for its people. She's a true climate hero to many. And in her capacity as Minister of the Environment and Climate Change of Brazil, we are truly honored to have her here to deliver our first keynote speech of the ceremony. So please join me in welcoming Marina Silva and her interpreter for the speech, [ Paper Pontez ] to the stage.

[Interpreted] Good afternoon, everyone. It is quite a challenge to be here and to have this discussion, we're roughly 2 months away from COP28 and we need to take the appropriate steps so that we not only fight climate change, but also we achieved those goals set in the Paris agreement, most of all, limiting global warming to 1.5 degrees. We have no time to lose. The results from the AR6 from IPCC as well as the synthesis report from the co-facilitators of the technical dialogue on the GST, have led it clear that the window -- the time window that we have to achieve these goals are closing. There is no doubt that as that we are living multiple and intertwine crisis of climate change, loss of biodiversity, water pollution, the increase in inequality and poverty and hunger and violence. And all of these crises have [Audio Gap] been worsened by [indiscernible] stagnation that we have come through. We have an ethical obligation, moral and political obligation of threatening path, a global path in which the social, economic, environmental and cultural dimension are equally integrated. So we need to -- we have -- we need to move forward in bringing together the necessary urgency of advances in the environmental agenda as well as the challenge of reducing poverty and supporting the most vulnerable in this process. We want to bring forward a new form of cooperation that help break this logjam of the cycle of negative externalities and bring forward a cycle of positive externalities. This should discontinue the idea of transforming only our comparative advantages -- in advantages that are purely competitive. We need to have more synergy in cooperation. In this sense, there are many challenges to be faced in the political, institutional and financial areas, including affirmative actions that value the role of indigenous people and traditional communities, as true guardians of biodiversity and of traditional knowledge linked to it, recognizing their means of life and knowledge as very important. It's fundamental to create opportunities for the bio-economy and for value chains related to the social biodiversity. In this sense, more than mitigation and adaptation, we need transformation. If we don't have a proper transformation, we're not putting us in the right path as we need. We need to break this inertia from the results that we have already achieved. Many times, we are satisfied with what we have achieved so far. But if we continue on this path, we're not promoting the needed transformations that we need. And who's saying that this has not been sufficient or not developed countries to developing countries or developing countries to developed countries, who is saying that our efforts have not been sufficient in nature. It is science that is demanding more and meaningful goals and commitments for our part, so that we can achieve what we have committed to in the Paris agreement. For this, we did a reform of the global finance architecture and harnessing it for the sustainability in all its dimensions. We also need to democratize the spheres of decision taking about our planet, stimulating debates and engagement of all stakeholders in finding solutions for the multiple crises that we face. We need to value and promote the maintenance of ecosystem -- global ecosystem services, protecting local populations that are good, the guardians of the forest, ensuring everyone a necologic transition that is just and inclusive and that allow us to move forward in a new cycle of prosperity. In this sense, our investments and the finance, they should be properly adequate and based on the commitments we have to achieve our goals. Ecosystem. In Brazil, President Lula, taking his third term in office. He put the agenda of sustainability, the protection of indigenous people and traditional people, front and center in his government as well as the fight of climate change. These are priorities in this government as well as the fighting of inequalities and supporting democracy. We undertook a strong commitment of zero deforestation in the Amazon by 2030. In this sense, in the first 8 months of government, the area and the deforestation in the Amazon fell by more than 48%, in relation to the same period last year. Preliminary calculations suggest that -- but with this reduction -- in deforestation in the first 8 months, Brazil has avoided the emission of roughly 200 million tonnes of CO2. I emphasize finally, that we cannot make the protection of the environment and fight against poverty and considerable dilemma. Just an inclusive transition must necessarily be based on the long-standing development and a more balanced and more equal for all guided by human, social and environmental values. Sustainable development is not just about doing things, but also about the way that we behave ourselves, about how we position ourselves in the world, is also how do we relate among ourselves and among nature. The good news is that, the technical answers that we need, we have already achieved. What we need is the strong political commitment, so that we can achieve those goals that we have set.

