Brad Smith, Microsoft | EarthxCEO S1E1 | EarthX - video Dailymotion

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EarthX Website: https://earthxmedia.com/   Brad Smith leads Microsoft on a wide range of issues involving the intersection between technology, society, and the environment.   About EarthxCEO:  Compelling stories from top business leaders across a variety of different industries. They share the belief that financial success is only one side of the equation and work to achieve a triple bottom line, People, Profit and Planet.   EarthX  Love Our Planet.  The Official Network of Earth Day.    About Us:  At EarthX, we believe our planet is a pretty special place. The people, landscapes, and critters are likely unique to the entire universe, so we consider ourselves lucky to be here. We are committed to protecting the environment by inspiring conservation and sustainability, and our programming along with our range of expert hosts support this mission. We’re glad you’re with us.     EarthX is a media company dedicated to inspiring people to care about the planet. We take an omni channel approach to reach audiences of every age through its robust 24/7 linear channel distributed across cable and FAST outlets, along with dynamic, solution oriented short form content on social and digital platforms. EarthX is home to original series, documentaries and snackable content that offer sustainable solutions to environmental challenges. EarthX is the only network that delivers entertaining and inspiring topics that impact and inspire our lives on climate and sustainability.       EarthX Website: https://earthxmedia.com/    Follow Us:  Instagram: https://www.instagram.com/earthxmedia/  LinkedIn: https://www.linkedin.com/company/earthxmedia  Facebook: https://www.facebook.com/EarthXMedia/  TikTok: https://www.tiktok.com/@earthxmedia  YouTube: https://www.youtube.com/@EarthXMedia      How to watch:   United States:   - Spectrum  - AT&T U-verse (1267)  - DIRECTV (267)  - Philo  - FuboTV  - Plex  - Fire TV    #EarthDay #Environment #Sustainability #EcoFriendly #Conservation #EarthX

Transcript

00:00Hello, everyone, and welcome to EarthX CEO,

00:04a weekly series on EarthX TV.

00:06Each week, we speak with business presidents and CEOs

00:10about their leadership on

00:12sustainability and climate change issues.

00:15I'm Bob Perciasepe, President of

00:17the Center for Climate and Energy Solutions,

00:19and with us today is our very

00:21first conversation with Brad Smith.

00:24Brad, thanks so much for joining.

00:27Let me just say a few words about

00:29you as Microsoft's president,

00:31you play a key role in spearheading

00:33the company's work on critical issues

00:35involving the intersection of technology and society.

00:40This includes issues like cybersecurity, privacy,

00:43artificial intelligence, immigration,

00:45philanthropy, and environmental sustainability.

00:48The Australian Financial Review described you as

00:51one of the technology's industry's most

00:54respected figures and the New York Times has

00:57called you the de facto ambassador

00:59for the technology industry at large.

01:02I'm really excited and welcome

01:04to this conversation, Brad.

01:06Well, thank you. Thank you for having me.

01:07I'm delighted to be the first person

01:09to be here and help kick this off.

01:12Wonderful. Well, let's get it started because

01:15obviously we want to talk about

01:17Microsoft and its role in society as well.

01:21This year, Microsoft has really moved

01:24the needle on corporate leadership

01:27in the arena of climate change and

01:30sustainability with a plan

01:32toward going carbon negative by 2030.

01:36Then with that going negative,

01:39trying to balance out

01:42the emissions that the company has

01:44had since it started in the 1970s.

01:46This is quite a commitment and on top of that,

01:49a commitment to help develop innovation and technology.

01:53Why don't you tell us a little bit about

01:56that plan and the work

01:59that you guys are doing on that?

02:01Yeah. Well, thank you. We kicked off

02:04what we called four sustainability sprints,

02:06the first of which we launched in January,

02:09and the fourth we just launched a couple of days ago.

02:12They're really around carbon,

02:14around biodiversity, around waste, and around water.

02:18One of the things we recognized is that frankly,

02:21we need to do more work in each of these areas.

02:24I do think the work that we're doing around climate or

02:27carbon has perhaps captured

02:29more people's attention than the others,

02:32and it certainly helped us focus as well.

02:35As you said, we said that we'll be

02:38carbon negative as a company by the year 2030.

02:41What that means is that we'll both be cutting

02:44our carbon emissions roughly in

02:46half compared to where we are today,

02:48and then each and every year,

02:50we will be removing from

02:51the environment more carbon than we emit.

