During her keynote speech during the Nordic Business Forum on Wednesday (27 Sept), Dr Rebecca Henderson praised the US Inflation Reduction Act (IRA) but warned the US may be falling behind other nations in its adoption of green technology.
Her speech, entitled ‘Reimagining Capitalism in a World on Fire’, focused on the new responsibilities faced by businesses during climate change.
Alongside asking businesses in attendance to lead with the purpose of creating and supporting community instead of profits, Henderson also spoke directly on the US IRA describing it as the “largest piece of legislation to accelerate change for the US.”
The US Department of Energy has stated the intent of the IRA is to push the US towards a 40% reduction in carbon emissions by 2030.
But, despite this initial praise, Henderson did state that the US is still in the early stages of its transition to green technology and energy.
When asked for further details on green technology adoption in the US, Henderson stated that she felt as though the US was at risk of falling behind other nations such as China.
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Henderson explained that she was “nervous” about more autocratic states dominating the global transition to green technology but continued to encourage businesses to remain committed to decarbonisation, which she stated they should view as a “huge opportunity”.
Michael Orme, research consultant for GlobalData, shares Dr. Henderson’s concerns around the US lagging behind China.
“In terms of the deployment of solar and wind technology China heavily outscores the US, and has done for years,” Orme explained.
Orme stated that China has already become the “EV capital of the world”, whereas the US in contrast has only just begun to kickstart its EV revolution under the IRA and cited that the US only had 150,000 public charging stations across the nation.
However, Orme highlights China’s substantial coal usage which he stated would only increase in the near future.
Henderson’s call for action to businesses comes as ESG commitments face growing scrutiny and scepticism.
A 2023 survey by research analyst GlobalData stated that 47% of respondents believed that disclosure of such ESG commitments are purely viewed by businesses as marketing exercises.
Instead, Henderson asked businesses to commit to decarbonisation to reduce strategic risk and fulfil a purpose of sustaining community, a purpose which she described as the faithful purpose of business over profit.
Additionally in Global Data’s survey, ESG was ranked the fourth most impactful disruption to business in the next year with only 6% of businesses responding that it was their top concern.
Henderson’s speech, however, amplified the near-future impact of climate change.
Specifically, Henderson pointed to the incoming bankruptcy of Florida. Increasingly unpredictable weather and higher rain fall leads to unliveable conditions and therefore the eventual migration of people living in Florida. In Henderson’s speech she explained that this will eventually lead to a crash of Florida’s housing market within the next few years.
Henderson’s speech also included several maps explaining the global impact of climate change within the next ten years, creating higher risk of year-long droughts for Europe and fatal wet bulb temperatures in South America, Oceania and Asia Pacific.
A potential lag within the US’ adoption of green technology, therefore, could be catastrophic for businesses within the short-term future.