Thank you very much. Thank you. Thank you. I don't know about you, but I've really been struck by this statistic under Marina's watch, deforestation of Amazon recently falling by 66%. I mean that is just absolutely an incredible number there. So thank you to Marina. Thank you very much. Well, I now have the pleasure of hosting our first big panel today. And this falls under that title, "If we delay, we all lose." We'll be confronting the fact that climate delay is no longer an option. It's displacing populations. We've seen the dramatic effects this year, this week. Just today with that report about the thinning ice in the Antarctic even. For the climate lobby, delay equals failure, the impact of delay becoming clearer and clearer. And this year, really 2023, so far, the most important, the most impactful year for climate change. So on the panel, I'll be joined by Nancy Mahon. Nancy is the Chief Sustainability Officer at Estée Lauder Companies; Katharine Hayhoe, Horn Distinguished Professor, an Endowed Chair, Texas Tech University, also the Chief Scientist with the Nature Conservatory; and last but definitely not least, Her Excellency, Razan Al Mubarak, President of the International Union for Conservation of Nature and also the UN Climate Change high-level Champion. So let's bring out all 3 of those to the stage for our next discussion. Come on out. Welcome. Have a seat. Pick your favorite chair. Hope it's not the same one. There are 3. Well, thanks for being here, and it's a tough act to follow after Marina, I know. But we really are here today, here in New York, as this UN General Assembly is getting underway. The Climate Ambition Summit happening on Wednesday. I think it's a very apt theme and kind of motto is, "If we delay, we all lose." And we've seen, over the past decade, I guess, climate denial being the thing that we thought was the biggest thing standing in the way in terms of climate action. There's this whole lobby, saying climate change doesn't exist. It doesn't seem to be the case anymore. If you had a roomful of people like this one, and if you had people raise their hand, do you think the climate change isn't real or isn't happening? There'll be very few hands up. I mean even those who are potentially standing in the way of climate progress, they would still say, well, what we're seeing climate change is happening. It's that new D, it's a delay, it's not denial.

So that's why I want to start off by asking each one of you. And if we can just start with Katharine, first of all. What do you make of what we've seen in terms of climate denial or climate delay? How much is that delay costing the planet, do you think?

Well, first of all, they're the same D, what I mean by that is we have known since the 1850s, that digging up and burning coal back then and then oil and gas, produces heat-trapping gases that are building up in the atmosphere, wrapping extra blanket around the planet. We knew how much warmer the planet would get since the 1890s. When did climate denial begin? It didn't begin in the 1890s. It didn't surface until the 1990s. Why not? Because that was when climate change moved from being a future issue that we didn't have to worry about right now, to being a present issue. The IPCC's first report came out. Time Magazine had multiple covers, crazy heat waves, Jim Hansen from NASA testifying to Congress. United Nations Framework Convention on Climate Change was signed. All of a sudden climate action moved from future to present, and that is when denial began. And the denial was never about the science. The denial was always about delaying the solutions as long as possible with whatever plausible excuse they could.

Razan, I saw you nodding. How do you parse those 2 different Ds, Razan? Is it all on the same thing? All in one.

So first of all, Carl I was nodding because that last time I was with Katharine, we were online in a virtual panel. And she superseded me and spoke before me, and I said note to self, never go after Katharine, but here we are. So I'm -- I have this incredible opportunity. I have been appointed the UN high-level champion for COP 28, to do exactly what Katharine had said, is to stop delaying solutions. And the solutions are there. Of course, we need to continue to invest in the technology of the future, but I'm here to talk about the technology of today. And the technology of today, that for somebody who also had the opportunity and has the opportunity to be President of the International Union for the Conservation of Nature, I call on the solution that nature provides. And Katharine and Nancy, Carl throughout my engagement over the past 8 months since my appointment, it has really, really surprised me how separate the discussions have on climate change solutions and nature. And this sort of discourse or this separation is really bizarre because it's so obvious that the biodiversity loss and climate change are not 2 sides of the same coin, they are the same coin. And so it's really, really important that we integrate these 2 agendas. Nature is a significant ally. We will not reach the goal of Paris without nature. Nature can provide 21% of the solutions and it's really time to ensure that nature is at the heart of the climate agenda.

