Good morning.
President Biden’s Special Envoy for Climate John Kerry spoke to members of Fortune’s CEO Initiative yesterday and agreed with what I’ve been saying for months: that business efforts to address climate have reached an inflection point.
“There is a very significant increase in dialogue in boardrooms of corporate America on ESG and sustainability, and money is beginning to move, and that’s not insignificant… I’ve been working with the six largest banks in the United States—Goldman Sachs, JP Morgan, Bank of America, Morgan Stanley, Wells Fargo, State Street—and their commitments to what they will invest in climate, their floor, is $4.6 trillion. That’s without Larry Fink and Blackrock and other asset management entities which are talking about doing a trillion of their own, maybe two.”
Yet in spite of that, Kerry told the CEOs that “we’re in a lot of trouble.” Citing recent international agency studies, he said that in order to achieve carbon neutrality by 2050
“…we would need to be accelerating our deployment of renewable energies six times faster that we are today, we’d have to be planting trees five times faster than today, we’d have to be phasing out coal five times faster than today, we’d have to be transitioning electric vehicles 22 times faster than today.”
Asked by one of the CEOs about Europe’s effort to place a carbon tax on imported products that aren’t reducing carbon emissions sufficiently, Kerry said:
“I would characterize Europe as, generally speaking, more prone to … regulatory and mandatory solutions and I would characterize us as being more entrepreneurial and incentive oriented, and I think that’s a better way to do things.”
But then he added:
“If China is on a ruinous path and the rest of us are all trying, we may have no choice to result to some sort of a broad-based CBAM (carbon border-adjustment mechanism). Europe would join and that would be the largest consumers of the world and clearly have a very big impact on China’s economy. So we just have to see how this plays out.”
That sounds like a threat. More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
P&G CEO
Procter & Gamble CEO David Taylor is to step down after six years leading the consumer-goods giant, handing over to deputy Jon Moeller. Taylor will continue to serve as executive chairman. Taylor: "When I came into this role, we were not delivering what we knew we were capable of… The strategy we have was working before the pandemic, is working in the pandemic and will continue to work well after the pandemic." Wall Street Journal
Nikola charges
Nikola founder Trevor Milton yesterday pled not guilty to federal fraud charges, for lying about "nearly all aspects" of the electric-truck startup. Legal experts say Milton should shoot for a plea deal. However, his lawyers say he "has been wrongfully accused following a faulty and incomplete investigation in which the government ignored critical evidence and failed to interview important witnesses." Milton may not longer be running Nikola, but the charges knocked its share price by around 7%. CNBC
ScarJo vs Disney
Scarlett Johansson is suing Disney over the streaming release of Black Widow, on the basis that her contract guaranteed an exclusive theatrical release. The studio simultaneously released the film in theaters and on its Disney+ platform, because pandemic, and theatrical grosses declined sharply after the first week. Disney says the suit shows a "callous disregard" to the pandemic and said she has already received $20 million from the project. Fortune
Battery fire
One of Tesla's Megapack mega-batteries caught alight in Australia today during testing of a very high-profile energy project called the Victorian Big Battery. There's no word yet on the cause of the blaze. Reuters
AROUND THE WATER COOLER
Inflation rise
Eurozone average inflation hit 2.2% in July, marketing the first time in nearly three years that it has overshot the European Central Bank target of 2%. Energy prices were the big driver. MarketWatch
Israeli boosters
Israel is going to start giving third doses of the COVID vaccine to people over 60, to better protect them from the Delta strain. It has already given the booster jabs to people with weakened immune systems. There is a huge debate over the necessity of boosters and the morality of administering them when poor countries have barely started regular vaccinations. BBC
Vaccine incentives
President Biden wants state and local governments to offer $100 to newly vaccinated people, as New York City is now doing. He's also told federal employees and onsite contractors to get vaccinated or mask up. The moves reflect the urgency of dealing with the coronavirus's Delta variant, which data suggests can be transmitted as easily by vaccinated people who develop "breakthrough" infections as it can by infected, unvaccinated people. Fortune
Big data
A.I. innovation does not require enormous datasets, according to Google Brain co-founder Andrew Ng. "Don't buy into that hype," he said, arguing that vast datasets are really only useful for consumer Internet companies, and A.I.'s next big step will involve building algorithms around much smaller datasets. Fortune
This edition of CEO Daily was edited by David Meyer.
