The Fortune Global Forum gathers the leaders of the world’s biggest multinational companies in great cities on the dynamic frontiers of global business.

Fortune Global Forum 2023

Jesper Brodin, President and CEO, Ingka Group, IKEA; Chair, The B Team Halla Tómasdóttir, CEO and Chief Change Catalyst, The B Team In conversation with: Ellie Austin, FORTUNE  

Fortune Global Forum 2023: Cop 28 And The Path To Net Zero

Conferences

Peng Xiao, Chief Executive Officer, G42  In conversation with: Matt Heimer, FORTUNE

Fortune Global Forum 2023: Beyond The Horizon

Peng Xiao, Chief Executive Officer, G42 In conversation with: Matt Heimer, FORTUNE

So there's a lot of buzz here in Abu Dhabi and around the world right now about what's being called the world's largest artificial intelligence supercomputer. The system was launched earlier this year by the Abu Dhabi Born tech company G 42. And it is said to offer a new approach to A I computing that's going to significantly reduce the time it takes to train an A I model. Uh In addition to the supercomputer G 42 has also unveiled J which is an open source Arabic language learning model considered to be the most advanced in the world. At the same time, events this week have shown how very geopolitically sensitive this kind of advanced technological work can be uh to discuss all this. We're very pleased and fortunate to have G 40 two's CEO Pen Chow joining us today to talk about his company's innovations, uh its mission to be a global leader in artificial intelligence and the challenges and responsibilities that come with that mission. Uh So please join me in welcoming Pang to the Fortune Global Forum. Please have a seat. So paying for people in the audience who aren't already familiar. Uh tell us more about G 42 and uh what it does and uh what you're, what you're hoping to accomplish. I got the back right here and thank you for bringing me up. Right. Yeah. Uh Anyway, so, yeah, tell us more about G 42 and what your goals are and what you're trying to accomplish. Thank you, Matt, first and foremost for this opportunity to be here with you. My pleasure. Thank you. As we discussed uh backstage, there are so many great and important things happening in the field of A I. Uh I I cherish this opportunity to discuss with you. G 42 is a company that started back in 2007, 2018 time frame as our friend Sam Oman who was here recently said Abu Dhabi was on A I before A I was cool. So uh that was part of us uh transpo this brand new technology becoming a global game changer. So we embraced A I as a core technology development objective of our company and build our business around it since then. And the company has developed into uh from the original research mission on on foundational A I work into many different disciplines across different industries, from health care to the space program. And here we are today. What are some of the specific challenges within those categories that G 42 is uh applying its uh its technology to? There are many specific industry specific challenges. But uh there, there are some fundamental challenge to A I uh development in general. Uh Specifically, I would say three things. Number one, you need a great talent, you need a great scientist and that's really the brain of creating A I. And second, you need a lot of food to fit into the growth of A I. And the food is, of course, the data and the third element is you need also tremendous of muscle to process all this science and data that is compute. So we've been tackling all three areas of challenge for many years now, attracting talent here and working talent with talent globally as partners and working on safeguarding and also utilizing large data sets. And finally working on supercomputers, you mentioned earlier in opening uh talk to bring more muscle to this uh to this effort. Yeah, thanks for bringing up the supercomputer. Um I think generally when people talk about A I, they talk work, uh the work being done, the models being trained and applied uh in the cloud in a sort of distributed way, uh The super computer seems like an opposite sort of more concentrated, physically concentrated model. Uh What are the reasons for going in that direction? What advantages might have confer to what G 42 is doing? Great question. Thank you for this question. Uh This is the reason why, by the way, we, we, we undertook our own super computer initiative with a partner therapist in California. You're right. Traditional hyper scholars use cloud in structure to help you to build your models. Uh It's a good way of developing model because they have so much compute. But it is also challenging the sense that we call system engineering effort because it is spread across distributed. You have to build your model in a smart way to take advantage of this vast array of resources in comparison if I can show you here, this is time for show and tell and it's good. I love this. It's very tangible. This is a single chip size of a small pizza that our partner service in California developed on this one chip, we have 2.6 trillion transistors. You can take a look. And so the advantage of this of having it all in one place is the speed up the training time, 100%. So literally 100%. Well, not literally actually, it can be more than 100% much more. So basically, what happens here is that in a traditional environment of many smaller chips across different systems, there's a huge cost of moving data on of the chip. That is where things get to slow down, that's a bottleneck. But if you can load all the data, you want to train on a single chip without having to an off ramp all the time, you save tremendous of of time. And that's why we believe in this supercomputer training model. So the one we launched, you refer to uh just now called Condo Galaxy, Condor Galaxy. Yes, phase one of Conor GLA was launched in California back in, I think July, it was already four X flops of capacity. So four X flops is in layman's terms. Uh one single A flop is 10 to the power of 18 computational cycles per second. It was very fast. It's very, it's a very large number. So we had four of those and we just recently announced in the uh in a high performance computing show in the in the in the us that we're doubling that now to eight X. So the whole idea here is to speed up the training of large models with potentially trillions of parameters, not just billions. And this is why we pursue this architecture. So Cerebri is an important partner, they're making your hardware. Uh Your company has forged a lot of relationships globally. Um What role do those partnerships in those collaborations can play in your strategy as you're assembling data as you're figuring out problems to attack? Like what are some of the key, some of the key partners that you're working with? Yeah, server for sure is one of them on the hardware side. By the way, they also co develop models with us too. Uh I heard you mention that this model, the largest and most comprehensive, most accurate Arabic model in the world was actually building in California between our researchers in Abu Dhabi and researchers in California with the um in a partner, we look for two things, number one superior capabilities than what we have. They bring to the table. And second, they have to share our value system, we have to have the common belief. So for each one of the problems we have, doesn't matter with service or with our friends at open A I or to global giants like Mac Microsoft, we find both. We believe there is an urgency in developing not just A I generative A I all the way to, in fact, general A iag I, we share that mission, we share that urgency and second, they bring to the table capabilities we actually don't have here. And even if you want to develop, it will take too long. So for example, with Microsoft, it's skill, they have skill A I is all about skill. You cannot develop A I without that large scalable platform. So we choose Microsoft as a key partner in that area. Open A I, of course, is a key research and development partner. We actually recently announced our partnership with them. We were joining the road map together from our research ecosystem here in Abu Dhabi, including our M BC University of Artificial Intelligence, together with Sam's team to ensure we don't duplicate our conflict. We go down the same path together, hopefully moving faster. And again, in the case of therapists without the hardware, we're gonna go nowhere. Sure, sure. That's the value that brings to the table, your partnerships uh gonna kind of address the elephant in the room. Uh Now your partnerships this week have attracted some some negative publicity. Uh Earlier this week, the New York Times reported that us intelligence agencies including the CAA had been raising concerns about G 40 two's ties to Chinese companies. Uh summarizing the report. The story essentially said us officials fear the G 42 could be a conduit by which advanced American technology is siphoned to Chinese companies. Um At the same time, the same article said, uh and again, I'm quoting uh companies in almost every sector around the globe have ties to China. So you do have some Chinese relationships and Chinese partnerships, they're attracting some concern. Uh There's also this group geopolitical tension between two major nations that that many people in this room, many business leaders have to navigate. How are you navigating it? How are you uh how are you dealing with this new attention? How are you, you know, confronting the the reality of, of this difficult environment? Thank you for the question. Thank you for the answer. Um First let me acknowledge my own ignorance because I didn't actually finish reading that article. OK. Someone sent it to me and something more important happened. I just didn't finish reading it but I did get a gist of what New York Times was trying to say. Uh as you mentioned already, Matt, this is a very strategic global topic A I and it has far reaching consequences uh for our society here in Abu Dhabi e to geopolitical situations around us all the way to the entire humanity. So it's correct that we all need to pay attention to the proper development of A I. And ultimately what we use A I for to that end, we have been a leading practitioner in this area. Uh As I mentioned, you saw our list of top partners, we are working with the safety of A I has been always a top priority for us. We spoke earlier backstage, the importance of safeguarding your data, the importance of proper data governance. I think that domain has been more or less dressed addressed pretty well from the previous work we did in big data analytics from the days when Google launched its first search engine. So when you say it's been addressed pretty well, are you saying that there are frameworks in place? Yes, that require you to the classification, data privacy, data residency. All this I think the age of hyper scholars, they are I believe fairly well addressed. And when you say well address, do you mean there's a wall built enough that is firm enough to keep data from being in the wrong hands. They are good policies and procedures in place. It's up to the practitioners to implement them in the right way if they are implemented like in our case properly, there's very little risk of data privacy concerns. However, I think you're referring to me probably going beyond data, the safety and security of intelligence. When data is actually put into a model, when the model has been developed, when the model begin to generate intelligence, this is where we are in a brand new territory. And I fully agree because it's brand new because it's so nascent, we have to as practitioners work together hand in hand to safeguard. Number one, the proper generation of intelligence, how do we know it's the right form of intelligence? How do we know it's really safe? Give us the right answers. And number two, how the intelligence becoming more and more powerful will not fall into wrong hands used for wrong purposes. Does this mean it's, you're not only responsible for safeguarding the data in terms of where it is held? But do you also have some responsibility uh over how your partners uh or I should say maybe over how your customers use it? And can you control that? Absolutely. I think uh I'm not looking absolutely that that's the right right uh question we need to address it with our partners met for sure. We have mutual agreement on how data is handled. For example, when we ship our Arabic data all the way to California to be trained on condo supercomputer, we make sure there's no leakage of sensitive information from our data set leaked in the US. The same thing if the US counterparts ever share any data with us, we are accountable to ensuring that that data stays safe and sound here and there's auditing procedures, this remote monitoring procedures in place for that. Now, the challenge at the moment when data or models get into your clients, your customer hands where you don't have that type of control anymore. Of course, your customers will sign certain agreements but ultimately how they use it, you as a vendor cannot be fully accountable for it. This is why we need a overall ecosystem framework from government all the way to consumers. And for that, you need, I assume collaboration, you need a lot of collaboration and transparency that's quite difficult. There are two arenas in which G 42 works if I understand correctly where there's particular concern around how data is used. Uh One is in uh medical research and essentially uh drug development where individually possible genetic data could get out into the ecosystem. Um The other is surveillance. There's uh I believe your company pres site A I which you know, does security and surveillance technology that police forces use. How do you make sure the same ethical standards uh apply in those in those even more sensitive realms and how uh you know what additional burdens come with that? And uh are you fairly confident again that the, the right safeguards are in place? Yeah, you just, I think two questions here. I'll try to answer them both. In the case of presci one of our companies in the T 40 portfolio focus on big data applications. We actually provide to our clients, the big data platform and the capabilities on which our client can develop their own applications. If our clients build applications commercial in nature is non sensitive, we build it for them following their guidance and their requirements. But in cases where the client actually are building sensitive applications continue extremely sensitive data sets and use cases, we train them how to use our tools to build their own solutions, which is in some cases, uh what preside is doing with some of our government clients here in the case of genomic data, you know, there is a Supreme Council of genomic Data Management here in the country. So there are multiple layers from regulation down to it policy to safeguard genomics and other other medical data sets in the country. In fact, I can tell you right now, I personally have never been able to get my hands on any of the data sets in the WTS database we have in the country and we don't need to, that's not our job to do so the data belong to the individuals, our job ultimately help our nation, help our partners to bring inside all of that data. Then to go back and provide hopefully precision medicine support to the population to do that. You actually don't have to disclose or even in many cases access, some of the sensitive you referred to. If I heard you correctly, he helping our nation. You're a, you're a national now a citizen of the UAE. Yes, I am. Uh What drove that decision? Well, the work I was doing in the UE is very important to the national agenda. The national agenda being to decarbonize, to diversify the Absolutely. Absolutely. When I came here almost nine years ago, I was answering a call to action from this nation that is they want to go from an extractive economy of relying on oil and going to a creative knowledge economy. That's why I came to help to build this big data platform, which eventually became this A I group of ours. So it became clear to me this cultural action became my calling, this became home. And because I'm doing such important cutting edge work in this country, I was very happy to join citizenship of, of UE. And the regulation here is such that you can only have one citizenship. I see. So here I am. Yes. Well, you answered their call. We're really grateful that you answered ours. Thank you for coming and talking to the global forum audience. Of course, good luck with the work you're doing. Thank you so much. Thank you.