Absolutely. Absolutely. Nancy, on the business side of things, I think it would be fair to say that many businesses have probably been accused, at some point or another, of that kind of climate delay of dragging their feet of not wanting to do what's necessary, maybe to change a factory or upgrade a certain way or put solar panels on top of the production line, taking care of those different parts along the production process, where you see those carbon emissions. What do you make? And with your seat and your experience with Estée Lauder of this type of climate delay, how do you break through that?

We have not really seen climate delay. It was actually, I was very struck by Laura Courbe's remarks around CEOs. Our last quarterly earnings, our CEO, actually started the call with the achievements that we've had around climate. What we've really tried to do candidly is to set very concrete goals. We actually don't have a 2050 goal. Because what we've decided is that we are going to glide path out every goal we have and we manage it on a quarterly basis with our Board, and we hold ourselves accountable. So I've tried to...

We've seen a lot of, sorry to interrupt. We've seen a lot of those type of goals, haven't we? In the corporate sector, a lot of 2050 goals, a lot of carbon neutral net 0 by 2050. Why is that something that you're not doing? And would you -- do you like to see the other companies say, "Look, we shouldn't be kicking the can down the road a couple of decades.

Yes. I mean I think that, candidly, each company has to set its own course. What we've really tried to do is similar to financial goals, is to glide path it out, and really focus on performance. And so last year, we published a transition report. We basically said, here we are. Here was our goal. Here is where we thought we would be. Here's where we are. Generally, what I experience is less, I would say, denial than the we're threading a smaller needle, I would say, in terms of operationally, because of the challenges the consumer goods companies are facing. We're trying to shorten our supply chain. We're up against inflation. We're up against the U.S. economy is doing very -- well, the U.S. currency is doing very well. So for me, it's much around how do you double down and create allies within the organization? And how do you ensure that if a colleague sends you an article saying, well, it's ESG dead. You send back another article says, no, it's not. And so I think that's really more about...

We've all been on those e-mails...

What did you think of this piece? So you always have to -- so keep sending me the good articles. I think that's really the bigger challenge, is how do we, as practitioners within an organization, have empathy. And then lastly, scale of solutions for big companies, we don't need small solutions, we need big solutions. And that, I think, is another big challenge. But again, we have not seen delay. We've seen more, I would say, complexity and achievement.

Interesting. Katharine, I just want to circle back to you, not to harp on the dooming gloom, but 2023, we're hearing now is very, very likely to be the warmest year on record in terms of human civilization. We've mentioned so many of the climate disasters that we've seen this year. And I think that adds a little sense of urgency to this room, into what's going to be taking place here this week and later at COP 28 as well. As a scientist, as a professor, what do you make of what we've been seeing this year? How can you put that into perspective, in terms of the way the climate change is progressing? Is it getting faster? Or is it accelerating?

Well, the best way to put it is come my colleague, Gavin Schmidt put it. He's right here in New York with NASA. He said, we collectively are shocked, but not surprised. And what he meant by that is, global temperature is tracking exactly where climate scientists predicted it would 50 years ago. It's not higher. It's rate where we said it would be. We know that we have been systemically underestimating streams for a long time. We know that climate change is loading the weather dice against us, putting extra 6s, 7s and even 8s on our weather dice, and we saw that this summer. But when you see it in real life, happening in front of your eyes instead of in your models on your computer screen, it is shocking. The impact on human lives and welfare. The impact on ecosystems in nature. The impact on the air that we breathe, the water that we drink, the homes that people depend on to shelter their children. It's real. It's here. It's now. And what we're seeing is we are seeing a tipping point in public opinion. We are seeing that the psychological distance that kept many people saying, this is a far away issue in space for time, that psychological distance is eroding at warp speed. But that alone is not enough to trigger action because the whole world could be worried. And if we don't know what to do, we'll do nothing.

I did happen to see. I did look at your Twitter account today, I have to admit. And this was something you were discussing, wasn't it? Because you were saying that now that these events are playing out in front of us, in our own backyards, in our own countries, and our own cities. And yet, you're also saying that, that may not be enough for some people to come on board and say that this is the time to take action.

