A major opportunity has appeared to capitalize on a seemingly contradictory, but fantastic convergence – the need to invest in climate actions and a general underfunding of energy efficiency measures in companies. Why fantastic? Let me explain.
For many years, executives have been accused of value-engineering out energy management solutions because of poor financial returns on these investments. Yet, in the first two months of 2020, CEOs of a significant number of Global 500’s have announced ambitious climate targets (see BP, Delta, and Microsoft). The Bank of England will begin evaluating the banking sector’s resiliency to climate change in their annual stress test. And in a parallel concern, environmental, social and governance (ESG) issues are becoming a primary consideration for pension fund managers who need to maintain 30-year growth in their portfolios. A trend is emerging aligning climate concern with maintaining corporate value. Yet how do we capitalize and link executive-level good intentions with critical needs in functional departments?
It takes a top-down approach with a unifying vision, a leader executing a comprehensive strategy across the entire organization and giving directed authority for initiatives to be taken within this framework. It takes a bottom-up approach, as nearly every role whether technical or managerial, is where the necessary functional energy consumption changes can be achieved for cohesive and meaningful results.
I’d like to suggest the Energy Strategist as the emerging leader who should be tasked with managing these multiple tensions – to be comfortable leading from the top, while ensuring grassroot initiatives thrive. The role needs to balance the generalist capabilities of mobilizing a multi-disciplinary team with the specialist knowledge of how to decarbonize. Those who are deep into corporate sustainability frequently admit that their primary function is that of change management. This person’s role is to create new connections and collaboration opportunities that are based on how energy flows through the organization as a lever to improving corporate value.
Potentially, the energy strategist could develop from any one of a number of fields to meet the generalist requirements, but it will take a person with a balanced skill set. This could be a technical expert selecting equipment, an investment analyst forecasting fuel options or a policy advisor advocating for risk mitigation practices. They must be an effective communicator understanding organizational structure to convey energy and climate actions through storytelling that connects with both internal and external audiences alike. Finally, the energy strategist must have an operations mindset to understand and implement industry standards, such as ISO 50001 on energy management or ISO 14001 on environmental management. Yes, all these skills must be in the energy strategist’s toolkit.
The Corporate Energy Strategist’s Handbook helps to cohesively address energy management, purposely written to support this new role. The numerous management tools that have been developed over time typically address other issues. What we have lacked is an organization-wide tool-set approach to energy as a common resource to be managed for value creation. This book weaves a tapestry of tools in a set of frameworks to manage energy across the entire organization. Although by no means exhaustive, it includes critical concepts and content gathered from over a decade of working in energy and sustainability management. Indeed, each of the 22 chapters reviews a selection of tools from different functions and applies them to an energy or environmental situation.
My hope is that leaders at all levels will appreciate the good fortune of this fantastic convergence and the value it not just brings to their organizations, but the world at large. To mobilize quickly, all leaders must know how climate and energy impacts their functions and ability to operate. We need to coordinate between all the divisions with whom we’ve never collaborated before. Becoming familiar with each other’s tools is a first step to the change management needed to tackle climate change.