Sky Kurtz, Founder and CEO, Pure Harvest Smart Farms In conversation with: Ellie Austin, FORTUNE

Fortune Global Forum 2023: Climate Innovation Spotlight: Food, Transformed 

Access to food is a concern that affects individuals and communities worldwide and especially in this region. According to the World Bank, in the Middle East and North Africa, half of all food that is consumed is imported and 90% of the food consumed in Gulf Cooper operation countries is imported. But here in the United Arab Emirates, significant steps are being taken to ensure the population has access to fresh locally produced food. Uh In our final climate innovation spotlight of the conference, we're highlighting one of the innovative companies that's working to do just that pure harvest smart farms uses cutting edge sustainable agriculture technologies here in Abu Dhabi and in other regions to produce a bounty of produce in desert environments. Sky Kurtz is the founder and CEO of pure harvest smart farms and he joins us today to talk more about the food production revolution. Please welcome Sky alongside Fortune Live media, deputy editorial director, Ellie Austin. Hello everyone. Sky. Welcome to the stage. So Matt kind of briefly outlined what pure harvest does, but I'd love you to give us more of an overview of its mission and how that came about. Well, so pure harvest is a technology enabled agribusiness. But really our mission is to make a more safe and sustainable food system. And beginning in some of the harshest environments in the world, we started here in the United Arab Emirates. We've expanded in Saudi now Kuwait Singapore soon, Morocco, soon. And really what we're trying to do is kind of save the world from bad un tasty, you know, unsustainable, produce production. And we do that, we design, procure construct and operate these very high tech climate controlled greenhouses that then allow us to farm really anything inside and to do so with greater resource efficiency, very high output per unit of input like water, energy, fertilizer, things like this. And we've got some footage, I think of one of the greenhouses that you were just mentioning. Let's roll the footage if we have it. What are we seeing here? Sky? I mean, the first thing I noticed personally is that there isn't much soil, for example. So how are we making these very juicy looking tomatoes thrive? In fact, it is soilless agriculture, we fertilize and feed the plants hydroponically. So it's think of it as a mineral bath sitting within a substrate. And that's how we're able to give them a precise amount of, of irrigation and nutrients for the specific needs of the specific variety that we're growing. And it's very resource efficient. We're able to recirculate the water and the fertilizers. So we use, you know, lower consumption and much higher output and precise requirements of the plant, which is why you see this near perfect food. And what's your strategy for deciding which specific produce to focus on it all starts with the market, right? So we're unlike any fresh produce company. In the end, we participate in a global fungible commodity market, right? In, in food. And so we have to be very mindful of based on where the market is, its demands, the diets of people, also the economics and alternatives of what they're is supplying the country is, is really what defines what the opportunity set is and where, where this solution is particularly competitive is anywhere where it's a water intensive high value short shelf life good. So tomato capsicum cucumber, strawberry, aubergine lettuce, microgreens, herbs, berries in any variety. But people ask us what, what can you produce? We really can produce anything. We make a perfect environment for food to grow inside and do nature to do its job and that genetic material to print beautiful food. But where should we is the more important question and where we should is in places like I mentioned where there's import dependence, where there's a severe climate or and you know, seasonal supply patterns. And when, when in a world where you are shipping water around, it is typically unsustainable both in terms economically long term, but also environmentally, right, with the carbon footprint of that food, when it's being air freighted across the oceans is not promising. And you were saying before we came on that you tend to focus your operations within a certain distance of the equation. Can you explain more about that? Yeah. So we, we typically say, where are we special the way we farm in that, in that greenhouse you saw, we're not alone folks in Holland and Canada and America and Australia and other parts of the world farm in greenhouses from low to high tech. What's special about us is our focus on climate management systems. So doing that in harsh difficult places like the United Arab Emirates, but also in the construction technology, the materials and redundancy and resiliency we build into the system, right? That's we're more climate tech and construction tech than Agtech. We're ag tech because we make money selling fresh produce. We are farmers, right? So with regards to the the markets we target, it's typically places that that proximity to the equator is important. And the reason why is that at the most fundamental level ag is sunlight co two water nutrients. That is the chemical process of photo census of plant creation, right? Sun and co two are abundant in places like the Middle East. And then if you look at the inputs to farming, this is true in a field farm in Botswana or in an A I powered high tech vertical farm in Manhattan. But that the inputs are light, whether artificial or real or natural light, labor, land, energy, water tax, transportation and capital, right? These inputs are the same. What's interesting is really what's different around the world? Are those inputs on like capital, energy, light land use, we are an extremely efficient use of land, high output per unit. We are in light. I mentioned that in full census is key. So why are we special in the middle is where the sunlight is and wherever there's light there is yield and then yield affects the entire economics of production. It makes the solution economic which has the added benefit of being much more sustainable, right? And I think with cop coming, that's part of the reason we're, we're featured there heavily and participating heavily. We're trying to drive awareness of people of the embedded water and the embedded carbon in your food is quite significant and these are major contributors to climate change. And so really if we farm better and feed better, we can of course help to mitigate a piece of this climate change. Do you measure the carbon footprint of these greenhouses? And how does it compare to other methods of producing, produce? So we do internally and we're soon externally, we're working on being audited so that we can actually share this data. But really what it comes to in the end, our solution and solutions like ours decouple the relationship of food production from climate and they instead marry it to energy and capital sources So we are as sustainable as the energy available to us and or the energy of the alternative produce that we displace. So if I'm gonna benchmark us against Holland, who's famously one of the most efficient resource focused food energy, water nexus players in the world and credit to them, their leaders in this industry globally. But if you're in the UAE and you're buying a tomato, say from Holland, that production is produced particularly during the winter months, using lots of energy for heating. It's using also energy for artificial lighting and then you're trucking it, air freighting it and it lands. So if you look at the full energy system including the transport, it's quite significant, right? You're burning jet fuel to get food here here though we of course have to control the climate and in markets like the UAE where we use grid energy where as sustainable as the grid, which credit to the government is getting increasingly more sustainable with the nuclear power utility online, huge utility scale solar deployments. But ultimately, we're reliant on that source of energy for the climate needs which are partially offsetting that heating, artificial light and air freight, right? But then on the other hand, in a market like Saudi, we built in Saudi with a 30 megawatt solar power farm. Over 80% of our total energy demand is renewable energy from solar power and clever energy storage techniques. There were dramatically more sustainable than any alternative and importantly, water, that's the other piece water. It's what source of water. And if that water is desalinated, burning natural gas, for example, that is against you. But if you're able to use much less water, like for example, versus incumbent local farms they use, you know, typically 7 to 10 times more water than we do per kilogram of production. So that's a massive step change in resource efficiency in the UAE and the GCC more generally, we're relying on very, very high levels of imports when it comes to food. And I wonder how scalable is your technology? What capacity potential does it have to really reduce? That figure? I think it's 85% of produce is imported into the UAE. Yeah. Well, so again, we we focus on produce and I'll come to that in a moment. But I think broadly just food system because we only earn one piece of the calorie pyramid, right? Fruits and veg. But of course, I believe people ask about food security. Food security is of course the living, it is calories to fuel the human life. And that really sits in more grains and pulses and et cetera, being honest about keeping people alive. But living is what we all want to do and about quality of life and longevity of life. And that's about nutrients and calorie density and health, which ultimately more people should be consuming fruit and veg and more of it. So to the point of what can we do? This is a region particularly troubled by import dependency and by health challenges, obesity rates that are off the charts and growing diabetes rates that are problematic. So we need to create a system that encourages and makes available and affordable, high quality, safe, sustainable tasty produce, to invite people to consume this versus alternative. And that's where in a region like this, particularly one that is wealthy, has access to capital, abundant access to energy and increasingly more renewable. We can make a huge impact, right? I I believe that a huge portion of the fresh produce, demands of the of the region can and should be produced locally. But back to that should produce. People ask me, should we be producing wheat or rice? We absolutely could, we definitely should not be that the water intensity that you can there is and the perishable rice, for example, could be produced somewhere where rainfall is abundant, land is abundant and labor costs are low and it can be ground stored and siloed, shipped in oil tankers, you know, an incredible efficiency in the value to weight ratio of the shipment and then it can be stored and have food security and resiliency in a portfolio of storage solutions. Not true of a tomato, not true of a lettuce. So that's where we should focus. And to the point I believe in this region with support. Ultimately cost of capital is our challenge. If we can drive down the cost of capital. This is food infrastructure, we need to finance more like airports and bridges then like venture capital backed tech start ups. And but unfortunately, that's it's a transition there needs, we are trying to prove that one of the pillars of sustainability, right is profitability. We got to prove that these farms truly generate economic value and are thus infinitely fable, which I think we're doing now. But it's a, it's been a long journey to get there as we've been inviting folks to focus on this as an investment sector. So how does the cost of your, for example, compared to the cost of a tomato that is imported into the UAE from Europe? Good question. So from Europe, we're 25 to 60% cheaper, right? We we we are able to dramatically compete on both quality. We're higher quality because we're able to harvest later. We are typically higher bricks of the sweetness and higher quality. And I think our consumers in the region, I'm looking at one of them would objectively state that that is true. So we we beat them on quality and beat them on price. So we're strictly dominant from a game theory perspective, right? Versus across our, we actually won an award recently. That was the first ever award of the product of the year for the entire portfolio of product. So the quality is superior, we're using the same genetic material, we just bring it here, give it perfect conditions and more light than it's ever witnessed. And it has a fantastic outcome and also credit to my team. We have a committed and wonderful group of agronomist and operators people that are passionate about making great produce. But I would also say though, um we're as, as far as in the region, we're increasingly now increasing the portfolio of what we supply. We started with just tomatoes and then now we're in strawberries and capsicums and leafy greens and spinach and blackberries and raspberries. We're trying to increase that portfolio. Our goal is to build a global fresh produce brand. You should be able to trust a brand and a product just like you do a Coca Cola. If you open it in Beijing or in San Francisco, you have the same experience and you have confidence in that not true, produce very few global brands, right, Driscoll's and even then if anyone's tried Driscoll's in different markets, it varies dramatically. The experience. Why should that be true in a world where we can use technology to give that consistent experience and back to the cost typically, especially if it's an air freighted or imported market, we can be much more cost effective. Now, importantly, though I want to be transparent about versus local seasonal, low field grown or low tech grown production, we are typically a premium typically 20 to 45% above. So we are a new category in the markets, we enter a premium local now over time and I mentioned this to you backstage is our vision is eventually to democratize access to solutions like this. It requires incredible infrastructure, investment and capability to do so. But really what makes it possible anywhere is the cost of capital and the availability and cost of energy. But what's great about this too? We're a major energy consumer because I mentioned we decouple food from climate, instead married to energy and capital, but we're able to use a lot of sources of energy. For example, we're working on a project in the Philippines in Manila. Looking to co locate with the geothermal power plant using behind the grid power CO two, which we clean and feed to the plants, which is a source of energy as well. And we use the waste heat and absorption chilling and create coal to dehumidify. So we feed off of this sustainable source of energy to provide the we're able to be competitive selling tomatoes in Manila, right? And I think that's the kind of partnership that we need to do around the world to make this infrastructure replace traditional agriculture in a world where climate change is challenging traditional production methods. We've only got a couple more minutes and I've got two questions I want to ask you. So let's treat kind of quick, quick fire. Um The first one is if we zoom out and talk about geopolitics for a second and I know this is a big question to answer briefly. What impact are the conflicts in Israel, Palestine and Ukraine having on your strategy? I know they impact the global food supply chains quite significantly, very quickly. Ukraine affected, fertilize markets over the world. We use a lot less fertilizer. It was admittedly good for our cost structure, bad for the world but also an awareness event of the importance of securing your food supply. Unfortunately, governments quickly forget in peacetime, everything is great trading, not so good with shocks and Israel. Palestine admittedly, both sides of the conflict have reached out to us about fresh produce supply. These shocks are awareness events to the world about you need a portfolio of of food security solutions. And I believe unfortunately what's bad for the world is good for the theme of controlled environment, agriculture of technologies, increasing production, potential and domesticating or food sovereignty as opposed to just food security where you control it within your own borders. So I think it's actually a net benefit but unfortunately a bad way to get there. And what you said both sides have reached out to you specifically, what have they been asking for fresh produce, supply food for you to supply food, to ship food and supply food and we of course capacity constrains. But there's ultimately shocks. I mean, even in that specific conflict region, there's a lot of fresh produce that trades. Jordan Iran also Israel's own production and Palestine's own production supplying and that's shocked. Right. It's now and with fresh produce supply there's, it's perishable. You don't have a stockpile of it. And that's problematic. Now, ultimately, people survive and moving to things like grains that can be carried in a sack, but it's not long term sustainable. Right. And I think, I, I hope and believe one day infrastructure can make this possible for people to supply their own needs. Sky. We've got to leave it there. Thank you so much for your time. Thank you. Appreciate that. Thanks for having me.

Jenny Johnson, President and CEO, Franklin Templeton Peter Orszag, Chief Executive Officer Lazard In conversation with: Clay Chandler, FORTUNE

Fortune Global Forum 2023: Mastering Complex Financial Markets 

H.E. Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, Minister in Charge of Talent Attraction and Retention, UAE H.E. Cham Nimul, Minister of Commerce, Cambodia In conversation with: Geoff Colvin, FORTUNE

Fortune Global Forum 2023: Globalization And The Future Of Trade 

H.E. Dr. Thani bin Ahmed Al Zeyoudi, Minister in Charge of Talent Attraction and Retention, UAE, H.E. Cham Nimul, Cambodia, Geoff Colvin, FORTUNE

Natarajan Chandrasekaran, Chairman, Tata Sons

Raj Subramaniam, President and CEO, FedEx

In conversation with: Clay Chandler, FORTUNE

 

