Podcasts about sustainability research

Sir Danny Alexander, CEO, HSBC Infrastructure Finance & Sustainability, and Eric Francia, President and CEO, ACEN, join Zoë Knight, HSBC's Global Head of Sustainability Research and Integration, for an insightful conversation on financing sustainable infrastructure.Watch or listen to their discussion about the new energy economic multiplier impact, barriers to project finance, and the innovative solutions that can help catalyse financing for sustainable infrastructure.This episode was recorded on the sidelines of the HSBC Global Investment Summit in Hong Kong on 26 March 2025. Find out more here: grp.hsbc/gisDisclaimer: Views of external guest speakers do not represent those of HSBC.

In this week's episode of ASEAN SPEAKS, our host Thilan is joined by our Regional Equity Strategist, Anand Pathmakanthan, to unpack the equity implications of Trump's Liberation Day tariffs, especially for ASEAN markets like Vietnam, Thailand, and Malaysia.Our Co-Head of Macro Research, Dr Chua Hak Bin, shares his views on the economic impact, including ASEAN growth downgrades and how China's retaliatory measures could shape the road ahead.Zooming in on Singapore, Thilan discusses why the STI's sharp drop could still present buying opportunities, and highlights key names in our Trump Tariff Winners portfolio.Our Head of Sustainability Research, Jigar Shah, introduces our latest ESG portfolio for Singapore, explaining how companies with strong sustainability practices are proving more resilient amid market volatility.Edited by Xuan Hao, Dion, Bruce

In this episode, we speak with Matteo Mirolo, Director of Strategy & External Relations at Contrails.org, a science-led nonprofit initiative aimed at transforming contrail research into practical climate action. Mirolo discusses:The substantial climate impact of contrails, which are responsible for 1-2% of human-caused global warming and have roughly the same warming effect as all aviation CO2 emissions since the jet age.The concentrated nature of the problem, with just 5% of flights causing about 80% of aviation's contrail warming effect, primarily over Europe, North America, and the North Atlantic.Contrails.org's three-pillar approach focusing on science (improving understanding of contrail impacts), technology (developing open-source tools and protocols), and adoption (raising awareness and fostering incentives).The cost-effectiveness of contrail mitigation compared to other decarbonisation options, with studies suggesting only 0.11% extra fuel burn across airline fleets.The vision for seamless integration into airline operations, where contrail avoidance becomes as routine as avoiding turbulence or adverse weather.Contrails.org seeks to be an open, collaborative space, with Mirolo likening it to “a tent under which people can put their furniture.” Its goal is to address the contrail issue through collective effort, recognising that effective management requires coordination across the aviation sector.If you LOVED this episode, you'll also love the conversation we had with Alejandra Martín Frías, Head of Sustainability Research at FLIGHTKEYS, who shared insights into the company's research on contrail avoidance. Check it out here. Learn more about the innovators who are navigating the industry's challenges to make sustainable aviation a reality, in our new book ‘Sustainability in the Air'. Click here to learn more.Feel free to reach out via email to podcast@simpliflying.com. For more content on sustainable aviation, visit our website green.simpliflying.com and join the movement. It's about time.Links & More:Contrails.orgHow airplane contrails are helping make the planet warmer - Yale e360 Feasibility of contrail avoidance in a commercial flight planning system: an operational analysis - IOPscience Understanding contrail management: opportunities, challenges, and insights - RMIThis episode is brought to you by 4AIR. 4AIR is leading the way with the industry's first framework to address aviation's climate impact—offering clear, verifiable pathways to reduce and counteract aircraft emissions. For more information, please visit: https://www.4air.aero/

In this episode of the Sustainability Podcast, host Jim Frazer dives deep into the dynamic world of industrial automation and the energy transition with two distinguished guests from Schneider Electric: Elias Panasiuk, EcoStruxure Power and Process Execution Director, and Thomas Kwan, Vice President of Sustainability Research. The discussion explores the rapid advancements in renewable energy technologies, the critical role of electrification, and the integration of smart systems such as AI and IoT in transforming manufacturing processes. Elias and Thomas share compelling insights and real-world examples highlighting the economic and sustainability benefits of these innovations. They also emphasize the importance of open automation platforms, collaboration across industries, and the pivotal role of human expertise in driving the energy transition. Tune in to discover how these developments are shaping a more sustainable future and the strategies leaders can adopt to stay ahead in this evolving landscape --------------------------------------------------------------------------Would you like to be a guest on our growing podcast? If you have an intriguing, thought provoking topic you'd like to discuss on our podcast, please contact our host Jim Frazer or Our Producer Tom CabotView all the episodes here: https://thesustainabilitypodcast.buzzsprout.com

In 2024, the University of New South Wales (UNSW) held a panel discussion on Degrowth as part of their Centre for Ideas series. The panellists were Tommy Wiedmann (Professor of Sustainability Research), Bronwen Morgan (Professor of Law and member of NENA), and Sabrina Chakori (CSIRO researcher). The discussion was hosted by former Deputy Lord Mayor and author of Glimpses of Utopia, Jess Scully. The panel explored sustainability and the urgent challenge of ensuring human needs are met without compromising a sustainable and inclusive future. With the kind permission of UNSW Centre for Ideas, the recording of this panel discussion is now available to listen to on the Post-Growth Australia Podcast (PGAP). Tommy Wiedmann has been a supporter of PGAP since our early days in 2021, so it was great to hear him in his element, sharing his research, knowledge, and ideas on Degrowth. We really appreciate Tommy and panel host Jess Scully giving PGAP a shout-out towards the end of the talk. We hope to return the favour by sharing this insightful discussion, which serves as an excellent introduction to Degrowth for those new to the topic. It is encouraging to see Degrowth becoming an openly discussed subject in Australian universities. Tommy also wrote a very encouraging review for PGAP on Apple Podcast (https://podcasts.apple.com/au/podcast/post-growth-australia-podcast/id1522194099). We warmly invite you to add your review. This will help to broaden our outreach and encourage new listeners. Please also feel welcome to contact us (https://pgap.fireside.fm/contact) with your feedback or suggestions for future episode topics. Co-hosts Mark Allen (https://holisticactivism.net/) and Michael Bayliss (https://michaelbayliss.org/)share their thoughts on the panel discussion in the introduction and conclusion. For the most part, we align with the perspectives of the four panellists, but we also provide additional thoughts on how the Degrowth movement can incorporate concerns around population, which we briefly touch on in our commentary. For a more in-depth analysis, we encourage you to read the PGAP blog: “To populate or not to populate? How we can come together around the eternal debate of everyone's favourite vexed issue. (https://pgap.fireside.fm/articles/population)” We also encourage listening to two recent PGAP episodes on population, including Anne Poelina (https://pgap.fireside.fm/annepoelinapatron), who brings a First Nations' perspective to the debate, and Isaac Kabongo (https://pgap.fireside.fm/isaaceco), who brings a Ugandan/Global South perspective. Regarding the discussion on population, Tommy cited two particularly relevant scientific articles, which are well worth reading: Lamb, W. F., Wiedmann, T., Pongratz, J., Andrew, R., Crippa, M., Olivier, J. G. J., Wiedenhofer, D., Mattioli, G., Khourdajie, A. A., House, J., Pachauri, S., Figueroa, M., Saheb, Y., Slade, R., Hubacek, K., Sun, L., Ribeiro, S. K., Khennas, S., de la Rue du Can, S., Chapungu, L., Davis, S. J., Bashmakov, I., Dai, H., Dhakal, S., Tan, X., Geng, Y., Gu, B. and Minx, J. (2021) A review of trends and drivers of greenhouse gas emissions by sector from 1990 to 2018. Environmental Research Letters, 16, 073005. http://dx.doi.org/10.1088/1748-9326/abee4e (. http://dx.doi.org/10.1088/1748-9326/abee4e) Kikstra, J. S., Mastrucci, A., Min, J., Riahi, K. and Rao, N. D. (2021) Decent living gaps and energy needs around the world. Environmental Research Letters, 16, 095006. https://dx.doi.org/10.1088/1748-9326/ac1c27 (https://dx.doi.org/10.1088/1748-9326/ac1c27) We would like to thank UNSW, the Centre for Ideas, and all four speakers for allowing PGAP to re-release this outstanding panel discussion. The original podcast of this discussion is available to listen to on the Centre for Ideas website HERE. (https://unswcentreforideas.com/article/degrowth) All views, opinions, and legacies—past and present—of the panellists and UNSW Centre for Ideas are their own and may not necessarily reflect the views and opinions of PGAP (and vice versa). Special Guests: Bronwen Morgan, Jess Scully, Sabrina Chakori, and Tommy Wiedmann.

Our analysts Ariana Salvatore, Stephen Byrd and Devin McDermott discuss President Trump's four executive orders around energy policy and how they could reshape the sector.----- Transcript -----Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Morgan Stanley's U.S. Public Policy Strategist.Stephen Byrd: And I'm Stephen Byrd, Morgan Stanley's Head of Research Product for the Americas and Global Head of Sustainability Research.Devin McDermott: And I'm Devin McDermott, Head of North American Energy Research.Ariana Salvatore: Our topic today looms large in investors minds. We'll be digging into how the new policies proposed under President Trump's administration will fundamentally reshape energy markets.It's Tuesday, February 4th at 10am in New York.On his first day in office, President Trump declared a national energy emergency. He issued four key executive orders, setting out a sweeping plan to maximize oil and gas production. All of this on top of stepping back in tangible ways from the Biden administration's clean energy plans. We think these orders can have a significant impact on the future of energy, one of Morgan Stanley's four key themes for 2025.So, Stephen, let's start there. One of the biggest questions is which segments of the power and AI theme stand to benefit the most, and which ones will be the most challenged?Stephen Byrd: Yeah, Ariana, I'd say the two biggest beneficiaries will be natural gas and nuclear, probably in that order. And in terms of challenges, I do think, wind, especially offshore wind, will be quite challenged. So, when I think about natural gas, it's very clear that we have an administration that's very pro natural gas.And natural gas is also going to need to be part of the power mix for data centers. It's flexible. It could be built relatively quickly. There are a lot of locational options that are perfect here. So, I do think natural gas is a winner.On nuclear, we do think Republicans broadly, and also many Democrats, firmly support nuclear power. Nuclear is quite helpful, especially for larger data centers or supercomputers. They're large, there's a lot of land at these nuclear plants. And so, I would expect to see some very large data centers built at operational nuclear plants. And we do think the Trump administration will work hard to make that – from a regulatory point of view – make that happen.I also think we'll see a lot of support at the federal level for new nuclear power plant construction, as well as bringing the U.S. nuclear fuel cycle back to the U.S. So those are a few of the areas that I would expect to do well.Ariana Salvatore: Devin, same question for you on the energy sector. How are you thinking about the impacts?Devin McDermott: Yeah, it's a good question, and there's a lot in these executive orders. I mean, some of the key things that we're focused on as impacting the sector include encouraging federal lands development and leasing for oil and gas activity, with a specific focus on Alaska. Resuming LNG permit authorizations, which lifts the ban that's been in place for the last year. Eliminating EV targets, including pausing some IRA funds tied to EVs. Broad support for infrastructure permitting, including pipelines. And then a broader review of environmental regulations, including some recent headlines that point to rolling back fuel efficiency and emission standards for cars and trucks – something that the prior Trump administration did as well.The near-term financial impact to the industry of all this is fairly limited. But there are two key longer-term considerations. First, on the oil side, rolling back fuel efficiency standards and other environmental regulations doesn't stop the transition to lower carbon alternatives, but it does slow it. And in particular, it moderates the longer-term erosion of gasoline and diesel demand; and creates a backdrop where incumbent energy players have a longer runway to harvest cash from these legacy businesses and time to scale up profitable low carbon growth, which is still progressing, despite the policy changes.And then second, gas is the biggest winner, building on some of Stephen's comments. The policy initiatives that we're seeing here are likely to support more LNG exports and more gas power generation relative to the status quo.Ariana Salvatore: So, Devin, one of the things you mentioned there is regulation, and we think that's specifically reflected in this theme of unleashing American energy that Trump likes to talk about. It seems that this would set the stage for looser regulation and more supportive policy for oil and gas development.Do you expect any meaningful changes in near-term investment levels or production growth across the industry?Devin McDermott: It's an easy one, Ariana. No. The reality is the majority of U.S. oil and gas investment activity occurs on state or privately held lands. It's regulated at the state level. And the amount of investment that occurs across presidential election cycles really doesn't change all that much. And, in fact, some of the highest growth years ever for the U.S. oil and gas sector occurred under the Obama administration and also the most recent Biden term where production of both commodities actually hit all time highs.So, when your baseline is things really aren't that bad, it's tough to do much that really accelerates the throttle and causes companies to add more activity or add more oil or gas drilling rigs. And the last thing I just say on this point is the sector is not funding constrained. There's adequate free cash flow; there's adequate investment capacity. And that also is another limiting factor on doing anything that positively influences willingness to spend capital.In the end, it's really more about price – and where oil prices specifically goes as it relates to oil and gas investment – rather than policy.Stephen Byrd: So, Ariana, let me move from Devin's thoughts on price back to policy – and if you take a step back, a key question that we often get asked is: Will the President's executive orders be fully implemented? What do you think?Ariana Salvatore: Well, it's always necessary to frame these policy proposals in terms of their feasibility, right? So, we're still parsing through all of the details of these executive orders. But we already feel higher conviction in some areas over others, where we think the president has clear and present authority to make policy changes.For example, President Trump can pretty easily unilaterally decide to move away from Biden's clean energy targets, but he's going to have a much harder time rescinding money that has already been appropriated, dispersed, or obligated towards these ends. For example, through the Inflation Reduction Act. We think that process is going to be much longer and likely result in a very targeted repeal as opposed to a broad-based claw back of funds.Stephen Byrd: Just thinking about sequencing, can you talk more about, sort of, the potential specific sequencing of these policies?Ariana Salvatore: There are a few different balls in the air right now, so to speak, as we noted in the run up to the inauguration. We expected President Trump to focus first on the areas that are more within his unilateral control as president. So, that really comes down to tariffs and trade policy more broadly, as well as immigration.I would also put deregulation in that bucket, but more on a sector specific basis. So, as we've talked about, we think there's clear deregulatory tailwinds for the energy sector. It's also clear in financials. But across the board, these are going to have more limited success in the energy complex.But Stephen, back to you, given everything that we've been talking about, how do you see the future of clean energy, renewables, EVs – all these elements that make up the Inflation Reduction Act and the broader energy transition?Stephen Byrd: Yeah, as I think about the areas that are most at risk, I think it's very clearly electric vehicles as well as wind power. Both have been, the subject of direct criticism and we would expect a high risk of elimination or reduction of support there. So that will cause some issues. I would say especially offshore wind faces multiple issues and we think the growth outlook is now very challenged.Now that said, onshore wind is often, for example, done on private land rather than public land, and the economics in many locations for both wind and solar remain quite favorable. And I think a big area of underappreciated upside would be AI itself – in the sense that the hyperscalers have very significant zero carbon emissions goals. So, what we see happening is we think these hyperscalers over time as they build out more and more data centers, which do have very high carbon footprints, we do think these hyperscalers are going to engage in power contracts with new renewable projects. So that is a boost to demand that I think the market is really not well appreciating.Ariana Salvatore: And finally, let's consider the issue of powering data centers. Devin, you've spoken about your positive outlook for natural gas. Do you think natural gas is going to play a bigger role in powering large U.S. data centers?Devin McDermott: Yeah, we do, and there's been an uptick in natural gas related announcements as it relates to data center growth in the U.S. over the last few months. And more recently, we've actually seen some very large deals; plus carbon capture which addresses some of the emissions concerns that Stephen was mentioning before – that the hyperscalers have longer term.It's important to contextualize this, though, with the broader growth backdrop for natural gas. The market here domestically is on the cusp of what we see as a structural growth cycle driven really by two key pillars. The first of which is that rise in LNG exports that I was alluding to before, where we're on track to roughly double U.S. export capacity over the next five years. And the second pillar is power. And power has a lot of different subsets to it. It's onshore manufacturing, it's this broader trend of electrification, like more electric appliances, a little bit from EVs. Some underlying industrial activity growth and then data centers in AI.So that is meaningful. That's a lot of gas, but there's also a lot more in all the other buckets I talked about.Ariana Salvatore: Stephen, pivoting back to you, beyond natural gas, how do you see this theme of powering AI developing more broadly under the new Trump energy policies?Stephen Byrd: Yeah, you know, I think broadly what we see is that a number of debottlenecking technologies are going to become very important. We cannot get enough power for data centers that we need really over the next several years. So, we're going to need to be very creative.One option will be to build data centers at large nuclear power plants. I think we'll definitely see that. We will also, I think, see converting bitcoin sites into data centers. That's going to be quite popular. And then lastly, I do think electric transmission will see excellent growth. That is certainly one way to try to debottleneck the grid – is to increase the grid itself.That takes many years, but I do think there will be more and more willpower. Both at the federal and state level to provide incentives for electric transmission. So that's an asset class that's definitely a winner.Ariana Salvatore: Last question for both of you, Stephen. I know we're going to hear from you in an upcoming episode about the implications of DeepSeek, but just to get a little bit of a sneak peek here. I'd love a quick take on how you're thinking about DeepSeek.Stephen Byrd: It's really quite jarring in a week to go from a $500 billion U.S. AI plan to a LLM with a reported price tag of just $6 million. I come away bullish on power demand, and let me walk through why that is. You know, I think that as the cost of inference drops, and we're seeing many signs of that – not just DeepSeek, but many other developments. As that happens, the absolute demand for inference compute goes up, and that compute requires a lot of electricity, so I'm quite bullish there.Also on AI training, I think the market has gotten too negative. I think that what we'll see is continued LLM R&D to go to the next level of capability. And there are at least five U.S. companies who are going to spend in the tens of billions, possibly into the hundreds of billions of dollars each on training the next generation of Large Language Models, which could be much, much more capable than the current generation. So, I'm actually quite bullish on the outlook for power demand from AI.Ariana Salvatore: Devin?Devin McDermott: The news drove a big dislocation across the gas value chain and pullback in many exposed stocks. And we think those types of dips are a buying opportunity because the gas setup is constructive or compelling for many reasons. Power is one of them, but you're not paying for power in the stock prices today.Ariana Salvatore: Stephen, Devin, thanks for taking the time to talk. And to our listeners, thanks for tuning in. If you enjoy Thoughts on the Market, please leave us a review wherever you listen and share the podcast with a friend or colleague today.