02:54In fact, we said that by the year 2050,

02:57we will remove from the environment all the carbon that

03:01Microsoft has emitted since it was founded in 1975.

03:05We're especially excited, I

03:08would say about this for a few reasons.

03:09First, it's a big ambition for us.

03:14We spent a lot of time defining the ambition.

03:17Second, we recognize that having an ambition is important,

03:21but you actually need a plan to make the ambition achievable,

03:25and we believe we put together a plan that will do that.

03:29Part of what we're trying to do,

03:31to be candid, is help change the conversation.

03:34We think that we all have a lot more to learn from

03:38each other when it comes to thinking

03:40about scope 1, 2, and 3 emissions.

03:43Scope 1 being what we directly emit, for example,

03:46when we drive a car powered by gasoline.

03:49Scope 2 being the carbon emissions that are emitted

03:53when the electricity is generated that we consume.

03:57Scope 3 is really everything else.

03:59So the supply chain,

04:00you buy concrete for a building.

04:04Well, that concrete was created based on carbon emissions.

04:07That's part of your scope 3 emissions.

04:09If you're a business and you create products like we do,

04:13we create Xbox gaming consoles.

04:15They run on electricity.

04:17When people plug them into the wall

04:19and they use our products,

04:21that causes carbon to be emitted.

04:23And so one of the things we really wanted to do

04:26was say we would make this commitment,

04:28not just for scope 1 and 2,

04:30but when it comes to being carbon negative by 2030

04:33for our scope 3 emissions as well.

04:36And we think the world needs that level of ambition

04:40if we're gonna do what needs to be done

04:42by the middle of this century.

04:44Yeah, these are, as I said,

04:46I think you guys have moved the needle

04:49in terms of your colleagues and other businesses

04:52and in the technology industry

04:54when they look at what you're trying to do

04:56and the plans that you've laid out.

04:58They are ambitious and they are focused on leadership.

05:03One of the things that I think is pretty important

05:06for people to hear, Brad,

05:10is what motivates a company to move in this direction?

05:17How does that come about inside a company

05:21where you have leaders like yourself,

05:24you gather up all the brain trust

05:27and you guys sit down and you figure out,

05:29well, why do we wanna do this?

05:31Why not wait to see what happens?

05:35What's motivating you?

05:36Well, I think that is a really important question.

05:39And for us at Microsoft, it was three things.

05:43The first was the science and the data.

05:46As we like to say, our work in this area

05:48is science-led and data-driven.

05:51Five years ago, when I was named the president

05:53of the company, one of the things

05:55that I assumed responsibility for

05:57was our sustainability work.

05:58And we had a small but very good team at that point.

06:02And it gave us a grounding,

06:04including in the part of Microsoft

06:07that does basic research, Microsoft Research,

06:09in environmental science.

06:12And so over time, what we decided to do

06:15was create a team that would bring together

06:17environmental scientists, computer scientists,

06:20and data scientists.

06:21And that, I think, grounded us, frankly, in the facts.

06:25What we're gonna need to do as a planet

06:27to ensure that humanity can continue to prosper here.

06:33The second thing we did was listen to our employees.

06:35And our employees have been vocal.

06:38When you're in the tech sector,

06:39the truth is you're only as good as your next product,

06:42and your next product's only gonna be

06:43as good as the employees that you hire

06:46and retain and develop.

06:48And a lot of our employees are younger.

06:51And for them, this issue around climate and carbon

06:54is extremely important, not just in terms

06:57of what they wanna see governments do,

06:59but what they wanna hear and see their employer do.

07:02So I would meet with employee groups,

07:04and it was a question I would get frequently.

07:07And often, it would be a question that was followed by,

07:10can't you do more?

07:12And then the final thing that really motivated us

07:14was feedback from customers.

07:16And I would have to say, customers in Western Europe

07:20over the past year and a half in particular.

07:23As I would travel the world with my colleagues,

07:27we would meet with customers.

07:28And they, too, especially in Western Europe,

07:32provided a voice that encouraged us

07:34to reach higher.

07:35So when we put these three things together,

07:37frankly, it was one of these things

07:40where the data told us what the world needs us to do,

07:44and our customers and employees told us

07:46what they wanted us to do.

07:49And I think serving the world

07:51and advancing our business really coalesced.

07:53And whenever that happens, it's a pretty powerful thing.

07:59Those are pretty good reasons.

