And on the eighth day, Jeff Bezos created the Earth Fund!
It was hard to move across the internet this week without bumping into headlines and hyperbole around the decision of the world’s richest person — Amazon founder Jeff Bezos — to dedicate $10 billion of his personal fortune to a fund addressing climate change.
At one end of the web, Wired shouted with a straight face that “With a $10 Billion Fund, Jeff Bezos Can Control the Planet’s Future.” At the other end, tax and climate activists pointed out that Bezos’ freedom to donate is largely derived from Amazon paying a corporate tax rate of barely 1 percent. Then there’s the question of Amazon’s convenient deliveries and massive data centers, which together emitted about 44.4 million metric tons of carbon dioxide in 2018.
The world was left wondering if Bezos is part of the problem or part of the solution. The answer, according to Rachel Kyte, is both. The new dean of Tuft University’s Fletcher School and former U.N. Sustainable Energy envoy, told Global Translations that it’s a good thing if other climate-shy philanthropists can learn from Bezos. At the same time, Kyte insists that philanthropy is an inefficient model for mitigating climate change. “It’s a silver bullet mindset that is not going to get us there,” in terms of stabilizing the climate, she said. What is needed instead is mass-scale green infrastructure, driven by long-term global policy incentives, and for leaders like Bezos to change their own company practices: “If he was aggressive, he could move a mountain,” she said about Amazon’s vehicle fleet and Amazon Web Services’ huge electricity needs.
One of the deeper legacies of Bezos’ move may not be philanthropic: it may lie in cementing the idea that employee climate activism works. Bezos depends on the goodwill of around 800,000 employees. While Amazon employee activists were not pleased with Bezos’ announcement, they likely played a role in his making it, after months of loud complaints about Amazon’s carbon footprint. The same dynamic has been driving many corporate sustainability initiatives, including those of corporate platforms like World Economic Forum’s annual meeting in Davos.
For Kyte’s part, she is more excited by the changes in sustainable finance than in philanthropy. Investor pressure is “beginning to bite,” she said: “The big guys are scrambling. They’re buying boutique firms to get more competence” to cope with pricing climate risks and to avoid being stuck with stranded assets.
In addition to asking what Bezos will spend his $10 billion on, it’s interesting to ponder how green Amazon would be today if Bezos had built sustainability into its business model by design. That’s the approach of entrepreneurs such as Tesla’s controversial CEO Elon Musk, who has bet that developing the best performing batteries is Tesla’s way to beat other car companies. Amazon instead focused on keeping costs low and reinvesting sales profit margins into growing the business.
BEYOND ENVIRONMENT: Sustainability is a constantly changing discussion. We take sustainability to mean creating impacts on society (be it through systems, organizations or governance) that shape something better for future generations. In other words, it’s about impact rather than rhetoric or ideology, and it’s about more than the natural environment. On that note, this week we’re taking a look at 24/7 work culture and business ethics.