It is not enough for 2 reasons. Reason #1 is, people who feel helpless and hopeless and don't know what to do, that makes up about half of the United States. And so that's why they need to hear what you're doing. They need to hear what is already happening, so that they can be encouraged and also so they can realize how they can make a difference. But then you still have the people who originally cemented the denial. There was just a new report out on Exxon again just 2 days ago, showing how they again delayed climate action. The opposition to solutions is now more overt, sort of the cloak of oval, we're not sure about the science has been removed, but the opposition to the solutions remains for those who profit from our continued dependence on fossil fuels.

I think also, we're a consumer goods company. So we spend a lot of time tracking our work to KPIs and stakeholders. So we know, for instance, that our employees generally care more about climate than any other issue in the work that we do. We also know our employees can work anywhere they want to work. And so our team spends a lot of time engaging those employees, educating those employees. Same thing with consumers. So I would say generally that Europeans are further ahead, in terms of their understanding of climate as well as folks in the U.K. We do a lot of work on claims, like what do our consumers care about? Do they care about net 0? Do they care about their carbon footprint? So I would say a bit against the doom and gloom is, vote with your wallets. Educate yourself. Talk to the -- write letters to the companies that you are not buying things for. And I think that is really...

In your seat, do those kind of letters make a difference to those and make it to your desk?

Absolutely. The other letters make it to my desk also. But I would say, definitely, the pro letters. And also for all of these companies, there's teams. Our team is sitting right here, who work day in and day out to make this stuff happen. And so a lot of -- also what I try and do is to show how it does matter to our employees, how it does matter, particularly also what we're seeing are investors. I do about 1/3 of my work with investors. It used to be, there was 1 or 2 people that was on the Governance Committee that would show up to these calls. Now we have teams of like 15 people and they are part of the buy sell quotient. So you should also look at your portfolios. What are you investing in? And what are those companies doing? So I think there is a lot of -- there is a call to action, but I wouldn't -- I would say, be as doom and gloom perhaps as other folks.

Razan, it's such a pleasure to have you here as well, because I know in just a few months, you will be the UN climate change high-level Champion at COP 28.

No pressure.

Yes. We've been talking a lot about the effect on humans on cities, rightfully so. But what about the effects of climate change that we've been seeing this year on wildlife, on nature? I mean, potentially the most visceral moment was the temperatures of the water around Florida turning into a hot tub, and watching scientists pulling core out of the water to try to save it. So what have you been seeing this year in terms of the effect on nature?

I mean it's -- again, it's not something that we are seeing this year alone. And as Katharine was saying, this has been incremental changes year-on-year and we're seeing transformations within the realm of biodiversity. And the sad thing is, but the opportunity also exists, is we are losing nature in a time when we need the nature the most. And we tend to forget about the carbon cycle. So what is climate change? To me, climate change is a consequence of our mismanagement of nature. How so? Greenhouse gas emissions, where are they coming from? It is our mismanagement of a finite natural resource, fossil fuels. Then you think about impacts. And absolutely, we are feeling impacts. Today, you cannot deny it and it's everywhere, and it's across the globe. I come from the United Arab Emirates and we have been living with a warming Arabian Gulf for the past, I would say, 2 decades. And it has incredible impact on our society and our economy. But again, when you think about what buffers us from the impact of climate change, again, a solution that is there, that is at scale already is nature. And then finally, when you think about the absorbent of capacity, our sequestration capacity. Nature, the carbon things are there to sequester our missions and we're losing them, again, at a time when we need them the most. So it is really critical that we invest in nature-based solutions, that we ensure that nature is at the heart of our climate action and it is very hopeful because it's there. It exists. The only thing we should do is stop destroying it. And so that's, I think, a very important critical discourse that I'll be bringing at COP 28. But I've also been inspired about what you've been hearing throughout this panel from Nancy and Katharine, about the sort of evolution of thinking around climate change. So I also just got back from the Africa Climate Summit and I could also feel a very different pulse. So you went through climate denial globally and now it's here and there, so you can't deny it. But then you also went through a discourse of a blame culture. It's the global north, not the global south, it's us, not them, who -- and that discourse is not changing into a much more positive discourse of really seeing the opportunity in economic transition toward no longer using even the phrases net 0, because that in itself can potentially discern a negative growth. And for many countries and economies around the world, that's not attractive. So how do you become carbon positive? Nature positive? How do you create jobs? How do you inspire future generations? And again, we sometimes get stuck in the gloom and doom. But then if you look in the real economy, what Estée Lauder is doing and other organizations around the world, there is a lot of movement. But the operative word is that it is in transition? And so you don't see the impact today, but we will see it moving forward. From incredible capacity, for example, in super batteries. In 2023, solar power, for example, attracted more capital than all fossil fuel combined. So we are seeing that movement. We are seeing that transition. And I'm hoping that this positive momentum can help us, as you said, glide over and exceed our needed targets.