Fortune Global Forum 2023: Reimagining Global Supply Chains And Manufacturing

Ok. Well, according to the Brookings Institution, the world now has 4 billion consumers. I think consumers are defined as people who have more than $12 a day to spend. That's about half the world's population. Uh Next year, 113 million more people will join the consumer class. And India and China will contribute much of that, that growing consumer class plus rapid advancements in technology. The transition to clean energy lessons learned from the pandemic. Those are all factors that are reshaping global manufacturing and supply chains. We're going to learn how now from leaders of two truly iconic companies on how to lean into these trans nations to foster growth and resiliency. In an organization, Mata Chandra Saccharin, we all call him Chandra, he's chairman of Tata Sons, the holding company and promoter of all Tata group companies and Raj Subramaniam, president and CEO of fedex, they're going to be joined by Fortune's executive editor for Asia Clay Chandler for a fascinating conversation. Please welcome them to the stage. Thanks Alan, welcome. Uh Thank you both for uh being here. It's such a, such a privilege to have you with us. You know, as Alan uh hinted it has, uh really been, the last five years have been a period of tremendous of people in global supply chains. And if you think about kind of the major business, uh, stories of the last five years, that's got to be one of them. Uh, we've had factor after factor kind of compounding uh on each other to, to drive this change. You know, there's been, uh, things like natural disasters, earthquakes, weather, some of them climate related shocks to the system. There's been the pandemic that caused disruption in ports, borders were closed. Uh Then there's this kind of rising uh geopolitical tension between the world's two largest economies that has complicated trade and investment. And then you've got all this technological change going on and on the positive side, you've had the rise of some smaller economies, uh you know, Southeast Asia and especially now South Asia that really opened their borders to business and investment. And so firms are all trying to capitalize that, negotiate that. Uh And it's, it's just a fascinating uh moment you two are both on the front lines of that shift. And so I'm, I'm eager to kind of hear your views on on what's happening. Raj, maybe I could start with you. I mean, Fedex famously launched in 73 with 400 employees and maybe 14 planes or something like that and has now got a fleet of 650 or more and 600,000 workers, which is amazing. Uh I think I read that you deliver 15 million packages a day. How have all these disruptions kind of affected your strategy and your business? Well, I think uh it's safe to say that uh the pandemic, you know, fundamentally changed the supply chain conversation forever. But, you know, before 2019, if I had mentioned supply chain and polite conversation, I heard have been escorted to the door and now it seems to be a talk show subjects, you know, uh I think uh you know, historically supply chains have seen this bull whip effects over time and uh because of uh you know, variabilities and so on and so forth. But over a period of 2025 years because of systems like fedex and because of technolo technological advancements, those you know, were relatively muted, of course, there were some swings but they were literally muted and then came the pandemic. And now we are seeing the supply chain BW effect of that we have been seen for ages. So it went up and then on the way down and it kind of normalizing post panem. But during the pandemic, it was um especially the issues when supply chains were twofold. One was lack of availability of parts for uh for manufacture, for manufacturing and second was simply bottlenecks, but particularly on the oceanfront, on the ports. And a lot of the issues were, I mean, when you look at the United States, there were, you know, 100 ships waiting to unload. And a lot of the issues were in that 1st 20 miles of the coast from the vessel operator to the crane operator, to the trucks to the warehouse. And the lack of information flow between all of these things. It once it got bottlenecked, it was, it was very difficult to unravel. And so that was what the issues were from a fedex point of view. We are flying over it and we were, we kept the, we kept the supply chains alive, so to speak, especially in doing, as you recover from the pandemic, we distributed almost a billion plus vaccines in the, you know, and so on and so forth. So, and we, you know, we moved so much P pe and uh you know, um other healthcare related stuff during the pandemic. So we've kind of kept it going. Uh But most of the issues were on the, on the port and primarily in the ocean side in, in a way that the pandemic was a boon to your business because there was this explosion of, of, of ecommerce and then as the pandemic. And yeah, how did you adjust to that? Well, I think uh I think one way to describe that in macro terms would be, I think from uh before the pandemic, e-commerce represented roughly about 16% of retail and during the pandemic, it rose to 22%. So that was a significant increase that's now down to about 9 19% and it's stabilizing. So, if you actually think about it, if there was no pandemic and you look post prepa emic to where we are today, the trend would be kind of OK, except that we went through this uh cycle here. Uh So, uh I think that's where we are. Uh I think uh we are kind of normalizing to levels. where would we would have been, had there been no pandemic, especially on e-commerce, but that was in the middle up and down. I wanna ask you Chandra a little bit uh if I could about, about India and where India fits into this equation? I mean, we have seen increasingly global manufacturers take a look at India that they haven't been willing to, to do uh in the past. Um you know, Apple, for example, has recently Apple, I think since the iphone launched in, was it 2007 that's probably produced about 95% of the those handsets in China. Uh you know, to the point where the, the slogan for Apple became, you know, sort of designed in California assembled in, in China. But Apple has recently come out and said that it wants to uh have 20% as many as 20% of the phones produced in, in India, which is remarkable. I think it's 10% now. Uh is that indicative of other opportunities that there are in in India for, for manufacturing and becoming sort of taking some of that China share uh as, as part of the global supply chain, I think um instead of uh looking at uh whether taking share or not, um we need to see the broader trends. Uh what the pandemic exposed is the failure of supply chains, which were designed for total optimization. Yeah. Uh we saw it in the car industry, we saw it in um um aerospace industry, we saw it in everywhere. Uh We saw it in chips, um huge shortage of chips um and many parts. So what is happening is diversification of supply chain. So I call this um as an India plus opportunity because supply chain is not a one country phenomenon. Supply chain is an ecosystem. So no one country can say that we are going to replace somebody or we are going to. So you need alternative uh ecosystem and India has a role to play because of the size scale and everything else. We are right in the middle of it. Um As start a group because uh we have announced a huge enter into electronics, precision manufacturing to uh semiconductor assembly to f similarly in batteries. We are putting together a 20 gigawatt plant in India and uh 40 gigawatts in the UK. So um and we are also into telecom equipment and many other uh many other opportunities. So I think the uh supply chain is getting diversified for resilience and India because of the size scale talent uh and the large domestic market uh definitely is attracting investments and will have a role to play. And it's, and it's not just that it's also uh some of the design and the, and the engineering uh uh product development as well. I mean, the thing that everyone is so excited in the Indian Financial Press uh this weekend, I guess is that tomorrow is it that Tata technology has its has its IP O Yeah. Yeah, see, I think you have to see this uh world um where many things are happening. At the same time. I don't know whether we know any point in history, whether we have had uh such kind of transitions happening. There is one which is the A I transition. Second is the energy transition. Third one is the supply chain transition. And then on top of that, the geopolitics and everything else that's going on. So India is kind of uniquely placed primarily because uh the digital infrastructure that India has put in place probably India is the only example where there is a very large scale public services delivery happening through digital primarily because we didn't have these systems, we didn't have the alternative. So you want the whole hog similarly in supply chain, it's a unique opportunity, energy transition. India's energy needs are going to quadruple in the next uh 2530 years. And all of this is going to be new energy. So unlike many other parts of the world where the uh new energy has to replace the thermal energy in India, it's all additive. So given that I think India is uniquely well placed and as you said, design and, and uh engineering skills are plenty and other technologies which is one of our IP OS after 20 years. Um I mean, just uh even surprised me in terms of the level of interest. Uh I mean, it, it is kind of uh bit in the charts, the single largest retail applications of any company. It's a small IP O comparatively. Mm And the number of times it's been more subscribed in every segment. Um It's just remarkable. It is astonishing. Um I wanna come back to this energy and sustainability question but just to dwell a little bit more on the on the India Point. Um I mean, from a logistics and, and kind of delivery uh point of view, Raj, I, I know you've been looking a lot at what the opportunity is there for, for Federal Express. Um And I'm fascinated by that, you know, I have been going to India for for many years and you know, you mentioned that sort of ships backed up outside the US ports. One of my kind of most vivid memories of India is the line of ships and trucks backed up behind the ports in, in Bombay, which was kind of a regular everyday thing for so long. Uh And, and you kind of think of India as a place that has kind of unique logistic challenges, transportation challenges, not enough roads, that's all really changing very rapidly. And I was struck by your um announcement recently that you are, you are setting up an advanced capability community in uh in Hyderabad. Uh I wonder if you could tell us a little bit about what that is and, and why, what, what the opportunity is you see in India? Well, thank you for bringing it up clay because it very important for us. India is an extremely critical market for fedex. And um we talked about supply chains a minute ago, you know, we are really the practitioners of supply chain at a very granular level from the bottom up, especially in high value trade. So uh we're kind of in everybody's business and we see it from the bottom up. In fact, every day is a reference, those 15 million packages you talked about is a referendum on global supply chains that we see every single day. India represents 2.8% of global manufacturing today. And I I think there is every chance as the supply chain patterns are evolving and changing, that number goes north and as manufacturing goes so goes fedex. So that's why fundamentally it is a core business opportunity for fedex to be especially, you know, India, in and India out um segments of that manufacturing uh you talked about infrastructure. So one of the things that we have talked about, you know, before um is the cost of logistics as a part of GDP, I mean, in fact, relatively quite high in India. And I think so I'm very encouraged by the national launch of the national logistics policy and what the PM Gti Shakti plan in India to actually go hand in hand with uh with manufacturing, to make sure that the logistics infrastructure keeps space so that the overall cost of logistics as a personal of GDP comes down. So those things board for well for our core business. But there are two other aspects that are important for us. One is simply talent, uh fedex is, you know, and the fedex 2.0 version, so to speak, the technology and digital play a significant portion in our future. We are literally sitting on data about supply chain and insights every single day. So we are we should be able to figure out, you know, how do we create value for all our stakeholders based on both on the insights and technology plays a key role and talent plays a key role. So that's why you know this announcement of this advanced community center in the community uh capability, the community in Hyderabad. Uh it is very critical for us to launch that there's also a third element of it is the innovation part. And again, Chandra's point, I mean, I'm, I'm really struck by the amazing move move that India has made in the digital infrastructure. And uh and I think uh we think that, you know, making sure that we have innovation for our globe, you know, to be able to be seated in India is an important thing. So we have a three pronged strategy, our core business, our talent and our innovation. And that's what we're pursuing this talent innovation point is a really interesting one because we're at this moment where we're getting these real uh explosive breakthroughs in in artificial intelligence uh that people are discovering all kinds of, you know, fascinating ways that they can be applied. I mean, Raja, I know in your business that uh route optimization is an absolutely crucial thing uh for uh uh you know, I mean, I take this point that uh people are, are more willing to uh you know, shift from just in time to just in case and they'll tolerate a little bit more inventory and, and are not prioritizing efficiency as much as before perhaps. But it's still a crucial thing in your business. How does A I help you to play into to that imperative for you? Well, I think it's uh it's absolutely critical for us and I, I would, I would uh mention a couple of things, the high level. Firstly, we talk about supply chain, you know, diversification andrei well, residency by definition makes it a little bit more expensive. And so the only way we become resilient and efficient is technology. And um the second point I would make is that in the space of A I and ML, you know, especially as we go into predictive models, we have now built a digital tone of fedex. And so we are going going from reactive to predictive. And what that means for a consumer's perspective is our ability to predict that estimated delivery date and time window is better and better and better with deep learning models every single day because it's got so many different, those 15 million packages have so many different ways to go. There's weather, there's traffic patterns, there's network conditions, you know, it's so, but all those know, factors are being dialed in to get predictive, high, higher level. But even one step further is this whole talk about uh GP T and things like that. I mean, you know, the chat GP D being trained on public data but the, you know, private data, the company level data is also a place where, you know, that's not been tapped at all. And I think everybody has recognized that, but the first step is to organize that data. The good news for us is we have spent the last three or four years really building up in the latest up to date data platforms. So we are able to now, you know, use some of these modern technologies and you know, learning models on some of our data to see how we can create more value for our customers. And again, moving into that digital trend in a predictive way versus a reactive way. Uh So, Chandra before uh taking your, your role as chairman in 2017, I guess it was you were CEO of T CS, which is uh India's largest software firm filled with a lot of these kind of bright uh engineers and, and software uh experts as well as was mentioning, where do you see the A I opportunity for India? I'm just curious, I think the opportunity is huge for every business and it's a huge opportunity for India, primarily because of the talent. Um and also uh the infrastructure that we are putting in place in India, both the public and private infrastructure uh and the number of start ups that are emerging in the air space is just humongous and uh as a group, um we are uh in both traditional businesses and the new businesses and we have deployed digitally across the spectrum. So for example, take the battery plant, we have not even started the construction, ok. We've just announced the battery plan. We're going to start the construction in early 2024 and we got a 24 month schedule and April 26 we want to go production, but already we have built, we are, we are building the digital trend from CS to batteries to the supply demand, all engines in place. So that we can do the simulation uh real time. Take Tata steel, all the Tata steel plants, which was a very old company of the group more than a few years and already uh uh totally digitized. And World Economic Forum uh ranks uh Tata Steel as a light of steel plant uh for um industrial 4.0 all all technologies there. It's iot whether it is data, um um cloud analytics, everything is in place. And so we fundamentally ask every business uh one question, what is that? What is it that you're gonna do in the next generation A I? So you used to ask, what are you going to do in data? How are you going to digitize your business? Now we moved to, what is your A I plan? That's the question. But I think in India coming to the larger point, there is going to be a lot happening in the India Us Corridor with the both the governments have also announced a number of policy measures and number of joint working groups. Uh I also charge the U SDS co forum and uh we are pushing the envelope on A I. Um So there will be a lot of a lot of convergence of technologies between uh India and leveraging the West Coast. We will set up um uh large scale um cloud data centers using platforms like in media. So we want to actually democratize A I. So we are putting together um E I cloud infrastructure, not the traditional infrastructure so that companies can innovate. Uh fascinating. Well, we will, we will watch with keen interest to see how India's trajectory uh evolves and how global supply chains continues to shift. I want to thank you both for your, your insights and your perspective. Thank you very much and.