Wolfgang Klein and Jack Hardill are joined by: George Gianarikas - Managing Director of Sustainability Research at Canaccord Genuity Doug Ford – Premier of Ontario

Wolfgang Klein and Jack Hardill are joined by: Joseph Vafi, Managing Director of FinTech and Digital Assets Research at Canaccord Genuity George Gianarikas, Managing Director of Sustainability Research at Canaccord Genuity. 

Send us a textWe launch our inaugural WTR Symposium Series “Sustainable Aviation Fuel and Low Carbon Ethanol Ready for Take-Off” on this week's episode of WTR Small-Cap Spotlight. Senior management of four leading companies in the low carbon farm-to-fuel and waste-to-fuel supply chains [Continuum Ag, Gevo (GEVO), LanzaTech (LNZA), and Synata Bio] join Shawn Severson, WTR CEO, Co-founder and Head of Sustainability Research, and Peter Gastreich, Senior Energy and Sustainability Analyst. Topics include: 1) how SAF and low carbon ethanol tie into company strategies; 2) the tangible economic benefit to farmers; 3) any implications from changes underway in Washington DC; 4) benefits and challenges of operating globally; 5) signposts investors should look out for and other topics.   

Our Sustainability analysts Stephen Byrd and Laura Sanchez discuss the range of impacts that the Republican sweep may have on energy policy and the ESG space.----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research and Head of Research Product for the Americas.Laura Sanchez: And I'm Laura Sanchez, Head of Sustainability Equity Research for the Americas.Stephen Byrd: Today, Laura and I will talk about the potential impact of the next Trump administration on the US energy transition, and on the US ESG Investing landscape.It's Thursday, November 21st at 8 am in New York.Now that Donald Trump has been re-elected, all eyes are on potential changes to the Inflation Reduction Act or IRA. So Laura, what are your expectations and on what kind of timeframe?Laura Sanchez: There has been a lot of dialogue internally between our clean tech and public policy teams exactly on this question, Stephen. Basically, we continue to believe that a full repeal of the IRA is unlikely because a significant amount of investment has gone to Republican states that has in turn driven a good amount of good paying jobs. On the back of this, we have seen a large number of Republican legislators, as well as large oil and gas companies, write letters to high members of Congress supporting portions of the IRA.Now, unfortunately, that doesn't mean that it won't be noisy. We do think that a partial repeal is likely, potentially a rebranding, and/or a clear phase out of the tax credits, by, let's say, the end of the decade.It will take some time to get clarity around what's in and what's out to the second part of your question. We believe clarity on final changes is likely by the end of 2025 at the earliest, which is when the TCJA, or the Tax Cuts and Jobs Act, is set to expire. And so, a lot of tax related conversations and concessions will happen then.Lastly, a point that I want to make here is that many technologies received support in the IRA, and even though the next 12 months will be volatile or noisy, as I said before, we do think that some of them are relatively safe. And those include the domestic manufacturing tax credit, the production tax credit for nuclear power, and the tax credits for carbon capture and sequestration technology, as well as for clean hydrogen.Stephen Byrd: That's really interesting, Laura. So, it really is a bit more nuanced than we often hear from many investors with portion of the IRA that are clearly at risk, others much less so at risk. That's really helpful. And Laura, a related topic that comes up a lot is concern around tariffs. So, do you see any risk to clean technologies from elevated trade tensions?Laura Sanchez: Yes, I see multi multilayered risks. The first, which is I think well understood by investors, is the potential risk for higher tariffs on goods imported from China. We know that the supply chain for energy storage specifically, and particularly lithium-ion storage batteries, is highly linked to China. And even though solar equipment also tends to come up in conversations with investors, the supply chain there has somewhat decoupled from China.However, a significant amount of supply is still sourced from China domiciled entities that operate in low-cost countries, such as those in Southeast Asia. But another risk, and I think this one is less understood or discussed by investors, is the potential inflationary pressure that could result from number one, higher tariffs on imported materials that are needed in the manufacturing of clean energy technologies. And number two, the potential risk of China responding to US imposed tariffs with additional export bans on minerals or materials that are key for the energy transition.We have analyzed a long list and believe that those at the highest risk of disruption include rare earths, graphite, gallium, and cobalt, which are all used in electric vehicles, but also in other clean tech equipment such as wind and solar systems, stationary battery storage, and electrolysers.Now, Stephen. Along with tariff escalation, President-elect Trump may look to roll back important EPA regulations that were put in place by the current administration to put the country on track to meet Paris aligned goals. What are the most important regulations investors should watch in your view?Stephen Byrd: Yeah, Laura, I think there are going to be several EPA regulations that are going to be targeted for rollbacks. Let me just start first on the truck side of things, the Clean Trucks Plan that's commonly known as the EPA Tailpipe Emissions Rule – could be rolled back. We could also see the greenhouse gas standards and guidelines for fossil fuel fired power plants get rolled back. And lastly, we could see waste emissions charged for petroleum and natural gas systems get rolled back.So, I think the overall message is actually; that the stock implications of this are actually relatively modest in most cases. What this does, in my view, is it sends a signal in terms of greater support from the Trump administration for fossil fuel. Usage in a number of areas, transport, infrastructure, et cetera I think we'll see that in power. And this does line up with some of the work we've done around the growth in data centers that we think will be powered by natural gas fire generation. So, this is consistent with that, and we do expect to see multiple layers of rollback at EPA.Laura Sanchez: And outside of changes to the stick – which are the EPA regulations that you mentioned – and changes to the carrot – which is the IRA – what are other factors or risks that investors with a mandate on sustainability should consider during a second Trump presidency?Stephen Byrd: Yes, for investors that do focus on sustainability, a few things that are on our mind. We could see additional states restrict the ability of state pension funds to consider ESG factors in their investment decision making process. We also, I think will see a lack of federal regulation that will require corporates to disclose certain ESG information. I think that's quite clear. And then also there could be additional legal and regulatory challenges around corporates and asset managers using sustainability as part of their decision-making process, as part of their fiduciary duties. So those are all the things that are on our mind.Laura Sanchez: I think it's worth noting that some states, California particularly, are moving forward with their state level decarbonization goals and greenhouse gas emissions rules. But there is one dynamic to consider or track and that is the EPA granting the state of California a waiver that is needed for the state to move forward with heavy duty low NOx rules. So, linking this back to the EPA rules commentary, Stephen, I think that one, the EPA 2027 low NOx rules is one to keep an eye on because it links to the California waiver and the California rules; and is something that could potentially impact some of those stocks.Stephen Byrd: Well, that's a good point, Laura, and I think that highlights this potential distinction between actions at the state level versus at the federal level, but sometimes those do intersect, such as, with the California heavy duty low NOx rules. So that's helpful.Well, Laura, thanks so much for taking the time to talk.Laura Sanchez: Great speaking with you, Stephen.Stephen Byrd: And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review wherever you listen and share the podcast with a friend or colleague today.

Virtual Fencing and GPS Collar Research Sustainability Research at Rannells Discouraging Rabbits   00:01:05 – Virtual Fencing and GPS Collar Research: Kicking off the show today is K-State beef systems specialist, Jaymelynn Farney, as she discusses research that she has been doing in southeast Kansas looking into to the use of virtual fencing and technological ear tags. www.southeast.k-state.edu   00:12:05 – Sustainability Research at Rannells: Logan Thompson, K-State sustainable beef production specialist, and Sophie Westbrook, K-State rangeland ecology and invasive species specialist, continue the show as they explain the history of Rannell's Preserve and how they plan to use it for research to benefit agriculture. Range & Forage at Rannells   00:23:05 – Discouraging Rabbits: K-State wildlife specialist, Drew Ricketts, ends today's show with information on the use of habitat modification, exclusion and removal to protect broadleaf and woody plants from rabbits.     Send comments, questions or requests for copies of past programs to ksrenews@ksu.edu.   Agriculture Today is a daily program featuring Kansas State University agricultural specialists and other experts examining ag issues facing Kansas and the nation. It is hosted by Shelby Varner and distributed to radio stations throughout Kansas and as a daily podcast.   K‑State Research and Extension is a short name for the Kansas State University Agricultural Experiment Station and Cooperative Extension Service, a program designed to generate and distribute useful knowledge for the well‑being of Kansans. Supported by county, state, federal and private funds, the program has county Extension offices, experiment fields, area Extension offices and regional research centers statewide. Its headquarters is on the K‑State campus in Manhattan

Mike Canfield, Morgan Stanley's Head of Europe Sustainability Research, discusses why ensuring safe and responsible artificial intelligence is essential to the AI revolution.----- Transcript -----Mike Canfield: Welcome to Thoughts on the Market. I'm Mike Canfield, Morgan Stanley's Europe, Middle East and Africa Head of Sustainability Research.Today I'll discuss a critical issue on a hot topic: How safe is AI?It's Thursday 10th of October at 2pm in London.AI is transforming the way that we live, work, and connect. It's really got the potential at every level and aspect of society, from personal decisions to global security. But as these systems become ever more integrated into our critical functions – whether that's healthcare, transportation, finance, or even defense – we do need to develop and deploy safe AI that keeps pace with the velocity of technological advances.Market leaders, academic think tanks, NGOs, industry bodies, intergovernmental organizations have all attempted to codify what safe or responsible AI should look like. But at the most fundamental level, the guidelines and standards we've seen so far share a number of clear similarities. Typically, they focus on fostering innovation in practical terms, as well as supporting economic prosperity – but also asserting the need for AI systems to respect fundamental human rights and values and to demonstrate trustworthiness.So where are we now in terms of regulations around the world?The EU's AI Act leads the way with its detailed risk-based approach. It really focuses on transparency as well as risks to people and fundamental rights. In the USA, while there's no comprehensive federal regulation or legislation, there are some federal laws that offer some sector specific guidance on AI applications. Things like the National Defense Authorization Act of 2019 and the National AI Initiative Act of 2020. Alongside those, President Biden's published an executive order on AI, promoting safety, responsible innovation, and supporting Americans and their rights, including things like privacy. In Asia Pacific, meanwhile, countries are working to establish their own guidelines on consumer protection, privacy, and transparency and accountability.In general, it's very clear that policymakers and regulators increasingly expect AI systems developers to adopt what we'd call the socio-technical approach, focused on the interaction between people and technology. Having examined numerous existing regulations and foundational standards from around the world, we think a successful policymaking approach requires the combination of four core conceptual pillars.We've called them STEP. That's Safety, Transparency, and Ethics and Privacy. With these core considerations, AI can take a step – pun intended – in the right direction. Within safety, the focus is on reliability of systems, avoiding harm to people and society, and preventing misuse or subversion. Transparency includes a component of explainability and accountability; so, systems allowing for future feedback and audits of outcomes. Ethically, the avoidance of bias, preventing discrimination, inclusion, and the respect for the rule of law are key components. Then finally, privacy considerations include elements like data protection, safeguards during operation, and allowing users consent in data used for training.Of course, policymakers contend with a variety of challenges in developing AI regulations. Issues like bias, like discrimination, implementing guardrails without stifling innovation, the sheer speed at which AI is evolving, legal responsibility, and much more beyond. At its most basic, though, arguably the most critical challenge of regulating AI systems is that the logic behind outcomes is often unknown, even to the creators of AI models, because these systems are intrinsically designed to learn.Ultimately, ensuring safety and responsibility in the use of AI is an essential step before we can really tap into ways AI could positively impact society. Some of these exciting opportunities include things like improving education outcomes, smart electric grid management, enhanced medical diagnostics, precision agriculture, and biodiversity monitoring and protection efforts. AI clearly has enormous potential to accelerate drug development, to advance material science research, to boost manufacturing efficiency, improve weather forecasting, and even deliver better natural disaster predictions.In many ways, we need guardrails around AI to maximize its potential growth.Thanks for listening. If you enjoy the show, please do leave us a review wherever you listen and share Thoughts on the Market with a friend or colleague today.

Send us a textOn this week's episode of WTR Small-Cap Spotlight, Mark Behrman, CEO of LSB Industries (LXU), joins Shawn Severson, Water Tower Research CEO, Co-founder and Head of Sustainability Research, and Peter Gastreich, analyst on WTR's Natural Resources and Energy Transition sector teams, to discuss: 1) how LSB is pursuing growth and higher returns with carbon capture and sequestration (CCS) and low carbon ammonia; 2) the growing appeal of low carbon ammonia as a fuel for power generation and marine transport; 3) implications from the recent landmark Woodside Energy acquisition of low carbon ammonia assets in Texas;  and 4) how agricultural-based low carbon supply chains like sustainable aviation fuel (SAF) may increase demand for low carbon fertilizer. 

Send us a textPatrick Gruber, Chief Executive Officer and Director at Gevo, Inc, joins Shawn Severson, Water Tower Research CEO, Co-founder and Head of Sustainability Research, and Peter Gastreich, analyst on WTR's Natural Resources and Energy Transition sector teams. Gevo produces renewable fuels and develops related technologies that help customers meet carbon abatement goals as cost effectively as possible. Mr. Gruber discusses: 1) Gevo's entry into low carbon ethanol and CCS with the $210 million Red Trail Acquisition in North Dakota; 2) multiple synergies of Red Trail with Gevo's existing business lines; 3) Gevo's move toward profitability and an improved financial condition; 4) how Gevo can value from CCS and durable 45Q tax credits; and other topics.

A group of 14 global financial institutions have expressed their support for the call to triple nuclear energy capacity by 2050. Their message, during New York Climate Week, stated their recognition that global civil nuclear energy projects have an important role to play in the transition to a low-carbon economy and means they join 25 countries and more than 120 companies already signed up to that tripling goal.Jonathan Cobb, senior programme lead, climate, at World Nuclear Association, explains the significance of the pledge from the 14 institutions - Abu Dhabi Commercial Bank, Ares Management, Bank of America, Barclays, BNP Paribas, Brookfield, Citi, Credit Agricole CIB, Goldman Sachs, Guggenheim Securities LLC, Morgan Stanley, Rothschild & Co, Segra Capital Management, and Societe Generale.But how can that support be translated into firm investments? Well, in this finance-focused episode, we also hear what some of the senior decision-makers said at World Nuclear Symposium earlier in September, about the challenges for private finance in new nuclear, and their ideas for smoothing that path. Among those featuring are: Vicki Kalb, Global Head of ESG and Sustainability Research at UBSSeb Henbest, Group Head of Climate Transition at HSBCBill Lacivita, Partner at McKinsey & CompanyEd Cook, Global Head of Capital Markets at BlackRockCosmin Ghita, Chief Executive Officer at NuclearelectricaKim Lauritsen, Senior VP, Enterprise Strategy & Energy Markets at Ontario Power GenerationLászló Varró, VP, Strategy Insights & Scenarios at Shell InternationalKey links to find out more:World Nuclear NewsInternational banks express support for nuclear expansionNet Zero NuclearEmail newsletter:Sign up to the World Nuclear News daily or weekly news round-upsContact info:alex.hunt@world-nuclear.orgEpisode credit:  Presenter Alex Hunt. Co-produced and mixed by Pixelkisser Production 

Wolfgang Klein and Jack Hardill are joined by: George Gianarikas - Managing Director of Sustainability Research at Canaccord Genuity David Sedgewick - Inspector, Investigative Services, Major Crime at York Regional Police

Stephen Byrd, the Global Head of Sustainability Research at Morgan Stanley, talks about investing in the watts needed to run tomorrow's supercomputers. Learn more about your ad choices. Visit megaphone.fm/adchoices

In this episode, we talk to Maxime Meijers and Nicolas Meijers, co-founders of Estuaire, who share insights into their innovative data platform that provides comprehensive climate impact assessments for the aviation industry.Maxime and Nicolas share:The development of Estuaire's data platform, which fuses various data sources to provide granular and exhaustive climate impact modelling for individual flights.The significant impact of non-CO2 emissions, particularly contrails, which can represent an additional 30% climate impact on top of CO2 emissions.The importance of sustainable aviation fuel (SAF) in reducing both CO2 and non-CO2 emissions, and Estuaire's approach to optimising SAF allocation for maximum climate benefit.The surprising finding that only 2% of flights are responsible for 80% of aviation's contrail warming effect, and how Estuaire's technology helps identify these high-impact flights.The potential for airlines to achieve significant climate savings through small changes in flight operations, such as slight altitude adjustments to avoid contrail-prone areas.Throughout the conversation, Maxime and Nicolas emphasise the unique transparency of the aviation sector and how Estuaire leverages this data to drive actionable insights for airlines, airports, and other stakeholders in the aviation ecosystem. Looking to the future, they discuss their ambitious goal of having 10 major airlines successfully implement contrail mitigation programs within the next year, showcasing the potential for rapid progress in sustainable aviation practices.If you LOVED this episode, you'll also love the conversation we had with Alejandra Martín Frías, Head of Sustainability Research at FLIGHTKEYS, who shares insights into the company's research on contrail avoidance and its potential impact on aviation sustainability. Check it out here. Learn more about the innovators who are navigating the industry's challenges to make sustainable aviation a reality, in our new book ‘Sustainability in the Air'. Click here to learn more.Feel free to reach out via email to podcast@simpliflying.com. For more content on sustainable aviation, visit our website green.simpliflying.com and join the movement. It's about time.Links & More:EstuaireContrail Index - Estuaire ESTUAIRE raises €2.2M in seed round to reduce the climate impact of aviation - Safran How FLIGHTKEYS promises major climate gains at a minimal cost - SimpliFlying 

Original Release Date August 8, 2024: Our Head of Europe Sustainability Research discusses how rising longevity is revolutionizing our fundamental approach from reactive to proactive treatment.----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Canfield, Morgan Stanley's European Head of Sustainability Research. Along with my colleagues, we're bringing you a variety of perspectives; and today we're focusing on a topic that affects everyone – how much does poor health cost us? And how are ageing populations and longer life expectancy driving a fundamental shift in healthcare? It's Thursday, August the 8th, at 4pm in London. As populations age across the developed world, health systems need to help people live both longer and healthier. The current system is typically built around to focus on acute conditions and it's more reactive; so it introduces clinical care or drugs to respond to a condition after it's already arisen, rather than keeping people healthy in the first instance. So increasingly, with the burden of chronic disease becoming by far the greatest health and economic challenge we face, we need to change the structure of the healthcare system. Essentially, the key question is how much is poor health amongst the ageing population really costing society? To get a true sense of that, we need to keep in mind that workers over 50 already earn one out of every three dollars across the G20 regions. By 2035, they're projected to generate nearly 40 per cent of all household income. So with that in mind, preventable conditions amongst those people aged 50-64 at the moment, are already costing G20 economies over $1 trillion annually in productivity loss. And there's one more key number: 19 per cent. That's how much age-diverse workforces can raise GDP per capita over the next thirty years, according to estimates from the Organization for Economic Co-operation and Development, or OECD. So clearly, keeping workers healthier for longer underpins a more productive, more efficient, and a profitable global economy. So it's clear that [if] the current healthcare system were to shift from sick from care to prevention, the global gains would be substantial.The BioPharma sector is already contributing some targeted novel treatments in areas like smart chemotherapy and in CRISPR – which is a technology that allows for selective DNA modification. While we can credit BioPharma and MedTech for really powerful innovations in diagnostics, in AI deployment for areas like data science and material science, and in sophisticated telemedicine – all these breakthroughs together give a more personalized, targeted health system; which is a big step in the right direction, but honestly they alone can't solve this much broader longevity challenge we face. Focus on health and prevention, ultimately, could address those underlying causes of ill-health, so that problems don't arise even in the first instance. Governments around the world are obviously realizing the value of preventive care over sick care. And as a strategy, disease prevention fundamentally aims to promote wellness across the board, whether that's in things like mental state, nutrition or even in things like sleep and stress. While it might be easy to kind of conflate that with wellness trends – things like green smoothies or meditation – the underlying benefits of boosting health at the cellular level have much broader and deeper implications. Things like Type 2 diabetes and heart disease, supporting better health across populations can significantly reduce the incidence of a wide range of chronic conditions. It can lower the burden on health systems overall, and actually increase healthy lifespan at the end of the day. BioPharma advances are significant, but addressing longevity will require a much broader alignment across a myriad of elements; everything really from the food system to sanitation to training healthcare professionals. And of course, all of that will require consistent policy support. Regulators and policymakers are paying very close attention to their ageing population – and so are we. We'll continue to bring you updates on this topic, which is so important to all of us.Thanks for listening. If you enjoy the show, please do leave us a review wherever you listen and share Thoughts on the Market with a friend or colleague today.

