Speaker 1: You're listening to Bloomberg Business Week with Carol Messer and
Speaker 1: Tim Stenebek on Bloomberg Radio.
Speaker 2: Envoys representing more than one hundred and ninety nations they're
Speaker 2: going to be gathering for COP twenty eight, the UN's
Speaker 2: annual Climate change Conference Bailly. It's held in Dubai later
Speaker 2: this week. You know, with everything going on, we can't
Speaker 2: forget that world leaders have made commitments when it comes
Speaker 2: to climate change.
Speaker 3: Yeah, no, it's definitely interesting. And I don't know if
Speaker 3: you saw the big take about China's remote deserts hiding
Speaker 3: an energy revolution see that head of COP twenty eight.
Speaker 3: So definitely top of mind as always, but even more
Speaker 3: so given the week ahead.
Speaker 2: Yeah, and think about the year that we've had right
Speaker 2: in terms of the hottest on record in terms of
Speaker 2: the climate. So let's get to it because someone who
Speaker 2: will be there. We know that the world's two largest polluters,
Speaker 2: the heads of those nations we're talking about, President Biden
Speaker 2: and Chinese President Xijimping, they will not be there, but
Speaker 2: our next guest will be there. Katie mcguindy is VP
Speaker 2: and Chief Sustainability Officer at Johnson Controls. They make building
Speaker 2: HVAC systems, building management and fire detection systems, security solutions,
Speaker 2: and a lot more. She joins us on zoom from Milwaukee. Katie,
Speaker 2: how are you doing terrific?
Speaker 1: How are you today?
Speaker 2: Doing well? Doing well? It's kind of a quiet day
Speaker 2: after what's been a chaotic year to say at least.
Speaker 2: First of all, I know you're head to Dubai, But
Speaker 2: tell us what do you think the significance is of
Speaker 2: presents Biden ag not being there. We know the two
Speaker 2: have held some talks recently to step up action joint
Speaker 2: action when it comes to climate change, So that's the
Speaker 2: good news, But their physical presence not being there, what's
Speaker 2: your view on that?
Speaker 1: Well, Look, ideally they would all be there because this
Speaker 1: is a critically important issue at a very sensitive and
Speaker 1: important time. However, I know they will be well represented
Speaker 1: and there is I think significant momentum in the direction
Speaker 1: of progress on important dimensions of the climate issue that
Speaker 1: both can tackle the problem as well as open up
Speaker 1: new opportunities.
Speaker 3: Well, Katie, decisions right, correct me if I'm wrong. They
Speaker 3: have to be unanimous. So how does that play into
Speaker 3: what we're going to hear and see from COP twenty eight?
Speaker 1: Yeah, it was an excellent point. And when you think
Speaker 1: of one hundred and ninety countries coming together and reaching
Speaker 1: agreement on issues that go to the heart of their economies,
Speaker 1: it is remarkable how much progress has been made. And
Speaker 1: I think as we look at the issues that are
Speaker 1: top of the agenda, tripling renewable energy, doubling energy efficiency,
Speaker 1: those are policy priorities that can drive common ground because
Speaker 1: they hit a trifecta. They help the environment, but they
Speaker 1: also grow economies and provide good, home grown new jobs.
Speaker 1: So I think that's a recipe to enable progress to
Speaker 1: accelerate at this conference of the parties.
Speaker 2: Well, we've definitely seen here in the United States the commitment,
Speaker 2: the investment and you know, through legislation to help when
Speaker 2: it comes to renewable energies, and that's certainly a significant way.
Speaker 2: What I do wonder about is that governments are increasingly
Speaker 2: around the world, the US included, Katie, you know that
Speaker 2: their budget deficits are growing, and I do wonder what's
Speaker 2: going to be cut going forward. So how are you
Speaker 2: thinking about that and the impact it could have on
Speaker 2: progress when it comes to climate moves.
Speaker 1: Well, I do think that those policies that send a
Speaker 1: market signal that the investment direction is in a climate
Speaker 1: friendly way or incredibly important. They're coupled though, by a
Speaker 1: business imperative that in buildings, for example, as you note
Speaker 1: that Johnson Controls is a one hundred and forty year
Speaker 1: young sustainable building technology company, and you know, we are
Speaker 1: all about both cutting carbon in buildings as well as
Speaker 1: giving a favor to the bottom line. So you know,
Speaker 1: buildings are forty percent almost of global greenhouse gas emissions,
Speaker 1: and that's just a lot of waste. When we get
Speaker 1: in there and electrify those operations and put a digital
Speaker 1: platform so you can have data, put data to work.
Speaker 1: We're seeing buildings where we're cutting their carbon by seventy
Speaker 1: plus percent while saving them more than sixty percent in
Speaker 1: their electric bills. So that is a recipe to enable
Speaker 1: us to both get on and accelerate action as we
Speaker 1: have to do on climate while lifting economies and accelerating growth.