Ray Dalio, CIO Mentor, and Member, Operating Board, Bridgewater Associates In conversation with: Alan Murray, FORTUNE

Fortune Global Forum 2023: Betting On A Changing World Order 

William McDonough, Chief Executive, McDonough Innovation In conversation with: Matt Heimer, FORTUNE

Fortune Global Forum 2023: From Net Zero To Net Positive 

Well, now our next guest wants you to know that carbon is not the enemy. He says it's a source of life and how we use it is key adding that fugitive carbon is the problem that needs to be dealt with. William mcdonough is a globally recognized leader in sustainable design and development. He is an architect author. He pioneered the concepts of cradle to cradle design and the circular economy. He's now taking the circular economy concept one step further stressing the importance of the circular carbon economy through his work. He advises commercial and government leaders worldwide on this concept as well as the importance of keeping next use in mind when designing products and facilities. He thinks this is important messaging for everyone to understand, especially the next generation. Please welcome William for a conversation with Fortune, executive editor of features, Matt Heimer. Hi, everybody. Thanks for sticking around. Thanks for being with us. Um So we're getting to the end of day two of Fortune Global Forum and I've already been to two other panels where Bill mcdonough has been uh in the audience and someone on stage has stopped and said, oh my gosh. Bill mcdonough is here. Um So if I could just say to his face, oh my gosh, Bill mcdonough is here. Um And as Jeff uh made clear to us, there's, there's good reason for that. I mean, you know, I don't wanna flatter you too hard, but, you know, Bill has been a pioneer in sustainable design. I almost literally wrote the rules on green buildings by helping establish lead certifications. So in a sense, Bill, you have shaped the way that we as business journalists and business leaders and the business community talk about climate. Um But the theme of this panel is changing the narrative. You're essentially saying the choices we're making in the language we use to talk about the climate don't fit, they aren't the right solution. What should we be doing better? What are we doing wrong? No pressure. Hi, everybody. I think the, the uh there are two things. One is we're confusing the next generation with our language. I'll give you a quick touch. Can you imagine going home and saying to your kids we're designing for the end of life. We say that life cycle assessment of inanimate objects very confusing. And then we also say things like, oh let's be Net zero. What does that mean? Must be nothing. Yes. Yeah. They, they wanna know what to do. Not what not to do. You don't say go out today, it'd be less bad. Yeah. Net zero. Net zero is a negative framing is that what you're saying? So, but, but at the same time, net zero is this concept that we've sort of just coalesced around as a, as a business community. Not really, really. Yeah, because we had eco efficiency, we had efficiency, which is about being zero waste. OK. So that's still less, there's still still a negative but there's nothing wrong with that. We should be less that, but we need an, we need something additional. That's what you're saying. So that sets us up to talk about what you call a net positive economic model. So uh can you define for the room? What, what is a net positive economy look like? How would you define that? Uh I think we have a slide too that we can tee up. Yeah, it should be appearing on your screens and behind us. Um So I see green, green is good, red looks bad. It looks like there's less, less bad and more good. So, but, but what does it mean to be net positive? The, the, the notion if we start with this idea of being less bad in front in business people is that you got a chart, here's zero and here's 100 and, and we say to everybody, OK, we're gonna be net zero and the chart goes down to the right and your goal is, and I don't know anybody in business who likes charts that go like that. We're not trained for that. So, so what we really want is to think about, let's just not be less bad, please be less bad. That's why I'm not saying don't be less bad. But we also can have a chart that says here we are today and we're gonna go here and we're gonna be 100% fabulous. I'm a designer and I'm optimistic, which means optimism and optimistic. And uh this idea of being optimized is a positive idea. So it's not just minimized, optimized, it's not just maximized, maybe doing the wrong thing. So it's optimized. And so then you have this chart that goes like this and young people like that chart, I'm gonna call be Fabulous. And you stop and think about what Kennedy did in 1962. He gave a speech and he said we choose to go to the moon, said it twice. We choose to go to the moon and I didn't access to space station on earth. So I got to know that the average age engineers putting Neil Armstrong on them when it was 28 and they did it in less than seven years after he said we're gonna do it in the decade. So, so if Kennedy had said, let's not, not go to the moon, we probably would not have gotten to this. And let's take as long as it takes. Right. Right. Right. So, so this is a model. So this is a model that really sees this as building something, as opposed to taking something away. Well, you start with inventory, you say what are our choices he chose? Go to the middle, then you assess it and you've either got good or bad. But these are human values, good and bad. These are not numbers, it's not less and more, it's good and bad. This plato values and then aerosol is truth in science and number is value creation and that's what business is like. But you, we really have to start with our values. What do we believe in? And that's where the good and bad come in. So your first inventory, then you sort it and then you put it on the chart and you go execute. What's the example of a, of a business right now, whether it's when you've worked with or when you've observed that is putting this into practice, that's essentially by being more environmentally mindful, creating net positives, creating, creating growth, creating something that brings people in and feels optimistic well in, in our world, if there's a regenerative biosphere, where growth is good and it's nature, so regenerative biosphere, move to that a healthy soils ecosystems. And then there's a circular techno here, objects of human intention and use. And so that's where being more good. For example, Shaw Industries, which was bought by uh Berkshire House and Industries. Just a back up. They make house, they, no, they make, yeah, flooring and they're now the largest car company in the world. And, and I remember when Warren Buffett heard about what we're doing, which is designing the materials for next use. He said, oh, I see. You're storing all our raw materials on the customers floors. Welcome to the circular economy. So the future carpets that this company will make and sell are are tied up in the carpets that they're already putting out on the market. Yeah, and this is a business model good enough that Warren Buffett wanted to buy it and wanted to invest it and the company went from being fifth in the market to number one or 1/5 to number one. That's really remarkable. Um This chart, by the way that we've uh moved to this, there will not be a test on this, but it does kind of create the idea that you uh on the one hand, are reusing the, the products in the technos sphere. These are that you've made that you've reused, but there's also uh uh a biosphere element to it where you're ideally if you're producing waste in uh in your production process, maybe some of that waste is becoming uh fertilizer or being reused as opposed to being uh spewed up into the atmosphere. Um What, what's an example of a business that's, that's really nailing the, the biosphere side, right. Well, uh Ralph Lauren is now doing clothing based on cottons and other uh natural materials that are designed with all their dyes. Morten finishes and so on to be safe in the biosphere because you are the biosphere and you're going to wear it. And so they want you to be safe and healthy. Think about that. That's an example that makes a lot of sense. Let's get to the, the carbon part of this, the circular carbon economy. Um I mean, again, in the, in the shorthand of, of green business, there's this sense that uh that carbon is the thing you want to get rid of. You know, I've, I've heard a lot of people say zero carbon when they're talking about, you know, emissions reduction, but circular carbon economy is, is recognizing something different about carbon, isn't it? I mean, and uh that it, that it can be the building blocks of something better. I was encouraged to write the circular carbon economy while I was in Davos and encouraged to meet with the Energy Minister of Saudi Arabia because he wanted to know where does carbon fit in the, in the circular economy. And we wanted to make sure that we, you know, since China took it up and I work with them and then we took it up the World Economic Forum where I chaired it, we want to make sure that they were all connected and it was really beautiful because if you look at those two diagrams and biosphere technos sphere, you realize the thing in the middle was the energy that ran the system and that's carbon today. So where does carbon fit in the circular economy? It's both the material and the fuel, which is amazing because we don't burn aluminum to run the economy. So carbon is both material and fuel. And so if we tell our Children that carbon is bad, there we go again. So what carbon is innocent? It's beautiful. It's a source of life. So how can you tell a child carbon is bad and then they go to school and find out everything is carbon. If it's alive, these things don't make sense for young people. So, so I wrote this for nature Journal. Carbon is not the enemy. So it's really us. And so if you look at it, there's three kinds of carbon to help us function. One would be living carbon, which is us and nature and growing things. We wanna have growth in business, right? So agriculture and food and food and then there's durable carbon which is products and things that are have utility over time or just sit there innocently like a mountain quietly being carbon. And then, and then there's this other one and that's fugitive carbon. The escape. He implies criminality, which is kind of fun. Harrison Ford running away from you. So, but anyway, the idea of fugitive carbon, it doesn't make sense because we're letting it escape to the atmosphere where we know it's damaging and or we're making plastics and they're getting in the ocean that's durable carbon fugitive. And so these aren't goods, they're bad. And we talk about making goods in an economy. What, what if we talk about making bad? It doesn't make sense and it's, it's obvious really. And so carbon, the fugitive is essentially a toxin. By definition, we do a lot of chemistry with products and a toxin is defined as the wrong material, the wrong dose, the wrong duration, the wrong place. Now think about carbon in the atmosphere today. Think about water is water toxic, highly toxic, wrong g surround yourself with it for six minutes, right. Right. Wrong material, wrong duration. Jump out of an airplane, land on the ocean at terminal velocity, very short duration, very big dose. So be careful. And so that what happened with carbon, it goes to the atmosphere, it's a toxin by definition. So if you go home and say today we poison the planet, we're sitting, we're sitting in the UAE, we're next door to Saudi Arabia. We're really in a place where an enormous wealth has been created by an older carbon model. Um You've been working with some people in the region about different ways of approaching carbon about sort of a circular carbon cycle. Uh What are some examples of the direction that that's taking? I think one of the most exciting ones is here in, in, in Abu Dhabi. They have a device here. Now it was invented by a professor at Cambridge who I got to know very well physicist from Poland and he found a way to make graphene, which is an exquisite material. We'll be using a lot of at some point once we figure it out. But he found a way to make pure graphene. So do you know graphene won a Nobel Prize for its discovers? Because they were using scotch tape literally on pieces of graphic going and see how thin they could get it. Graphene is so thin, it's one layer of thick. It's a second sheet and you can't get a knife through it. And it's like 20 times more conducted for electricity and heat like it's astonishing material anyway. They found a way to do it here with natural gas where they can uh extract the carbon pure and then take the H four, I see H four and they're using two of the HS and use it to power the system. And the other two is H two, which is known as hydrogen and we sell it. So they're making durable carbon for future generations to be immensely valuable. And then they're, they're producing hydrogen as a fuel by using their natural gas. And the other H two turns into what water. So the hydrogen goes off to become energy, it's safe and the carbon goes off to become material. It's immensely valuable and the amount of fugitive carbon is 00. Climate action has been a major theme of the last couple of days. The other major theme as I'm sure you have seen is a I um what role, if any we've got about a minute left, what role does generative A I if any play in your thinking about the circular carbon economy in the early seventies, the anthropologist Gordon, um Gregory Bateson, Margaret Man's husband wrote about cybernetics that had been brought up by Norbert Weiner at MIT and it was about a system that's full of synaptic space. And he was writing to his daughter and he was describing a computer in the future. And he goes, he says, I'm in front of the computer and this would be 30 let's see, about 50 years ago, I'm sitting in front of a computer and I asked the computer, tell me, computer, when do you think computers will begin to think like humans? And there's a long pause and the computer says, hm, that reminds me of a story. Hm. Welcome to A I. So the thing that it's language based, it's telling each other stories, but the stories need to be principled and I would love it if we could do regenerative natural intelligence principle that tells principled stories and stories rooted in our values and stories that could be optimistic. And the chil Children would learn from that Bill mcconnell. We're so lucky to have you. Thank you so much for joining us and thank you all for being here.

Dr. James Mwangi, Group Managing Director and CEO, Equity Group Holdings; Executive Chairman, Equity Group Foundation In conversation with: Hala Gorani, International Correspondent, Journalist, and Author

Fortune Global Forum 2023: A New Outlook For Africa 

Dr. James Mwangi, Group Managing Director and CEO, Equity Group Holdings; Executive Chairman, Equity Group Foundation, Hala Gorani, International Correspondent, Journalist, and Author