 In this episode of the Sustainability Podcast, host Jim dives deep into the dynamic world of industrial automation and the energy transition with two distinguished guests from Schneider Electric: Elias Panasiuk, EcoStruxure Power and Process Execution Director, and Thomas Kwan, Vice President of Sustainability Research. The discussion explores the rapid advancements in renewable energy technologies, the critical role of electrification, and the integration of smart systems such as AI and IoT in transforming manufacturing processes. Elias and Thomas share compelling insights and real-world examples highlighting the economic and sustainability benefits of these innovations. They also emphasize the importance of open automation platforms, collaboration across industries, and the pivotal role of human expertise in driving the energy transition. Tune in to discover how these developments are shaping a more sustainable future and the strategies leaders can adopt to stay ahead in this evolving landscape.--------------------------------------------------------------------------Would you like to be a guest on our growing podcast? If you have an intriguing, thought provoking topic you'd like to discuss on our podcast, please contact our host Jim Frazer View all the episodes here: https://thesustainabilitypodcast.buzzsprout.com

Our Head of Europe Sustainability Research discusses how rising longevity is revolutionizing our fundamental approach from reactive to proactive treatment.----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Canfield, Morgan Stanley's European Head of Sustainability Research. Along with my colleagues, we're bringing you a variety of perspectives; and today we're focusing on a topic that affects everyone – how much does poor health cost us? And how are ageing populations and longer life expectancy driving a fundamental shift in healthcare? It's Thursday, August the 8th, at 4pm in London. As populations age across the developed world, health systems need to help people live both longer and healthier. The current system is typically built around to focus on acute conditions and it's more reactive; so it introduces clinical care or drugs to respond to a condition after it's already arisen, rather than keeping people healthy in the first instance. So increasingly, with the burden of chronic disease becoming by far the greatest health and economic challenge we face, we need to change the structure of the healthcare system. Essentially, the key question is how much is poor health amongst the ageing population really costing society? To get a true sense of that, we need to keep in mind that workers over 50 already earn one out of every three dollars across the G20 regions. By 2035, they're projected to generate nearly 40 per cent of all household income. So with that in mind, preventable conditions amongst those people aged 50-64 at the moment, are already costing G20 economies over $1 trillion annually in productivity loss. And there's one more key number: 19 per cent. That's how much age-diverse workforces can raise GDP per capita over the next thirty years, according to estimates from the Organization for Economic Co-operation and Development, or OECD. So clearly, keeping workers healthier for longer underpins a more productive, more efficient, and a profitable global economy. So it's clear that [if] the current healthcare system were to shift from sick from care to prevention, the global gains would be substantial.The BioPharma sector is already contributing some targeted novel treatments in areas like smart chemotherapy and in CRISPR – which is a technology that allows for selective DNA modification. While we can credit BioPharma and MedTech for really powerful innovations in diagnostics, in AI deployment for areas like data science and material science, and in sophisticated telemedicine – all these breakthroughs together give a more personalized, targeted health system; which is a big step in the right direction, but honestly they alone can't solve this much broader longevity challenge we face. Focus on health and prevention, ultimately, could address those underlying causes of ill-health, so that problems don't arise even in the first instance. Governments around the world are obviously realizing the value of preventive care over sick care. And as a strategy, disease prevention fundamentally aims to promote wellness across the board, whether that's in things like mental state, nutrition or even in things like sleep and stress. While it might be easy to kind of conflate that with wellness trends – things like green smoothies or meditation – the underlying benefits of boosting health at the cellular level have much broader and deeper implications. Things like Type 2 diabetes and heart disease, supporting better health across populations can significantly reduce the incidence of a wide range of chronic conditions. It can lower the burden on health systems overall, and actually increase healthy lifespan at the end of the day. BioPharma advances are significant, but addressing longevity will require a much broader alignment across a myriad of elements; everything really from the food system to sanitation to training healthcare professionals. And of course, all of that will require consistent policy support. Regulators and policymakers are paying very close attention to their ageing population – and so are we. We'll continue to bring you updates on this topic, which is so important to all of us.Thanks for listening. If you enjoy the show, please do leave us a review wherever you listen and share Thoughts on the Market with a friend or colleague today.

Our sustainability experts Stephen Byrd and Tim Chan discuss what's driving new opportunities across the global nuclear power sector and some risks investors should keep in mind.----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Steven Byrd, Morgan Stanley's Global Head of Sustainability Research.Tim Chan: And I'm Tim Chan, Asia Pacific Head of Sustainability Research.Stephen Byrd: And on this episode of the podcast, we'll discuss some significant developments in the nuclear power generation space with long term implications for global markets.It's Monday, July 29th at 8am in New York.Tim Chan: And 8 pm in Hong Kong.Stephen Byrd: Nuclear power remains divisive, but it is making a comeback.So, Tim, let's set the scene here. What's really driving this resurgence of interest in nuclear power generation?Tim Chan: One key moment was the COP28 conference last year. Over 20 countries, including the US, Canada, and France, signed a joint declaration to triple nuclear capacity by 2050. Right now, the world has about 390 gigawatts of nuclear capacity providing 10 per cent of global electricity. It took 70 years to bring global nuclear capacity to 390 gigawatts. And now the COP28 target promises to build another 740 gigawatts in less than 30 years.And if this remarkable nuclear journey is going to be achieved, that will require financing and also shorter construction time.Stephen Byrd: So, Tim, how do you size the market opportunity on a global scale over the next five to ten years?Tim Chan: We estimate that nuclear renaissance will be worth $ 1.5 trillion (USD) through 2050, in the form of capital investment in new global nuclear capacity. And the growth globally will be led by China and the US. China will also lead in the investment in nuclear, followed by the US and the EU. In addition, this new capacity will need $128 billion (USD) annually to maintain.Stephen Byrd: Well, Tim, those are some gigantic numbers, $1.5 trillion (USD) and essentially a doubling of nuclear capacity by 2050. I want to dig into China a bit and if you could just speak to how big of a role China is going to play in this.Tim Chan: In China, by 2060, nuclear is likely to account for roughly 80 per cent of the total power generation, according to the China Nuclear Association. This figure represents half of the global nuclear capacity in similar stages, which amounts to 520 gigawatts.And Stephen, can you tell us more about the US?Stephen Byrd: Sure, during COP 28, the US joined a multinational declaration to triple nuclear power capacity by 2050. In this past year, the US has seen the completion of a new nuclear power plant in Georgia, which is the first new reactor built in the United States in over 30 years.Now, beyond this, we have not seen a strong pipeline in the US on large scale nuclear plants, according to the World Nuclear Association. And for the US to triple its nuclear capacity from about 100 gigawatts currently, the nation would need to build about 200 gigawatts more capacity to meet the target.In our nuclear renaissance scenario, we assume only 50 gigawatts will be built, considering a couple of factors. So, first, clean energy options, such as wind and solar are becoming more viable; they're dropping in cost. And also, for new nuclear in the United States, we've seen significant construction delays and cost overruns for the large-scale nuclear plants. Now that said, there is still upside if we're able to meet the target in the US.And I think that's going to depend heavily on the development of small modular reactors or SMRs. I am optimistic about SMRs in the longer term. They're modular, as the name says. They're easier to design, easier to construct, and easier to install. So, I do think we could see some upside surprises later this decade and into the next decade.Tim Chan: And nuclear offers a unique opportunity to power Generative AI, which is accounting for a growing share of energy needs.Stephen Byrd: So, Tim, I was wondering how long it was going to take before we began to talk about AI.Nuclear power generators do have a unique opportunity to provide power to data centers that are located on site, and those plants can provide consistent, uninterrupted power, potentially without external connections to the grid. In the US, we believe supercomputers, which are essentially extremely large data centers used primarily for GenAI training, will be built behind the fence at one or more nuclear power plants in the US. Now these supercomputers are absolutely massive. They could use the power, potentially, of multiple nuclear power plants.Now just let that sink in. These supercomputers could cost tens of billions of dollars, possibly even $100 billion plus. And they will bring to bear unprecedented compute power in developing future Large Language Models.So, Tim, where does regulation factor into the resurgence of nuclear power or the lack of resurgence?Tim Chan: So, for the regulation, we focus a lot on the framework to provide financing: subsidies, sustainable finance taxonomies and also from the bond investor; although we note that taxonomies are still developing to offer dedicated support to nuclear. We expect nuclear financing under green bonds will become increasingly common and accepted. However, exclusion on nuclear still exists.Stephen Byrd: So finally, Tim, what are some of the key risks and constraints for nuclear development?Tim Chan: I would highlight three risks. Construction time, shortage of labor, and uranium constraint. These remain the key risks for nuclear projects to bring value creation.US and Europe had high profile delay in the past, which led to massive cost overrun. We are also watching the impacts of shortage of skilled labor, which is more likely in the developed markets versus emerging markets. And the supply of enriched uranium, which is mainly dominated by Russia.Stephen Byrd: Well, that's interesting, Tim. There are clearly some risks that could derail or slow down this nuclear renaissance. Tim, thanks for taking the time to talk.Tim Chan: Great speaking with you, Stephen.Stephen Byrd: And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review wherever you listen and share the podcast with a friend or colleague today.

In this episode, we talk to Alejandra Martín Frías, Head of Sustainability Research at FLIGHTKEYS, who shares insights into the company's research on contrail avoidance and its potential impact on aviation sustainability.Condensation trails, also known as contrails, are long, thin clouds that often form behind an aircraft in cold and humid conditions when water vapour freezes around small dust and soot particles from the engine. Although they look harmless, contrails are made up of small ice crystals that trap heat in the earth's atmosphere and contribute to global warming. Frías delves into the complexities of contrail formation and its impact on climate, highlighting that non-CO2 emissions from aviation may be as significant as CO2 emissions in terms of climate impact. She explains the challenges of implementing contrail avoidance strategies, including weather unpredictability, operational complexities, and the industry's hesitance to participate in non-CO2 emissions monitoring.Recently, FLIGHTKEYS was part of a study that simulated contrail avoidance for about 85,000 flights. The study, published in February 2024, analysed two weeks of American Airlines flights in June, and two weeks in January. Frías shares that the study demonstrated significant reductions in contrail energy forcing (up to 73%) with minimal increases in fuel consumption and overall costs (less than 0.11%!).If you LOVED this episode, you'll also love the conversation we had with Adam Durant, Founder & CEO of SATAVIA, who shares  the groundbreaking work being done in the field of contrail reduction and its implications for the environment. Check it out here. Learn more about the innovators who are navigating the industry's challenges to make sustainable aviation a reality, in our new book ‘Sustainability in the Air'. Click here to learn more.Feel free to reach out via email to podcast@simpliflying.com. For more content on sustainable aviation, visit our website green.simpliflying.com and join the movement. It's about time.Links & More:FLIGHTKEYS Feasibility of contrail avoidance in a commercial flight planning system: an operational analysis - IOPscience Airlines divide over new EU rules on monitoring and reporting of their non-CO2 emissions - GreenAir News SATAVIA wants to solve a majorly ignored aspect of aviation's climate impact - SimpliFlying 

With elections held in large economies such as India and the EU, and more to come elsewhere, particularly in the US, investors might be left wondering how changes of government and in the composition of parliaments would affect the ambitions of countries to mitigate and adapt to the effects of climate change. They can be reassured for the most part, Alex Bernhardt, Global Head of Sustainability Research, tells Chief Market Strategist Daniel Morris.For more insights, visit Viewpoint: https://viewpoint.bnpparibas-am.com/ Download the Viewpoint app: https://onelink.to/tpxq34 Follow us on LinkedIn: https://bnpp.lk/amHosted by Ausha. See ausha.co/privacy-policy for more information.

Our Global Head of Sustainability Research and U.S. Utilities Analyst discuss the rapidly growing power needs of the GenAI enablers and how to meet them.----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research.David Arcaro: And I'm Dave Arcaro, Head of the US Power and Utilities team.Stephen Byrd: And on this episode of the podcast, we'll discuss just what it would take to power the Gen AI revolution.It's Tuesday, April 16th at 10am in New York.Last summer, scientists used GenAI to find a new antibiotic for a nasty superbug. It took the AI system all of an hour and a half to analyze about 7,000 chemical compounds; something that human scientists would have toiled over for months, if not years. It's clear that GenAI can open up breathtaking possibilities, but you have to stop and think. What kind of compute power is needed for all of this?A few weeks ago, our colleague Emmet Kelly, who covers European Telecom, discussed the exponential growth of European data centers on this podcast. And today, Dave and I want to continue the conversation about this critical moment of powering the GenAI revolution.So, Dave, what is your current assessment of the global power demand from data centers?David Arcaro: Yeah, Stephen, we're expecting rapid growth in the power demand coming from data centers across the world. We're currently estimating data centers consume about one and a half per cent of global electricity today. We're expecting that to grow to almost four percent in 2027. And in the US, data centers represent roughly three percent of total electricity consumption now, and we expect that to escalate to eight per cent of the total US by 2027.And there will be even more dramatic impacts at the local and regional level. The data center landscape tends to be highly concentrated, and the next wave of GenAI data centers is likely to be much larger than the previous generation.So, the impact on specific regions will be magnified. To give an example, in Georgia, the utility there has previously forecasted just half a percent of annual growth in electricity use but is now calling for nine per cent of annual growth in electricity consumption, and that's largely driven by data centers.It's a dynamic that we haven't seen in decades in the utility space.Stephen Byrd: You know, what I find interesting about what you just said, Dave, is -- it is impressive to see growth go from one and a half to four per cent, but it's really these local dynamics where what we're seeing is just much more concentrated, and that's where we start to see the real issues with the infrastructure growing quickly enough.So, it's becoming obvious that the existing power grid infrastructure is not meeting the growth and capacity needs of data centers. And that's something that you refer to as the tortoise and the hare. How big of a mismatch are we exactly talking about here, Dave?David Arcaro: It's definitely a big mismatch. To your point before, the US electricity growth across the country has been flattish over the last 10 years.So, this is a step change in expectations now, from the impact from Gen AI going forward. And we're looking at over 100 per cent annual growth in the power consumed by data centers now in the US over the next four years. And for comparison, the US utility industry is growing at about 8 per cent a year.These data centers that are coming are huge. They can be 10 to 50 times as big as the last generation of data centers in terms of their power consumption. And this means it takes time to connect to the electric grid and get power. 12 to 18 months in the best case, three to five years plus in other locations, often because they might need to wait for the electric utility grid to catch up, waiting for grid upgrades and assessments and new power plants to get built.Stephen Byrd: Well, I think those delays are going to be fairly problematic for the fast-moving GenAI sector. So essentially there's a lot of pressure on data center developers to secure a power source as quickly as possible. And in our note, we described the mathematics around that. The time value to get these data centers online is absolutely enormous. But you've just described the power grid infrastructure as a tortoise.So, are there any other alternatives? How about nuclear power plants in this context?David Arcaro: There's a lot of urgency, as you can tell from the data center companies, to get online as fast as possible. It's a fast-moving market, very competitive, they need the power, they need to run these GenAI models as soon as possible. And the utility industry is not used to responding to demand that's coming this quickly.It's a slower moving industry. There's policies and processes and regulation that all utilities have to get through. They're not prepared strategically to move as quickly as the data center industry is moving. So, data center developers are getting creative and they're looking at all options to get power.And one that has an appealing value proposition is nuclear plants. By placing a data center at an existing nuclear plant, this can avoid the need to go through that lengthy electric grid connection process, providing a much faster timeline to get the data center powered up.And that has big benefits for the data center companies, as you can imagine. Nuclear plants also have other advantages. They have land available on site. They have water for cooling, security. It's 24x7 clean power with no emissions, and it's already up and running, so you don't have to go and build much.Over time, we do expect renewables to play a major role as well in powering data centers along with traditional power from the electric grid and even new gas plants, but the benefits of coming online quickly in this market we think, give nuclear an edge.So, Stephen, as much as I can talk about the massive power needs of Gen AI, we can't ignore the issue of sustainability. So, what have you been thinking about when it comes to assessing the potential carbon footprint of powering data centers? What concerns are you seeing?Stephen Byrd: You know, Dave, this field is evolving so quickly that we've had to evolve our assessment of the carbon footprint of GenAI quite quickly as well. You know, traditionally what we would have seen is a data center gets connected to the grid. And then that data center developer would often sign a power contract with a renewable developer. And that results in a very low carbon footprint, if zero in many cases. But going forward, we do see the potential for increased natural gas usage in power plants, higher than we had originally forecast.And that's driven really by two dynamics. The first is the increased potential to site data centers directly at nuclear power plants, which you described, and there are a lot of benefits to doing so. In effect, what's going to happen then is, those data centers will siphon away that nuclear power, so less nuclear power goes to the grid. Something has to make up that deficit. That something is often going to be natural gas fired power plants.The second dynamic that we could see happening is an increased potential for just onsite natural gas fire power generation at the data centers that could provide shorter time to power, and also provide quite good power reliability.Now, when we sum these up and we look at the projected carbon footprint of data centers going forward, we could see an additional 70 million tons a year. We're about half a per cent of 2022 global CO2 emissions for data centers. That is quite a bit higher than we had previously forecast.Now that said, a wild card would be the hyperscalers and others who may decide to consciously offset this by signing additional power contracts with new renewables that could reduce this quite a bit. So, it's very much in flux right now. We frankly don't know what the carbon footprint is really going to look like.David Arcaro: You know, there's so much urgency to bring data centers online quickly that in the past many of these big hyperscalers especially have had quite ambitious sustainability goals and decarbonization goals. I'd say it's an open question on our end as to how flexible they might get in the near term or how strictly they do apply those decarbonization …Stephen Byrd: Exactly…David Arcaro: … targets going forward as they, y'know, also try to compete in an urgent grab for power in the near term.Stephen Byrd: That's exactly right. That's… You laid that tension out quite well.David Arcaro: And finally, from your global perspective, what regions are best positioned to keep pace with the power needs of Gen AI?Stephen Byrd: You know, Dave, I am thinking a lot about what you said a minute ago, about the size of these datacentres moving from, you know, quite small – often we would see datacentres at just 10 or 15 megawatts. Now the new designs are often above 100 megawatts.And now we're starting to hear and see some signs of truly mega data centers, essentially massive supercomputers that could be a thousand megawatts, a couple of thousand megawatts, and could cost tens of billions of dollars to build. So, when we think about that dynamic, that's a lot of power for any one location. So, to go back to your question, we think about the locations. It's very local specific.The dynamics all have to line up correctly, for this to work. So, we see pockets of opportunity around the world. Examples would be Pennsylvania, Texas, Illinois, Malaysia, Portugal -- these are locations for a variety of reasons where policy support is there, the infrastructure growth potential is there, and for a number of reasons, just it's the right confluence of dynamics. Most of the world doesn't have that confluence, so it's going to be very specific. And I think we're also setting up for a lot of concentration in those locations where all these dynamics line up.David Arcaro: You know, historically, the data center industry in the US has been highly concentrated, like you say, in Northern Virginia, in Northern California, they've been data center hubs, but we're running into infrastructure constraints there, we've got to look elsewhere. And some of these factors, geographically, are going to be extremely important.Where is their local support? And one of the dynamics we think could happen is that as you build more data centers that are very power hungry, that could push up the price of power. And what kind of local pushback might you get in that situation? What's the local desire to have a data center from an employment perspective and property tax and local benefit perspective? And how does the cost benefit weigh against the potential for higher power prices in those regions?Stephen Byrd: That's a great point. I mean, in places like Northern Virginia, to your point about property taxes, the value of all this data center equipment is in the tens of billions, which does help local tax revenue quite a bit. That said, there are offsetting impacts such as higher power prices. And this is why I think your original point about the local dynamics mattering so much is so critical because you really do need to see political support, policy support. You need to see the infrastructure that's available.So that's a fairly precious lineup, a fairly rare lineup of all the attributes you need to see to support new giant data center development.David Arcaro: Definitely a delicate balance that the industry needs to tread here as these huge data centers start to come online.Stephen Byrd: Well, I think a delicate balance is a good place to end this discussion. Dave, thanks so much for taking the time to talk.David Arcaro: Great to speak with you, Stephen.And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review wherever you listen to the show, and share the podcast with a friend or colleague today.

