At the beginning of 2020, two major British businesses had recently welcomed new CEOs. Alison Rose had become the first woman to lead a major British lender when she took charge of NatWest in November 2019, while Bernard Looney took the helm at BP, a 111-year-old company entering a period of reinvention, in February 2020.
Not long after, both were plunged into the unprecedented challenge of traversing a pandemic. All the while, the challenge of halting climate change was becoming more urgent. Both NatWest and BP are working towards achieving net zero in the future – but what actions are they taking now?
Bernard refuted the idea that BP’s climate change plan is “window dressing”, pointing out that his is the only company in the sector with a “triple net zero target” – across operations, production, and sales. “This isn’t some greenwashing job, but now it’s time to crack on and do it. 2022 onwards is all about delivery.”
Dealing with the climate emergency is a core part of NatWest’s strategy, Alison explained, because it’s “the biggest challenge that our customers, society and the global economy will face.” The bank is “getting its own house in order” by making its operations net zero, putting an end to harmful activities like lending to the coal industry, and focusing on green finance.
The key to green financing, Alison explained, is “transparency around where the money is going” and how it’s funding the transition to net zero. She cited NatWest’s Green Loans programme, which allows SMEs to borrow money cheaply to fund green improvements like solar panels.
Threat or opportunity?
“Whether you approach the energy transition as a threat or an opportunity shapes everything”, Bernard said. In his view, the transition offers “an enormous opportunity for BP to create value”. In the coming years, he said, “trillions of dollars will be spent rewiring and re-plumbing the earth’s energy system. BP’s years of experience in energy mean we have a role to play in solving the ‘energy trilemma’ – how do we provide energy that’s clean, secure, and affordable?”
Discussing her plans for NatWest over the next decade, Alison cited emissions as a key performance indicator: “in ten years’ time we’ll have halved the emissions generated by companies on our balance sheet”, she said. The government’s recent sale of its majority stake in the bank, acquired after the financial crash in 2008, would not affect her strategy, she said. “The government is a good shareholder but it doesn’t get involved in our strategy.”
For BP, it was the recent announcement of a windfall tax on energy firms aimed at easing the cost-of-living crisis that seemed as though it could blow the business off course. “We’re still working out the full implications”, Bernard said, “but we operate in many jurisdictions all over the world.” By 2030, BP is aiming to be the leading electrical vehicle charging provider in the world and to control 10% of the world’s hydrogen market. “We’ll look like quite a different company by then”, Bernard said – “fewer emissions, and hopefully a lot more valuable too.”
Progress on inclusion
As the leader of an independent report on female leadership known as the Rose Review, Alison is well-placed to discuss the topic of inclusion. “There are so many reports and studies that show that the more diverse teams are the highest performing. What we want is people with different perspectives on life.”
Progress is being made in this area, but there’s still so much more to do, Alison said, taking venture capital funding as an example. The proportion of funding going to female businesses has risen from 1% to 5%, but “that 5% is still woeful.”
Mental health was also on the agenda, as Bernard recalled the challenge of living alone during the pandemic. Although it was an “awful time” for many people, he said, lockdowns also had the effect of putting mental health “front and centre” in the public conversation. “If you can talk about it, the problem is lessened”, he said, describing how BP has extended access to counselling for employees and their families as well as offering free access to the mental health app Headspace.
With mental health, promoting inclusion and net zero all part of the discussion, it was a wide-ranging and interesting conversation.
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