OK, the world's population continues to grow and shift depending on region. Notably, more than half of the global population growth between now and 2050 is expected to occur in Africa. Uh But even before that point, by 2040 Africa will be home to the world's largest working age population according to uh work done by our knowledge partner mckenzie and company. Uh right now in Africa, at least 345 companies have annual revenues of 1 billion U US dollars. Collectively, they produce revenues of more than $1 trillion. And despite a recent economic slowdown in Sub Saharan Africa, the International Monetary Fund is predicting a rebound in 2024. Now, that's a lot of statistics to digest. But what they point to is that Africa is a major opportunity that can't be overlooked joining us now to get to the heart of it all is James Mwangi. He is group managing director and CEO of integrated financial services institution, equity group holdings. He's also executive chairman of Equity Group Foundation, the company's social arm leading the conversation is international correspondent and journalist Hala Gorani. Please welcome them to the stage Thank you, Doctor James Mwangi. Thank you so much. We've been having such an interesting discussion backstage and I want to tease out some of the wider themes. Uh We're talking about Africa. Um We're talking about opportunities in Africa, the demographics, the adoption of new technologies, the leap frogging into the future. If for those uh listening to you today in your capacity as the CEO of equity group holdings. Why is Africa an opportunity? Thank you very much, Africa is an opportunity in a multidimensional way. The first one is the opportunity for productivity gains using technology and deployment of its population uh constituting of a mean age of 18. Uh So that's essentially in areas like agriculture, mining and manufacturing. Then Africa is likely to improve technology and the skill and energy of young people. The second one is the potential of Africa to contribute significantly to the issue of global food security. And that is the investment opportunity. Um Given that it has 65% of unutilized Ala Bullard. The third one is uh the huge endowment the continent has in strategic green minerals and essentially to deal with uh the climate action. Uh the technologies involved in uh clean energy, Africa has a huge role to play. And so we see that as um an opportunity to catalyze the transformation of the African continent through investment. To me, those are the big ones, but lastly is the issue of population. Um World Bank IMF predict that Africa will be home to 25% of the world population by 2050. That means a market shift, Africa will have the capacity then to be a big market. If at that time, one of every three people in the labor market will be African, then there will be a significant purchasing power. I want to talk a little bit about your personal story because it is so inspirational. You've been uh at equity group holdings for 30 years. But when you started out as a young boy and you credit your mother, you say your mother is the one who brought you to the school when you didn't have a pair of shoes to wear. And the school principal didn't want to admit you into that school. And you credit your mother for giving you that for pushing you to get that education. How does your personal story and your tremendous success today? How does that inspire younger people in Africa, do you think? Yeah, it's true that having lost my father as a toddler and my mother being widowed at 38 on the eve of dependent, a mother who had not received formal education, the insight that education was the only tool that you could empower me with. Um inspires a lot of young people on the need to pursue education as a means of bettering themselves and as a means of accessing opportunities. But I think it's what I've done with that education uh maybe in developing the financial sector of, of most people say we democratized financial uh services in Africa through in crucial that it became uh low, low margin, high volume to allow the population to access financial service that inspires most people. And lastly is the issue of a business model that uh uh is built on shared prosperity. 2% of our total revenue goes to the foundation, that foundation then has to its um name 60,000 scholarships um in secondary in secondary schools, 25,000 scholarships in university and about 1000 scholarships globally. I think people see this and see um what the private sector that is conscious and aware of the structure of society and the need not to leave anybody behind. And those scholarships, a few 1000 of them are medical school scholarships. 1800 of those who have gone to university have done medicine. And as a result, we have created a franchise for them where in just four years, we now have uh 100 and two hospitals and medical franchise and those hospitals are seeing an average of 90,000 patients per month. So it's a financial didn't exist before it has existed because of this scholarship. We now have the largest health outpatient health franchise in eastern central Africa. So we talked about the opportunities of Africa. What are the challenges? Of course, um Africa uh Brewry is an emerging market and it has uh constant uh head weeks of global economic shocks like today, Africa is going through the challenges of debt uh simply because of um uh the strengthening of uh uh us dollars. Uh uh So the second aspect uh that uh Africa goes through is the issue of infrastructure. But for the private sector, I see that as the opportunity we are saying uh the the infrastructure to enable business has not evolved the level of the Western world. So the cost of doing business is slightly higher. But that is the opportunity to develop that infrastructure. I found how the way you manage the company, the group out of the pandemic to be one of the most inspirational uh aspects of your leadership if I may. Um you actually cut shareholder dividends so that you could continue to offer affordable loans to your customers. As you like said, I've managed this group for 30 years and customers have always stuck with us. But this one unique opportunity. We asked ourselves, how do we ensure the businesses and our customers survive the global health pandemic? And uh we, we withdrew dividend for two years, saved. How did they react? By the way, I had a very good conversation with the shareholders because uh they, they, they were uh we were withdrawing $30 million to give it to the customers in form of accelerated um support. We supported 100 and 16 hospitals with P pe S all the hospitals that were dealing with pandemic cases. We supported them for three years with the P pe to the exclusion of government and sponsors. So that really made a huge difference. But for our customers, we gave them uh lonely payment breaks for up to four years, depending on how they are were affected. Eventually, most of them survived because of that and paid back the loan and now they are paying back the ruins. So one statistic I have read about micro finance is that female borrowers repay 100%. Yeah, equity has maybe the best loan repayment record in eastern central Africa. 54% of our customers are women. So it is it does that square with your statistics, the 100% repayment of female, it may not be 100%. It may be 9890. Is it higher than men? It's broadly higher than we've got 98%. We'll take that. So talk to us a little bit about the high volume smaller loan model. Why does that work for your market? Essentially, we looked at Africa and so affordability was a major challenge to finance inclusion. And we felt the only way we could really have a model that could accommodate majority of the population was addressing the issue of access affordability and quality and affordability. We felt there were two ways of dealing with it, uh ensure it's a high volume so you can take a low margin but also use technology to reduce the cost of operation to date. When we started 30 years ago, only 4% of Kenyans had bank accounts today, 90% of the population is included and 60 equity holds 60% of all the bank accounts. Because of that model, I want to talk about the climate challenge as well because it's affecting Africa deeply. Could you expand on that? Yeah, Africa, because of its location is significantly affected by climate change. Uh 60% of livelihoods in Africa are extracted from nature. So when nature is affected, then essentially that affect 40 to 50% of the GDP of African economies is built on nature capitals and again when they are, they are affected. But I think the most affected one are the small scale farmers and uh these are the biggest effect is because of climate change. We have seen significant droughts in France going together as we speak today. Uh Kenya and the Horn of Africa is going through an nino season that has really had devastating France, but that is following five seasons of drought. So you could imagine the lad is bare and then sudden uh uh this uh so essentially that has devastated effect on small scale farmers. And lastly is the issue of livelihoods at business when businesses are built on nature capital and then those capitals are destroyed. Then businesses are equally affected because of cost structure. We were talking backstage about the brain drain and for instance, in the Middle East, it's happened quite a bit, especially in the Levant where there are trained, professionals, engineers and doctors, they don't find the opportunities at home. They end up leaving. You said that's something that Africa is also suffering from. How do you prevent that? How do you attract back? The best brain brain brain has been a big challenge to the African continent because of more local opportunities in the developed world. So when you sponsor our people to the developed world to get education, they are reluctant to come back. But is when particularly areas like health doctors and nurses, you end up losing them particularly to Europe from where they have a shortage. So essentially what we are trying to do at the moment is to try and create opportunities in Africa and together with our partners, we have developed the African recovery and resilient plan. This is a plan to see the transformation of Africa through concerted efforts uh through partnerships and collaborations. Um basing uh the plan on what the competitive advantages of Africa and hopefully that will spur an opportunity for knowledge, for skill, for experience, for technology transfer, which will then be sorry to jump in. How do you attract back? I think there are 2 50% just about of, of for other equity. What we have done is to set aside um uh $7 billion to fund those in the diaspora who would like to come back home to set businesses. So we are facilitating them. We have um partnered with the development banks uh who are syndicating another $24 billion. And so essentially, once you take the financial burden from them, given the environment and the opportunity, then we are hoping that they will bring back their businesses and in the process, they will not only come back but they will come with the experience, the knowledge and the technological know how of helping to start off for uh manufacturing the African continent. And just correct me if I'm wrong. The statistic is 60% of those who you who scholarship, the sorry 60% of those benefited from the scholarship program return to. We have 1000 students we have sent to global universities and after 10 years, we only receive about 60% back. We don't mind them staying out for five years, 10 years to acquire the skills, the competences and global templates. But after that, we want to persuade them uh that they are of age and they have what it takes to come and spa uh development on the African continent. Remember Africa sells on low materials in of commodities. So we are now saying you have the skills to convert these uh uh low materials into finished product and create jobs for the millions of people. So if we give them capital, they have the entrepreneur skills and managerial skills. And uh the Reba is available. We think that is the way before we invite the international community, we invite the sons and daughters of Africa back because they have what the international community will be bringing back. All right, we've got to wrap it up. Thank you so much, Doctor James Mohan. Really a pleasure and an inspiration to be talking to you today. Thank you. Thank you for having me.

Khaled Al Shamlan Al Marri,, Deputy Chief Executive Officer, Disruptive Investments, Mubadala Dr. Ridha D. M. Wirakusumah, Chief Executive Officer, Indonesia Investment Authority In conversation with: Peter Vanham, FORTUNE

Fortune Global Forum 2023: Sovereign Wealth And Sustainable Growth 

Khaled Al Shamlan Al Marri,, Deputy Chief Executive Officer, Disruptive Investments, Mubadala Dr. Ridha D. M. Wirakusumah, Chief Executive Officer, Indonesia Investment Authority Peter Vanham, FORTUNE

Little Bola's commitment to deploying capital purposely echoes the vision of the uae's founding father through investments that are durable global and above all responsible our strategy to invest in industries, shaping the future, supports our vision of a brighter tomorrow. Ladies and gentlemen, please welcome Fortune, executive editor Peter Vanner. Welcome back, everyone. I hope you enjoyed that break. Well, it's time to talk about something very important right now in the world, sovereign wealth funds have about $11 trillion of assets under management. The Middle East Asia and North Africa have actually the largest set of sovereign wealth funds and several of them are right here, including of course, the Abu Dhabi Investment Authority and Mubadala. The funds are important sources of capital of innovation and they help to spur growth. That's obvious to anyone who knows them. But in a world grappling with things like high inflation, geopolitical tensions, digital transformation and climate risks all things we've talked about today. Sovereign wealth funds are navigating an increasingly complex landscape so they must adapt to these challenges. See the diversification, sorry and sustainable investments to safeguard and enhance their wealth in an ever changing world. So let's talk about how they do that. Joining us are Khalid Al Shamlan, Al Marri, the Deputy Chief Executive Officer of Disruptive Investments at Mubadala and Dr Rita Wida Kusama, the Chief Executive Officer of the Indonesia Investment Authority. Welcome to you. Thank you. Well, welcome to both of you and I should also say the same. Thank you for having us here. Of course, we're talking about very important things. Uh But before we get to those very important things, I want to ask you um what are disruptive investments because you are responsible for disruptive investments? Yeah, the name is very scary but it's not as scary as it sounds. Uh Well, good afternoon to everyone. It's a great pleasure to be here. Thank you for the invitation. Um My name is Khalid and I, I'm here from Mobile and Investment company. Uh Disruptive Investments. To your question is one of four platforms within Mubadala that is mandated to oversee uh three businesses. One is growth. Uh We invest in tech growth uh globally. Number two, we oversee a credit, business, private debt, middle market lending and three, we oversee dedicated country investment programs. So the name disruptive really came from the fact that when we started, we were more on the tech early stage growth uh focusing on disruptive technologies. Uh but it doesn't seem that the name uh is, is what we do today and we are seriously considering looking at the name again. That's excellent. And of course, to be clear, that is perhaps also to show that you're different from traditional sovereign wealth funds who are like portfolio investors who spread their money into the market. I take perhaps one or 2% in large public listed companies, whereas you might take a much larger share indeed of scale ups or other companies. I said, I think the um if you look at uh sovereign World funds today, um they have evolved in the past 10 to 15 years uh in terms of the role that they play and in terms of their investment strategies, if you look 1015 years ago, several world funds uh were more focused on indirect investing, more of the endowment model investing in funds. Uh But today, you'll find that they are becoming a lot more active in direct investing, they're a lot more active in taking control. Um And you will also find that uh a lot of those sore we funds today uh are forging much more effective, much stronger partnership with private GPS. So and indeed with each other, you mentioned because you worked together on some investments with your colleague in Indonesia. Yes, and we continue to do so and Mr Ra, I'm sure he's going to touch on some of the exciting investments. I don't want to steal the th but you know, we've done some great stuff together, but it's interesting evolution, isn't it? And it really is also interesting in the perspective in the, in the, in the context that we're meeting today, which is a world of course, in constant change and where there is a need of someone driving the global economy in a certain direction. One of the obvious directions that the world economy needs to turn in uh is towards being more sustainable, to being more aware of, of the climate changing and doing something about that. Let me ask both of you and, and let me start with you, Dr Rita, what does that reflect? How does that reflect in your investment strategy? Does that mean that you now only invest in, let's say green technologies or does it still mean that you do that as a part? But you hedge your, your bet or your risk? Well, thank you and thank you for, for inviting me here. Um We are relatively a new sovereign wealth fund. We just started um almost three years ago. Uh We focus on four main areas, infrastructure which includes transport and logistic infrastructure. Um Digital um includes digital infrastructures and digital commerce, um healthcare. And lastly the um the green or renewable energy um we extremely paying attention to the purpose of what we are investing and we want to make a difference in every single thing that we do. Um In fact, in all those four areas that we mentioned, um our fund has grown maybe over 80% in the last uh since we started. But um it is rather peculiar that the best performing areas of investment is actually in the green energy. The best performing investments are in green energy. In fact, that's the one that we are coveting, which they don't want to steal the under we are investing in uh in, in, in geothermal. Um We alongside with one of the um Mazda portfolio companies we invested in in one of the largest um geothermal company. And as you know, Indonesia has a lot of um geothermal energy because it sits on the, you know, ring of fire. Um The performance has been up, you know, 70% since we brought the company public in, in February. I mean, that's very encouraging, of course, because, you know, sovereign wealth funds, you have a large uh assets amount of assets under management individually, but together we've heard $11 trillion of assets under management, you can really move the needle. Uh So let me get uh get back to you Khaled when you do that. Um Does that mean that you are in that sense different than, for example, the revenue side of the UAE the, the the oil companies? Uh for example, in that you do go all in on green technologies. I don't think that we're different. I think um climate change is, is a global uh challenge. Um It's a global mission. Um and us being part of the global community, uh We do feel the responsibility to contribute and play a part in addressing that challenge. Um And I think every uh organization in its own capacity has its own strategy in terms of addressing the climate change challenge. And in Mubadala, this is very central uh to our investment strategy. As a matter of fact, uh every investment that we look at it has to pass through an ESG slash climate change criteria. Um Does that include then that there is a timeline for you to no longer invest, for example in fossil fuels? Well, there is a timeline for us to get to net 0 2050 in line with yes, in line with the U A government. And there are a lot of measures that we have started taking and we continue to find new measures to take to, to reach to our goal. And as a matter of fact, we have a fully dedicated function within the organization that's overseeing and spearheading these initiatives to make sure that we track well vis a vis our objectives, right? But so there is no specific timeline to exit fossil fuel investments. That's not part of that net zero. There is a specific timeline to ensure that we reach net zero and that's that 2050. Exactly. That's 2050 with the government. OK. That's very clear. You mentioned the ESG framework as central to your agenda when you make investments. I want to ask the same question to you, Dr Rita. Tell us how you use frameworks like ESG or the responsible investment framework in your investments in the US we've seen there's increasingly a backlash against the concepts of ESG uh it seems to me like for both of you, that's absolutely not the case, this is central to your investment. These could you elaborate on that? Look, um Indonesia is a developing nation. Um If you talk about uh changing from fossil fuels to renewables, many of Indonesian are not even having enough electrification, for example. So a lot of things you have to, to put things in perspective. Um we talk about building infrastructure still, whereas if you go into UAE everything is extremely smooth in terms of the roads and, and the ports and stuff like that. So when it comes to um on the very topical investment, um topics of, of renewables, you either talk about um reducing carbon footprint or creating uh carbon credit. Now, uh we have done um quite a number of things on that area. That's one of our four pillars. Um And in every single one of our investments ESD has become not only part of our filters, but also part of differentiation, but those differentiating versus other investors who are. So we have what we call ourselves, not only just an ESD team, but we also put a filter in terms of ESD to deal. Um We will not get into the company where we cannot make a difference in the areas of ESD, for example, um differentiating towards the company, you were able to make a difference to you, but you need to temper the expectation because, you know, at least in our market, um many companies don't even think along the lines of, of the Yes, yes. Um So we have a lot of work still needs to be done on the on the reducing carbon footprint. We have done the um the geothermal, for example, we also have done the platform on the energy transition because you cannot just jump into renewable energy without solving right, the you know, the coal fired power plant which we have now are going to transition um a few coal power plant. And so of course, you have that responsibility not just for the world, but specifically for your own country has its own needs as you outlined earlier. And that explains that you have that transition plan including other technologies, you mentioned geothermal as the one that is most relevant to you in your investments, which is the the renewal that you are most interested in or invested in. It is actually part of mustard, which is one of our portfolio companies. Uh It is one of their core themes that they're focusing on out of many other themes I want to move. And if there's any questions from the audience, please raise your hand, we might have time for one question. But if not, I want to move in this last part of the conversation towards the other two trends that are shaping the global economy, you know, globalization versus de globalization and technology. We heard a lot about A I and we're going to continue to hear about that. How do those two filters play into your investments? Do you seek out specifically to make investments in A I? And if so do you, do you do that in a certain part of the world or do you remain committed to a truly global economy? It's a very good question. And I think, you know, A I is, is a hot topic and everybody talks about A I these days. Um And, and we have to be also mindful of all the issues and the challenges from a legal, ethical business perspective that come with A I. Um But also we have to recognize that we are still at the beginning of the A I kind of uh journey if you look at, for example, Chad GP T just went out in less than 12 months. So, really kind of innings, right? That's very early. So, uh and, and we have not a single major company, you know, or corporation has seen real use of A I yet or impact. So it's still in the early stage. So we're being um very delicate and very careful with how we uh approach investing in A I. We look at A I in two ways, one is as an investment destination. Um And we have a dedicated tech program that adopt A I as one of the themes. However, we're more focused on the application side of A I rather than the core large language models. So we look applications exactly. We look at, you know A I enabled businesses. For example, we invest in uh drug discovery companies that use A I to improve the timeline for drug discovery. We invested in an A I company that actually work with call center operators to make them do what they do better is that you, you, because of course, you, you, you, you stress the importance of safety and having safeguards, making sure that you are careful when you make these investments. Um Do you have similar considerations when it comes to geopolitics that, that you, you want to play it safe, for example, by investing in industrial applications rather than the more uh uh the elements that are more contested? I think, listen, we're, we're, we're an investor, right? We're uh we operate in the business and the investment uh world. So we always try to look at things from uh from an investment perspective while also being mindful uh of all other kind of, you know, issues and challenges around it and trying to navigate uh some of these issues uh in a way that is, you know, very careful and very deliberate. Um Let me ask you the same question uh Rita. But in another way because you know, you've mentioned that your four criteria A lot of them are based on infrastructure, right? Helping the economic development needs of your country and, and, and the place you invest in, where does A I track for you, where you stand in your journey? I would say that we're not there yet. Uh we our needs and our investments are more basic. Uh but from the investors perspective, we have been partnering with the likes of the Mubadala and the AD and G I CS, many pension funds in Europe and Canada and stuff like that. Investments as investments. Um we are applying technology in all of our portfolio investments. Uh A lot of our investments are more basic but much more rewarding um in a number of areas because it is much more rewarding to, to invest in the developing nations at times as you can actually box in the risk and still getting the returns that are actually above um the market, right? And we should not forget that, of course, uh you operate in a part of the world that that still has a lot of those basic infrastructure needs. Um And that do, does that also mean that in that sense, there's not really an opportunity to leapfrog there is to a i huge opportunities. Now think about it this way, right, Indonesia, supposedly, if we, if we, if we are tracking right, uh will become the fifth largest economy by 2040 right? We have 280 million people. Um between 15 to 64 years, age um accounts for about 70% of our populations. Um 30 years and younger is actually about 50% and we are still growing very fast. The younger generations are so much more tech savvy. Um And we are, we are using a lot of applications and we are actually one of the fastest growing in terms of internet and data and stuff like that. Um Our data centers are now we invested in one and we are equipping them. It seems to me like you're doing both. Um And I want to thank both of you because we've come to the end of our conversation uh for letting us into your world, how you make investments and how you move the needle in the global economy. So uh Dr Rita uh and Khaled, thank you so much for this discussion. Thank you. Thank you.