An example of that would be, we are undertaking for our Scope 3. The bottom line for companies in Scope 3 is that is the way we will most...

Walk us though -- even I get mixed up with Scope 3. Scope 3 is at the very kind of tail end of...

What we call value chain, which is basically all of our suppliers.

Okay. So you're not directly responsible for it, but you might be buying from somebody who is polluting and that's kind of your Scope 3. Is that right? Am I close?

Yes. Not on the polluting part, definitely. But essentially, 1 and 2 are electricity and our operations, Scope 3 are our suppliers. And why that's a big deal? First of all, it's a much longer tail, but also that's where candidly, the change lies. And so what we've really tried to do is lean in with our top 200 suppliers and ask them to put their data in for climate disclosure projects. So their Scopes 1 and 2 are Scope 3. So we're making a lot of progress there. The big shift that we've been working on -- the team really here has been working on, is shifting from what's called spend-based, which is how much money did you spend with your ad agency, to activity based. And the closer we get to activity, the better, because we will be able to manage it better. And so we are seeing great movement there. We do need, I think, a lot of help, candidly, around IT and media work that we've been doing. But there is an example of movement and management. What's tougher, as Razan said, is where we can't measure or manage. And nature, generally, I think I completely agree with you. It is kind of tough candidly as a corporation, who makes themselves luxury beauty products, to wrap our heads around nature outcomes. And so I think there is a fair amount of work to be done in the area of what are the outputs. I mean it's very clear with regard to our sourcing, our ingredients, ingredients stories. I think it's very clear with regard to water. But I think we have some work to do in the field, about how to educate in metrics, honestly, within the value chain. But I think that's some of the great work to do. And then just lastly, just to give you an example, we've really focused on double wins. I think one of the difficulties we have in this dialogue as we keep saying, well you're either going to battle climate change or you're going to make money or you're going to save money. And that's actually not true. And our job is to create double wins. The team here created a virtual power purchase agreement in Oklahoma that covers all of our green electricity. We've made over $2 million on that. So there are real business opportunities. Now when we went into it, we just wanted to make sure that we hit even. But there are opportunities for win-wins. And again, I think that we have to make sure that we're not saying it is either or, but at both ends.

Razan, I was really struck by something you said about your experience at the Africa Climate Summit, and just that change in mentality and cap. And I wonder if you were thinking about that as well, because I know that you are very much a proponent of hope and about discussion, you said one of the best ways to tackle climate change is to talk about it. What do you make of the way that the conversation then is changing?

That's exactly where the conversation needs to go. So waking people up to the risk is important. If you're not aware of it a risk, then you don't need to act. But once you're aware of the risk, you need to know what to do and that's where hope comes in. So hope is not positive thinking. Hope is not just assuming everything will be okay if we wish it to be, because it won't. But what hope is, is it is a vision of a better future, which is exactly what you hear, and a path from A to B on how to get there, and a way for each person to know what they can do along that path. And so that is what I heard and what you shared from the Africa Summit.