Thomas Hohne-Sparborth, Head of Sustainability Research at Lombard Odier Investment Managers in Switzerland joins the Plantbased Business Hour. Host and CEO of VegTech Invest, Elysabeth Alfano, discusses with Thomas who pays and who benefits from food systems transformation. Subscribe! For plant-based media/branding consulting and public speaking, reach out at elysabeth@elysabethalfano.com. For more information, visit ElysabethAlfano.com. For more information, visit ElysabethAlfano.com. Connect with Elysabeth on Linked in here: https://www.linkedin.com/in/elysabeth-alfano-8b370b7/ For more PBH, visit ElysabethAlfano.com/Plantbased-Business-Hour.

Thomas Hohne-Sparborth, Head of Sustainability Research at Lombard Odier Investment Managers in Switzerland joins the Plantbased Business Hour. Host and CEO of VegTech Invest, Elysabeth Alfano, discusses with Thomas who pays and who benefits from food systems transformation. Subscribe! For plant-based media/branding consulting and public speaking, reach out at elysabeth@elysabethalfano.com. For more information, visit ElysabethAlfano.com. For more information, visit ElysabethAlfano.com. Connect with Elysabeth on Linked in here: https://www.linkedin.com/in/elysabeth-alfano-8b370b7/ For more PBH, visit ElysabethAlfano.com/Plantbased-Business-Hour.

In this episode of Environment Variables, host Chris Adams delves into the fascinating topic of the rebound effect with Vlad Coroamă, founder of the Roegen Center for Sustainability. They discuss how improvements in efficiency can sometimes paradoxically lead to increased consumption, using examples like teleworking and online shopping to illustrate the point. Through their conversation, they explore why this happens and what conditions make it more likely. Their insights shed light on the complexities of balancing technological advancement with environmental sustainability, offering valuable perspectives for anyone interested in building greener digital services.

In this episode of Current Account, Clay is joined by IIF's Director of Sustainability Research, Emre Tiftik, to give an update on the current state of global debt. The podcast includes discussion on predominant trends on the current tally of over $310 trillion of global debt, outlook for the debt landscape in 2024, impact of geopolitics on debt, the concept of the United States being "the world's largest emerging market," funding strategy for climate finance, debt restructuring approaches and more.

Dorivar Ruiz Diaz, professor of soil fertility and nutrient management at Kansas State University, discusses a recently-funded research project led by the university that focuses on improving yields sustainably amidst changing climates.

The U.N. Climate Change Conference, COP28, delivered positive news around technology, clean energy and methane emissions. But investors should be wary about slower progress in other areas.----- Transcript -----Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Along with my colleagues, bringing you a variety of perspectives, today I'll discuss some takeaways from the recent UN Climate Change Conference. It's Thursday, December 14th at 10 a.m. in New York. Achieving net zero emissions is a top priority as the world moves into a new phase of climate urgency. Decarbonization, or energy transition, is one of the three big themes Morgan Stanley research has followed closely throughout this year. As we approach the end of 2023. I wanted to give you an update on the space, especially as the U.N. Climate Change Conference or COP 28 just concluded in Dubai. First, there have been multiple announcements from the conference around the issue of decarbonizing the energy sector, which accounts for about three-quarters of total greenhouse gas emissions. The first was a surprisingly broad effort to curb methane gas emissions. Fifty oil and gas producers, accounting for 40% of global oil production, signed an agreement to cut methane emissions to 0.2% by 2030 and to reduce carbon emissions to net zero by 2050. Methane accounts for 45 to 50% of oil and gas emissions, and the energy sector is responsible for about 40% of human activity methane globally. Important to note, this agreement will be monitored for compliance by three entities, the U.N. International Methane Emissions Observatory, the Environmental Defense Fund, and the International Energy Agency. Second, 118 countries reached an agreement to commit to tripling renewable energy and doubling energy efficiency by 2030, an action that boosts the global effort to reduce the usage of fossil fuels. A smaller group of countries also agreed to triple nuclear power capacity by 2050. And third, several governments have reached an agreement on the Loss and Damage Startup Fund, designed to provide developing nations with the necessary resources to respond to climate disasters. The fund is especially important because it could alleviate the debt burden of countries that are under-resourced and overexposed to climate events and to improve their climate resiliency. So what do all of these developments mean for the energy transition theme? Overall, our outlook is mixed, and at a global level, we do see challenges on the way to achieving a range of emissions reductions goals. On the positive side, we see many data points indicating advances in energy transition technology and a more rapid scaling up of clean energy deployment. We are also encouraged to see a major focus on reducing methane emissions and a small but potentially growing focus on providing financial support for regions most exposed to climate change risks. On the negative side, however, we see multiple signs that fossil fuel demand is not likely to decline as rapidly as needed to reach a variety of emissions reduction goals. We see persistent challenges across the board, for instance, in raising capital to finance energy transition efforts, especially in emerging markets. This is in part driven by greater weather extremes stressing power grids, as well as a broad geopolitical focus favoring energy security. An example of this dynamic is India. Not only does India depend on coal for over 70% of its national power generation, but it intends to bolster further its coal power generation capacity despite the global efforts to move towards renewable energy, and this is really driven by a focus on energy security. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.

Original Release on November, 2nd 2023: Generative AI could transform the nature of work and boost productivity, but companies and governments will need to invest in reskilling.----- Transcript -----Stephen Byrd: Welcome to Thoughts in the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Seth Carpenter: And I'm Seth Carpenter, the Global Chief Economist. Stephen Byrd: And on the special episode of the podcast, we'll discuss how generative A.I. could reshape the US economy and the labor market. It's Thursday, November 2nd at 10 a.m. in New York. Stephen Byrd: If we think back to the early 90's, few could have predicted just how revolutionary the Internet would become. Creating entirely new professions and industries with a wide ranging impact on labor and global economies. And yet with generative A.I. here we are again on the cusp of a revolution. So, Seth, as our global chief economist, you've been assessing the overarching macro implications of the Gen A.I. phenomenon. And while it's still early days, I know you've been thinking about the range of impacts Gen A.I could have on the global economy. I wondered if you could walk us through the broad parameters of your thinking around macro impacts and maybe starting with the productivity and the labor market side of things? Seth Carpenter: Absolutely, Stephen. And I agree with you, the possibilities here are immense. The hardest part of all of this is trying to gauge just how big the effects might be, when they might happen and how soon anyone is going to be able to pick up on the true changes and things. But let's talk a little bit about those two components, productivity and the labor market. They are very closely connected to each other. So one of the key things about generative A.I is it could make lots of types of processes, lots of types of jobs, things that are very knowledge base intensive. You could do the same amount of work with fewer people or, and I think this is an important thing to keep in mind, you could do lots more work with the same number of people. And I think that distinction is really critical, lots of people and I'm sure you've heard this before, lots of people have a fear that generative A.I is going to come in and destroy lots of jobs and so we'll just have lots of people who are out of work. And I guess I'm at the margin a lot more optimistic than that. I really do think what we're going to end up seeing is more output with the same amount of workers, and indeed, as you alluded to before, more types of jobs than we've seen before. That doesn't exactly answer your question so let's jump into those broad parameters. If productivity goes up, what that means is we should see faster growth in the economy than we're used to seeing and I think that means things like GDP should be growing faster and that should have implications for equities. In addition, because more can get done with the same inputs, we should see some of the inflationary pressures that we're seeing now dissipate even more quickly. And what does that mean? Well, that means that at least in the short run, the central bank, the Fed in the U.S., can allow the economy to run a little bit hotter than you would have thought otherwise, because the inflationary pressures aren't there after all. Those are the two for me, the key things one, faster growth in the economy with the same amount of inputs and some lower inflationary pressures, which makes the central bank's job a little bit easier. Stephen Byrd: And Seth, as you think about specific sectors and regions of the global economy that might be most impacted by the adoption of Gen A.I., does anything stand out to you? Seth Carpenter: I mean, I really do think if we're focusing just on generative A.I, it really comes down, I think a lot to what can generative A.I do better. It's a lot of these large language models, a lot of that sort of knowledge based side of things. So the services sector of the economy seems more ripe for turnover than, say, the plain old fashion manufacturing sector. Now, I don't want to push that too far because there are clearly going to be lots of ways that people in all sectors will learn how to apply these technology. But I think the first place we see adoption is in some of the knowledge based sectors. So some of the prime candidates people like to point to are things like the legal profession where review of documents can be done much more quickly and efficiently with Gen A.I. In our industry, Stephen in the financial services industry, I have spoken with clients who are working to find ways to consume lots more information on lots of different types of firms so that as they're assessing equity market investments, they have better information, faster information and can invest in a broader set of firms than they had before. I really look to the knowledge based sectors of the economy as the first target. You know, so that Stephen is mostly how I'm thinking about it, but one of the things I love about these conversations with you is that I get to start asking questions and so here it is right back at you. I said that I thought generative A.I is not going to leave large swaths of the population unemployed, but I've heard you say that generative A.I is really going to set the stage for an unprecedented demand in reskilling workers. What kind of private sector support from corporations and what sort of public sector support from governments do you expect to see? Stephen Byrd: Yeah Seth, I mean, that point about reskilling, I think, is one of the most important elements of the work that we've been doing together. This could be the biggest reskilling initiative that we'll ever see, given how broad generative A.I really is and how many different professions generative A.I could impact. Now, when we think about the job impacts, we do see potential benefits from private public partnerships. They would be really focused on reskilling and upskilling workers and respond to the changes to the very nature of work that's going to be driven by Gen A.I. And an example of some real promising efforts in that regard was the White House industry joint efforts in this regard to think about ways to reskill the workforce. That said, there really are multiple unknowns with respect to the pace and the depth of the employment impacts from A.I. So it's very challenging to really scope out the magnitude and cadence a nd that makes joint planning for reskilling and upskilling highly challenging. Seth Carpenter: I hear what you're saying, Stephen, and it is always hard looking into the future to try to suss out what's going on but when we think about the future of work, you talked about the possibility that Gen A.I could change the nature of work. Speculate here a little bit for me. What do you think? What could be those changes in terms of the actual nature of work? Stephen Byrd: Yeah, you know, that's what's really fascinating about Gen A.I and also potentially in terms of the nature of work and the need to be flexible. You know, I think job gains and losses will heavily depend on whether skills can be really transferred, whether new skills can be picked up. For those with skills that are easy to transfer to other tasks in occupations, you know, disruptions could be short lived. To this point the tech sector recently experienced heavy layoffs, but employees were quickly absorbed by the rest of the economy because of overall tight labor market, something you've written a lot about Seth. And in fact, the number of tech layoffs was around 170,000 in the first quarter of 2023. That's a 17 fold increase over the previous year. While most of these folks did find a new job within three months of being laid off, so we do see this potential for movements, reskilling, etc., to be significant. But it certainly depends a lot on the skill set and how transferable that skill set really is. Seth Carpenter: How do you start to hire people at the beginning of this sort of revolution? And so when you think about those changes in the labor market, do you think there are going to be changes in the way people hire folks? Once Gen A.I becomes more widespread. Do you think workers end up getting hired based on the skill set that they can demonstrate on some sort of credentials? Are we going to see somehow in either diplomas or other sorts of certificates, things that are labeled A.I? Stephen Byrd: You know, I think there is going to be a big shift away from credentials and more heavily towards skills, specific skill sets. Especially skills that involve creativity and also skills involving just complex human interactions, human negotiations as well. And it's going to be critical to prioritize skills over credentials going forward as, especially as we think about reskilling and retraining a number of workers, that's going to be such a broad effort. I think the future work will require hiring managers to prioritize these skills, especially these soft skills that I think are going to be more difficult for A.I models to replace. We highlight a number of skills that really will be more challenging to automate versus those that are less challenging. And I think that essentially is a guidepost to think about where reskilling should really be focused. Seth Carpenter: Well, Stephen, I have to say I'd be able to talk with you about these sorts of things all day long, but I think we've run out of time. So let me just say, thank you for taking some time to talk to me today. Stephen Byrd: It was great speaking with you, Seth.Seth Carpenter: And thanks to the listeners for listening. If you enjoyed Thoughts on the Market, please leave us a review on Apple Podcasts and share the podcast with a friend or colleague today.