08:01And it's certainly interwoven with a business case.

08:07Not to go into details on your book

08:11that you wrote and published last year,

08:14Tools and Weapons, which is the good and the bad,

08:18or the opportunities and the challenges of technology,

08:22but in that discussion, which is a long one

08:26and very thorough in the book,

08:29you walked up to the issue of where does the government

08:33and the businesses work together to deal with these issues.

08:37And so we have a similar situation here

08:39with sustainability and climate change.

08:40A lot of your plan relies on innovation

08:44that needs to occur.

08:48How do you see the relationship with government policy

08:51and a company like yours striving to be more sustainable?

08:57I mean, obviously you're in a system.

08:59So talk a little bit about how you see the intersection

09:02with government policy and your plans.

09:07I think it's a really interesting topic to think about.

09:10When you think about climate and carbon

09:13or any of these sustainability challenges, let's face it,

09:16they are huge issues.

09:19And I think it's unrealistic to think that governments

09:23can solve these problems by themselves,

09:25but it's equally unrealistic to think that we can solve them

09:29without strong government policy.

09:31But in addition to government policy,

09:33we need to put the market and market forces to work.

09:37And that means I think there is a real role for businesses.

09:41And whenever you need government and business

09:43to do something, you usually need great nonprofits,

09:47NGOs, civil society to come together as well.

09:50So it's this partnership.

09:53And that's something that we in our business

09:56and in the tech sector have seen

09:58for a number of other issues as well.

10:01Caroline Brown, who I work with every day at Microsoft,

10:03and I wrote our book based in very much

10:07on sort of the real world experience

10:11of interacting with others in the tech sector

10:13and with people in government around issues like privacy

10:16and security, access to broadband, digital skills.

10:20And there was just this common thread

10:23that ran through every topic

10:25and I think runs through sustainability as well.

10:29In the tech sector and in the business community,

10:31I think we need to push ourselves harder.

10:33I think we need to step up

10:35and we need to act with more ambition

10:37and then execute the way I think businesses

10:40sometimes almost uniquely are capable of executing

10:43in the world today.

10:44But we need governments to move faster.

10:47We urgently need governments to move faster,

10:50including on the sustainability issue.

10:53So in each of the four areas

10:55that we've made a sustainability focus,

10:57whether it's water this week or climate in January,

11:01we've spelled out not only what we want to do,

11:04but opportunities to work more broadly

11:06with the business community

11:07and where we think government policy needs to evolve

11:11and can make a difference as well.

11:14So even before you put out your plans this year,

11:20going back to January,

11:22Microsoft had an internal price on carbon,

11:25an internal accounting system

11:28to look at how the impacts

11:31of different development projects were going.

11:33Has that helped you as you went forward

11:37with your own policies

11:40and plans that you worked on this year?

11:43I think we have benefited enormously

11:47from having an internal carbon tax at Microsoft.

11:50I mean, this is not something

11:53that I was an expert in five years ago,

11:56and I've just come away so persuaded by its importance.

12:00At Microsoft, our internal carbon tax

12:03is not a shadow price.

12:04Some companies will have a shadow price

12:07so people know what they would pay if they were being taxed.

12:10Ours is a real tax,

12:11which means every part of the company

12:14has to pay into the corporate center a fee,

12:18and the fee is based on dollars per metric ton

12:23and the metric tons that they are responsible for emitting.

12:27So we started with a lower price tax back in 2012,

12:32and this was only applicable to scope one and two emissions,

12:35so it didn't get at our supply chain

12:37or the use of our products.

12:39We raised that price to $15 a metric ton

12:43a couple of years ago,

12:45and then we expanded our internal carbon tax

12:48to our scope three emissions this year at a lower price,

12:51but it's gonna go up every year

12:52till it gets to $15 as well.

12:55And what I have found is that it's really done three things.

12:58First, it really galvanizes people's attention.

13:02They now know if they're a manager or they run a department,

13:06they know what they're doing that is emitting carbon.

13:10Second, it gives them an incentive

13:12to reduce their emissions.

13:15Typically, when a government has a tax,

13:17it's thinking about it

13:18as a long-term sustainable source of revenue.

13:21Well, the interesting part about this is

13:23we have revenue projections,

13:25and they go up and then they go down over time

13:28because we believe that just having to pay this

13:31is creating the right incentives

13:33for people to reduce their carbon.