No, absolutely. And I'm going to challenge you Nancy on the nature of it, because I think also we have a tendency. The scientists in us or to perhaps keep asking questions and keep asking for more information. And that's great. That's a very worthy path. We're all going to, hopefully, be lifelong learners. But I think today, we know enough. So we know enough in terms of how do we protect nature. We know we need to get companies. We need to get -- to stop commodity-driven deforestation. That will have a huge impact. We know today the oceans, for example, every second and third breath you take comes from the ocean. How do we have a society value this? That is, of course, a difficult proposition. But we know that we can push governments to have sustainable ocean planning. We know we can work with the shipping industry, for example, to green the shipping sector. We can do that. The technology exists today. We know there's so many opportunities. And yes, we may not know all the answers, but I think we know enough to act. We also need to make sure that we start -- not start. We need to have those that are at the front line in the audience and on the panels. Because like you said, they are communities that are facing the impacts of climate change, most of the time, the least responsible, but they are the ones that are actually doing the solutions and need to be heard and need to be supported. And one group that I work and I'd like to kind of -- in the field of nature conservation are indigenous peoples all around the world. Today, indigenous peoples with very little support, with very little recognition, protect 80% of our biodiversity. And so how do we support these communities? How do we listen, not just hear, and really actively co-create with them, the mechanisms for them to continue to do what we need them to do the most.

And we've seen that as well, just based on the discussion in Brazil. So much of that conservation happening and the Amazon is coming with indigenous communities. We have a few minutes left. We're just going to do a lightning round here. And I want to talk about COP 28, which is coming up. We're just -- we're going to leapfrog UN here. But obviously, just taking advantage of the fact that we'll -- we have already someone who will be there and playing a big role. And this is one of the questions that many of you wanted to address in this panel as well. So let's do a COP 28 question. What do you want to see? And Nancy, if we can just start with you, what would you like to see done at COP 28, specifically with your lens looking at corporations and the business community?

We specifically would love to see more private public partnerships. In fact, Razan and I were speaking about it, in terms of we are looking for power purchase agreements in Europe, in the Middle East and Africa. And what we really need, candidly, are to lessen the load of permitting processes. And for those of us who are in minority users, to be able to get deals more quickly, honestly. We're looking at a 2- to 3-year time lag on a lot of these deals, and we feel there is the political will to do that, and we just need to connect the dots.

Interesting. And Katharine, COP 28, I mean, it seems like it's going to be this -- everyone seems monumental. But this one in particular, it seems to have a different feel. What would you like to see discussed or come out of that conference?

It does. And I know what most people want, is they want a solution to the climate crisis.

Amen.

They want that every time. But one conference is not going to deliver that. States are only 1 stakeholder. You've got the corporations, the organizations, the cities. You've got all kinds of other stakeholders, many of whom do come to COP, but they're not bound by the COP process. So it is 1 step along the way, but it's a very important step. Because what's on the table now is the fact that we have get rid of fossil fuel emissions. And what the science says is very clear, the sooner we do it, the better off we'll be.

Razan?

So I'm just wanting to say that I'm taking notes.

And I apologize again for having you coming after Katharine. But, it just happened that way.

No. But two things. One is absolutely, we need everybody around the table. And we need the discourses to kind of need. You can't have a political negotiations discourse and then having non-state actors and private sector, civil society, in a completely different -- on a different drum, and we need to start building those bridges. And I think at COP 28, we need to deliver that bridge building. So I think that is really critical. And one thing that the COP 28 is doing is also making sure because, I mean, I've only attended one previous COP, so please caveat my experience. What it is, it's a circus. I mean so many things. And so how do we make sure that we make the best use of people's time, brains.

We need a lion same at our circus.

What we thought we would do is host very -- on the first few days of COP, as you know, that's where the leaders summit, a business and philanthropy forum, to make sure that we really start uniting the discourses. The other thing is really to align also the community around 4 concrete goals because, again, it is complex and we can't in one conference solve everything. But the 4 paradigm shifts that the COP presidency calls for. First is exactly what you said, Katharine, we need to fast track the energy transition and flash emissions by almost half in 7 years. Technically, this can be done. Two, climate finance. We need to also transform the finance mechanisms to deliver on climate solutions. We need to build trust in the system. There's been lots of pledges throughout the years. And as I talk to various stakeholders across the board, from government and nonstate actors. There is an initiative fatigue, people are sick of new initiatives. So don't come to COP with new initiatives unless you've delivered on initiatives that you've announced before. Don't come to COP with pledges, come with real commitments. Don't come to COP with recycled financing, come with new financing. Those are the types of things that we really need to see at COP. Finally, we have to remember everything that we're doing, it's for people. So lives and livelihoods need to be at the center of how we think. Of course, nature will play a big role at COP 28. And finally, our hope is to mobilize for the most inclusive COP as of yet and to build momentum across future costs. Finally, we need help with the process. Having annual COPs are just so difficult. I mean, it's been 8 months and I've learned this much about the COP process. And then afterwards, we hand over. This annual COP is very difficult and challenging to produce real solutions. So what we've been doing is we've partnered because we don't know who the next COP host is. COP 29 is still up in the air but we know that Brazil is going to host COP 30. So we are partnering with Brazil to ensure that we have a multiyear agenda.

