Discover more from Bank of Nature
Part 1: A Victory for Climate Security 2036
An introduction to our paper, backcasting and "Why BP?" as a case subject
Bank of Nature was invited to present a paper at this week’s Energy Ethics conference at St. Andrews University, Scotland. As you might know, we use an exercise called backcasting to imagine a world made sustainable in order to define the steps we need to get there. It’s a way to break free from status quo blindness. You can link to a PDF of the paper here. Alternatively, I have broken up the paper in three parts.
Part 1: An introduction to our paper, backcasting and "Why BP?" as a case subject
A Victory for Climate Security Datelined 2036
“Hardly anyone envisions a sustainable world as one that would be wonderful to live in. The best goal most of us who work toward sustainability offer is the avoidance of catastrophe. We promise survival and not much more. That is a failure of vision.”
As much as our status quo society might broadcast that it is “risk averse” in the face of a daunting and uncertain future, we spend a lot of effort in predicting, shaping and careening toward it. We buy insurance against potential future loss. We invest in disruptive R&D without a certainty of success. A resource company attaches a price to potential reserves yet to be extracted from nature, and trades that value, artificial or not, on a stock exchange. We board up windows in advance of a looming hurricane based on predictive, but fallible, weather maps.
Anyone who says we don’t know the future may be technically correct, but they are disingenuous. We know enough to make smarter choices today that will impact the future. An uncertain future is not an excuse for inaction on a crisis like anthropogenic climate change. Rather, “what if?” drives a booming, future-forward global preoccupation.
“Backcasting" is a common strategic planning tool in business, but is instructive for sectors like managing a climate crisis. Backcasting’s goal is to scope out a future operations landscape and the “drivers” and “restraints” to business continuity. Imminent changes in values, ethics, technologies, resource limitations, social trends, legal tactics and other factors will affect how a business succeeds in the future – not the least of which is an ever-more hostile climate by human choices of energy consumption.
A vision of the future is educated guesswork – so, hardly guaranteed – but not arbitrary. It’s a target to work toward. Most often, you can see what’s coming. In this exercise, unlikely outliers have a place on the whiteboard. What backcasting reveals are solutions that are not limited by the status quo, but rather the multitudinous imaginative alternatives. It’s a model that scales to unlock all kinds of logjams.
In this paper, we zero in on one hypothetical case: BP’s shift from oil to more benign energy production. It’s based on the CEO’s public statements. We work backward from the hypothetical news story datelined 2036 (Exhibit 1 — readable as a blog here) that, for illustration, confirms Looney’s goal has been met.
Regardless whether you believe BP’s goal is genuine right now, you get a sense of what must happen in order for BP to actually get there.
For example, in contrast to the status quo, our success scenario:
1) Fiduciary Finance: A new kind of finance
“Fiduciary Finance” is our dedicated finance channel for fiduciary money guided by fiduciary duties in the fiduciary economy.
Rather than growth priorities, it meets sufficient ROI to enable the delivery of a “dignified retirement” promise decades away.
Presently, tens of trillions in fiduciary money is used for non fiduciary purposes. This is the money we use to shift BP.
2) Money as a Social Structure
If we agree that government, enterprise and civil society comprise, in broad strokes, how society is organized, then we can consider how we might reorganize for success.
Each social order fulfills our social agreements – how we agree to work together – albeit imperfectly.
While money is ever present today, we are recognizing it in this paper as a separate social structure with its own rules.
This makes visible the vast fiduciary money that is presently controlled by government and enterprise can finance BP’s goals.
3) Pensions Fiduciaries: Climate Heroes
Fiduciaries of defined benefits pension plans – worth $50 trillion globally – have the historical mission, defined legal duty and enormous financial scale to lead in the climate crisis and stewards the future.
They don’t yet and that’s the opportunity for BP and others wanting to lead in the fiduciary economy
“We’ve been an international oil company for 112 years. We want to transform ourselves into an integrated energy company. It’s what society wants and needs. And, ultimately we will prove that it’s what our shareholders need. We have an enormous challenge as a society which is to provide the world with reliable, affordable and clean energy.”
London-based BP plc, formerly British Petroleum, is an oil company ranked among the top 10 most valuable oil companies in the world with a market cap of $108 billion and 2022 revenues of $249 billion, which is a 53% year-over-year improvement during the Russian war in Ukraine. BP leads all oil companies as the most-fined by the US government with $29 billion in penalties, most of them since its 2010 Deepwater Horizon oil spill disaster in the US Gulf Coast. To generalize, BP is a senior player in the global oil sector and one of its worst historical bad actors in reputation and deed. To empirically improve its sustainability performance is to show that the most entrenched status quo defenders can also change.
You don’t have to believe Looney. The company gives ample reason for doubt. At the time of this writing, BP had just started new oil production at its Argos offshore platform 190 miles south of New Orleans. “Argos will strengthen our key position in the Gulf of Mexico for years to come,” said Looney in April 2023.
In this paper, we’re agnostic. Taking Looney on his word, BP will be “net zero” by 2050. When the status quo is designed to thwart him, how do we make his goals happen?