Technology & Innovation
The growth of climate solutions and expansion of the climate innovation ecosystem has been on a rapidly accelerating trajectory. Yet, as the effects of climate change become more difficult to ignore and more money pours into the sector than ever before, those spearheading climate efforts—whether corporations, investors or entrepreneurs—still haven’t been able to convince skeptics that the intersection of climate and business is critical to our collective future.
One of the main culprits of this is simply language. Mainstays of the climate lexicon like “ESG” and “impact” have lost their luster. Instead of encouraging faster and more intentional movement on climate, these terms now often result in confusion, ambiguity and even distrust. Their meaning can also change from person to person or company to company, surrendering a standard definition for terms an entire sector has come to rely on. Even BlackRock CEO Larry Fink, who helped to catapult ESG into the mainstream, is rethinking what the acronym means and how to use it.
To further advance climate action and innovation, what’s needed now is to flip the switch on messaging industry-wide. This means turning seemingly nebulous concepts into clear descriptions that showcase real-world results. After years of discussion around the potential of climate innovation, we are well past speculation. Just look at the growth in renewable energy or the ongoing rise of electric vehicles. We are now in the era of climate outcomes versus ideas—and our language should reflect that.
Be specific and direct in defining what you do
The first step any company should take is to reevaluate how they position themselves in the market. This includes defining what the company does as it relates to the climate and why this is important, in simple and concrete terms.
Rather than leaning on words that can be interpreted in a variety of ways, like “ESG” or “impact,” define specifically what these terms mean to you and use this more exact language. Peel back the layers of your company and think critically about how your business or technology is able to effect change across the climate landscape. For instance, is your goal to reduce emissions, increase safety in disaster-prone areas, comply with the latest regulatory guidance or help build a climate workforce? How specifically do you achieve this and what tangible results do you enable for people, companies and the broader ecosystem (whether business or planetary)?
Talk about business outcomes and growth
Due to the lack of specificity around language, so much of the climate conversation today has gotten lost in debates around ESG and who or what actually benefits from it. To move beyond these disputes, get back to the basics: business fundamentals.
Show that businesses that merge climate and capitalism are not just good for the planet, but are also good for a company’s bottom line. In fact, a 2022 study found that financial results exceeded expectations for nearly ¾ of businesses taking action to combat climate change.
To do this for your own company, use numbers, data and analysis to demonstrate how a focus on climate is growing your business or your customer’s business. To clearly link climate and returns, consider outputs and hard numbers that reinforce your vision and business strategy, like profitability, revenue, scale potential, or even helping to boost local economies.
Lean on real-world use cases
The realities of successful climate-driven business is not something that we are waiting on to materialize—it’s happening now. Companies across the globe are either inventing or investing in new innovations or implementing strategies that allow people, businesses and entire industries to operate more efficiently while vastly decreasing emissions.
Take Fervo Energy, for example, which recently successfully achieved a technological breakthrough of its geothermal solution. Or Redwood Materials, which earlier this year shared an update on the company and its progress on battery recycling for EVs.
Like these companies, back up your numbers and vision with how your technology or business strategy has played out in the real world. Creating case studies that reveal important metrics, like emissions reduced, money saved or other quantifiable outcomes, are one of the most powerful tools to build widespread credibility—both for you and the broader climate sector.
Through clearer, more descriptive language, companies will be better positioned to accelerate action and innovation—and actually realize the climate commitments they’ve set out to achieve. With strong tailwinds behind the climate ecosystem today, from technology and investment to policy and beyond, it’s crucial we capitalize on this opportunity.