That's all the time we have for this panel. Her Excellency. Razan Al Mubarak, Professor Katharine Hayhoe, Nancy Mahon. Thank you so much. Thank you, thank you. All right. Well, in the spirit of no time to delay. We're going to jump right into our next speaker. It's a pleasure to introduce Mr. Selwin Hart. Now Selwin is the special adviser to the UN Secretary General on Climate Action. He is -- we'll just go straight into our next guest, Mr. Selwin Hart, the special adviser to the UN Secretary General on Climate Action. He's prepping for this week's important UN Climate Ambition Summit. That's where the UN -- we've mentioned this a couple of times, it's going to push for accelerated action, by not only governments but business, finance and local authorities and civil society as well. So without further ado, I'd like to bring Selwin Hart to the stage. Selwin.

Thank you so much and good afternoon to all of you. Science tells us that we still have a narrow window of opportunity to avert a climate catastrophe. And the Secretary General's acceleration agenda, shows just how to seize this opportunity. So today, at Climate Week, I urge you to head the Secretary General's call to accelerate action, corporation and collaboration in 2 specific areas: decarbonization of the global economy and delivering climate justice to those on the front lines of the climate crisis. Accelerating the pace of decarbonization, simply means moving away from fossil fuels and turbocharging the renewables revolution. All governments must provide the policy and regulatory certainty and predictability on a clean energy future, carbon pricing and in fossil fuel subsidies. And we must all work together to remove the bottlenecks to renewables deployment including permitting and regulatory barriers and the high cost of capital for renewables in the developing world. Friends, I'll be blunt, the fossil fuel industry and its enablers have a special responsibility. Even as they continue to ride on the backs of taxpayers, receiving trillions in government subsidies and other handouts, the fossil fuel industry continues to pedal fault solutions, spread miss and disinformation and use their considerable influence and resources to impede and delay climate action and ambition, including many of the net 0 coalitions that many of you are currently working on. All leaders need to demand that the fossil fuel industry present credible and comprehensive transition plans that chart the industry's move to clean energy. And financial institutions must end their fossil fuel lending, underwriting and investment and shift to renewables instead. Of course, transformations of this nature and scale don't happen overnight, and transition plans are precisely to provide a road map for a managed orderly process that guarantees affordability, access and energy security. And this is why the Secretary General has asked companies as well as cities, regions and financial institutions to come to this climate ambition summit on Wednesday with transition plans that are fully aligned with the United Nations net 0 standard, presented by our high level of experts that was led by Catherine McKenna, the former Minister of Environment of Canada, and I see [indiscernible] somewhere in the audience, who was also a member of that group. The objective of the Climate Ambition Summit is clear. The United Nations is providing a platform to leaders from governments, business, finance, local authorities and civil societies -- civil society with credible actions and policies to accelerate the pace of decarbonization and deliver climate justice. We said clearly no greenwashing or backsliding and to those leaders like Governor Newsom, the state of California, who have met this price of entry, we look forward to seeing you at the United Nations on Wednesday and we hope -- our only hope is that the Summit inspires others to follow. Friends, many of you in this room today have considerable financial, political and technological might, reach and influence. The decisions you are making now will have consequences for decades to come. Your words, your actions, your policies move and shape national economies, global markets and determine really important policy outcomes. The battle to avert climate chaos will be won or loss under your watch. And to the first movers and doers in this room, I have a special message of hope and encouragement from the Secretary General, do not relent in the face of attacks on progress. You are doing the right thing, keep going. Too much is at stake for us to be silent or to sit on the sidelines. We're simply out of time. Ladies and gentlemen, I thank you. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]