Generative AI could transform the nature of work and boost productivity, but companies and governments will need to invest in reskilling.----- Transcript -----Stephen Byrd: Welcome to Thoughts in the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Seth Carpenter: And I'm Seth Carpenter, the Global Chief Economist. Stephen Byrd: And on the special episode of the podcast, we'll discuss how generative A.I. could reshape the US economy and the labor market. It's Thursday, November 2nd at 10 a.m. in New York. Stephen Byrd: If we think back to the early 90's, few could have predicted just how revolutionary the Internet would become. Creating entirely new professions and industries with a wide ranging impact on labor and global economies. And yet with generative A.I. here we are again on the cusp of a revolution. So, Seth, as our global chief economist, you've been assessing the overarching macro implications of the Gen A.I. phenomenon. And while it's still early days, I know you've been thinking about the range of impacts Gen A.I could have on the global economy. I wondered if you could walk us through the broad parameters of your thinking around macro impacts and maybe starting with the productivity and the labor market side of things? Seth Carpenter: Absolutely, Stephen. And I agree with you, the possibilities here are immense. The hardest part of all of this is trying to gauge just how big the effects might be, when they might happen and how soon anyone is going to be able to pick up on the true changes and things. But let's talk a little bit about those two components, productivity and the labor market. They are very closely connected to each other. So one of the key things about generative A.I is it could make lots of types of processes, lots of types of jobs, things that are very knowledge base intensive. You could do the same amount of work with fewer people or, and I think this is an important thing to keep in mind, you could do lots more work with the same number of people. And I think that distinction is really critical, lots of people and I'm sure you've heard this before, lots of people have a fear that generative A.I is going to come in and destroy lots of jobs and so we'll just have lots of people who are out of work. And I guess I'm at the margin a lot more optimistic than that. I really do think what we're going to end up seeing is more output with the same amount of workers, and indeed, as you alluded to before, more types of jobs than we've seen before. That doesn't exactly answer your question so let's jump into those broad parameters. If productivity goes up, what that means is we should see faster growth in the economy than we're used to seeing and I think that means things like GDP should be growing faster and that should have implications for equities. In addition, because more can get done with the same inputs, we should see some of the inflationary pressures that we're seeing now dissipate even more quickly. And what does that mean? Well, that means that at least in the short run, the central bank, the Fed in the U.S., can allow the economy to run a little bit hotter than you would have thought otherwise, because the inflationary pressures aren't there after all. Those are the two for me, the key things one, faster growth in the economy with the same amount of inputs and some lower inflationary pressures, which makes the central bank's job a little bit easier. Stephen Byrd: And Seth, as you think about specific sectors and regions of the global economy that might be most impacted by the adoption of Gen A.I., does anything stand out to you? Seth Carpenter: I mean, I really do think if we're focusing just on generative A.I, it really comes down, I think a lot to what can generative A.I do better. It's a lot of these large language models, a lot of that sort of knowledge based side of things. So the services sector of the economy seems more ripe for turnover than, say, the plain old fashion manufacturing sector. Now, I don't want to push that too far because there are clearly going to be lots of ways that people in all sectors will learn how to apply these technology. But I think the first place we see adoption is in some of the knowledge based sectors. So some of the prime candidates people like to point to are things like the legal profession where review of documents can be done much more quickly and efficiently with Gen A.I. In our industry, Stephen in the financial services industry, I have spoken with clients who are working to find ways to consume lots more information on lots of different types of firms so that as they're assessing equity market investments, they have better information, faster information and can invest in a broader set of firms than they had before. I really look to the knowledge based sectors of the economy as the first target. You know, so that Stephen is mostly how I'm thinking about it, but one of the things I love about these conversations with you is that I get to start asking questions and so here it is right back at you. I said that I thought generative A.I is not going to leave large swaths of the population unemployed, but I've heard you say that generative A.I is really going to set the stage for an unprecedented demand in reskilling workers. What kind of private sector support from corporations and what sort of public sector support from governments do you expect to see? Stephen Byrd: Yeah Seth, I mean, that point about reskilling, I think, is one of the most important elements of the work that we've been doing together. This could be the biggest reskilling initiative that we'll ever see, given how broad generative A.I really is and how many different professions generative A.I could impact. Now, when we think about the job impacts, we do see potential benefits from private public partnerships. They would be really focused on reskilling and upskilling workers and respond to the changes to the very nature of work that's going to be driven by Gen A.I. And an example of some real promising efforts in that regard was the White House industry joint efforts in this regard to think about ways to reskill the workforce. That said, there really are multiple unknowns with respect to the pace and the depth of the employment impacts from A.I. So it's very challenging to really scope out the magnitude and cadence a nd that makes joint planning for reskilling and upskilling highly challenging. Seth Carpenter: I hear what you're saying, Stephen, and it is always hard looking into the future to try to suss out what's going on but when we think about the future of work, you talked about the possibility that Gen A.I could change the nature of work. Speculate here a little bit for me. What do you think? What could be those changes in terms of the actual nature of work? Stephen Byrd: Yeah, you know, that's what's really fascinating about Gen A.I and also potentially in terms of the nature of work and the need to be flexible. You know, I think job gains and losses will heavily depend on whether skills can be really transferred, whether new skills can be picked up. For those with skills that are easy to transfer to other tasks in occupations, you know, disruptions could be short lived. To this point the tech sector recently experienced heavy layoffs, but employees were quickly absorbed by the rest of the economy because of overall tight labor market, something you've written a lot about Seth. And in fact, the number of tech layoffs was around 170,000 in the first quarter of 2023. That's a 17 fold increase over the previous year. While most of these folks did find a new job within three months of being laid off, so we do see this potential for movements, reskilling, etc., to be significant. But it certainly depends a lot on the skill set and how transferable that skill set really is. Seth Carpenter: How do you start to hire people at the beginning of this sort of revolution? And so when you think about those changes in the labor market, do you think there are going to be changes in the way people hire folks? Once Gen A.I becomes more widespread. Do you think workers end up getting hired based on the skill set that they can demonstrate on some sort of credentials? Are we going to see somehow in either diplomas or other sorts of certificates, things that are labeled A.I? Stephen Byrd: You know, I think there is going to be a big shift away from credentials and more heavily towards skills, specific skill sets. Especially skills that involve creativity and also skills involving just complex human interactions, human negotiations as well. And it's going to be critical to prioritize skills over credentials going forward as, especially as we think about reskilling and retraining a number of workers, that's going to be such a broad effort. I think the future work will require hiring managers to prioritize these skills, especially these soft skills that I think are going to be more difficult for A.I models to replace. We highlight a number of skills that really will be more challenging to automate versus those that are less challenging. And I think that essentially is a guidepost to think about where reskilling should really be focused. Seth Carpenter: Well, Stephen, I have to say I'd be able to talk with you about these sorts of things all day long, but I think we've run out of time. So let me just say, thank you for taking some time to talk to me today. Stephen Byrd: It was great speaking with you, Seth. Seth Carpenter: And thanks to the listeners for listening. If you enjoyed Thoughts on the Market, please leave us a review on Apple Podcasts and share the podcast with a friend or colleague today.

A strong El Niño event in the coming months could have negative effects for food inflation, commodities markets and climate change.----- Transcript -----Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Along with my colleagues bringing you a variety of perspectives today, I'll discuss the global risks and impact from a potential El Niño event later this year. It's Thursday, September 7th at 10 a.m. in New York. Over the last few months, as you've been doing your backyard grilling or taking a well-deserved summertime vacation, you may have heard a passing news reference to a climate pattern called El Niño. And although I'm an equity analyst and not a meteorologist, I'm going to talk about El Niño today because it could have some significant impacts for investors. To explain, El Niño refers to a warming of the ocean surface or above average sea surface temperatures in the central and eastern tropical Pacific. It's the counterpart to La Niña, which refers to the cooling effect of the same ocean surfaces. Essentially, El Niño and La Niña represent opposite extremes in the El Niño Southern Oscillation or ENSO. ENSO follows cyclical patterns that repeat at a 2 to 7 year cadence and tend to peak in the November to February window. Current conditions imply about a 70% probability that we could be facing a moderate to strong El Niño event later this year with a range of potentially significant impacts across regions and industries. First, although El Niño starts in the Pacific equator area, it has a significant impact on global weather. El Niño tends to peak around year end, impacting global rains and temperatures. El Niño driven seasonal patterns in the U.S., Argentina and the Andes tend to be wet, while those in Southeast Asia, Australia, Brazil, Colombia and Africa tend to be dry. This dynamic creates conditions that move wildfires and hurricanes from the Atlantic into the Pacific area. El Niño events also impact the global economy and the environmental, social and governance, or ESG, factors for businesses worldwide. More specifically, a moderate to strong El Niño in combination with the Russia-Ukraine war could impact food inflation, raising questions about the emerging markets central banks easing cycles. It could also impact trade and GDP in agro-related economies such as Argentina, India, Australia, Brazil and Colombia, among others. It may also impact several commodities, including sugar, grains, animal meal, proteins, electricity, lithium, copper, iron ore, aluminum and coal. El Niño's effects can be positive or negative for different sectors and regions. For example, El Niño tends to be a negative in emerging markets. In Latin America, given the size of the agricultural sector and the spillover effect of agriculture into other industries, growth could be affected significantly. The recession we expect in Argentina this year is partially driven by La Niña, which generated an unprecedented drought. We expect El Niño to help grain yields in Argentina and to provide significant positive base effects to GDP in 2024. Finally, when it comes to ESG, El Niño can exacerbate climate change impacts and increase concentrations of greenhouse gasses. Since this is a global issue and impacts all sectors to various degrees, we believe investors should pay close attention. Furthermore, the humanitarian impact of El Niño lasts long after the phenomenon itself, be it through impacts on food security and malnutrition, disease outbreaks, disrupted basic services and sanitation or significant impacts on livelihoods around the world. Typically, extreme weather events hit the poorest communities the hardest. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts app. It helps more people to find the show.

The profound demographic changes underway in countries around the world will require innovative, socially focused solutions in sectors including health care, finance and infrastructure.----- Transcript -----Stephen Bryd: Welcome to Thoughts on the Market. I'm Stephen Bryd, Morgan Stanley's Global Head of Sustainability Research. Mike Camfield: And I'm Mike Camfield, Head of EMEA Sustainability Research. Stephen Bryd: On this special episode of the podcast, we'll discuss the social factors within the environmental, social and governance framework, or ESG, as a source of compelling opportunities for investors. It's Tuesday, August 8th, at 10 a.m. in New York. Mike Camfield: And 3 p.m. in London. Stephen Bryd: At Morgan Stanley Research. We believe that investing in social impact is critical to addressing some of the most pressing challenges facing our world today, such as inequality, poverty, lack of access to health care and education, and the repercussions of climate change. Traditional methods like philanthropy and government aid are a piece of the puzzle, but alone they can't address with the breadth and scale of these issues. So, Mike, looking back over the last couple of decades, investors have sometimes struggled with the social component of ESG investing. Some of the main challenges have been around data availability, the potential for social washing and the capacity to influence systemic change. How are market views on social investing changing right now, and what's driving this shift? Mike Camfield: It has historically been quite easy for investors to dismiss social, it's too subjective, too hard to measure, overly qualitative, and perhaps not even material in moving share prices. Increasingly, we do find investors recognize the vast and intractable social problems we face, whether that's structural shifts in workforces with countries like Korea, Japan and large parts of Europe projecting working age population decline by double digit percentage in the next 15 to 20 years, significant growth in urbanization or growing middle class populations in countries around the world. Investors also increasingly understand the interconnectivity of stakeholders across society, be that supranational organizations or governments or the corporate world, or even citizens themselves. Concurrently, it's becoming clear that corporate purpose and culture are critical considerations for prospective and current employees, as well as end customers themselves who are prepared to vote with both their wallets and their feet. All that said, we do note the overall impact at EM has garnered in 18% kagger over the last five years to nearly $213 billion with the Global Impact Investing Network pointing out that over 60% of impact investors are targeting some of the UN's socially focused SDGs. Notably goal eight around decent growth, goal five, around gender equality, goal ten around reduced inequalities broadly and goal three good health and well-being. In terms of drivers, we're seeing the realization rapidly dawning amongst investors that the profound changes underway in society and the climate will drive the need for innovative, socially focused solutions in a number of sectors, from health care to finance to infrastructure, as well as significant challenges to resilience and adaptation for industries around the world. With huge shifts in demographics coming whether through urbanization or migration, aging populations in some countries or declining fertility rates, the investing landscape is set to change dramatically across sectors, with change manifesting in anything from shifting consumer preferences to education access and outcomes to greater need for assistive technologies, to substantial food production issues, to financial system access and inclusion, or even simply addressing rapidly increasing demand for basic services and clean energy. Stephen Bryd: Thanks, Mike. So what are some of the core themes in social investing? Mike Camfield: Yeah in our recent social skills notes, we did identify five truly global, fast growing and compelling investment themes you can focus on under the broad umbrella of what we would call social investing. Firstly, access to health care, which includes but obviously not limited to pharmaceuticals, vaccines, orthopedics, medical devices, elderly care, sanitation and hygiene, women's health and sexual health. Secondly, nutrition and fitness, which encompasses things like infant nutrition, healthy or healthier food and beverage options, alternative proteins, food safety and food packaging. Thirdly, social infrastructure, which includes mobility, digital and communication systems, connectivity, health care and education facilities, community and affordable housing and access to clean energy. Fourthly, education and reskilling, which includes everything from pre-K, K-12, higher education, corporate and lifelong learning. Our colleague Brenda recently wrote on the potential $8 trillion opportunity in these markets. And finally, right inclusive finance, which encompasses microfinance, financial infrastructure, mobile digital banking, banking for underserved communities, fintech solutions and provision of financial services to SMEs. So Stephen, do you think any industries or regions stand out as leaders or laggards perhaps when it comes to social investing? Stephen Bryd: You know, Mike, when I think about industries leading, I do think education really stands out. And I think we all recognize that education is really one of the pillars of a productive, well-functioning society, but it does face an array of challenges. A quality education can promote democracy, help communities elevate their social and economic status, and drive innovation in the economy, and yet, over the past few years, multiple issues in education, which were really exacerbated by the COVID 19 pandemic, have hampered equitable progress in society across markets, regions and communities. In our note this past May on education innovators, we really focus on these issues as fields of opportunity for investment in innovation. An example would be improving the quality of the learning experience. The pandemic was an especially disruptive period for K-12 education, leaving a learning deficit that could linger for an entire generation, especially for groups that were already disadvantaged. The pandemic also highlighted the need for more robust lifelong learning opportunities beyond the traditional classroom. We expect to see players that are able to service these needs, best meet market demand. And Mike, in terms of reasons that stand out. A key issue that you highlighted before is data availability. And I would note that really Europe has led the way in terms of best in class disclosure. So Mike, social considerations have historically been viewed as overly qualitative rather than quantitative, but our research has shown a variety of ways in which the S-pillar can closely link to company fundamentals. Could you walk through some of these? Mike Camfield: Yeah, absolutely, Stephen, I think the starting point for our research was this notion that you can both do good and do well. The values in value based investing can be combined to deliver alpha and positive social impact at the same time. So one of the ways we think to approach this is to assess the corporate culture and its that that forms the first pillar of our forces social investing framework. At its heart, company culture pertains to the shared values, attitudes, practices and standards that shape a work environment and the strategy for business. In our analysis, we want to establish a holistic view of why a company exists, what it's doing to contribute positively towards society, how it's managed, and where its most material social related opportunities and risks lie. In doing that, we've established a data driven, objective process to evaluate culture using eight core components across five performance linked indicators, which are Glassdoor ratings, shareholder voting against management or proprietary, her school employee turnover and board gender diversity. And three engagement focus indicators. The trend in employee diversity, whether the company has a supplier code of conduct in place, and violations of the UN's Global Compact. These data sets are readily available and repeatable, giving a clear view of companies relationship with both its internal and its external stakeholders. Steven, How do you think investors can think about social investing more systematically, can you elaborate a little more on the 4 C's framework? Stephen Bryd: Yeah happy to Mike, I think you really touched on culture in a very comprehensive way. I really do think it's important that the performance related KPIs that you laid out really do show very clear performance differential between top and bottom quartiles. I want to move on to the second of the C's. This is Cultivate. And here we really focus on three so-called AIM lenses. The first is additionality. This is really the notion of generating positive social outcomes or impacts that otherwise would not have materialized. So finally, Mike, how does A.I play into social investing? Mike Camfield: Everyone's favorite acronym at the moment, clearly something that we can't ignore. We do believe there's a very real potential for us to be at the start of another economic revolution, driven by rapid technological evolution in AI. The so-called third industrial revolution, otherwise known as the digital revolution, brought with it transformational technologies in cell phones and the Internet, increased interconnectivity, greater industrial productivity and vastly greater accessibility of information. AI looks to play a central role in the fourth Industrial Revolution. Klaus Schwab, founder of the World Economic Forum, popularized that term back in 2015 when he suggested that AI and advanced robotics could herald a substantial shift in industrial capitalism and the so-called knowledge economy. This evolution could fundamentally change employment and geopolitical landscapes. Just as in the early 19th century, when Luddites found machines left weaving skills obsolete. AI could well prove just as disruptive, but technology on a grander scale, across everything from manufacturing to search engines to media content creation. We do see significant AI opportunities in areas like drug development, in education outcomes and access and significant benefits across efficiencies and resource management, whether that's in power grid optimization or in weather prediction, for example. We do suggest a three pronged approach to evaluating AI driven opportunities which focus on areas including reducing harm to the environment, enhancing people's lives through biotech, cybersecurity and life sciences, for example, and enabling technological advancements. Simultaneously, given a relative lack of regulation for the industry at the moment, we do think consistent investor engagement is key to driving responsible A.I practices. Stephen Bryd: Mike, thanks for taking the time to talk. Mike Camfield: Great to speak to you, Stephen. Stephen Bryd: And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review on Apple Podcasts, and share the podcast with a friend or colleague today.

Gaya Herrington is Vice President Sustainability Research at Schneider Electric (voted most sustainable corporation in the world in 2021). She studies how environmental, social, behavioral and economic trends interact and what systems changes are needed for achieving true global sustainability. Gaya is best known for her research on the Limits to Growth (LtG), and how it informs us about a more human and ecocentric economic system, one fit for the 21st century: wellbeing economics.   Gaya has given keynote speeches and guest lectures around the world, and is an Advisor to the Club of Rome, an international 100-member club of scientists, economists, and other thinkers. She has a Master's degree in Econometrics from the Liberal Amsterdam University and another Master's in Sustainability from Harvard University. She lives in Washington D.C.   Recent interview with Gaya about her work: https://www.wired.com/story/gaya-herrington-avoiding-global-collapse/ Peer-reviewed journal article on Gaya's LtG research: https://onlinelibrary.wiley.com/doi/abs/10.1111/jiec.13084 Gaya's book (free for download): https://www.mdpi.com/books/mono/6206   Social media: Gaya's Facebook and Schneider Electric's: Twitter, Facebook and Instagram.   The songs picked by all our guests can be found via  our playlist #walktalklisten here.    Please let me/us know via our email innovationhub@cwsglobal.org what you think about this new series. We would love to hear from you.   Please like/follow our Walk Talk Listen podcast and follow mauricebloem on twitter and instagram.  Or check us out on our website 100mile.org.  We also encourage you to check out the special WTL series Enough for All about an organization called CWS. 

