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Good morning, and Happy Earth Day.
With each passing week, I become more convinced that 2021 will be seen as the year that business got serious about climate change. And the reason is because climate change is becoming ever more important to business.
A new survey out this morning from IBM underscores the point. The survey covered 14,000 people in nine countries. Among its findings:
—More than 70% of people now say they are more likely to work for, or stay with, a company with a good record or reputation on the environment.
—55% say they are “willing to pay more for brands that are sustainable and environmentally responsible.”
—48% of investors say their portfolio “already takes environmental sustainability into account,” and another 21% say they will likely add sustainability as a factor for investment decisions in the future.
Those numbers all have moved up in the last year. That’s why 84% of CEOs said in a separate IBM survey that sustainability will be important to their strategy in 2022—up from just 32% who said the same in 2018. “COVID has substantively raised people’s awareness of general global connectedness,” says Mark Foster, SVP of IBM Global Business Services. “The line has been crossed. It has gone from an intellectual conversation about sustainability to more of a gut sense.” And “people are looking at it as a business opportunity.”
Heineken CEO Dolf van den Brink, whom I also spoke with yesterday, is a good example. He recently announced ambitious plans to make the company’s beer production carbon neutral by 2030, and to make its entire supply chain, distribution and packaging carbon neutral by 2040. Achieving those goals “is going to be painful.” But he says the commitment is not only good marketing, it also motivates employees. “You do all this external messaging, but the real energy is inside the company.” Van den Brink believes the pandemic has led to “a kind of expanded consciousness of vulnerability. People realize how dependent they are on the environment.”
By the way, the IBM study shows the U.S. continues to be an outlier when it comes to public attitudes on climate, with only 51% saying climate change is very or extremely important to them, compared to 73% in the other eight countries surveyed.
More news below.
The European Commission has officially proposed its much-anticipated A.I. legislation, and there's a lot to take in. Some types of A.I. would be banned, such as China-style social-scoring systems, while "high-risk" use cases such as critical infrastructure and educational A.I. would need stringent controls. Crucially, like the EU's GDPR privacy law, the rules would affect tech firms around the world, unless they're happy to cut off the European market. Fortune
The Archegos Capital Management collapse really did hit Credit Suisse hard. The Swiss bank (now subject to Swiss enforcement proceedings over its risk management) is trying to raise nearly $2 billion in fresh capital, after losing well over $5 billion. Apart from its Archegos exposure, which led to a @275 million quarterly loss, Credit Suisse actually had a pretty strong first quarter. Fortune
Apple, which will next week disadvantage Facebook and other ad companies by beefing up its privacy controls in iOS version 14.5, is reportedly preparing to boost its own ad business by selling slots in the App Store's "suggested apps" section. Financial Times
Ozlem Tureci, BioNTech's co-founder and chief medical officer, has backed up Pfizer CEO Albert Bourla in saying people will probably need a third, booster jab of the companies' COVID vaccine. She also said she expects people will need an annual coronavirus shot, as they do with seasonal flu. CNBC
AROUND THE WATER COOLER
What will Chapter Two of the digital economy look like? At Fortunes Brainstorm Finance event yesterday, heavy hitters such as PayPal CEO Dan Schulman and Prudential Financial CEO Caroline Feeney set out their visions of "high-touch and high-tech" virtual interactions with customers, and the promise of cryptocurrencies and "super apps." Fortune
Both Reuters and Politico report that the European Commission is preparing to sue AstraZeneca over its failure to deliver the volumes of COVID vaccine that are described in its contract.
The rate of vaccinations in the U.S. has begun declining, perhaps signaling the approach of the campaign's last mile: where the supply-and-demand curve reverses, and the anti-vaxxer 20% of the U.S. populace needs convincing. Fortune
Politico has an interesting piece on the impasse over vaccine intellectual property, and whether IP rules should be waived to enable more manufacturing that could help out the developing world. Even with a waiver, obstacles remain—many pieces need to come together for the idea to work out. (Bonus read: Reuters on how the EU undermined the push for equitable global vaccine access.) Politico
This edition of CEO Daily was edited by David Meyer.