Laura Cha, Chairman, Hong Kong Exchanges and Clearing Joey Wat, Chief Executive Officer, Yum China In conversation with: Clay Chandler, FORTUNE

Fortune Global Forum 2023: China’s Next Phase Of Growth 

All right, we're going to get ready now for the for the next session after decades of GDP growth above 9% a year. The world's second largest economy is finding itself amidst a flurry of unexpected challenges. China's economy is in some ways faltering due to fact that include many things, a real estate crisis, declining consumer confidence as well. There's an aging population factor, the knock on effects of the zero COVID policy as well and a decrease in trade and foreign investment. So, so many challenges for that economy and the idea, you'll remember by some economists that China would surpass the United States to become the world's leading economy is now in question in a way that it wasn't maybe a few years ago. Um And, and this is a concern for the global economy because will this have a knock on effect for everyone else? We are going to hear from business leaders today who operate inside of China on what they are doing to manage these economic headwinds and what they're doing uh to stay resilient as well. And we'll listen for insights that they can offer all of you international executives on the best ways of doing business in China right now. Uh both uh rank on this year's list of fortune's most powerful women in business. They are Laura Cha. She's the Chairman of Hong Kong Exchanges and clearing a powerhouse in the world of Financial Exchanges that operates an extensive portfolio of markets, equities, commodities and currencies. Joey Watt is chief executive of Yum China and of note, Yum China ranks on fortune 2023 change of the world list, which looks at companies that have achieved measurable, sustainable social impact as part of their profit making activities. Laura and Joey Joey join Fortunes Clay Chandler. Please welcome them, please. Thank you. Thanks. He um I have been looking forward to this uh panel uh all day. These really are two amazing power women and uh we feel very fortunate to have them with us in our strategy session about China this morning, we talked a little bit about some of the challenges that ha I just mentioned, but we also spend a little bit of time talking about investor sentiment and how fickle it can be. We noted the boom and bust and global investment sentiment about China this year. And uh for those of you that don't know, I mean, in January, we saw a huge run up in investment uh in China stocks and bonds as people expected that the Chinese economy would come roaring back from the pandemic that there would be a lot of pent up consumer demand. And uh that's not really how things played out what happened instead was that we had a gradual recovery. We had a lot of positive expression of uh kind of economic policy and, and a kind of pro market uh uh changes from uh China's planners and policymakers, but investors weren't really convinced. And uh so, uh you know, 10 months or so into uh into the year, a lot of that investment money that, that piled in has uh has just exited China stocks and bonds again. And so I think there's a little bit of a question which I want to us today about why that is, is it that China's economy is weak and faltering? Is it that investor perceptions are overly bullish or is it, is it some combination of the two? Um and I want to start Joey maybe with you because you're right on the front lines of this. Um Yum China is a fantastic company. It operates uh KFC and Pizza Hut and Taco Bell and other fast food brands. It has one of China's largest networks of stores. You've got, I think about 9000. Is that right? KF CS? We are celebrating 10,000 KFC December 15th. That's next month. Yeah. And 14,000 plus stores altogether in something like almost 2000 Chinese cities. Yeah. So you've really got your finger on the pulse of, of Chinese consumption and consumers. You're right there on the front lines but this year has been an interesting one for you because you had a pretty good year last year, given that the COVID restrictions were still in place. And this year your profits and your revenues are, are up. You added something like six or 700 stores this year I saw. So you're, you're definitely growing and expanding. Uh And then I, I just noticed in the third quarter, yyy, you know, you said, well, sales were not, were a little softer than you thought that they would be and your stock price dropped 15% in a single day and it's now down to about 20% I think uh uh year to date. Uh And so I hope you can explain that a little bit. Um Is it that consumer sentiment is weak or is it that investor sentiment is weak? What's going on? Maybe a little bit of both? Um Well, you know, China went through three year, it was tough in whatever way, including uh you know, consideration for the consumer. So it just takes a little bit more time. Um Not to forget during three years. Uh people don't get much sort of subsidies in financial terms from so not like the United States. So in the process, we can understand people become rather cautious and rational with the spending and you learn to live your life without much luxury for three years. Um So, you know, as a result, the consumer behavior, I will call it become more rational in terms of their spending, uh which we can understand. Uh But at the same time, some pattern change, for example, over the weekend people stay at home more. Um because, you know, they're still coming out particularly for older people. So that's, that's one thing happening. At the same time, the expectation is very different because um for, for people outside China, the open up happened much earlier. Um you know, November 14 means nothing to most people in the world, but means the world to people in China. That's the first day China opened up in Hebei. And last year right now in Shanghai, we were still in time. It's not that long, but the expectation is that everything honky dory. So there's a bit of mismatch and as a result, I would say that's a bit of um perception or understanding still take a bit of time to, to uh you know, to just to let it happen and then come back to my company as an example because I can't really comment on the whole economy. I only can, can look at economy from chicken, selling fried chicken. So, so um at the best I call it chicken, economic or economic. Um so from selling fried chicken, uh what happened is we report, well, actually, it's reported by multiple media that uh quarter three, last quarter, we ourselves grew by 9% in reporting currency. But in reality, we grew ourselves by 15% in Renminbi. But because of currency, that's mismatch and that 6% make a break in terms of meeting expectation or not. But the headline misunderstanding, which is a term that they used this morning, I think it's brilliant way to describe. There's a lot of headline misunderstanding. People just look at the headline without going into the detail. That's one thing sort of happening everywhere. Um And then the Chinese economy is growing at whatever number you call it 4% 5% let's say assuming is growing at 5%. What does that mean? China economy is at 1718 trillion right now, 5% means 800 to 900 billion. What does that mean? It means two Vietnam a year. So in in absolute terms, so as a business operator myself, when we are opening stores in in China, why do I have to go that far? I mean, it's happening right here. And by the way, what bring it all together is while there's still so much opportunity for consumer product industry, the economy years is growing only at three or 4 5% whatever number is restaurant industry we've been growing at double digit, high, double digit this year. And as a result in reality, we achieve record sales, record profit this year. Um And in terms of new store opening, actually, this year, we're gonna smash about 14,000 stores. So we at the end of today, after today I have a few more stores in our portfolio. That's the speed that we are talking about. And we are not the only ones in our industry, the big M and then many other brands in shoes, in electronic, they're all expanding very aggressively. So while on the one hand, you have the perception or misperception, whatever call it. On the other hand, people are voting still with the money with the wallets. You know, this is really fascinating and it does sort of speak to this question of whether perhaps what there is, is a, is a kind of misperception on the part of global uh uh investors. I mean, it strikes me that your sector in particular and where you're positioned in the market, investors should be looking a little bit more sophisticated in a more sophisticated way at the types of different companies. I mean, maybe luxury companies are, are are struggling or having a harder time, maybe the housing sector is struggling. But you're in a that, you know, even during a time when people are thinking more carefully about how they spend their money, um you know, uh you might actually benefit from that kind of uh uh uh you know, people maybe are not going to a fancy super expensive restaurant but they're happy to go to a KFC or, or a pizza hut. Yeah, that that's happening. But at the same time, Chinese consumers are becoming more rational in the sense that they want the price but also good product, not just one, they want both and we have to continue to and we are in that position, but also we work very hard for it. It does not just happen that way for three years pandemic, we deliver profit over 12 quarters nonstop. Um And I, I truly believe that whatever industry we are or whatever sector, what define a company is not only where you are but what, what have we done in the last few years? And I truly believe all the great company are the Children of the long term. Huh? Great companies that Children in the long winter. Ok, then. Oh, I wanna come back to that. It's a really interesting uh uh sentiment. Laura, let's turn to you for a moment. I mean, the the the Conduit for a lot of this investment, a big conduit has been the Hong Kong Exchange. And uh one of the things that really impresses me about the exchange is how um uh aggressively you've worked to expand the Connect program and to make it easier for global investors, to invest in, in China stocks and to make it easier for Chinese investors to invest in global stocks. Um Talk to us a little bit about connect because maybe people here may not be familiar with it and how it's how it's expanded over the last few years. Yeah. Thank you, Clay. Um the Connect program, what we call the Hong Kong Shanghai connect and the Hong Kong Sump connect uh our flagship product in terms of connecting China with the world and Shanghai. Uh Hong Kong connect was set up in 2014. So it's been now 89 years and it's been proven extremely successful. What the program is is that investors retail investors on the Chinese domestic market, they have investor accounts, they can buy Hong Kong shares through this mechanism and then the same for Hong Kong investors, they can buy a shares on the Chinese Exchange without having to go through the the process. So if you are in the Connect program, uh you have actually been able Chinese investor in international and Hong Kong company and vice versa. And then we expanded it to uh the Sum Exchange as well. This year, we have a breakthrough in the sense that international companies that are that have a primary listing in Hong Kong will be admitted into that Connect program. That means for example, a Middle East com companies if they come to list in Hong Kong, not only are you able to assess the Hong Kong investors and global investors but also the Chinese investors, the Chinese retail market uh in the stock market has 206 million accounts. So you know those are real name accounts. There's not, you know they they're not allowing a fake names. So there's a huge pool of capital that can be accessible by foreign investors. So this is a very important aspect and you know, China has the highest saving rate in the world. So we calculated that not just we but the public data is that uh they are untapped capital of $30 trillion in the population of China. They are looking for a way to go out to invest in good companies. And Hong Kong is the perfect conduit. And now you know, we are not only in terms of equity, but we also have bond connect, swap connect, which is a derivative ETF connect. So we are expanding that, that, that that portfolio offering so that investors can take advantage of this very unique uh program in Hong Kong. So you know, you can go both ways the capital. So not just the opportunities for the number of ways that uh investors can invest in uh in equities but also uh bonds debt now and then the different ways that they can invest in equities uh which is, which is extremely sophisticated. I mean, I cover the and, and watch the exchange pretty closely. It's, it's one of the most sophisticated financial operations in the world. And it's been quite entrepreneurial in finding ways to uh you know, put itself at the center uh of these two markets that have in many ways, different economic uh systems. Um I wonder if you could talk a little bit about uh the, the the geopolitics of that because you know Hong Kong's strength has always been that it is this connector. It's got a kind of foot in one market. It's got a foot in the west and that's always, you know, been. It's, it's, it's genius and its virtue um that becomes a very tricky position to be in the little though when the two biggest economies in the world are suddenly uh uh at loggerheads as increasingly they seem to, to be. Um are you finding uh you know that people are reluctant to come and trade in Hong Kong to do business in Hong Kong? That that's somehow inhibiting Hong Kong's ability to fulfill its its mission as being this unique uh connector when when uh geopolitical tensions are the way they are, I think um the geopolitical tension affects everyone and affects a lot of markets. And Hong Kong is no exception in exchange, as you said, we are in the center of it. But if we step back and look at the two factors, one is what has made Hong Kong great as an international center. You know, we have those factors have not changed. For example, the transparency, the rule of law, low tax regime, a you know, a a large pool of professionals um and where our rules are clear and transparent, we have no administrative interference in the market. These are the factors that have given investor confidence to invest in our market, global investors to come, none of that has changed. And then we look at the other side which you know, ok, the China factors China as someone has said earlier, it is the second largest economy in the world, 80 trillion $18 trillion us dollars of GDP, which is four times that of Japan, six times of India, six times of ASEAN country and 10 times of South Korea. So it is also the largest trading partner of 100 and 40 countries in the world. So these factors, yes, they are affected by geopolitical tension now and there, here and there and to some degree more, some degree less. But these are the hard factors that you cannot ignore. So China plays a very important role going forward and going forward in the global economic scenario. So we have to look at those factors are also in the long term, they haven't changed. So if you look at the two fundamentals, they change Hong Kong on one side and China's supply, those are what will keep on keep us growing. But we're not only looking at China, we have been in this part of the world a few times this year already. We are um looking to diversify our investor base, our source of capital, our po possibility of listed um issuer. So we are also trying to be as international as we can to keep that um navigate, as we say, we have to navigate very carefully in these circumstances. We've got just a couple of minutes left. I want, maybe just with one minute for each of you ask, you know, come back to Joey's observation that, that strong Children are the survivors of, of, uh, long cold winters. So, we're in a little bit of a winter period right now. Uh, I'd love you to both kind of look forward a little bit and give me your quick take on. How long, how much longer do you think winter lasts? Um, I don't know, nor does it matter. Um As long as we stay agile, it's winter or summer, whatever weather will do. Well, um in the short term might be challenging. Uh But here's the final number for, for my optimism we can see in China for 36 years, we have only served about one third of total Chinese population only. And right now, 10,000 stores in China. What does that mean? KFC Global have 29,000 store in 150 countries and 10,000 is in China. That's where the the the the growth has been and it will be continue and not to mention the brand as well. So we can't afford to ignore a market of that size under any circumstances. Laura, what's your, what's your view? I think for the capital market as a whole and for Hong Kong, in particular for Hong Kong exchange, the area of growth that we see coming out of China, uh the green economy and the digital economy um in sustainable finance and sustainability. You know, in terms of decarbonization, China is really leading the way in terms of wind, renewable, etcetera. And the next thing will be the improvement, enhancement of those technologies to make renewable much more accessible. And China has been doing that more than many other countries. The ev number, the electrical vehicle, the batteries and the wind turbine and the solar uh solar uh panel. Uh they are the top producer in the world. What we need next is breakthrough to make it more accessible, cheaper for the entire population and outside. And then the other thing is the digital economy. We see the innovation there that's driving and the green economy plus the digital economy itself at 5% to the GDP growth. So we see very strongly. The trend coming is, you know, technology A I um sustainable finance, etcetera. These are the driver and that will look to new capital and Hong Kong could be the place to help raise them. Fascinating. Um I'm afraid that's all the time we have, but thank you so much for your views uh on the world's second largest economy and Hong Kong's role in facilitating its continued growth. Uh Please uh join me in giving a warm welcome to our, our uh our panelists. Thank you very much.