13:36The third thing it does

13:37is it does create a really valuable source of revenue.

13:41We use that money in our sustainability work

13:45to make ourselves more efficient,

13:50to reduce our energy consumption,

13:52to become greener, to use more renewable energy.

13:56One of the fascinating things I'm just finding

13:58in the last few months

14:00is we've taken some of the added revenue

14:03generated by the expansion of this internal tax

14:06to scope three emissions,

14:08and we've issued an RFP.

14:10We've issued an RFP to go purchase around the world

14:14services to remove a million metric tons of carbon

14:19from the environment in this year alone.

14:22It's probably the biggest RFP of its kind,

14:26and I think when we can do that type of thing,

14:30I think we can have an outsized impact

14:32in sending signals to the market

14:35that will hopefully encourage even more investment

14:38in things like carbon removal technology.

14:41So from my vantage point,

14:42the ability to apply this tax

14:44and put it to this kind of use

14:46has been an absolute game changer for Microsoft.

14:51So it gives us some hope

14:53that if we use these market mechanisms in society at large,

14:58these kinds of motivations

14:59can be more ubiquitously distributed in the economy.

15:05Obviously, getting the full economy zeroed in on this

15:08is really an important role.

15:11There's a couple of other points, I think,

15:13in your work that you all announced this year

15:16that I think are worth a little bit of comment on.

15:18You also identified a billion dollar fund

15:22that you wanted to use,

15:23which I think is different than the revenue adjustments

15:26from the internal carbon tax.

15:29Do you see that aligning with some of the challenges

15:32you still see that use that fund

15:34to try to look at some of the emerging technologies

15:37and maybe help motivate some investments by others?

15:43I absolutely do.

15:44And that was another part of our January announcement.

15:47We created a billion dollar climate innovation fund

15:52to specifically invest in, among other things,

15:55but with a high priority,

15:57new technologies that would advance, say, carbon removal.

16:03And one of the things that I think

16:04is so interesting to consider

16:07is that there is an enormously large and important industry

16:11that doesn't yet really exist.

16:14Call it the carbon removal industry.

16:17It reminds me of being a college student in the 1980s,

16:23and I still remember sitting on an airplane flight,

16:27going from the Northeast back to the Midwest,

16:29just happened to be seated next to a person who said,

16:33you know, there's this thing

16:34that's gonna become really important.

16:36It's gonna be an industry of the future.

16:38And I said, what is it?

16:40And the woman sitting next to me said, it's called software.

16:44And I really didn't know what it was.

16:46I never imagined that that's where I would spend my career

16:50and my professional life.

16:52Well, the message I think for somebody

16:55who is going through college today

16:57is there is going to be an industry

17:00that will need to be one of the biggest industries

17:02on the planet in the middle of this century,

17:05the industry to remove carbon from the environment.

17:08It needs, like software was and is,

17:11to be technologically driven.

17:14There are so many innovations,

17:16so many things that are gonna need to be invented

17:20to really build at scale the kinds of tech

17:24that will say, capture carbon in the air,

17:27remove it from the air, deposit it deep in the earth

17:31so it doesn't come back.

17:33And when we put our billion dollars at work in this space,

17:37we really did it with two things in mind.

17:39One is to stimulate investment in this space

17:43in new inventions.

17:45But two, to send a market signal.

17:47And I think the market signal may be even more important.

17:50What we said is,

17:51we're not gonna be in the carbon removal industry,

17:54but we wanna buy the services

17:57from the industry that is created.

18:00And hence show that there's not just supply of money

18:03for innovation, but demand for its use once it's created.

18:08Which gets to, well, first of all,

18:10sticking with this for just a second,

18:12and particularly the carbon removal,

18:14you all have identified nature-based approaches

18:20as part of the scenarios you're looking at.

18:26Have you looked at the interrelationship

18:28on the sustainability platform

18:31between nature-based solutions,

18:33perhaps for carbon sequestration and water quality,

18:37which you just talked about this week?

18:42It is something that we've looked at.

18:45The first thing I would say is,

18:46if you want to remove carbon

18:48from the environment in the year 2020,

18:51you really are focused mostly on nature-based solutions.

18:55I would hope that by the year 2030,

18:58we might have more technology-based solutions

19:01that will be more affordable.

19:02But for today, it's the year 2020.

19:05And there is a very close connection

19:08for the reason that you're alluding to.