With technology evolving rapidly in education, investors are taking a closer look at how it will financially impact the global education market. Stephen Byrd and Josh Baer discuss.----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Josh Baer: And I'm Josh Baer from the U.S. Software Team. Stephen Byrd: On the special episode of the podcast will discuss the global education market. It's Friday, May 12th at 10 a.m. in New York. Stephen Byrd: Education is one of the most fragmented sectors globally, and right now it's in the midst of significant tech disruption and transformation. Add to this, a number of dynamically shifting regulatory and policy regimes and you have a complex set up. I wanted to sit down with my colleague Josh to delve into the intersection of the EdTech and the sustainability side of this multi-layered story. Stephen Byrd: So, Josh, let's start by giving a snapshot of global education technology, particularly in this post-COVID and rather uncertain macro context we're dealing with. What are some of the biggest challenges and key debates that you're following? Josh Baer: Thanks, Stephen. One way that I think about the different EdTech players in the market is through the markets that they serve. So in the context of education, that means early learning, K-12, higher ed, corporate skilling and lifelong learning. The key debates here come down to what it usually comes down to for equities, growth and margins. So on the growth side, there's several conversations that we're constantly having with investors. Some business models are exposed to academic enrollments as a driver. To what extent would a weaker macro with higher unemployment lead to stronger enrollments given their historical countercyclical trends? And enrollments have been pressured as current or potential students were attracted to the job market. And on the margin side, some of the companies that we follow in the EdTech space, they're the ones that were experiencing very rapid growth during COVID and investment mode to really capture that opportunity. And so investors debate the unit economics of some of these business models and really the trajectory of margins and free cash flow looking ahead. One other more topical debate, the impact of generative A.I. on education, and maybe we'll hit on that topic later. Josh Baer: Stephen, why do these debates matter from the point of view of ESG, environmental, social and governance perspective? Why should investors view global education through a sustainability lens? Stephen Byrd: Yeah Josh I'd say among sustainability focused investors, typically the number one topic that comes up within the education sector is inequality. So higher education is a key pillar of economic development, but social and economic problems can arise from limited access. Unequal access to education can perpetuate all forms of socioeconomic inequality. It can limit social mobility, and it can also exacerbate health and income disparities among demographic groups. It can also restrict the potential talent pool and diversity of backgrounds and ideas in different academic fields, leading to all kinds of negative economic implications for both growth and innovation. While progress has been made in increasing enrollment among underrepresented students, significant disparities remain in admission and graduation rates. For investors and public equities, I think one of the more useful tools in our note is a proprietary framework that measures sustainability impact. Now that tool is really primarily rooted in the United Nations Sustainable Development goal number four, which lays out targets in education. This framework is rooted in the premise that I mentioned earlier. The COVID-19 pandemic has exacerbated multiple challenges in education. So when we think about business models that we really like, we're focused on models that can improve the quality of student learning, enhance institutions' operations and increase access and affordability. And we think our stocks that we selected really do meet those objectives quite well. Stephen Byrd: Josh, what is the current size of the EdTech and education services markets and why invest now? Josh Baer: First, on the size of the market, we see global education spend of 6 trillion today going to 8 trillion in 2030. So that's a CAGR below the growth of GDP, but we do see faster growth in EdTech. So there's really compelling opportunities for consolidation in the fragmented education market broadly and for EdTech growing at a double digit CAGR, so much faster than the overall education market. Why invest in EdTech? Well, as just mentioned, EdTech addresses these very large markets. It's increasing its share of education spend because it's aligned to several secular trends. So I'm thinking about digital transformation of the entire education industry. The shift from in-person instructor led training to really more efficient or economic online or digital learning. And positives from this shift, as you mentioned, include better scalability, affordability, global access to really high quality education. These EdTech companies are aligned to corporate skilling, which are aligned to companies, strategic goals, digital transformation initiatives. And then from a stock perspective, there's really low investor sentiment broadly and of course, the exposure to ESG trends around inclusion, skilling, education, access. Josh Baer: And Stephen, what is the regulatory landscape around global education and EdTech, both in the U.S. and in other regions? Stephen Byrd: So education policy is not really featured heavily in recent sessions of Congress in the U.S., as it tends to develop at more local levels of government than really at the federal level. The federal government in the United States provides less than 10% of funding for K through 12 education, leaving most of regulation and funding to state and local governments. Now, that said, there have been a few large education policy focused bills enacted into law since the establishment of the U.S. Department of Education in the second half of the 20th century. The most recent was in 2015, when President Obama signed the Every Student Succeeds Act, which granted more autonomy to states to set standards for education that vary based on local needs. In Brazil, there's some really interesting developments that we're very focused on. The Ministry of Education began loosening the rules for distance learning in 2017 to compensate for the lack of public funding and affordability. This was a new modality that didn't depend on campuses and was much cheaper for students. So companies saw this as the next growth opportunity and started investing in digital expansion, especially after COVID-19 lockdowns forced the closure of campuses. Distance learning grew rapidly and surpassed the number of on campus enrollments in 2021. Despite the increase in addressable market, this potential cannibalizes is part of the demand for in-person learning and reduces average prices in the sector. Lastly, in Europe, the European Union has set seven key education targets that it is hoping to achieve by 2025. And by 2030 on education and training. Let me just walk through a couple of the big targets here. By 2025, the goal is to have at least 60% of recent graduates from vocational education and training, that should benefit from exposure to work based learning during their vocational education and training. By 2030, the goal is for less than 15% of 15 year olds to be low achievers in reading, mathematics and science, as well as less than 15% of eighth graders should be low achievers in computer and information literacy. Stephen Byrd: Josh, how are emerging technologies like artificial intelligence and virtual reality disrupting the education space, both in the classroom and in cyberspace? How do you assess their impact and what catalysts should investors watch closely? Josh Baer: Great question. Investors are hyper focused on all the generative A.I. hype, all the risks and opportunities for EdTech. And it's important to remember that all EdTech companies serve different markets and they have different business models and they provide varying services and value to all those different markets. And so there's a wide spectrum from risk to opportunity, and in actuality, I think many businesses will actually have both headwinds and tailwinds from A.I. At the core, the question is not, will generative A.I. change education and learning, but how will it change? And from the way it may change, from the way education content is created and consumed, to the experience of learning and teaching and testing and studying. And on one end of the spectrum, investors should also look for signs of disruption, disruption to the publisher model or tutoring services or solutions, look for signs of students that may meet their learning needs or studying needs with generative A.I. instead of existing solutions. But from an innovation perspective, I think investors should look for new entrants and incumbents to leverage generative A.I. to really enhance the future of education, from personalized and efficient content creation to more adaptive assessments and testing, to more customized learning experiences. And these existing platforms, they're the ones that own vast datasets, really rich taxonomies of learning and skills. And I think those are the ones that are well-positioned to use A.I. technology to vastly improve their capabilities and the education market. Investors can also look for a more direct revenue opportunities, as the EdTech platforms are the platforms that will be teaching and reskilling and upskilling the whole world on how to use these innovative technologies, today and in the future. Stephen Byrd: Josh, thanks for taking the time to talk. Josh Baer: Great speaking with you, Stephen. Stephen Byrd: And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review on Apple Podcasts, and share the podcast with a friend and colleague today.

We're seeing more companies and countries start to account for the value of nature. In this episode of ESG Insider, we'll hear from two people well-placed to explain how the world has historically done little to understand the way nature benefits the economy — and how that is now evolving.   For the global perspective, we talk with Martin Lok, Executive Director of the Capitals Coalition, a global collaboration that advocates for companies to identify, measure and value their impacts and dependencies on natural capital, social capital and human capital.    We also explore how the US is moving to put nature on the nation's balance sheet. The Biden administration announced the strategy in January 2023 with the goal of better understanding how nature contributes to the US economy. To learn more about what this strategy entails, we talk with Aniket Shah, Managing Director and Global Head of Environmental, Social and Governance and Sustainability Research at the financial services company Jefferies Group.  Photo source: Getty Images  Copyright ©2023 by S&P Global      DISCLAIMER       This piece was published by S&P Global Sustainable1, a part of S&P Global.      By accessing this Podcast, I acknowledge that S&P GLOBAL makes no warranty, guarantee, or representation as to the accuracy or sufficiency of the information featured in this Podcast. The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. This Podcast should not be considered professional advice. Unless specifically stated otherwise, S&P GLOBAL does not endorse, approve, recommend, or certify any information, product, process, service, or organization presented or mentioned in this Podcast, and information from this Podcast should not be referenced in any way to imply such approval or endorsement. The third party materials or content of any third party site referenced in this Podcast do not necessarily reflect the opinions, standards or policies of S&P GLOBAL. S&P GLOBAL assumes no responsibility or liability for the accuracy or completeness of the content contained in third party materials or on third party sites referenced in this Podcast or the compliance with applicable laws of such materials and/or links referenced herein. Moreover, S&P GLOBAL makes no warranty that this Podcast, or the server that makes it available, is free of viruses, worms, or other elements or codes that manifest contaminating or destructive properties.      S&P GLOBAL EXPRESSLY DISCLAIMS ANY AND ALL LIABILITY OR RESPONSIBILITY FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR OTHER DAMAGES ARISING OUT OF ANY INDIVIDUAL'S USE OF, REFERENCE TO, RELIANCE ON, OR INABILITY TO USE, THIS PODCAST OR THE INFORMATION PRESENTED IN THIS PODCAST.

The drive to reduce carbon emissions could trigger the biggest transformation of the steel industry in decades. Global Head of Sustainability Research, Stephen Byrd, Head of European Metals and Mining Research, Alain Gabriel, and Head of the Americas Basic Materials Team, Carlos De Alba, discuss. ----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Alain Gabriel: And I'm Alain Gabriel, Head of Europe Metals and Mining Research. Carlos De Alba: I am Carlos De Alba, Head of the Americas Basic Materials Team. Stephen Byrd: On this special episode of the podcast, we'll discuss the implications of decarbonization in the steel industry. It's Monday, April 24th at 10 a.m. in New York. Alain Gabriel: And 3 p.m. in London. Stephen Byrd: Achieving net zero is a top priority as the world moves into a new phase of climate urgency, and global decarbonization is one of the three big themes for 2023 for Morgan Stanley research. Within this broader theme, we believe that decarbonizing steelmaking has the potential to trigger the biggest transformation of the steel industry in decades. Stephen Byrd: Alain to set the stage and just give our listeners a sense of the impact of steelmaking, just how much does steel contribute to global CO2 emissions? Alain Gabriel: Thank you, Stephen. In fact, the steel industry emits around 3.6 billion tonnes of CO2 per annum. And this enormous carbon footprint puts the industry at the heart of the climate debate, and public policy is rapidly evolving towards stricter emissions reductions targets, but also shorter implementation timelines. So for instance, in Europe, which is leading this transformation by simultaneously introducing a carbon border adjustment mechanism, which is otherwise known as CBAM and gradually reducing free CO2 allowances until their full removal by 2034. Stephen Byrd: So, Alain, given the size of Steel's contributions to emissions, it should come as no surprise that decarbonizing steel would likely really reconfigure the entire supply chain, including hydrogen, renewable energy, high quality iron ore and equipment providers. So, Alain, given this impending paradigm shift, what is the potential impact on upstream resources? Alain Gabriel: Yes, the steel value chain is collectively exploring various ways to reduce carbon emissions, whether it was miners, steelmakers or even capital equipment providers. However, we think the most promising path from today's perspective appears to be via the hydrogen direct reduced iron electric arc furnaces process, which is also known as H2DRIEAF in short. Admittedly, if we were to have this conversation again in three years, this conclusion might be different. But back to the H2DRIEAF process, it promises to curb emissions by 99% by replacing carbon from coal with hydrogen to release the oxygen molecules from iron ore and convert it to pure iron. The catch is that this process is resource intensive and would face significant supply constraints and bottlenecks, which in a way is positive for upstream pricing.So if we were to hypothetically convert the entire industry in Europe today, we will need more than 55% of Europe's entire production of green hydrogen last year. And we'll also need more than double the global production of DRI grade pellets, which is a niche high grade iron ore product. Stephen Byrd: Alain, you believe that steel economics in Europe is really at an inflection point right now, and given that Europe will likely see the biggest disruption when it comes to the green steel transformation, I wondered if you could give us a snapshot of the current situation in Europe and of your outlook there. Alain Gabriel: Should steel mills choose to adopt the H2DRIEAF proccess, they would need to build out an entire infrastructure associated with it, and we detail each component of that chain in our note. But in aggregate, we estimate that the average capital intensity would be approximately $1,200 per ton, and this excludes the build up of renewable electricity. So on OpEx, green hydrogen and renewable electricity will constitute more than 50% of production costs and this will lead to wide disparities between regions. So the economics of this transformation will only work, in our view, under effective policy support to level the playing field. And this would include a combination of grants, subsidies and carbon border taxes. Fortunately, the EU policy is moving in that direction but is lagging the United States. Stephen Byrd: So, Carlos, as we heard from Alain, Europe is leading this green steel transformation. But at the same time, the U.S. has the greenest steel footprint and is benefiting from some relative advantages vis a vis Europe and the rest of the world. Could you walk us through these advantages and the competitive gap between the U.S. and other regions? Carlos De Alba: Yeah, I mean, definitely the U.S. is already very well positioned. And what drives this position of strength is the fact that about 70% of the steel production in the U.S. is made out of electrical furnace, and that emits roughly around half a ton of CO2 per ton of steel, which is significantly better than the average of 1.7 tons per ton of steel and the blast furnace route average of around 2 tons per ton of steel. So that is really the genesis of the better position that the U.S. has in terms of emissions. Another way of looking at it is the U.S. produces around 6% of the global crude steel and it only makes around 2% of the overall steel emissions in the world. Stephen Byrd: That's a good way of laying it out, Carlos. It's interesting, in the U.S., the cost of electricity being relatively low certainly does help with the cost of making steel as well. I wanted to shift over to China and India, which are responsible for two thirds of global steel emissions. How are they positioned for this green steel transition? Carlos De Alba: Yeah, I mean, these two countries are significant contributors to the emissions in the world. And when you take the average emission per ton of steel produced in India, it's around 2.4 tons and in China it's around 1.8 tons. And the reason being is that they have a disproportional majority of their steel made under the blast furnace route that, as I alluded to previously, emits more CO2 per ton of steel than other routes like the electrical furnaces. So it's going to take some time definitely for them to reposition their massive steel industry steel capacity and reduce their emissions. We need to keep in mind that these two countries in particular have to weigh not only the emissions that their steel sector provides, but also the economic implications of such an important sector. They contribute to jobs, they contribute to economic activity, they provide the raw material for their infrastructure and the development of their cities and their urbanization trends. So for them, it is not necessarily just straightforward a matter of reducing their emissions, but they need to weigh it and make sure that they have a balance between economic growth, urbanization, infrastructure buildup and obviously the environment. Carlos De Alba: So Stephen, given the scale of the global steel industry, what are some of the broader sustainability implications of the shift towards green steel production? How do you view this transition through the lens of your environmental, social and governance or ESG framework? Stephen Byrd: Yeah Carlos as Alain started the scope of emissions from the steel industry certainly is worthy of attention. We think a lot about the supply chain required to provide the clean energy and electrolyzers necessary to achieve this transformation that you both have laid out. Now, green hydrogen supply in particular is limited and will take some time to ramp up. So while technically feasible, there are numerous hurdles to overcome to make widespread green hydrogen use a reality. We do expect the ramp up to be gradual. A lot of capital is being deployed, but this will take time. Now, on clean energy, I think it's a bit more straightforward. The cost of clean energy has been dropping for years, just as a frame of reference in the United States from 2010 to 2020, the cost of clean energy dropped annually by about 15% per year, which is quite remarkable. Now, the levelized cost of electricity from renewables is lower in the US and China relative to Europe. So we think a lot about the growth in clean energy. We do think that the capital will be there. The cost of clean energy we believe will continue to drop. So that is a hopeful development that over time should result in a lower and lower cost for green steel. Stephen Byrd: Alain, Carlos, thanks for taking the time to talk. Alain Gabriel: Great speaking with you both.Carlos De Alba: Thank you very much. I enjoy your discussions as well. Stephen Byrd: And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review on Apple Podcasts, and share the podcast with a friend or colleague today.