Isabelle Kocher de Leyritz, Founder, Blunomy; Member, The B Team; Former CEO,  ENGIE In conversation with: Hala Gorani, International Correspondent, Journalist, and Author

Fortune Global Forum 2023: Financing The Shift From Brown To Green

OK. All right. Brown to green. Well, before we dive into how and how much what is brown to green? First of all, uh good morning. Good Mor good afternoon for me. It's morning for you this afternoon. We don't know what time it is here in the Emirates Palace. Well, happy to be there. Uh Brown to green. What, what do we mean when we say brown to green, it's uh to distinguish that from pure uh green. Uh meaning we spend a lot of money to develop green start ups and that's very good just to be pursued. But it's also very important to move the brown. I mean, the existing players, the existing industries to something that is green. So this move from brown to green of the existing leaders is as important as to nurture and finance emerging leaders. So here is brown to green. How to move apart for you. That's true for a company that is a portfolio of activity. That's true for an asset manager. Typically how to move the portfolio of assets towards something that is drawn at the beginning and that has to become greener. So this is across sectors across regions as well. And the title of this session is financing this shift. Could you expand on that concept? I I come from the energy industry um that experienced that grow to green transformation before the others 10 years in advance. And as a, as a big cooper, you have to precisely to move your portfolio of activities towards something that is greener. We were a champion of uh power production through coal, uh coal production in the world in a lot of countries. And it was a very profitable business for us. And the topic when you and that's true for energy, but that's true for almost all the sectors when you start moving from brown to green is that the green activities at the beginning, they are not as productive and profitable than the existing ones. So here is probably the main topic here you have to overcome when you start to shift from brown to green is that typically renewable energy was not as efficient, was not as productive, was not as profitable as cool activities. So I want to ask you about the cost of transitioning and then the cost of not transitioning. So first of all, how do you over? Because as a consultancy, you're going to try to convince boards to overcome a certain reluctance. I believe the first condition is to lead that from the future not seen from today. If you look at that from today, you compare the profitability and a lot of things and, and you cannot move. If you look at that from the future, you say, OK, we are 10 years from now and let's try to guess what are the conditions for existing activities of today, but for emerging ones. And here the picture is fully different. If if you leave that from the future, you can afford and you can um and you can explain and you can have a case, you, you can convince on the good news is that there are more and more tools, data to help people guessing what will be the profitability? What will be the valuation of the activities? I mean, in 10 years from now at at Bruno me, uh it is what we do with uh it's what client ask. So we are specialist of transitions. We help industries to transform their portfolio and we help them get guessing what will be the profitability and the and also the efficiency of emerging solutions that that they are expected to to develop. Let me, by the way, remind our audience that if you have a question uh for Isabel, uh do not hesitate to put your hand up and we'll get you a microphone as well. So this is, I mean, many of the people here attending are either industry leaders or work in the corporate world and may have questions about the cost of transitioning. But also I think importantly, the cost of not doing so because that's one that we talk less about. Yeah, if I go back to the, the the case, I know the best, which is this energy company? Il uh I mean, we decided to transition, it was a bit early. We were probably the first doing doing so. It was 10 years ago and we managed to have value creation case. Very strong. Uh It was a deal with the shareholders. It's maybe the second lesson we can draw from that experience of the energy industry, that it is necessary to have a deal, let's say, with long term shareholders and to share the case with them and to convince them and to, I mean, and to adapt if needed. But that there is a case for value creation, but on several years, in our case, it was four years which is not very long for a group that was 100 years old and a bit more. So um in our case, we managed to, I remember this figure because it's a double 50% it was uh 50% less carbon emissions at the end of this four year period versus the beginning and for a share total share, the return of 50%. So that's interesting because initially, I'm sure you you may not have in fact but experienced some reluctance. I mean, in a shareholder system where quarter to quarter, it's important to show returns. How difficult is it to then argue that your timeline should be a little bit longer because ultimately the returns will be higher. You, you, you have similar types of shareholders. You are very short term oriented shareholders. They cannot agree or support. Uh They can agree but they cannot support if, if an efficient way you transition because they enter and they quit and et cetera. Uh so, but you can rely on some long term ones. They are, this is uh an important conversation to have with them. It's what we did before starting the transition. So we had almost 12 months of roadshows with long term shareholders discussing with them the best way to transition and getting their support to say, OK, you, you discuss the duration of that we landed at these four year period I I mentioned and we get their support, not a lot of them but a sufficient pool to, to, to open the room and to make that you have the room for maneuver to, to efficiently uh transition your model. And they were perfectly aware that the beginning the curve was decreasing because by design, when you stop your activities or your our cool activities, in this case, they were the most profitable activities of our group, we were extremely efficient in this technology, we were extremely profitable. So by design, when you stop that, you stop by having, I mean less cash flow uh coming that you, you managed to be uh quick enough to re profile, rechannel these resources to learn new activities. And this, at this moment, we started renewables because we had nothing in this domain. And we started at this moment. And I'm wondering because as you're describing this process, I'm wondering, have you in the several years since you've been um the consulting and advising corporations and industries to move from Brown to Green? Have you noticed a shift in awareness among executives and boards? Is this and, and if so why, what, what is it, why is there a change there? I see more and more Corporates, let's say industries and also more and more uh asset managers or asset owners. Speaking about future proofing, the question is, are you, are we as a company, future proof? So this is, this is really something that is seen as a risk not to be future proof and that's new that, that raising, it's not absolutely new, but it's raising a lot and, and there is difference between industry and uh and uh shareholders as a shareholder, you can switch your portfolio overnight. So you suddenly realize that a given company is no longer, should you prove every time you say something its accompaniment? No more movement, we're fine, we're fine. Um Your mic is not working. OK. That's ok. Maybe we'll get you a handheld. Uh Here you go. We have one of the and by the way, let me reiterate, I don't know if I've, I didn't have not seen a hand go up. But if you do have a question. Go ahead and put your hand up, maybe not. That's OK. We have, we have enough to, we have enough. So here's your microphone. So we were talking about attitudes and boardrooms. Yes, go ahead. So more and more awareness on the fact that future proofing is the key. And I'm part of them looking at that from the opportunity side, they are really Corporates believing that this is an opportunity for them. I believe they are right for the most innovative companies. This is an opportunity also and that that a lot of uh Corporates are realizing more and more that there, there is the risk not to move. Yes. So if you have to give a like just general advice to corporations, companies, um people with business interests, portfolios as well to make this shift, what would your first piece of advice be first? Look at that from the future? I I repeat that but it is absolutely key. If you look at that from now, you cannot move it too, too costly. If I may say second um build alliances. Yeah, this exploration because it's an exploration, you cannot do that alone. So in our case, we had uh alliances with our unions and employees more generally because it's a big shift. You imagine you, you, you stop a lot of plants, you have people on these plans. So how do you manage to, I mean to retrain them to help them understanding where it could be their next job. So this is a huge uh this is extremely important for you to gather, to embark people on that move. So build alliances with the teams, of course, but also with uh suppliers, with, with, with and with clients. The scope three, the scope three topic. I don't know if everybody is familiar with that. The scope three emission. Now, if you could do emissions, this is for a company, the emissions that are not exactly in your parameter, your legal parameter, let's say, but the emissions of your suppliers or the emissions of your clients, all the frameworks are increasingly including ISSB which is really a big move, taking the SCOPE 3 CO2 emissions in what they ask as far as disclosures are concerned. This is a huge change. It means that when you are in, when you are company, you you to be sure that your supplier will survive, your client will survive. You need to, to, to ask them what they intend to do regarding transition. So it becomes something that is about alliances with your suppliers and your clients. So to build alliances in my views. So scope three, meaning up and down the chain horizontally as well. What are the emissions of the whole chain? For example, at the bloomy company, I already mentioned we work with a big mining company uh that has decided to engage its clients and I screening the portfolio of clients detecting the clients that have not yet any commitment for decarbonisation and starting an engagement process with all of them. Ask, OK, why no commitment for the moment? What do you intend to do? Uh I would be sure that I would like to be sure that my, my portfolio of clients as a company is effectively moving towards something that make this client future proof. And it seems as you mentioned, there's a realization that this is an essential thing. Um We've run out of time, Isabel Coa thank you so much uh for, for joining us, the founder of gloomy and who's worked extensively in the energy industry and managed and helped to manage, helped others manage their transition from brown to green. Thank you so much. We appreciate it.