19:11Namely, oftentimes today,

19:14one of the keys to nature-based solutions

19:16is the planting of more trees.

19:18Now, I think it's very important

19:20that when companies commit to this type of thing,

19:24that they frankly commit not just to pay people

19:27to keep the trees that are there now,

19:28because that's just paying people literally to do nothing.

19:31It's a good thing, but it's not gonna plant more trees.

19:34You know, we need to, as we are,

19:36commit to plant more trees,

19:39plant trees that would not otherwise be planted,

19:42and actually have a strategy

19:45that looks beyond the lifespan of a tree.

19:48Because, you know, when a tree dies or is cut down,

19:52you basically lose the benefit

19:54of the carbon sequestration in which you invested.

19:57But the connection to water quality is also clear.

20:01You know, in so many places,

20:03deforestation, you know, has impacted water quality.

20:08So if we're gonna improve water quality,

20:10we need to think about the ecosystems

20:13in which, you know, are involved,

20:15are inherent in the quality of water.

20:19It's why we've made biodiversity one of our four pillars.

20:23You know, and you see this, of course,

20:25in places like the Amazon and the tropics,

20:27but you see it in more northern climates as well,

20:30where, you know, for example, the ecosystem is suffering.

20:33There are fewer salmon

20:37in the Pacific Northwest of the United States,

20:40in part because of forestation changes

20:43that has led to water changes

20:46that has led to a decline in the habitat for salmon.

20:49You know, all of this, as you know,

20:50is a constant reminder of how connected we are,

20:54all of us on this planet.

20:57Yeah, that sort of puts the climate change issues

21:02as a force multiplier on top of all these other impacts

21:06that we've had, which is really an important reason

21:08that you guys are looking across

21:10a more broader sustainability group of exercises and work.

21:17You mentioned cement earlier.

21:20I just want to talk about that for 30 seconds here,

21:23or not 30 seconds, but just for a few seconds here.

21:26You know, you've talked about using your procurement,

21:29and you just alluded to it a little bit with the fund.

21:32Talk a little bit about what you're thinking there,

21:34and the supply chain, and using procurement

21:39potentially standards that you might have on them.

21:42Well, in a way that I could never have imagined

21:46just a year ago, I can get very excited about cement.

21:49It's not something that I was familiar with,

21:52but of course, you know, it's part of everywhere we live.

21:55It's the foundation of our buildings.

21:57For many people's homes, it's their basements.

22:01And of course, you know, cement is created

22:04in part because of very high temperatures

22:08that involve the emission of a lot of carbon.

22:12You know, so what we have to think about

22:14when it comes to cement is sort of a microcosm,

22:16I think, of almost every issue.

22:19You know, what I find when I talk to government leaders,

22:21or when I talk to other people

22:22who really understand these issues well,

22:25like Bill Gates, with whom we have the good fortune

22:28to discuss these issues and work together regularly,

22:32you almost have to start by drawing a pie chart,

22:35if you will, what are all of the different things

22:38in the economy that generate carbon,

22:40and what percentage of our carbon emissions

22:42are attributable to them?

22:44And one of the things you do find

22:47is that the cement contributes to a lot of carbon emissions.

22:52You know, we then have to start to contemplate,

22:55well, how can we change that?

22:58And, you know, there is now emerging a vibrant discussion

23:01around green cement, but in order to get there,

23:05you have to really think about the so-called green premium.

23:08And the green premium, of course, is, you know,

23:11the extra cost associated with creating a greener form

23:17of a particular product, in this case, cement.

23:20And we'll have to then think about just the economics

23:23and the logistics of advancing the economy

23:26in that direction.

23:28Now, for a company like Microsoft,

23:30we can take certain steps on our own.

23:32We're building a huge addition to our campus,

23:3617 new buildings east of Seattle.

23:39You know, and so in some cases, we can afford

23:43to spend the extra money to get greener cement,

23:46or we can afford to put in other raw materials

23:50that would be, say, a substitute,

23:52in some instances, for steel,

23:53which is another big issue together with cement.

23:57But ultimately, I think what we're all gonna have

24:00to spend more time doing is really thinking

24:02about systemic changes, you know,

24:05that will lead to real structural change

24:09in these different parts of the economy.

24:11Putting a price on carbon is obviously one way to do it.

24:14If you put a price on carbon at its source,

24:17that then goes through every part of the economy.

24:20That might be a path.