Artificial Intelligence is clearly a powerful tool that could help a number of sustainability objectives, but are there risks attached to these potential benefits? Global Head of Sustainability Research Stephen Byrd and Global Sustainability Analyst Brenda Duverce discuss.----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Stephen Bryd, Morgan Stanley's Global Head of Sustainability Research. Brenda Duverce: And I'm Brenda Duverce from the Global Sustainability Team. Stephen Byrd: On the special episode of the podcast, we'll discuss some key A.I. related opportunities and risks through the lens of sustainability. It's Friday, April 14th at 10 a.m. in New York. Stephen Byrd: Recent developments in A.I. make it clear it's a very powerful tool that can help achieve a great number of sustainability objectives. So, Brenda, can you maybe start by walking us through some of the potential benefits and opportunities from A.I. that can drive improved financial performance for companies? Brenda Duverce: Sure, we think A.I. can have tremendous benefits to our society and we are excited about the potential A.I. can have in reducing the harm to our environment and enhancing people's lives. To share a couple of examples from our research, we are excited on what A.I. can do in improving biodiversity protection and conservation. Specifically on how A.I. can improve the accuracy and efficiency of monitoring, helping us better understand biodiversity loss and support decision making and policy design. Overall, we think A.I. can help us more efficiently identify areas for urgent conservation and provide us with the tools to make more informed decisions. Another example is what we see A.I. can do in improving education outcomes, particularly in under-resourced areas. We think A.I. can help enhance teaching and learning outcomes, improve assessment practices, increase accessibility and make institutions more operationally efficient. Which then goes into financial implications A.I. can have in improving margins and reducing costs for organizations. Essentially, we view A.I. as a deflationary technology for many organizations. So Stephen, the Morgan Stanley's Sustainability Team has also done some recent work around the future of food. What role will A.I. play in agriculture in particular? Stephen Byrd: Yeah, we're especially excited about what A.I could do in the agriculture sector. So we think about A.I. enabled tools that will help farmers improve efficiencies while also improving the quantity and quality of crop production. For example, there's technology that annotates camera images to differentiate between weeds and crops at the pixel level and then uses that information to administer pesticides only to weed infested areas. The result is the farmer saves money on pesticides, while also improving agricultural production and enhancing biodiversity by reducing damage to the ecosystem. Brenda Duverce: But there are also risks and negative implications that ESG investors need to consider in exploring A.I. driven opportunities. How should investors think about these? Stephen Byrd: You know, we've been getting a lot of questions from ESG investors around some of the risks related to A.I., and there certainly are quite a few to consider. One big category of risk would be bias, and in the note, we lay out a series of different types of bias risks that we see with A.I. One example would be data selection bias, another would be algorithmic bias, and then lastly, human bias. Just as an example on human bias, this bias would occur when the people developing and training the algorithm introduce their own biases into the data or the algorithm itself. So this is a broad category that's gathered a lot of concern, and that's quite understandable. Another area would be data privacy and security. An example in the utility sector from a research entity focused on the power sector, they highlight that the data collected for A.I. technologies while being meant to train models for a good purpose, could be used in ways that violate the privacy of the data owners. For instance, energy usage data can be collected and used to help residential customers be more energy efficient and lower their bills, but at the same time, the same data could also be used to derive personal information such as the occupation and religion of the residents. Stephen Byrd: So Brenda, keeping in mind the potential benefits and risks for me that we just touched on, where do you think A.I's impact is likely to be the greatest and the most immediate? Brenda Duverce: Beyond the improvements A.I. can have on our society, in our ESG space in particular, we are excited to see how A.I. can improve the data landscape, specifically thinking about corporate disclosures. We think A.I. can help companies better predict their scope through emissions, which tend to be the largest component of a company's total greenhouse gas emissions, but the most difficult to quantify. We think machine learning in particular can be useful in estimating these emissions by using statistical learning techniques to develop more accurate models. Stephen Byrd: But it's ironic that when we talk about A.I., within the context of ESG, one of the drawbacks to consider around A.I. is its potential carbon footprint and emissions. So is this a big concern? Brenda Duverce: Yes, we do think this is a big concern, particularly as we think about our path towards net zero. Since 2010, emissions at data centers and transmission networks that underpin our digital environment have only grown modestly, despite rapid demand for digital services. This is largely thanks to energy efficiency improvements, renewable energy purchases and a broader decarbonization of our grids. However, we are concerned that these efficiencies in place won't be enough to withstand the high compute intensity required as more A.I. models come online. This is a risk we hope to continue to explore and monitor, especially as it relates to our climate goals. Stephen Byrd: In terms of the latest developments around risk from A.I, there's been a call to pause giant A.I. experiments. Can you give us some context around this? Brenda Duverce: Sure. In a recent open letter led by the Future of Life Institute, several A.I. researchers called for a pause for at least six months on the training of A.I. systems more powerful than GPT-4. The letter highlighted the risk these systems can have on society and humanity. In our view, we think that a pause is highly unlikely. However, we do think that this continues to bring to light why it is important to also consider the risk of A.I. and why A.I. researchers must follow responsible ethical principles. Brenda Duverce: So, Stephen, in the United States, there's currently no comprehensive federal regulation specifically dedicated to A.I.. What is your outlook for legislative action and policies around A.I., both here in the U.S. and abroad? Stephen Byrd: Yeah, Brenda, I'd say broadly it does look like the pace of A.I. development is more rapid than the pace of regulatory and legislative developments, and I'll walk through some developments around the world. There have been several calls across stakeholder groups for effective regulation, the US Chamber of Commerce being one of them. And last year we did see some state level regulation focused on A.I. use cases and the risks associated with A.I. and unequal practices. But broadly, in our opinion, we think that the likelihood of legislation being enacted in the near term is low, and that in the U.S. in particular, we expect to see more involvement from regulatory bodies and other industry leaders advocating for a national standard. The European approach to A.I. is focused on trust and excellence, aiming to increase research and industrial capacity while ensuring safety and fundamental rights. The A.I. ACT is a proposed European law assigning A.I. to three risk categories. Unacceptable risk, high risk and applications that don't fall in either of those categories which would be unregulated. This proposed law has faced significant delays and its future is still unclear. Proponents of the legislation expect it to lead the way for other global governing bodies to follow while others are disappointed by its vagueness, the potential for it to stifle innovation and concerns that it does not do enough to explicitly protect against A.I. systems used for weapons, finance and health care. Stephen Byrd: Finally, Brenda, what are some A.I. related catalysts that investors should pay attention to? Brenda Duverce: In terms of catalysts, we'll continue to see innovation updates from our core A.I. enablers, which shouldn't be a surprise to our listeners. But we plan to continue to monitor the ever evolving regulatory landscape on this topic and the discourse from influential organizations helping to push for A.I. safety around the world. Stephen Byrd: Brenda, thanks for taking the time to talk. Brenda Duverce: Great speaking with you, Stephen. Stephen Byrd: And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review on Apple Podcasts and share the podcast with a friend or colleague today.

The final episode of our series on market integrity in sustainable finance, focuses on the asset management and the fund industry. Nicholas Pfaff, Deputy CEO and Head of Sustainable Finance at ICMA sat down with Hortense Bioy, Global Director of Sustainability Research, Manager Research, Morningstar, Mark Manning, Strategic Policy Advisor Sustainable Finance, FCA, Patrik Karlsson, Senior Policy Offices, ESMA and Stéphane Janin, Head of Global Regulatory Developments and Public Affairs, AXA Investment Managers, to talk about greenwashing in the industry, the impact of regulation such as SFDR and what's next on the regulators' agenda.

After the passing of the Inflation Reduction Act in the U.S., other countries may be looking to invest more in their own energy transitions.----- Transcript -----Welcome to Thoughts on the Market. I'm Michael Zezas, Head of Global Thematic and Public Policy Research for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the intersection between public policy and financial markets. It's Wednesday, March 1st at 10 a.m. in New York. When Congress passed and the president signed into law the Inflation Reduction Act last year, they may have started a race among global governments to spend new money in an attempt to cut carbon output dramatically. Consider the European Union, where our economists and strategists are flagging that they expect, later this month, there will be an announcement of a major allocation of government funds to mirror the nearly $370 billion allocated by the U.S. toward its own energy transition. In the U.S., we've already flagged that much of the investment opportunity lies in the domestic clean tech space. As Stephen Byrd, our Global Head of Sustainability Research, has flagged the IRA's monetary allocation and rules creating preferences for materials sourced domestically or in friendly national confines, means that the U.S. clean tech space is seeing a substantial growth in demand for its products and services. In the EU, the story is more nuanced as we await details on what a final version of the European Commission's Green Deal Industrial Plan is, a process that could take us into the summer or beyond. Streamlining regulations to encourage private funding and expand the network for trade partners on green tech equipment is expected to be in focus. So the near term macro impacts are murky, but at a sector level, such a policy should present opportunities in utilities, capital goods, materials and construction. In short, this policy would mean the EU is finding ways to accelerate demand for these green enabler companies. So, in line with the transition to decarbonization as one of our big three investment themes for 2023, investors would do well to follow the money and see where there may be opportunities. Thanks for listening. If you enjoy the show, please share Thoughts on the Market with a friend or colleague, or leave us a review on Apple Podcasts. It helps more people find the show.

Companies continue their attempts to mitigate their environmental impact. But are some merely buying their way out of the problem using carbon offsets? Global Head of Sustainability Research Stephen Byrd and Head of ESG Fixed-Income Research Carolyn Campbell discuss. ----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Carolyn Campbell: And I'm Carolyn Campbell, Head of Morgan Stanley's ESG Fixed-Income Research. Stephen Byrd: On this special episode of the podcast, we'll discuss the voluntary carbon offset market and the role carbon offsets play in achieving companies' decarbonization goals. It's Thursday, February 23rd at 10 a.m. in New York. Stephen Byrd: As extreme weather becomes the new normal, and sustainability rises in importance on investors' agendas, many companies are working towards mitigating their environmental impact. But even so, there's persistent public concern that some companies claiming to be carbon neutral may in fact be "greenwashing" by purchasing so-called carbon offsets. So, Carolyn, let's start with the basics. What exactly are carbon offsets and why should investors care? Carolyn Campbell: So a carbon offset represents one ton of carbon dioxide equivalent removed, reduced or avoided in the atmosphere. Companies are buying offsets to neutralize their own emissions. They essentially subtract the amount of carbon offsets purchased from their total emissions, from their operations and supply chain. These offsets are useful because it allows a company to take action against their emissions now, while implementing longer term decarbonization strategies. However, there's concern that these companies are just buying their way out of the problem and are using these offsets that do not actually do anything with respect to actually limiting global warming. So, Stephen, some of these offsets focus on reducing carbon dioxide emissions, while others aim to directly remove these emissions from the atmosphere. Between these so-called avoidance and removal offsets, how do you see the market evolving for each over the next 5 to 10 years, let's say? Stephen Byrd: Yeah, Carolyn, I think the balance is set to shift in favor of removal over the coming decade. So we developed an assessment of the potential mix shift from carbon avoidance to carbon removal projects, which shows the long term importance of removal projects as well as the near-term to medium term need for avoidance projects. We're bullish that over the long term removal projects, and think of these projects as projects that demonstrably and permanently take carbon dioxide out of the atmosphere, as generating enough carbon offset credits to reach company's net zero targets, again in the long term. However, over the near to medium term, call it the next 5 to 10 years, we expect the volume of removal projects to fall short. As a result, we think carbon avoidance projects, and these would be projects that avoid new atmospheric emissions of carbon dioxide. These will play an important role as offset purchasers shift their mix of carbon offsets towards removal over the course of this decade. Carolyn, one of the big debates in the market around voluntary carbon offsets involves nature based projects versus technology based projects. Could you give us some examples of each and just talk through, is one type significantly better than the other? And which one do you think will likely gain the most traction? Carolyn Campbell: Sure. So on the one side, we've got these nature based projects which include things like reforestation, afforestation and avoided deforestation projects. In essence planting trees and protecting forests that are already there. There's also other projects related to grasslands and coastal conservation. On the other side, we've got these tech based projects which are actually quite wide ranging. This includes things like deploying new renewable technology or capping oil wells to prevent methane leakage, substituting wood burning stove for clean cookstoves, everything up to direct air capture and carbon capture, so on and so forth. So in our view, these tech based offsets will eventually dominate the market, but they face some scaling and cost hurdles over in the near term. Tech based offsets have some key advantages. They're highly measurable and they have a high probability of permanence, both disadvantages on the nature based side. Nature based sides, like I said, have measurement hurdles, but we think they represent an important interim solution until either geographic limits are reached because there's no more area left to reforest, or legislative conservation takes over. Removal technologies, like direct air capture and carbon capture, yield highly quantifiable results. And that drives a value in a market where the lack of confidence is a major obstacle to growth. So we think that's where the market's heading, but we're not really there yet. Now, one thing we haven't discussed is why even buy carbon offsets at all? Should companies be spending their limited sustainability budgets on carbon offsets, or is that money better served on research and development that might get us closer to absolute zero in the long term? Stephen Byrd: Yeah, we are seeing signs that companies are increasingly looking to spend more of their sustainability budgets on research and development of long term decarbonization solutions, in lieu of buying carbon offsets. Now we support that trend, given the need for new technologies to really bend the curve on carbon emissions. And we do believe that offsets should not substitute for viable permanent decarbonization projects. Now, that said, offsets are a complimentary approach that enables action to be taken today against emissions that corporates currently cannot eliminate. We also believe the magnitude of consumer interest in carbon neutral products is underappreciated. Survey work from our alpha wise colleagues, really focused on consumer preferences and carbon neutral goods and services, shows that consumers are willing to pay about a 2% premium for carbon neutrality. Now, that may not sound like much, but it's actually a very significant number when you translate that into a price on carbon. Let's take sneakers as an example. Our math would indicate that consumers would be willing to price carbon offsets at a value above $150 a ton of carbon dioxide. That prices about 15 times the weighted average price of offsets in 2022. So consumer preferences may well play an important role in the evolution of the carbon offset market throughout the course of this decade and beyond. And we do think that this dynamic could provide the support needed to move the market towards higher quality offsets, and also drive companies to develop their own innovative decarbonization solutions. Carolyn, how big do you think the carbon offsets market could get over the next 5 to 10 years and even longer term? Carolyn Campbell: Okay, so right now the market's around 1 to 2 billion in size, but we think there is a sizable growth opportunity between now and 2030, which is when many of the interim targets are set. And also longer term out to 2050, by which point we're trying to be net zero. So we estimate that the market could grow to around 100 billion by the end of this decade, and that will swell to around 250 billion by mid-century. And we've done this analysis based on our median expectation for progress on a few different decarbonization technologies like decarbonizing cement, decarbonizing manufacturing, and increasing the zero carbon energy penetration in the grid. When we look at that technological progress versus where we need to be in terms of our ambition to keep warming to one and a half or two degrees Celsius, that's how we arrive at the shortfall to make up that size of the market. Stephen Byrd: Finally, Carolyn, one of the criticisms of carbon offsets is that they aren't regulated. So could you give us a quick glimpse into the policies and regulations around carbon offsets that potentially lie ahead? Carolyn Campbell: Yeah, so you're right. Right now the market is largely unregulated and that creates the risk of fraud and manipulation. However, we don't expect imminent action, and it's just not a priority in the U.S. for Congress. That being said, if regulation does occur, we have an idea of what it could look like. We would expect to be led by the CFTC, which regulates the commodities markets. And we think that it would be focused on ensuring integrity in the market, creating a registration framework for the offsets and pursuing individual cases of fraud. Now, without formal regulation, there are few voluntary initiatives that have continued to set the standards in the industry. These organizations focus on the integrity of the market, they set principles to ensure that offsets are high quality, and they're even looking at labeling to mark credits as high integrity. So there's a lot of guidance out there, and it's constantly adapting to this evolving landscape. Stephen Byrd: Carolyn, thanks for taking the time to talk. Carolyn Campbell: Great speaking with you today, Stephen. Stephen Byrd: And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review on Apple Podcasts and share the podcast with a friend or colleague today.

On this episode, Nate speaks with econometrician and sustainability researcher Gaya Herrington about her new book, Five Insights for Avoiding Global Collapse, a more in-depth and personal telling of her 2021 review of the Limits to Growth (LTG). More than 50 years after the original LTG report was released, the model trajectories remain both relevant and controversial, as we continue with the ‘business as usual' scenario, in which the LTG model resulted in collapse. Why are we stuck on this road and how are our growth based economic systems optimized to keep us there? Is it possible to shift our goals to a different path, away from growth, focused on the well-being of all life? Can we plan or mitigate the path to descent? About Gaya Herrington: Gaya is a Dutch econometrician, sustainability researcher, and women's rights activist. Gaya holds masters' degrees in both econometrics and sustainability studies. After becoming disillusioned by initially working in the financial sector Gaya became the executive director of StoereVrouwen, a non-profit Dutch women's movement promoting sustainable economic policies through activism. In 2014, Herrington became the Director of Sustainability Services of KPMG. Most recently, her study on the projections made in the 1972 Limits to Growth report was widely publicized internationally. She is currently Vice President Sustainability Research at Schneider Electric. For Show Notes and More visit: https://www.thegreatsimplification.com/episode/57-Gaya-Herrington

Dr. Sarah Klopatek currently serves as the Director of Sustainability Research and Development at JBS USA. Specifically, Sarah works on livestock sustainability research, Net Zero initiatives, and animal welfare. Prior to working at JBS, Sarah was a postdoctoral research fellow at University of California-Davis working in beef cattle system dynamics and livestock sustainability. During her graduate career Sarah completed numerous beef cattle research projects including a sustainability assessment of four grass-fed and grain-fed beef systems, multiple beef cattle life cycle assessments, a national beef sustainability and BQA survey, and multiple meat science projects. In addition, Sarah was heavily involved in teaching and extension. Over the course of Sarah's graduate and postdoctoral career Sarah earned numerous awards and fellowships including the National Cattlemen's Foundation WD Farr Scholarship, the Council of Agriculture and Science Technology Fellowship, the James Beard Fellowship, and the American Society of Animal Scientists Young Scholar Award.Find Dr. Sarah Klopatek at-LK- @Sarah C. Klopatek, PhDTW- @DrBeefBabeFind Boundless Body at- myboundlessbody.com Book a session with us here! Check out our new Patreon page!

