Charlie Morrow, Cognito’s Global Head of Sustainability Communications joined Account Director, Vanja Lakic live in our New York office during Climate Week NYC to share his views on this year's Climate Week events and what he is hearing from business leaders, trends he’s seeing in sustainable finance and ESG investing and the important role communications professionals play in the fight against climate change.
Transcript for podcast
Vanja Lakic 0:05
It's Climate Week in New York City, the largest annual climate event that brings together business leaders, politicians and other key decision makers from all over the world to discuss anything from ways to accelerate decarbonization to how to finance climate justice. On today's Cogcast, Cognito's podcast where we speak with PR Pros and Journalists on the latest happenings in media and business communications, we have Charlie Morrow on our show. Charlie is Global Head of Sustainability Communications at Cognito. He works with a wide array of clients doing innovative work around key issues we're facing around climate change. All the way from our London office. Charlie joined us this week in New York to share his views on this year's Climate Week events and what he's hearing from business leaders and trends see seeing in sustainable finance and ESG investing of use to communications professionals. I'm your host of Cogcast, Vanja Lakic and pleased to welcome Charlie onto the show today.
Charlie, nice to have you on.
Charlie Morrow 1:17
Great to be here Vanja.
Vanja Lakic 1:18
Charlie, this year's Climate week theme is "We can. We will," can you tell us more about how you're expecting that will play out at this year's event?
Charlie Morrow 1:27
Yes, sure. That's a really great question. I think it's really reflective of the urgent focus needed to mitigate the full effects of climate change, which are essentially unavoidable now for everyone whether or not you're looking at the stifling summer we've had in Europe, or the forest fires in Canada, or the worst droughts in four decades in East Africa. And I think just, it's reflective of the fact that the narrative we get from the IPCC is just gloomy, you know, we're on track to miss 1.5 degrees. So I think the theme is really trying to maintain a positive focus on the solutions available, and the doubling down that needs to go on to mitigate climate change, and really pave the way to COP28 in the UAE, at the end of the year, where we hope to see all the big announcements coming out about the way forward.
Vanja Lakic 2:08
You've been involved in climate work for most of your career. Can you give us a bit of a lay of the land on the climate transition? Where are we today compared to where we were last year?
Charlie Morrow 2:20
So I think many people talk about rubber hitting the road when it comes to climate action. And I think last year, the feeling coming out of COP in Egypt was that there weren't any concrete or extreme enough decisions made, plans put down and progress; And I think what's different this year is really the growing urgency to ensure that we don't reach a point of no return. And while there's a sense, sadly, that we are losing the battle, there's also a sense taht solutions are still available; And so much more needs to be done with regards to how we deploy these solutions, how we finance them, and how quickly this can be done. So for instance, it's now abundantly clear that there's no way of avoiding shooting past 1.5 degrees, global temperature increase without carbon finance, carbon credits having a role in financing nature-based and technology-based solutions. So we will see more and more focus on these kinds of solutions going forward, more communications about how to make these solutions better, make sure they operate with higher integrity, and it just more understandable to everyone. And I think another big evolution that we're seeing is really the converging of finance, from private public and multilateral sources. So everything, everywhere, all at once, which is the line from UN Secretary General Guterres talking about the important focus on climate solutions is that you have to bring all this together, you know, there are solutions out there, they do all cost money and it's critical that these are deployed as quickly as possible.
Vanja Lakic 3:47
Let's talk regulations for a second, there have been quite a number of regulatory initiatives around the climate transition, both here and in Europe. The SEC's climate disclosure rule proposals are expected to be finalized soon for instance. Can you walk us through some of these major ones and how that's going to impact businesses?
Charlie Morrow 4:06
Yeah, I think it's safe to say that 2024 and beyond is going to be a big moment for climate reporting and regulation around this. And you're right to point out that the rulemaking process for the SEC's climate disclosures; I think are going to be locked down and Q1 next year. So it's going to be a big moment in the US market. As a comparison, Europe is slightly further ahead. So the SFDR regulation, which was the European Commission's big, sustainable finance regulation, phase one reporting is beginning in January. So they've had quite a bit of time of consultation and integration of that and that's going to start moving forward for companies from early next year. I think the other thing to look at is also the development of global regulations and policies. So for example, this week, we get the final recommendations from the task force on nature-related financial disclosures, or TNFD, which has consistently pointed to significant financial and systemic risks that exist, we allow nature to be degraded and not protected and restored. It's critically important, right? 85% of the world's largest companies have a significant dependency on nature. $44 trillion worth of economic value generation, over the half the world's total GDP is potentially at risk of the dependence of business on nature and its services. So these global disclosure frameworks are critically important. And we look forward to the TNFT's final recommendations due to be published this week, I believe.
Vanja Lakic 5:34
What kind of challenges do you expect that's gonna pose for organizations now and also down the line?