24:21But I just think it's one piece of, you know,

24:24what is really, you know, sort of the puzzle of our time,

24:28the challenge of this decade,

24:30the kinds of things we're gonna have to come together

24:32to discuss and then really take more action to address.

24:37I'm very excited.

24:38I just had a conversation with the president

24:40of a software company about cement, so.

24:44But you made it clear.

24:46You use cement in your company,

24:48as well as people in your supply chain.

24:50And so when I talk to people in the cement industry,

24:52they say, we need more people wanting our greener cement.

24:54So here's another place where government

24:57and private sector can work together to get this done.

25:00So let's cover one more subject before we have to finish.

25:04And I really appreciate your views on all of these things.

25:07But this gets us to the larger economic development

25:10of the United States and the world.

25:12You know, we often hear,

25:14and I'm sure you hear this all the time,

25:16that there's a conflict between being green,

25:18you raised one of the issues just now,

25:21and, you know, dealing with climate change and the economy.

25:24And obviously our economy is going

25:26through some transitions already.

25:29How do you see the role of tackling some

25:32of these sustainability and climate issues

25:35in economic development,

25:36and also in particular in our current world that we are in,

25:39with recovery from the current recession

25:43that's been brought on by a pandemic?

25:46Well, I would say two things.

25:48I mean, first, I think like a lot of economics,

25:53it starts with demand and consumer demand.

25:56You know, when consumer demand shifts,

26:00people who create products

26:02suddenly start to think differently.

26:05In the 1960s, there was a huge debate in the United States.

26:09Should auto manufacturers be required

26:12to put in a seat belt?

26:14Should they be required to put a safety bag,

26:19an airbag in the front seat?

26:22And if you look back at the history of that debate,

26:25there were people in government, and Ralph Nader,

26:29arguing that car makers should have to do more.

26:32And there were, frankly, people in the industry

26:34arguing that they should have to do less,

26:37because they saw it as sort of a regulatory tax,

26:40overhead, if you will.

26:42And then suddenly there became a point in time

26:44in the 21st century,

26:47when the last thing a car maker would want to do

26:50is sell a car that didn't have seat belts or an airbag.

26:54It had nothing to do at that point with the regulations.

26:57It had everything to do with consumer expectations.

27:01People didn't want to buy a car that lacked these things.

27:05And this, to me, is one of the perhaps biggest hopes

27:08we have for the future.

27:10It is a younger generation

27:12that is becoming more and more important every year

27:15in terms of their purchasing power.

27:18They are people who care deeply

27:20about having a more sustainable planet.

27:23And one vision that I have

27:27is that perhaps by the year 2030,

27:30you'll be able to go into the grocery store

27:32and look at any product on the shelf.

27:35You'll be able to look at a car.

27:37And one of the things you'll see

27:39is how much carbon was emitted to create that product.

27:44And if you want,

27:46you can choose the lower carbon alternative,

27:50just the same way you may choose

27:52the lower calorie alternative today.

27:55And it doesn't mean that everybody will make that choice,

27:58but everyone will be empowered to choose.

28:01And I think when you get to that point,

28:05you'll see business and the market

28:08shift even more rapidly than it is today.

28:11And in part, it will take at the end of this process,

28:14a law, it will take a regulation

28:16to say that everyone has to report this on their products.

28:20But before we get to that day,

28:21we first have to develop a reliable way

28:23to measure carbon emissions

28:25in every part of the supply chain.

28:27That's why we're innovating this year

28:30and requiring all of our suppliers

28:33to work with us on standardized reporting.

28:37And once we experiment,

28:40we incubate together with other companies,

28:43we're working with other companies

28:45that share our interest,

28:46we can then create a standard

28:48that may be adopted across an industry.

28:50The entire cement industry, for example,

28:53might measure its carbon emissions in the same way.

28:57So you go from individual experimentation

29:00and incubation to standards,

29:02to ultimately to law,

29:04to the empowerment of people.

29:07And I think that is a decade that should excite us all.

29:13And that to me is where a company like Microsoft

29:17and those of us in business more generally,

29:20have a lot to contribute,

29:22but it does really bring together all of these pieces,

29:26not just in one country, but frankly, on a global basis.

29:31Well, Brad, I think we're out of time,

29:34but I think we covered the landscape

29:37that we needed to cover.

29:38But I also, I wanna once again, thank you

29:41and also your entire team for the work that they do.

