In 1997, John Browne, MS ’81, gave a speech at Stanford on the subject of “the global environment.” What he said back then might seem uncontroversial today, but at the time, speaking as an oil industry leader (he was group chief executive officer of the UK-based BP), his remarks sent shock waves through the industry and the American Petroleum Institute that represented it.
Browne — Lord Browne of Madingley — spokeopen in new window of a “discernible human influence on the climate,” a “link between the concentration of carbon dioxide and the increase in temperature,” and a “need for action and solutions.”
BP, he told the audience, would be taking steps to control its own emissions, fund scientific research, invest in the development of alternative fuels, and contribute to public policy debates on solutions to the problem, measures that he said went “well beyond the regulatory requirements.” This was at a time when most oil companies were lobbying against environmental regulation and questioning the science around climate change.
Today, among other roles, Browne is chairman of BeyondNetZero, a climate investing venture established in partnership with the global growth equity firm General Atlantic. BeyondNetZero invests in high-growth companies developing climate solutions in areas such as supply chain and industrial process decarbonization, energy efficiency, resource conservation, and the measurement, management, storage, and removal of greenhouse gas emissions.
Twenty-five years on, Browne reflects on his Stanford speech, on what progress has since been made on environmental sustainability, where the biggest gaps remain, and what could have been done differently. His comments have been edited for clarity and length.
In 1997, I imagine you knew your Stanford speech would cause a stir. Why did you feel so strongly about speaking out on climate change?
I felt it was a real risk that had to be handled, and it wasn’t just me — it was the leadership of BP. So I felt very confident being part of a team that believed we needed to do something. And we realized that we had to be at the table when people were talking about our future.
How did your peers in the oil industry react?
Most thought it was eminently ignorable, a view that was supported by the industry’s trade associations and other powerful groups, which said, “Let’s ignore it and if we need to do something we can wait 20 years; we can kick the can down the road.” They were still lobbying against climate change and saying the science wasn’t there.
Which stakeholders — from environmental groups to the policy world — were most receptive to your arguments?
Most people were skeptical, and they tested us in a variety of ways: talking to our team and watching our actions to see if there were any inconsistencies. But eventually a lot of them came round. Environmental Defense Fund began to work with us, as did the World Wildlife Fund and, from time to time, Greenpeace.
What were the biggest challenges BP faced in meeting the expectations of these stakeholders?
We could not be fully consistent from the start. There was a lot to iron out inside BP in the way things worked, and we had to correct certain harmful practices. One example is the flaring of excess natural gas [which emits carbon
dioxide, other noxious gases, particulates and methane]. It took a long time to get that under control.
Knowing what you know today, would you have framed the speech differently — and if so how?
Quote
“There are plenty of global applications, but they need investment and they need customers ready to commit in the long-term to buy supplies of clean energy.”
I would have been much clearer about saying that we must set targets and then externally audit performance in this area on a consistent basis, because what gets measured gets done. Second, I would have been clearer about the level of investment needed. You cannot do this without significant investment. Third, we needed to engineer the solutions to get the costs down. Twenty-five years ago there was a lot to engineer. We’ve engineered quite a few of the solutions but now we need to apply them.
You mention the importance of standards and measurement. We’ve seen some progress on this with the EU’s Sustainable Finance Disclosure Regulation, which imposes standards on financial products claiming to be sustainable, and the launch of the International Sustainability Standards Board at the COP26 climate summit. Are you encouraged by such developments?
I’m quite hopeful — but it’s very patchy around the world and not everyone is going to be synchronized. BeyondNetZero is focused on solutions that have the potential to deliver real-world reductions in greenhouse gas emissions. We have adopted a rigorous approach to measuring and reporting that is driven by data and aligned with the Science-Based Targets initiative.
If that’s the case, where are the leaders on environmental standards, and where are the laggards?
It looks like Europe is doing a good job. I hope they’re not destabilized by what’s going on at the moment [in the wake of Russia’s
invasion of Ukraine], but high energy prices and lack of energy security should demand diversification, which means that there will be lots of new energy sources, including renewables left.
China is being transparent on objectives but not on measures and America is kind of between the two. But the SEC is taking a bold approach to greenwashing — a really bold approach — and they have every intention of putting in place measures that will require people to report on what they’re doing.
If the oil industry had taken your words to heart in 1997, where would we be today with respect to the net-zero emissions needed by 2050 to limit global warming to 1.5 degrees centigrade above pre-industrial levels?
We would have definitely been on a path to 1.5 degrees or less, because the problem was rather smaller 25 years ago and we would have not had to retrofit so many things. We would have had new infrastructure in place that might have reduced greenhouse gas emissions already. So we would have been on a much better path, and without the amount of reinvestment we have to make today. It’s the reinvestment that’s the tough bit — taking infrastructure that is still way into its useful life and replacing it with new.
In your speech you said that the climate measures you planned to take were voluntary. Would you have welcomed more regulation at the time?
Yes, probably, because there is a limit to what you can achieve alone. There were cost savings in things like capturing more natural gas and methane, but boards have to work within a regulatory framework or they may be accused of doing things that are not in the best interests of shareholders. You have to balance it all, and regulation does give you a way of balancing it.
How realistic is it for an industry to abandon its core product?
The world cannot abandon oil and gas in the short term. When you look at whatever energy mix there will be in the future, oil and gas will be needed for a long time. If you shut down all the oil majors, it wouldn’t make a huge difference to the world because the oil would be produced by OPEC. It would, however, make a big difference to economies in North America and Europe, and to energy security. Of course we’d all love like to have carbon-free energy everywhere and we need to push on this as hard as we can but we have to be realistic. This is a multi-decade transition.
In 1997, you talked about the importance of developing alternative energy sources. Progress has been made, and renewables are now competing with fossil fuels on price. But what is needed to accelerate the move to clean energy?
In the developed world, it’s about planning and regulations and getting transmission systems to connect distributed pods of energy into the central grid. That may be more complicated than building the wind farm itself, as you need to get all the consents in place.
There are plenty of global applications, but they need investment and they need customers ready to commit in the long-term to buy supplies of clean energy and, for example, hydrogen.
The technology will get better and better over time — it always does — and costs will come down. We have to crack long-term storage for intermittent energy and that hasn’t happened yet. Energy storage remains a very important part of the supply side.
We also need to come back to decarbonization of fossil fuels. We can capture CO2 and lock it away forever. But we need to investigate how to do it without pumping all this CO2 down into used reservoirs.
Nuclear is a zero- or ultra-low-carbon energy source but it has issues around its reputation as being very dangerous and it has a high price tag. We can solve the second but the first we have to work through.
Now, 25 years after your Stanford speech, are you optimistic that the world can meet its ambitious net-zero goals?
If we add up all the goals we’ve set, we’ll be under 2 degrees, but it does mean we have to implement it all. As an optimist, I hope we can. But as a realist, I know we have a lot to do to keep anywhere close to 1.5 degrees. I do believe that humankind will do the right thing.
See related:
See related:
as well as the cautionary tale about university “websites” on climate change at Yale, Harvard and other institutions:
And past course material:
Global Climate Change
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