In 1971, John Lennon wrote “Imagine,” one of the most beautiful songs of all time, the Soviet Mars 2 probe landed on the surface of the red planet and in Davos, in the Swiss Alps, the World Economic Forum (WEF) held its first edition of what few would have imagined would go on to become such an important annual event.
Since then Davos has become a must for the world’s political, economic and financial leaders. The 50th edition was held from 21 to 24 January and it provided the opportunity to launch a new new Manifesto, an appeal for a more sustainable economic system. “The purpose of a company is to involve all the stakeholders in the creation of shared and sustainable value,” wrote the founder of the WEF, Klaus Schwab, advocating “stakeholder capitalism,” a system that considers not only the interests of shareholders but of all the other people involved (company employees, customers, suppliers, the local community) and that, alongside the financial metrics, prioritises goals concerning Environmental, Social, Governance (ESG) factors. According to the Manifesto, “a company is more than just an economic unit that generates wealth,” it is part of the society in which it works and therefore its performance cannot be measured solely in financial terms. In line with this vision, the theme chosen for this year’s edition was “Stakeholders for a Cohesive and Sustainable World.”
Climate at the top of the agenda
A more united and sustainable world has to prioritise the fight against climate change, which United Nations Secretary General António Guterres, who was also present at the event, described as “the defining question of our time.” “It is absolutely essential to recognise that climate change is an existential threat to us all,” stated Guterres, who went on to offer a clear outline of the approach we must follow. “There has to be a significant shift in industrial resources from fossil fuels towards the green economy".
Safeguarding the climate is, however, the responsibility of all of us. This is underlined by the report “The Net-Zero Challenge: Fast-Forward to Decisive Climate Action” compiled by the WEF together with the Boston Consulting Group. Governments must establish precise rules; investors should be able to request guarantees of sustainability and the world’s citizens must contribute in their own way by adopting more sustainable types of behaviour and by making their voices heard. Companies are called on to reduce their CO2 emissions and to share technological innovation in order to usher in a cleaner system. On this front, the document has significant praise for Enel not only for its development of renewable energy sources, but also for its initiatives concerning sustainable finance and, more generally, the integration of sustainability into the Group’s strategy.
The formula for systemic efficiency
Guterres’s view was shared by Enel CEO and General Manager Francesco Starace, who took questions at the panel on “Creating a carbon-neutral future.” In order to build a low-emissions future, the first requirement is to tackle efficiency: in the sectors of electricity generation, transport, construction and heavy industry, an estimated 67% of primary energy is wasted. In order to reduce this figure, the formula is systemic efficiency, an integrated approach in which existing solutions and technologies converge: increasing the share of electricity in total energy, optimising consumption, designing efficient and sustainable buildings, the decentralisation of electricity generation, the development of renewable forms of energy and, naturally, the digitalisation of the networks, which is the cornerstone of this process.
The systemic approach, but also the need for clear and incisive political decisions, were key points that the other members of the panel – Jean-Pascal Tricoire, CEO of Schneider Electric, Amani Abou-Zeid, the African Union’s Commissioner for Infrastructure and Energy, and Benoit Potier, CEO of Air Liquide – insisted were necessary.
Of particular importance is what will happen in cities, which in the near future are set to house a growing proportion of the world’s population and that are already responsible for 70% of the planet’s greenhouse gas emissions. For Starace, cities offer enormous potential for efficiency, change and decarbonisation. This was in fact the topic of a paper jointly authored by Starace and Tricoire and published on the WEF website, entitled “To achieve net-zero carbon cities and buildings we need systemic efficiency.” The paper describes two exemplary cases: the completely digitalised T-Mobile Arena, a sports and entertainment venue in the heart of Las Vegas, and the project Urban Futurability created by Enel in São Paulo, Brazil, with a “digital twin,” which creates a 3D replica of the local electrical infrastructure.
Concerning the sectors of transport and electricity generation, the role of batteries is fundamental, both for increasing the use of renewable forms of energy and for the spread of electric mobility. Indeed, on the occasion of the event in Davos, 42 organisations, including authorities, institutes and companies (such as our Group), signed a document establishing some guiding principles: from striving to achieve ever greater efficiency to the reuse of batteries and the recycling of materials.
For a sustainable future, however, technology alone is not sufficient. Change must be achieved through people. This point was clarified by Ernesto Ciorra, Enel’s Chief Innovability Officer, speaking at the session on “The Transformation Imperative” organised by The Economist.
Ciorra concluded that the most important thing is to change corporate business models in order to shift towards sustainability, as our Group has done and continues to do.
A zero-emissions event
In light of all this, it was fitting that the entire event in Davos was organised – for the fourth consecutive year – in such a way as to achieve a net balance of zero emissions. This was made possible mainly by minimising consumption and environmental impacts: the Congress Centre was redesigned, the meals were prepared with a focus on locally sourced and seasonal produce, and internal transport was provided using a fleet of vehicles that were 90% electric or hybrid. The inevitable emissions were compensated by green projects all over the world, such as the protection of vast areas of the Amazon Forest. In addition to this contribution, many of the companies taking part made commitments to carbon neutrality. The WEF is leaving no stone unturned in its determination that in the future, at a Davos meeting, it will be possible to celebrate victory in the fight to save the environment. Perhaps John Lennon expressed it best when he sang, “Imagine all the people sharing all the world.”