29:46Your ambitions rub off on other people in business,

29:53not only in the tech industry,

29:55but also in other parts of the economy.

29:57And so we're really appreciative

30:00of the work that Microsoft does.

30:02I'm especially appreciative of you taking the time

30:04to be our first conversation in EarthX CEO.

30:09So thank you so much for coming today and enjoy New York.

30:13Well, thank you.

30:14I'll just say in conclusion,

30:15this is an area where I think healthy competition

30:17between companies makes us each better.

30:20We each learn from each other.

30:22This is competition that in a literal way

30:25can help us save the world.

30:26So we're very excited to be a part of it.

30:33The scientific consensus is clear.

30:36The world has a huge carbon problem.

30:39Humans have released more than 2 trillion metric tons

30:43of greenhouse gases into the Earth's atmosphere

30:46since the start of the first industrial revolution.

30:50And the vast majority of these emissions

30:52have occurred since the mid 1950s.

30:55This is more carbon than nature can reabsorb.

30:58And every year, humanity pumps out

31:00more than 50 billion additional tons of greenhouse gases.

31:05This blanket of carbon in our atmosphere

31:08is heating the planet and changing our climate.

31:11And this isn't a problem that lasts just a few years

31:15or even a decade.

31:16Once excess carbon enters the atmosphere,

31:19it can take thousands of years to dissipate.

31:22Already, the planet's temperature

31:24has risen by one degree Celsius.

31:27And if we don't curb emissions

31:28and temperatures continue to climb,

31:30science tells us that the results will be catastrophic.

31:34In fact, scientists agree that if we don't do anything,

31:38temperatures could rise somewhere between 1 1⁄2

31:41and 4 1⁄2 degrees Celsius.

31:43So what can we do?

31:45Well, it starts by understanding

31:48and getting real about carbon math.

31:52Scientists account for carbon emissions

31:54by classifying them into three categories or scopes.

31:58Scope one emissions are the direct emissions

32:01that your activities create,

32:03like the exhaust from the car you drive.

32:06Or for a business, the trucks it drives

32:09to transport its products from one place to another

32:12or the diesel generators it might run.

32:14Scope two emissions are indirect emissions

32:17that come from the production

32:19of the electricity or heat you use,

32:22like the traditional energy sources

32:24that light up your home

32:25or power the buildings owned by a business.

32:29Scope three emissions are the indirect emissions

32:32that come from all the other activities

32:34in which you're engaged,

32:35including the emissions associated

32:37with producing the food you eat

32:39or manufacturing the products that you buy.

32:42For a business, these emission sources can be extensive

32:45and must be accounted for across its entire supply chain,

32:49from the materials in its buildings,

32:52the business travel of its employees,

32:54to the full lifecycle of its products,

32:57including the electricity that customers may consume

33:00when using something like a phone, laptop,

33:03or gaming console.

33:05Given this broad range,

33:06a company's scope three emissions are often far larger

33:09than its scope one and two emissions put together.

33:13And this accounting is important

33:14because if we're going to avoid the worst aspects

33:17of a rapidly changing climate,

33:19then the world must reduce its carbon emissions

33:21and reach net zero across all scopes.

33:25Now, net zero doesn't mean

33:27that there will no longer be any carbon emissions at all,

33:30but it does mean that the world will need to remove

33:33as much carbon as it emits.

33:36This will require two things.

33:38First, we'll need to reduce carbon emissions

33:41very substantially over the next few decades.

33:44And second, we'll need to remove carbon from the atmosphere,

33:47starting with nature-based removal approaches,

33:50but ultimately through including

33:51new carbon removal technologies,

33:54like direct air capture approaches

33:55that literally remove carbon from the air.

33:58And while the world will need to reach net zero,

34:01those of us who can afford to move faster

34:03and go further should do so.

34:05That's why Microsoft is committing

34:08to become carbon negative by 2030,

34:10meaning that we'll reduce our emissions by half

34:13and remove from the atmosphere more carbon than we emit,

34:16including all of our scope one, two, and three emissions.

34:21It's why we're also committing to remove, by 2050,

34:25all of the carbon Microsoft has emitted,

34:28either directly or by electrical consumption,

34:31since it was founded in 1975.

34:34Simply put, the stakes are too high

34:36for us to not make bold changes now.

34:40The world is counting on all of us to act.

34:43EARTHX.TV, our planet from every side.

Brad Smith, Microsoft | EarthxCEO S1E1 | EarthX

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