Speaker 3: Well, Katie, how easy is it to deploy those technologies
Speaker 3: and kind of what regions of the world are actually
Speaker 3: set up to have things like that deployed and utilized
Speaker 3: in their buildings.
Speaker 1: Yeah, you know, it's a great question because people think, well,
Speaker 1: maybe it's just for brand new and state of the
Speaker 1: art buildings, but it's not that is the case, or
Speaker 1: maybe it's just for buildings that are in the sunniest
Speaker 1: parts of the planet where you can use solar energy.
Speaker 1: We have worked both on the one end of the
Speaker 1: spectrum with public housing authorities, community colleges where every dollar
Speaker 1: is precious and we can knock twenty thirty forty percent
Speaker 1: off the energy bills there and an equal amount of
Speaker 1: carbon so that the carbon footprint, you're doing right by
Speaker 1: the planet while you're doing right by your pocketbook. We
Speaker 1: have buildings that are way north of the Arctic Circle
Speaker 1: that not only are net zero buildings, they actually generate
Speaker 1: more electricity than they consume and they give the rest
Speaker 1: of it back to the surrounding communities through what's called
Speaker 1: district energy loops. So these technologies work in every building,
Speaker 1: and for every building, there is the opportunity to make
Speaker 1: the people who live, work and play in those buildings healthier,
Speaker 1: more productive, more engaged, while you are also dialing down
Speaker 1: that energy bill and dialing up doing your part for
Speaker 1: the planet. And I think what we have found is,
Speaker 1: you know, sometimes I think of ESG is becoming JGB
Speaker 1: just good business. Shareholders expect it, they see the weather
Speaker 1: events that have been happening. They want to know their
Speaker 1: investments or future proof attracting the best and brightest talent.
Speaker 1: Young people are being cleared. They want to work with
Speaker 1: purpose driven companies. And it is true that customers are
Speaker 1: voting with their dollars as well to say give me
Speaker 1: a sustainable option. So I think it comes together for progress.
Speaker 2: Katie, no argument there, and again I feel like these
Speaker 2: are the arguments that have been around for a couple
Speaker 2: of years. Understanding that people want it. It makes good sense,
Speaker 2: it's good for the environment. Having said that, if you're
Speaker 2: a publicly held company, yeah, you get also make sure
Speaker 2: that your shareholders are happy a old timely otherwise it's
Speaker 2: going to be tricky. And I understand this idea of
Speaker 2: it's good business, but you know, sometimes you've got to
Speaker 2: make a decision between a CAPEX spend that's going to
Speaker 2: move the needle more when it comes to earnings versus
Speaker 2: doing the right thing. So how do we get around that.
Speaker 1: It's a great point, and we actually have new research
Speaker 1: that we'll be releasing very soon. Here a poll of
Speaker 1: three thousand and five hundred senior executives, and they are
Speaker 1: pointing exactly to a couple things. First of all, that
Speaker 1: sustainability is a top business priority. A third of them
Speaker 1: have made great progress against their commitments to reduce climate change,
Speaker 1: but they all are saying, look, we don't necessarily have
Speaker 1: the upfront capital, and we need partners to help us
Speaker 1: accelerate our progress. I guess the bright side of the
Speaker 1: downside that buildings are forty percent of global greenhouse gas
Speaker 1: emissions is that when we make those buildings more efficient,
Speaker 1: those interventions cash flow to the extent that companies like
Speaker 1: Johnson Controls now offer net zero as a service. We'll
Speaker 1: pay all that upfront capital because we know we'll see
Speaker 1: a return and the incredible savings on the back end.
Speaker 1: So that is something that is very important. It's a
Speaker 1: solution that people need because in these days where you're
Speaker 1: worried about are we going to have a recession or not,
Speaker 1: every dollar needs to go to the purpose of that
Speaker 1: business and this can help when you embrace decarbonization in
Speaker 1: a smart way.
Speaker 3: And Katie, we only have about twenty five seconds here,
Speaker 3: but as Carol mentioned, a lot of companies and a
Speaker 3: lot of leaders will talk, but will they actually make
Speaker 3: action happen. What is going to happen this week, and
Speaker 3: what actually can we take away from a meeting of
Speaker 3: leaders again really quickly.
Speaker 1: Yeah, there'll be some tough things like writing the check
Speaker 1: to enable developing countries to grow in a more sustainable way,
Speaker 1: and that'll be tough to reach agreement. But I think
Speaker 1: we're going to see great progress on energy efficiency or
Speaker 1: renewable energy and in understanding that we can grow the
Speaker 1: world's economy even as we cut global greenhouse gas emissions.
Speaker 1: And that's the imperative for us to do right now.
Speaker 2: And gotta ask, all right, we'll certainly be looking for
Speaker 2: some headlines out of a Cup twenty eight later on
Speaker 2: this week. Katie mcguinny, VP and Chief Sustainability Officer at
Speaker 2: Johnson Controls on Zoom from Milwaukee