Charlie Morrow 5:40
So I mean, it's all new, right? And there's a degree of having to grapple with that and get used to the new norm. You know, I think the challenges around anything and in climate transition, in my view can kind of be be sort of boiled down to sort of two, two main areas. The first of these is around trust. And I think trust is really at an all-time low. You know, many companies have got it wrong historically, and how they approach climate action, and how they communicate about it. Consumers and shareholders inevitably questioned the inaction, which is exasperated by, you know, greenwashing allegations, companies, companies getting it right. So they really need to think hard about they - how they communicate about anything around reporting obligations, solutions that they're adopting, you know, they need to do it right. And they need to, they need to be clear about it. And this brings me on to the second area, which is around authenticity, that accompanies really need to be authentic, they need to be real about how they're approaching climate transition, and ultimately not be scared to put their hands up when they aren't on track. But they need to show that they are trying to move a track forward, trying to move, move forward progressively, and approach communications in a very real way that humanizes the brand, and shows that they're part of a wider, wider climate fight.
Vanja Lakic 6:56
So when we look at a range of different businesses, asset managers, banks, fintechs NGOs, what kind of role are they going to be playing as the conversation shapes up around climate policy and action?
Charlie Morrow 7:10
Yeah, it's great question and I think it's probably actually better just to try to bring them all together, really, because I think, you know, my greatest concern is that we're seeing emerging from greenwashing is another kind of activity. Green hushing, and green bumbling is another one where you either say nothing, or you say nothing of any significance in the hope that it doesn't get, get noticed. And all organizations, you know, are facing this form of activity in some shape, or form and, and how they communicate, you know, they're either saying something, and being accused of getting it wrong, or they just, they just do nothing, you know, I think we need all organizations to step up on the comms battle. And, you know, as many of the criticisms that are being felt in the climate space, you know, these are really all comms issues. At the end of the day, there are great solutions out there, you know, I think just the way that they're often communicated about, and the plans for businesses have communicated about, you know, needs to be communicated as clearly and authentically as possible. So I think we need examples of the right kind of behavior, the right message about the true impact of solutions and finance, we need to tell good news stories, not stories that just that just freak us out. And I think all companies that are voluntarily or obligated, by law to transition need to tell these stories, not because they have to, but because they want to. And because they see the value not because of pressure from their shareholders, but because they see the important role that narrative plays in the global collective efforts to create change.
Vanja Lakic 8:36
So speaking about how this is being covered in the news. Of course, there have also been articles written about how ESG investing is in a downward spiral underpinned by recent happenings, like how Larry Fink won't talk about ESG anymore. For instance, where do you think ESG investing is trending this year and beyond?
Charlie Morrow 8:55
I think it's it's just become a too hot a topic for many to play with, not least because of political backlash that you see most directly here in the US, for example, but consumer sentiment in general as well is also at a low on it. So I think you're seeing a negative impact as well on, around that, but also on ESG investment strategies, which had been historically quite well balanced towards tech stocks, which had been underperforming recently, but are now back up. So we expect a resurgence in interest in in the investment class in general. But I do think the asset class needs to be mixed up a little bit and it's narrative. So what you're seeing is more direct investment, slash kind of focused strategies coming out, for instance, on social impact on water on offshore wind on peatland restoration, so much more specific and in focus around the investment strategy, rather than taking a broader brush approach to ESG that we've, that we've seen in the past.
Vanja Lakic 9:57
Last year Cognito published a white paper on the communications of climate transition that found among other facts, well, media coverage around the climate increased substantially from 2021 to 2022. We haven't yet reached peak coverage. Where do we stand today? And how is the media focus around climate changing?
Charlie Morrow 10:18
Like I mean, it can only have half grown. Right. So unless we are running the research again, we're actually just recently starting, and we'll be releasing something in the coming months. But look, our sense from talking to media each day, though, is that there's still a big focus on, on the solutions that are driving climate transition. So in general, what we're seeing, we believe is the shift away from the what, ie., that 1.5 degree target set by the IPCC, and just the general sort of dire situation, we're in around that to the how. So the solutions and the innovation that gets us there. And, you know, people are interested in the stories that demonstrate the pathway forward. So I think that's what our sense in terms of where we're continuing to see our focuses is press coverage of the solutions of the how we're going to get there.
Vanja Lakic 11:04
So looking forward, then what are you most excited about this week, and for the rest of the year?
Charlie Morrow 11:10
Look it's really exciting to be back in New York and see the city really shining during this this week, which is truly international scale. You've got the UN General Assembly meeting this week, Climate Week feels like there's tons of people in town. It's great to be here. And I think, you know, just in terms of the road ahead. I think it's just great to see people. I've seen a mat along with different milestone moments this year in the climate transition space, ranging from conferences such as I4C (Innovate4Climate), which is one of the big world bank climate meetings in Bilbao in the spring, through certain, you know, keeping close these these folks through to COP28 and paving the way forward and just talking about the critical role that comms can play in the climate fights and the way that organizations can be partnering together to deliver a authentic, compelling and clear narrative that talks about how we're going to get there.
Vanja Lakic 12:00
Well, Charlie, thank you so much for joining us, and we hope you have a great time at Climate Week.
Charlie Morrow 12:05
Thanks very much.