FEDERICO R. LOPEZTwenty-twenty has been a bizarre year for all of us. These last few months made what was unthinkable, tangible and real. We now live in a world that’s not merely complicated but tightly interrelated and complex.
We saw the year open with the COVID-19 pandemic rapidly spreading across the globe and shaking up our lives and our world that we’re so used to. It also exposed us to the raw power of exponential progression. The phrase “gradually, then suddenly” seems to apply to so many aspects of our lives: how we go to sleep, how the gradual onset of heart disease leads to a heart attack, how technology disrupts, how bankruptcies unfold, how pandemics spread, and pretty soon how climate change will affect us all, where we’re fast approaching the “suddenly” phase if we aren’t in it already. How will we in the Lopez Group move forward in this unsettling new world?
I’ve felt for some years now that the unprecedented times we’re living in have been begging for a new narrative and a new paradigm for how we live, work, do business and even how we measure success and progress.
Our way of life has set us on a trajectory of 3°C-4°C of warming by 2100. This current path will clearly be catastrophic and turn Earth into an unlivable and socially disrupted planet way before then and surely within the lifetimes of our children. The UN IPCC timelines needed to keep global average temperature rise to 1.5°C, when plotted on a chart, reveals a curve still just within reach but, with each year of inaction, gets precipitously steeper and tougher to meet. It’s imperative for us to cut carbon dioxide emissions in half by 2030, and take it all the way down to Net Zero by 2050, if we want to limit global warming to 1.5°C by 2100. These next 10 years will determine whether we are able to halt the climate crisis in time, or watch it run away from us irreversibly.
Today at just 1°C of warming, we can see the geologic-scale changes happening to our planet’s environment everywhere: record high temperatures at the poles, mega droughts across several continents, raging wildfires in the US and Australia, and more destructive typhoons. Just last month, millions of Filipinos were successively pummeled and thrashed by Rolly, the world’s most powerful typhoon this year, and Ulysses, one that surpassed typhoon Ondoy’s wrath in 2009. The destructive power of these formerly 100-year events has no doubt been intensified by the accelerating climate crisis and they now hit us with greater frequency and regularity. How long then can even the strongest, most resilient communities withstand this relentless and repeated pounding year after year if they can lose everything they have at least 20 times a year? Is this the kind of world that narrows or widens the gaps between rich and poor? Do we sit around and wait for prayerful resilience of the vulnerable to turn into anger, then harden into hate?
Capitalism has brought tremendous and amazing progress, creativity and innovation. But as it’s currently practiced, it has also left too many behind. Even as we breach much of our planet’s safe environmental limits, billions of people still do not have decent access to energy, clean drinking water, toilets, food, healthcare, education, housing, income and work, political voice, social and gender equity or even peace and justice.
The populism that’s sweeping the world is a symptom of the growing disenchantment with business, politics, and life as usual. In today’s world, it’s a disenchantment that’s moving at exponential warp speed through the power of social media, weaponized or otherwise. The natural, social and political forces being unleashed in the coming decade will likely make it the most challenging and most disruptive business has ever seen. The COVID-19 pandemic is just a mere “fire drill” for what’s coming and demonstrates the scale at which things need to change. We are living in a time that calls for great paradigm shifts, and businesses that seek to thrive in this era must be able to reimagine and redesign themselves for this new world.
Businesses need to align themselves, their resources and their capabilities towards a mission that seeks to elevate everything they touch—their customers, employees, suppliers, contractors, the environment, communities and, of course, their investors (in that order). I refer to this sequence as a five-point star called the Pentad (courtesy of Carol Sanford) which has in the background been guiding my own decision-making on doing business regeneratively.
CSR or philanthropy may ease our consciences but can never scale up enough to heal our hurting world in time. There is an urgency for all of us to go beyond incremental sustainability and transform into regenerative forces that align our profit engines with the need for a better, more just world and a safer planet. Collectively, we have the creativity and innovative energy needed to solve the world’s greatest problems. Unlocking these will be the foundation to some of the greatest business opportunities in the coming century. Paul Polman, the former chairman of Unilever, refers to the 17 UN Sustainable Development Goals as simply the world’s greatest business plan.
Moving closer to home, this year we crystallized our mission at FPH and our group of companies and that is: “To forge collaborative pathways for a decarbonized and regenerative future.” It’s a deliberately high bar and we’re nothing short of humbled by it.
This short phrase solidifies our role in the transition to a decarbonized energy system. But it goes beyond energy and anticipates dealing with the many adaptive challenges needed to redesign how we live, work and do business in a changed world that demands social justice—one of our core, defining values.
How do you put all this into practice? How do we align our businesses and profit engines with fixing a hurt world and solving its most intractable problems? Ronald Heifetz, the pioneer in the study of leadership from the Harvard Kennedy School, would say that we are clearly in the midst of what’s called an “adaptive challenge.” The solutions to the problems we face are not known, cannot be solved, he says, by “someone who answers from on high.” They require “experiments, new discoveries and adjustments from numerous places in the organization or community. Without learning new ways—changing attitudes, values and behaviors—people cannot make the adaptive leap necessary to thrive in the new environment. The sustainability of change depends on having the people with the problem internalize the change itself.” Our hope is to see our businesses and our people thinking instinctively along regenerative lines as they go about their work and their daily lives.
Today we already work this way in small pockets within our various subsidiaries. But if we look around our various businesses there are many other such opportunities we have yet to explore. And it excites me to know that our values and our capabilities play up to many of these opportunities.
We might look back at a tough year that passed. But it is also a time of reflection and a chance for recalibration as we go into 2021. We are aware of what is ultimately at stake—the planet we live in, our livelihoods, our communities and our families, much like what’s being taken from the vulnerable every time destructive natural disasters hit. I know these can be sobering facts. But even though what we’ve been doing so far just feels like a tiny first step on a thousand-mile journey, we should always remind ourselves that we don’t have to go this journey alone. We’re all imperfect beings, with imperfect abilities, in an imperfect, maybe broken world, but it should never mean losing the courage to make things better.
As the songwriter and poet Leonard Cohen wrote: Ring the bells that still can ring Forget your perfect offering There is a crack,... in everything That’s how the light gets in --Anthem
This Christmas, may we let more of that light shine in as we prepare for another year ahead. I wish you and your families a safe and meaningful holiday celebration. - FEDERICO R. LOPEZ