With the recent breakthrough in fusion energy technology, the debate around the feasibility of nuclear fusion as a commercialized energy source may leave investors wondering, is it a holy grail or a pipe dream? Global Head of Sustainability Research and North American Clean Energy Research Stephen Byrd and Head of Thematic Research in Europe Ed Stanley discuss.----- Transcript -----Stephen Byrd: Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research and North American Clean Energy Research. Ed Stanley: And I'm Ed Stanley, Morgan Stanley's Head of Thematic Research in Europe. Stephen Byrd: And on the special episode of Thoughts on the Market, we'll discuss the potential of nuclear fusion technology in light of a key recent breakthrough in the space. It's Tuesday, December 20th, at 10 a.m. in New York. Ed Stanley: And 2 p.m. in London. Stephen Byrd: Ed, you recently came to this podcast to discuss your team's work on "Earthshots", technologies that can accelerate the pace of decarbonization and mitigate some of the climate change that's occurring as a result of greenhouse gas emissions, trapping the sun's heat. In a sense, Earthshots can be defined as urgent solutions to an intensifying climate crisis and nuclear fusion as one of these potential radical decarbonization technologies. So, Ed, I wondered if you could just start by explaining how nuclear fusion fits into your excellent Earthshots framework. Ed Stanley: Absolutely. So in Earthshots we laid out six technologies we thought could be truly revolutionary and changed the course of decarbonization. Three of those were environmental and three were biological innovations. In order of investability, horizon carbon capture was first, smart grids were next, and then further out was nuclear fusion on the environmental side. In early December the U.S. Department of Energy announced the achievement of fusion ignition at the Lawrence Livermore National Laboratory. So Steve, passing back to you, can you give us a sense of why this was considered such an important moment? Stephen Byrd: Yeah Ed, you know, as you mentioned, ignition was achieved at the government lab. And this is very exciting because this shows the potential for fusion to create net energy as a result of achieving fusion. So essentially what happened was two megajoules of energy went into the process of creating the ignition, and three megajoules of energy were produced as a result. So a very exciting development. But as we'll discuss, a lot of additional milestones yet to achieve. Ed Stanley: And there's been significant debates around nuclear fusion in recent days caused by this. And from the perspective of a seasoned utilities analyst, but also with your ESG hat on, is fusion the Holy Grail it's often touted to be, or do you think it's more of a pipe dream? And compared to nuclear fission, how much of a step change would it be? Stephen Byrd: You know, that's a fascinating question in terms of the long term potential of fusion. I do see immense long term potential for fusion, but I do want to emphasize long term. I think, again, we have many steps to achieve, but let's talk fundamentally about what is so exciting about fusion energy. The first and foremost is abundant energy. As I mentioned, you know, small amount of energy in produces a greater amount of energy out, and this can be scaled up. And so this could create plentiful energy that's exciting. It's no carbon dioxide, that's also very exciting. No long live radioactive waste, add that to the list of exciting things. A very limited risk of proliferation, because fusion does not employ fissile materials like uranium, for example. So tremendous potential, but a long way to go likely until this is actually put into the field. So in the meantime, we have to be looking to other technologies to help with the energy transition. So Ed, just building on what we're going to really need to achieve the energy transition and thinking through the development of fusion, what are some of the upcoming milestones and technology advancements that you're thinking about for the development and deployment of fusion energy? Ed Stanley: The technology milestones to watch for, I think, are generally known and ironically, actually relatively simple for this topic. We need more power out than in, and we need more controlled energy output, and certain technology breakthroughs can help with that. But we also need more time, more money, more computation, more facilities with which to try this technology out. But importantly, I think the next ten years is going to look very different from the last ten years in terms of these milestones and breakthroughs. I think that's going to be formed by four different things: the frequency, geographically, disciplinary and privately. And by those I mean on frequency it took about 25 years for JET in 2020 to break its own output record that it set in 1995. And then all of a sudden in 2021, 22, we saw four more notable records broken. Geographically, two of those records broken were in China, which is incredibly interesting because it shows that international competition is clearly on the rise. Third, we're seeing interdisciplinary breakthroughs to your point on integrating new types of technology. And finally, the emergence of increasingly well-funded private facilities. And this public private competition can and should accelerate the breakthroughs occurring in unexpected locations. But Stephen, I suppose if we cut to the chase on the when, how long do you think commercial scale fusion will take to come to fruition? Stephen Byrd: You know, it's a great question Ed. I think the Department of Energy officials that gave the press release on this technology development highlighted some of the challenges ahead. Let me talk through three big technology challenges that will need to be overcome. The first is what I think of as sort of true net energy production. So I mentioned before that it just took two mega jewels to ignite the fuel and then the output was three megajoules. That's very exciting. However, the total energy needed to power the lasers was 300 megajoules, so a massive amount. So we need to see tremendous efficiency improvements, that's the first challenge. The second challenge would be what we think of as repeatable ignition. That relates to creating a consistent, stable set of fusion, which to date has not been possible. Lastly, for Tokamak Technologies, Tokamaks are essentially magnetic bottles. The crucial element for commercialization is making these high temperature superconducting magnets stronger. That would enable everything else to be smaller and that would lead to cost improvements. So I think we have a long way to go. So Ed, just building on that idea of commercialization, you know, with the economics of fusion technologies looking more attractive now than previously given this breakthrough that we've seen at the U.S. DOE lab, what's happening on the policy and regulatory side. Do you see support for nuclear fusion? And if you do, in which countries do you see that support? Ed Stanley: I mean, it's a great question. And governments and electorates around the world, particularly in Europe, where I'm sitting, have what can only be described as a complicated relationship with nuclear energy. But on support for fusion broadly, yes, I think there is tentative support. It depends on the news flow and I think excitement last week shows exactly that. But personally, I think we are still too early to worry too much about policy and regulation. In simple terms, you can't actually regulate and promote and subsidize something where the technology isn't actually ready yet, which is part of the point you've made throughout. But that question also reminds me of a time about 15 years ago when I received national security clearance to visit the U.K.'s Atomic Energy Authority in Europe. And at that time, they were the clear global leader in fusion research. Obviously, that was hugely exciting as a young teenager. But something that the lead scientist said to me at that point struck me and it remains true today, that no R&D project on the planet receives as much funding relative to its frequency of breakthroughs as Fusion does. Which tells you just how committed that governments and now corporates around the world are in trying to unlock carbon free nuclear waste, free energy. But as you have said, quite rightly, that has taken and it will continue to take patience. Stephen Byrd: That's great. Ed, thanks for taking the time to talk. Ed Stanley: It's great speaking with you, Stephen. Stephen Byrd: As a reminder, if you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts app. It helps more people to find the show.

Traditional ESG investing strategies highlight companies with top scores across ESG metrics, but new research shows value in focusing instead on those companies who have a higher rate of change as they improve their ESG metrics.----- Transcript -----Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research. Along with my colleagues, bringing you a variety of perspectives, today I'll focus on our new approach to identifying opportunities that can generate both Alpha and ESG impact. It's Tuesday, November 29th, at 10 a.m. in New York. On previous episodes of this podcast we've discussed how, although sustainable investing has been a trend over the past decade, it has faced significant pushback from critics arguing that ESG strategies - or environmental, social and governance - sacrifice long term returns in favor of the pursuit of certain ESG objectives. We have done some new work here at Morgan Stanley, suggesting that it is possible to identify opportunities that can deliver excess returns, or alpha, and make an ESG impact. Our research found that what we call "ESG rate of change", companies that are leaders on improving ESG metrics, should be a critical focus for investors looking to identify companies that meet both criteria. What do we mean by "ESG rate of change"? Traditional ESG screens focus on "ESG best-in-class" metrics. That is, companies that are already scoring well on sustainability factors. But there is a case to be made for companies that are making significant improvements. For example, we find that there are companies using innovative technologies that can reduce costs and improve efficiency. These companies, which we call deflation enablers, generally screen very favorably on a range of ESG metrics and are reaping the financial benefits of improved efficiency. A surprisingly broad range of technologies are dropping in cost to such an extent that they offer significant net benefits, both financial and ESG oriented. Some examples of such technologies are very cheap solar, wind and clean hydrogen, energy storage cost reductions, cheaper carbon capture, improved molecular plastics recycling, more efficient electric motors, a wide range of recycling technologies, and a range of increasingly inexpensive waste to energy technology. To get even more specific, as we look at these various technologies and the sectors they touch, we think the utility sector is arguably the most advantaged among the carbon heavy sectors in terms of its ESG potential. Why is that? Because many utilities have the potential to create an "everybody wins" outcome in which customer bills are lower, CO2 emissions are reduced, and utility earnings per share growth is enhanced. This is a rare combination. In the U.S. utility sector many management teams are shutting down expensive coal fired power plants and building renewables, energy storage and transmission, which achieve superior earnings per share growth. Many of these stocks would screen negatively on classic ESG metrics such as carbon intensity, but these ESG improvers may be positioned to deliver superior stock returns and play a critical role in the transition to clean energy. As with most things, applying this new strategy we're proposing isn't simply a matter of looking at companies with improving ESG metrics. It's about really understanding what's driving these changes. Here's where sector specific expertise is key. In fact, we believe that in the absence of fundamental insight, ESG criteria can be misapplied and could lead to unintended outcomes. The potential for enhanced performance, in our view, comes from a true marriage of ESG investing principles and deep sector expertise. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts app. It helps more people to find the show.

The voluntary carbon offsets market is growing as companies and countries look to meet their climate goals. Offsets from agriculture have been getting attention recently. While they comprise only 1% of total offsets today, their potential to spur innovation and change in agricultural practices means there is scope for a much bigger impact. From soil management to livestock-related activities, farmers are at the heart of the agriculture offsets market. Today, we speak about what agriculture carbon offsets are, what one needs to think about when considering whether the emissions reductions are additional, and who is keeping an eye on them. To provide us with those details, Kyle Harrison, Head of Sustainability Research at BNEF, joins us on the show. For further reading on this topic, BNEF subscribers can read, Agriculture Carbon Offsets Outlook: Barren to Bountiful, at BNEF on the Bloomberg Terminal, and bnef.com or via our mobile app.See omnystudio.com/listener for privacy information.

Increasing ESG pervasiveness has led to increasing confusion, in particular around how investors might apply these criteria to the utility sector. Head of Sustainability Research and Clean Energy Stephen Byrd and Equity Analyst for the Power and Utilities Industry Dave Arcaro discuss. ----- Transcript -----Stephen Byrd Welcome to Thoughts on the Market. I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research and Clean Energy.Dave Arcaro And I'm Dave Arcaro, Equity Analyst for the Power and Utilities Industry.Stephen Byrd And on this special episode of the podcast, we'll be discussing a new framework for investors to approach ESG analysis within the utility space. It's Thursday, October 13th, at noon in New York.Stephen Byrd Our listeners are no doubt well aware that ESG criteria—that is environmental, social and governance criteria—have become an increasingly important part of the investment process. This growth has been spurred by a continual search for better long term financial returns, as well as a conscious pursuit of better alignment with values. Yet despite ESG's seeming pervasiveness within the financial ecosystem, there's been a genuine confusion and even controversy among investors about how to apply ESG metrics to the utility sector in particular. And so, in an effort to bring clarity to this key market debate, today we're going to share an innovative framework designed to drive both Alpha, which is the returns aspect, and impact, which is the societal benefit. So Dave, let's start with the problem. What causes this investor confusion and how does the new ESG framework address this problem?Dave Arcaro There are a few sources of confusion or debate that we're hearing from investors. The first seems to be centered on the lack of a clear distinction between ESG criteria that are likely to have a direct impact on stock performance, and then those that are more focused on achieving the maximum positive impact on ESG goals. Secondly, there is too much focus directly on carbon emissions, and there isn't enough focus on the social and governance criteria in the utility space. These can also have an impact on stocks and on key utility constituents, things like lobbying, operations, customer relationships. The new ESG framework that we've introduced here addresses these issues. It expands the environmental assessment, incorporates specific social and governance criteria that are most relevant for utilities, like customer and lobbying metrics, and it adds a new perspective. For each of these metrics, we assess which ones truly have an impact on alpha generation and which ones have the largest purely societal impact.Stephen Byrd And stepping back, Dave, we've seen that the utility sector is arguably the best positioned among the carbon heavy sectors in terms of its ESG potential. Can you walk us through that thought?Dave Arcaro Utilities are in a unique position because they can often create an outcome in which everybody wins when it comes to decarbonizing. This is because when utilities shut down coal and replace it with renewables, it often has three benefits; carbon emissions decline, customer bills are reduced because renewables have gotten so cheap and the utility also grows its earnings. So, it's a strong incentive for utilities to set ambitious plans to decarbonize their fleets.Stephen Byrd Now Dave, typically, when considering the E, that is environmental criteria, ESG analysis tends to focus solely or primarily at least on carbon dioxide. Is this a fair approach or should investors be considering other factors?Dave Arcaro We think other factors should come into play here, and we recommend investors consider the rate of change in carbon emissions, the CO2 intensity of the fleet, risks from climate change, and also impacts on biodiversity. Some of these are more readily available than others, but we think the environmental assessment should expand beyond a simple look at carbon emissions.Dave Arcaro So, Stephen, I want to turn it to you. The E part of ESG is always drawing attention when investors talk about utilities. But so far it seems that there's been little focus on the S, social, and G, governance, criteria when assessing U.S. utilities. What are some of the key areas that investors should concentrate on?Stephen Byrd The utility sector really is one of the most heavily regulated sectors, so both social and governance factors can impact the success of the utility business and drive stock performance as well. The short list of metrics that we found to have a clear linkage to share price performance would be one, corporate spending on lobbying activities, especially through 501c4 entities. Two, operational excellence, which for utilities really reflects safety and reliability. Three, risk of customer defection due to high bills and worsening grid reliability. And four, impacts to low-income communities. So, we use these metrics to round out a holistic ESG assessment of the industry.Dave Arcaro And last but not least, how does the new Inflation Reduction Act legislation figure within the kind of ESG framework Morgan Stanley is proposing here?Stephen Byrd Yeah, the Inflation Reduction Act really is a big deal for our sector. To be specific, the Inflation Reduction Act provides significant, wide-ranging support for decarbonization technologies really across the board, including wind, solar, storage and clean hydrogen. As a result, this legislation could accelerate progress for utility decarbonization strategies in a way that also drives earnings and alpha. For that reason, within our framework, we specifically consider whether a utility is a beneficiary of the Inflation Reduction Act, given the potentially very large positive impacts on both the business and the environment.Stephen Byrd David, thanks for taking the time to talk.Dave Arcaro Great speaking with you, Stephen.Stephen Byrd And thanks for listening. If you enjoy Thoughts on the Market, please leave us a review on Apple Podcasts and share the podcast with a friend or colleague today.

The Inflation Reduction Act represents the single biggest climate investment in U.S. history, so how will these provisions influence consumers' pocketbooks and the clean energy market? Head of Global Thematic and Public Policy Research Michael Zezas and Global Head of Sustainability Research Stephen Byrd discuss.----- Transcript -----Michael Zezas Welcome to Thoughts on the Market. I'm Michael Zezas, Morgan Stanley's Head of Global Thematic and Public Policy Research.Stephen Byrd And I'm Stephen Byrd, Morgan Stanley's Global Head of Sustainability Research.Michael Zezas And on this special episode of Thoughts on the Market, we'll focus on the Inflation Reduction Act's bold attempt to stem the tide of climate change. It's Tuesday, August 23rd at noon in New York.Michael Zezas Regular listeners may have heard our previous episodes on the potential impact for the U.S. economy and on taxes from the Inflation Reduction Act. Today, we'll focus on another essential aspect of this new legislation, namely its sweeping support for clean energy, which represents the single biggest climate investment in U.S. history. So, Stephen, there's a ton of important issues to address here. Let's start with an immediate pain point that most of us deal with on a daily basis, the cost of energy. How does the Inflation Reduction Act aim to lower energy costs for Americans?Stephen Byrd The simplest way to think about this is that in the past decade, wind and solar costs in the U.S. declined every year by double digits. What's exciting about the IRA is that there are really important investments that will increase the scale of manufacturing. So, the fundamental point in terms of the benefit of the IRA really is support for a variety of clean energy investments that's going to increase efficiency, reduce per unit costs. This is becoming really essentially a very big business. To put this in context, in the last 12 months utility bills in the U.S. and most of the U.S. have increased by sometimes well into the double digits. And yet clean energy costs remain quite low. Given some of the near-term COVID supply chain dynamics, costs aren't dropping as quickly as they normally would, but before long we're going to see those reductions continue. That should result in lower power costs for customers across the U.S. and that's the single biggest benefit from a sort of deflationary point of view that I can think of around the IRA.Michael Zezas And the IRA also has a stated aim to increase American energy security. In what ways does it attempt to do that?Stephen Byrd Yeah, Michael, it's really interesting. The IRA has some very broad areas of support for domestic manufacturing of all kinds, of not just clean energy but related technologies like energy storage. And we do think that's going to likely result in quite a bit of onshoring of manufacturing activity. That is good for American energy security, that brings our sources of energy production right back home, creates jobs, reduces dependency on other governments. So, for example, the subsidy for solar manufacturing is really very large. It can be as high as essentially $0.17 a watt, and to put that into context, the selling price at the wholesale level for many of these products is around $0.30 a watt. So that subsidy for domestic manufacturing should result in real investment decisions in real U.S. factories, and that will help to improve American energy security.Michael Zezas Now, another aspect of this legislation is its attempt to substantially limit carbon emissions in the U.S. What are some of the measures that are aimed at doing this?Stephen Byrd Decarbonization is a major area of focus, just as you said, for the IRA and this shows up in many ways. I'd say the most direct way would be providing a number of incentives to increase the growth of wind and solar. So, we'll see a great deal of growth there as a result. However, there are other elements that are really interesting. One example is support for nuclear. I think the drafters really wanted to ensure that we didn't lose any additional nuclear power plants. Those plants provide obviously zero carbon energy, but they also provide really important grid reliability services so that's helpful. There is also quite a bit of capital for carbon capture, which should reduce the emissions profile of other sectors as well. There's quite a bit of support for electric vehicles that will help with the pace of electrification. And that's kind of a nice double benefit in the sense that if more consumers choose electric vehicles and the grid becomes cleaner then we get a double benefit. So, we're really seeing very broad-based support for decarbonization in the IRA.Michael Zezas Now, one of the methods here to incentivize decarbonization is through tax credits. What are some of these tax credits? How do they work?Stephen Byrd We have a lot of tax credits in this IRA for what I think of as wholesale players, that is the big clean energy developers. There are tax credits for wind and solar that get extended well into the next decade. We have a new tax credit for energy storage. We have tax credits that have been enhanced for carbon capture and utilization, which is very exciting because that's at a level needed to incent quite a bit of investment in carbon capture. We have a new very large tax credit for green hydrogen. That's great, because today hydrogen is made in a process called ‘gray hydrogen' that does have quite a high carbon profile. So, a variety of tax credits essentially at the wholesale level or at the developer level, but also that could benefit consumers as well, such as on electric vehicles and those are quite sizable as well.Michael Zezas Now these tax credits and the other efforts in the Inflation Reduction Act aimed at carbon reduction, they represent a major pickup in spending on clean technologies. Can you give us some perspective on that? And is the industry ready to supply all the equipment and labor needed to make this a reality?Stephen Byrd I think what we're seeing with many technologies here in clean energy is that the demand is starting to grow very rapidly. Now the industry is really pushing very hard to keep pace, essentially. The limit on growth for some of our companies is really down to people. That is, how many people can they hire and train. So, for some of those companies, that growth rate caps out at about 25% per year. You know, that's quite good and we'll see that continue for many years. I think we're going to see a lot of increased efforts on education. And you'll see also within the IRA a lot of language around prevailing wage and ensuring that employees get paid a fair wage. On top of that, though, there are some areas of shortage. So in energy storage, for example, demand is very high across the U.S., not just for electric vehicles, but also to help with grid reliability. A good example would be in Texas during the winter storm, parts of the Texas grid failed and quite a few people were without power during very cold conditions. That was very challenging. And as a result, a lot of customers, both individuals and corporations, want to have storage. There are limits, there is a shortage essentially globally in terms of energy storage, and that's going to take years to address. That said, the IRA does make important headway in terms of providing incentives and financial support to bring a lot of manufacturing back to the U.S. so we have better control of manufacturing. We'll be able to scale up more quickly and also avoid a lot of the logistics and supply chain issues that have plagued some of our companies that have dealt with very complex and challenging global supply chains.Michael Zezas So, for investors, then, what's the takeaway? Is this perhaps a boon for the clean tech sector, or is it maybe too much, too soon?Stephen Byrd I think this is a boon for not just the clean tech sector. I think ultimately this is going to translate into much more rapid adoption of clean energy, which fundamentally is very much a deflationary force. So what we're going to see is further innovation, further manufacturing in the U.S. That means more jobs in the U.S, that means a faster pace of innovation and a faster rate of cost reduction. So that does look to us to be a virtuous cycle that's going to benefit not just the decarbonization of the U.S. economy but benefit the consumer and provide jobs as well.Michael Zezas Stephen, thanks for taking the time to talk.Stephen Byrd Great speaking with you, Michael.Michael Zezas As a reminder, if you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts app. It helps more people find the show.