Industrial collaboration is the key to sustainability

As head of the We Mean Business Coalition, Maria Mendiluce sees most things in the world in terms of their carbon footprint – whether it is as an individual, a company, an organisation or even a country. “Sustainability starts with being aware of our footprint, and then understanding it better so that we can begin to reduce it effectively,” she explains.

On a personal level, the Spanish-born Mendiluce eats less meat than she used to. Her journey to work in Geneva, Switzerland, where she lives with her family, now involves a bicycle rather than a car or public transport.

On a business level, she influences companies to take action, encouraging them to understand their own carbon footprint better – and to implement emissions reduction strategies both within their organisations as well as along their supply chains.

“Combating climate change is often less about reducing emissions in your own company or factory, and much more about identifying how to reduce emissions along your supply chain,” she explains. “If we learn to address that wider footprint, we will solve the climate crisis.”

The We Mean Business Coalition, which dynamises business and policy action with the aim of halving global emissions by 2030, sees corporate collaboration as an indispensable piece in the sustainability puzzle.

In the automotive industry, the coalition is encouraging manufacturers to collaborate with energy companies to build the charging infrastructure needed to speed the transition to electric vehicles across entire economies. In the US, transport was the single biggest contributor to greenhouse gas emissions in 2019, accounting for 29 per cent of the total, according to the US Environmental Protection Agency (EPA). In the UK, Europe and other industrialised nations, it is a similar story.

Mendiluce is also helping auto manufacturers to reduce emissions that stem from the materials they use. One example is getting competitors to form so-called ‘demand clubs’ for low-carbon materials, sending a strong signal to steel manufacturers and other heavy industry sectors where there is a growing demand for cleaner processes. “The transition to net zero requires heavy investment to change processes but that investment will only come when it is clear that there is sufficient demand,” she says.

Mendiluce argues that establishing corporate and industrial collaboration in specific sectors creates templates for carbon reduction that can then be applied in other industries. “We’re creating pathways that companies in any sector can copy and paste,” she explains.

But she also warns that successfully combating climate change requires immediate action. Achieving a global net zero economy in time to avoid climate disaster depends on private capital identifying and backing clear and effective investments today that align with a 1.5-degree pathway. Sticking to that will not only avoid the increasing loss of natural habitats and the growing intensity and frequency of extreme weather events, but it will also mean creating a better world than the one we inhabit today.

Indeed, while combating climate change is often associated with having to make sacrifices, Mendiluce argues that effective and immediate action will lead to healthier and more enjoyable lifestyles for billions of people. “Cities will be greener, public transport will be cleaner and more efficient, and the concept of climate safety will become a value that we appreciate along with other values that enrich our lives.”

Due to its simplification, this document is partial and opinions, estimates and forecasts herein are subjective and subject to change without notice. There is no guarantee forecasts made will come to pass. Data, figures, declarations, analysis, predictions and other information in this document is provided based on our state of knowledge at the time of creation of this document. Whilst every care is taken, no representation or warranty (including liability towards third parties), express or implied, is made as to the accuracy, reliability or completeness of the information contained herein. Reliance upon information in this material is at the sole discretion of the recipient. This material does not contain sufficient information to support an investment decision.

Issued in the UK by AXA Investment Managers UK Limited, which is authorised and regulated by the Financial Conduct Authority in the UK. Registered in England and Wales No: 01431068. Registered Office: 22 Bishopsgate London EC2N 4BQ In other jurisdictions, this document is issued by AXA Investment Managers SA’s affiliates in those countries.