Presenter: Dr. Parag Khanna, Founder and CEO, Climate Alpha

Fortune Global Forum 2023: Future-Proofing Global Real Estate 

Global real estate market is valued at more than $300 trillion. It's the most valuable asset class in the world. But shocks such as mass migration, climate change, and geopolitical strife plus trends such as rapid digital transformation and remote work are influencing where people live and redrawing the map of humanity. So how can we determine which locations are most resilient and offer the best opportunities for business investors and all stakeholders. Our next guest is harnessing data and utilizing A I to analyze hundreds of socio economic demographic and market indicators to get the answers. Dr PAG Kana is founder and CEO of Climate Alpha, an all A I powered platform that forecasts asset values to future proof global real estate. He joins us to share the trends and scenarios that will influence where and how we all live. Please welcome him Park. Good afternoon. Thank you very much, Clay. Well, you're all familiar with the concept of the Black Swan hardly needs to be explained anymore, low probability, high impact event, but the real risk in the world today are the green swans and they are flocking and what's different, of course, between them and a Black swan is that they are not unpredictable or low price ability. In fact, they're happening all the time. So much so that the total annual estimated damage and payouts from climate disasters is increasing by tens of billions every single year. We reached $250 billion last year. So we now know what we have to prepare for but are we, we are not, we have a major collective action problem. And here as we gather on the eve of cop 28 we know over the last several decades that while heroic amounts of resources are being committed to mitigation, decarbonization, greening our industries and supply chains, not enough is being committed to adaptation, which is how we retrofit our infrastructure relocate, populations, invest in climate resilience for our societies for our economies that has not happened yet. And therefore, as the bank of international settlements has warned us without that collective action, climate risks are largely un hedge at a systematic level. And indeed the industry that is most exposed is the largest. Now as if high interest rates, COVID related abandonment of offices and worker relocation after COVID and so forth wasn't bad enough. Now, you have the climate factor, uh potentially decimating certain geographies. Now, for all of us, we've been accustomed to real estate going up and to the right for generation after generation after generation, but not only due to climate change but also a separate topic, but a very important one. The plateauing of the world population means that really there is a zero sum game underway in global real estate and the geography of global real estate. All of these are slamming the global real estate industry as valuable as it is, but it is trapped and immobile as it is by definition all at once. What is to be done now if you take the present distribution of the world population, all 8 billion of us on this map, literally every human being is a pixel and forecast. What happens to the livability, the suitability for human habitation of geographies over the next 5, 1015, 20 years as temperatures rise across the 1.5 degree towards the two degree threshold, you get a picture that looks somewhat like this. Now, I think we all unfortunately have been made aware in recent years that this is not a map of the year 2050 or 2060. We cannot be complacent in believing that if we simply meet the Paris Agreement targets and limit greenhouse gas emissions and try to slow temperature rise, that we can avert certain negative chain reactions that are already well underway in our biosphere generally. And certainly when it comes to the consequences of temperature rise itself. For example, if you look at South Asia, now, the most populous region of the entire world India alone with more people than China. If you take Pakistan, India, Bangladesh, that alone is 1.8 billion people as a subregion. That is one of the most climate stressed regions of the entire world. So it wouldn't be a stretch to posit that over the next 5, 10 years or in the coming decades, the number of people who are going to relocate as a result of climate phenomenon, which is already one third of total dislocated people in the world today is going to cost hundreds of millions of people. That's what the World Bank has already forecast and they're potentially understating the case. So the question becomes not just what to do next, but where is next? Because unfortunately not only the real estate industry, but by extension, our habitats, our settlements, our towns, our cities, our communities are going to be affected and many people are going to move and investors are going to need to anticipate the new geographies that are more climate resilient, more fertile uh to, to uh to build new towns and communities and so forth as we adapt to climate change. Because remember, the climate is not going to adapt to us, we have to adapt to it. But one of the things that we have neglected in the focus on mitigation and decarbonization instead of adaptation is really quantifying financial impact. We simply have these studies and forecasts that say that it will get worse in place X or Y. But without putting a price on that phenomenon, we're not able to really incentivize and share industry behavior. There's a lot of focus on again, the decarbonisation, space and regulations there, particularly in Europe and in a couple of other countries, it's starting to happen more in the United States. But generally speaking, adaptation is considered a private good, not a global public, good like decarbonisation. So you have much more localized impact assessments and calculations and time horizons under which firms operate. What we've done in our research is to think about how spatially geographically you should look not only at the risk indicators from climate where it's uncertain under what time horizon or scale those are going to play out and also layer in the resilience, the local resilience. The truth is that the ground truth in any given place in the world is not going to be determined solely by what the climate models say are going to happen in terms of flood, storm heat, fire, drought, hurricane sea level rise and so forth. The ground truth is going to be determined by how adapted that location is what are its investments in resilience. And one of the things we have not done is to quantify resilience. Resilience is a term that gets talked about a lot, especially during COVID, what made for a resilient society. How did communities bounce back but have we quantified it? We haven't. And that's what we've started to do is to say what is, in fact the financial impact, a positive financial impact to offset climate risk of having an energy grid powered by renewables. What about the the the availability of health care and the quality of life in a given location, the quality of infrastructure, the public spending, the social robustness, all of these indicators that you can in fact back test the climate stuff. Climate change is new but a lot of the socio economic and infrastructural investments that we can and need to make more of Now, you can prove have a historical impact on real estate assets, retaining their value. So it's at the confluence of risk and resilience and turning that index into financial impact that we believe creates a very actionable scorecard dashboard and set of coefficients that we generate that help real estate investors plan accordingly. Now, there are a lot of things you can do in the real estate space, the built environment to cope with risks. In fact, for every single physical risk, there is an intervention that you can make with, there's going to be heat stress, you have to invest more in air conditioning or district cooling where there's hurricane risk. You want to do more around coastal inundation protection, drainage systems and so on and so forth. We can do so much more with water conservation, water management and so forth. But that said part of what's happening, as I mentioned earlier is the demographics and the investment landscape changing as a result of everything from the interest rate environment to relocations of companies to human migration and a young generation that is um that is less wedded to any particular geography. And so you have a competition among locations to be the most adapted to attract investment, to attract people. And this is one of the macro trends that if you really pan back and think about this reality of us having to adapt to climate change rather than the climate adapting to us. You realize that if you go back 15,000 years, the history of human settlements, there's always been a competition among geographies to be uh the places that are the most open that attract talent that are the sort of centers of industry and innovation and that process is underway today as well. Some of the most significant commercial hubs and economic centers of the world are also very climate stressed geographies. And if they don't adapt new centers of excellence, new civilizational centers and hubs are going to arise in my travels and research, I've spotlighted and this is just a artistic rendering, you might say of some of the locations that I see as being not only climate resilient but doing a lot to build microclimates of energy efficiency, places that are trying to retrofit their infrastructure, trying to keep temperatures down in their built environment and all of these kinds of things that make them attractive and livable. So it's a lot of things that are going to make a lot of ingredients that are going into, make places resilient. And I'm ranking judging, scoring them according to what extent they are making those investments and that's going to make them attractive destinations for the global asset management, global investment industry. And indeed for young talent now note there is a star right there over this country, United Arab Emirates. And so let's remember that the climate model is saying it's going to be searing scorching hot here, right? Can't argue with that. It already is however, think about the adaptation investments, right? Not nearly enough countries are doing what this country has already done and started to do everything from air conditioning, coastal mangroves, water desalination and so on and so forth. And that again is the differentiator. The climate model tells us many places doomed, but we have that capacity for investment and ingenuity and innovation to adapt and so places have to adapt or they will lose out in this competition for investment and talent. Now, as you saw on that previous map, we have many geographies in the world that are sadly becoming unlivable or certainly less suitable for human habitation. And so really, you can create a simple supply demand curve, right, the supply of climate resilient assets and geographies is getting smaller and therefore the demand for them and as the demand for them rises, their prices, their price is going to rise as well. So this inevitably becomes something of an investment proposition to be the first movers to invest in those climate resilient geographies to start to retro at them to build the food, water, energy, housing, transportation and other systems that are necessary as the populations of climate resilient geographies grow over time. And that time is in fact, now, indeed resilient geography, I would say is the most valuable asset class in the world if real estate is already the largest industry, but we haven't again, quantified it priced it located it and made an investable proposition. In fact, if you think about the way in which we calculate sovereign risk today, so often it's based strictly on regulatory norms or rule of law. But it doesn't take into account whether a country is really investing in climate resilience or not. And yet there are entire swaths of the world that you can see here on this map. It might be Central Asia or other places in, in, in, in, in Asia or even parts of Europe. That may not be investor darlings right now, but that are making the right investments or climate propitious and more capital should be allocated there. One of the things that we're doing is to help to guide asset managers to really allocate capital, these climate resilient locations because indeed, not only is their income generation off of those investments, but there's actually capital appreciation, capital appreciation as well in the long term, given that supply demand curve. So in summary, we have a very important opportunity. Here we are at a crossroads in the world where this massive misalignment that we have in the world between the geography of people, the geography of borders, the geography of infrastructure, the geography of economic activity is terribly misaligned and it's up to us to actually realign it. It's not going to happen on its own. The COP 28 is not going to give us that solution. It's really up to the Corporates, the ceos, the investors, the leaders of the world to realign the map by building where we need to build, to adapt all of human civilization collectively. Thank you very much.

Shaista Asif, Co-founder and Group COO, PureHealth  Geoff Martha, Chairman and CEO, Medtronic In conversation with: Alyson Shontell, FORTUNE

Fortune Global Forum 2023: Health Care’s Big Moment 

Moving to a very different topic. Um The integration of A I into global health care holds the potential to revolutionize the industry while addressing and overcoming the challenges that arise along the way. And while there are clear benefits, there are also concerns. In fact, the World Health Organization recently outlined what called key areas of regulatory consideration with regards to the utilization of A I and health. The idea is to offer countries guidance to help regulate A I and the health space while harnessing its potential. They include the importance of transparency, documentation, risk management, data validation, privacy and data protection and collaboration between stakeholders. Today, we want to talk about the innovations, challenges and benefits of digital tools and health to help us lead this. I'm going to have fortune editor in chief Alice Allison Chantelle is going to join us on stage along with Shisha Asif, who's a co founder and group coo of pure health, the largest integrated health care network in the UAE the cross category ecosystem that covers hospitals, clinics, diagnostics, insurance, pharmacies, health, tech procurement, and more. And then we have Jeff Martha, the chairman and CEO of Metronic, a global leader in health care technology with a team of more than 90,000 people in 150 countries. Please welcome them to the Fortune Global Forum. That's we think that's the wrong. Good afternoon, everyone. Great to see all of you. And, and we're actually working for being here, mission set up a nonprofit and that's, that's something we wanna talk about. Like that would be really interesting, do that. Uh And now my mic is working now, you can really hear me great. Um So, hey, guys, backstage mics are on. Ok, here we go. Um OK, so on the way to start, well, one thing I realized with is like the state of health care today, I think we're in this transition from it being um a really reactive industry where you go to the doctor when you're sick, you're not feeling good, you go get a test done or something. Um But it's really not that helpful for preventing things and being proactive with things. Um So where are we in making that transition as health care as an industry from being really reactive to proactive? All right, you want me to start? Well, first of all, a good job, but now now getting the interesting start there and, and thanks for having me. Um look, so Metronic, we treat um we deal generally with pretty sick people, right? We're a global leader in medical devices and cardiology, neuroscience, surgery and diabetes and uh like I said we're dealing with people that have been diagnosed generally. With the problem. We do some diagnosis but mainly therapy. Uh and they're, they're fairly sick people generally. And so what we try to do at this point is be more proactive at preventing an escalation, right? So that's really what we're doing. We're not really at the wellness stage, I will say though that um with the advent of A I and the explosion of data, we're using that to move upstream. So today we treat two patients every second. That sounds like a lot. But when you do the math, it's 80 million people a year. The world has, you know, over a billion people. So there's for us to move upstream to be more proactive. It is around data and A I I believe is the key. So just in in our world today, um you know, as we move up, we are using uh data and A I to to be more proactive and to identify problems earlier and prevent that escalation. So like one example I can give you a bunch. 11 would be like diabetes management. So we, we provide for insulin dependent diabetics, a closed loop system here of a insulin delivery device like a pump, they wear tied tethered to a, you know, a continuous glucose monitoring system all tied together with an algorithm and we're testing their blood sugars every five minutes and using A I to predict based on their past behavior, what's going to happen and try to microdose insulin uh to avoid uh a high sugar, high or low. Uh And so we are preventing escalations using so that's kind of more like what we're doing and over time wanna move from these sick people to less sick to high risk to more what, you know, preventative. But we're, we, we've got a ways to go on that and Shasta, I know um I wanna hear your thoughts on this as well, but I know an important initiative for you is longevity. Um And there's a lot of progress working around health spans so that you're not just living a longer life, but you're actually enjoying more years of your life and able to do more with the longer years of your life. And you have a 100 and one by 2071 initiative. Uh Hopefully, that's the time for me to make it. That would be great. Um But I'm curious, where are we in that path? And, and how does uh preventative care work into that? So I'll try and, and club both your questions with one answer. So the entire ethos are based on which your health vision is based and our vision personally is based is the ability to give people more time, which is longevity, which is preventive care. Unfortunately, the health care system of today is is sick care. It's not preventive health care. It's when you like you mentioned when you get sick, you walk into a hospital, you get treated and how hospitals are structured is more like hotels, come and enjoy our stay, enjoy the minibar, enjoy the pool, enjoy, you know, so this is how the entire business of health care is being delivered right now. And we want to deviate away from this, which is why longevity is, is just, it's, it's a natural margin to what you know, we want to do. Now, when we talk about longevity, longevity is let's uh slice in into longevity is having the ability to have a larger health span, a longer health span and thus pushing your lifespan more and more sorry. And when we talk about it, we have an individual who is 25% 25% of his longevity is dependent on his 20 to 25% on his genetics. And the rest of the 75 to 80% is dependent on epigenetics. Now, I think we'll need a separate panel on data and A I and gene sequencing. That's, that's a whole different conversation, but we're delving into that and we're being able to identify now what our code consists of and what we can do to prevent something which would naturally happen, you know, otherwise. But the rest of the 80% which is your epigenetics, that is your environment, your conditions, your access to health care, the choices that you make, which determine how long and how healthy you would live and how we're enabling that through technology. And A I is imagine if every single individual here in this room had a personal physician, a personal trainer, a nutritionist, a mental health coach, a pharmacist and whatnot. All of them available with you. 24 7. Guiding you every step of your journey of your life. Would you for sure, have a healthier life for sure. I mean, don't eat this, eat that you need to exercise more. Your BM I is now going towards an healthy level. You need to bring it back down, you need to visit a doctor. Your heart rate is abnormal stress levels are getting high. That's what we're hoping to deliver through the use of technology and A I through the application that we've built Pura that integrates all your health records, data from your wearables, your skins from, from your smart mirrors, your smart bathrooms and it guides you on the best possible journey for a longer health span. So it sounds like also tech will bring down the cost quite significantly because I too would love a dietitian and a nutritious and all these things, a personal trainer with me all the time. And you're saying tech can be that solution and it can be for everybody. Yes, absolutely. Tech is the only way to democratize health care. There is an estimated 15 mi shortage of 15 million uh clinicians in the world right now as we speak, there is no way to have to plug this hole through just normal. I mean, uh when we say just physicians, human physicians, if there's no way, the only way to bridge that gap is through technology. And A I. So, um e every health expert says like this is the golden age right now. What we're seeing the pace of innovation in health tech is astronomical. It's not like anything we've seen in the last 100 years. I'm curious both of your perspectives. Um What do you think is coming like, what are, what is A I gonna enable us to really do that? You're really excited about whether it's a device that you all are working on. And I think your diabetes, one is a great example. But like what's something where in 10 years it will just be sort of the mind blown. Do you think of what we can achieve? Well, look, I I think um in the medical device space, we're at an inflection point. There's, there's a lot of great innovation and traditional biomedical engineering. You know, I think mechanical engineering, electrical engineering, chemical engineering, you know, miniaturization of technology, you combine that with what we're learning about the human body. Uh And you combine it with digital technologies as digital comes into med tech. So think uh you know A I edge computing cloud computing, quantum computing, you know, five G uh all of this is is and then I put robotics in that bucket, uh you know, a game changer and what it's allowing us to do is, is personalized care at scale. Uh, you know, it, it for and, and, and I totally concur with what you're saying about physicians, tech is the only path forward. You can't, you know, if you're not personalizing, you're gonna get, you know, you're not gonna get the outcomes that you're looking for and you don't have the human capital to do this. It has to be uh technology. So in our world, things like we treat Parkinson's disease, we, we have a implantable device that stimulates certain parts of your brain that mitigates the um the effects of Parkinson's the uh the movement issues. Uh And it's an amazing therapy called uh you know, brain stimulation, brain modulation. And, you know, you see the, the, the, the the symptoms of that you turn this on and the patient is calm and smooth. It's, it's an amazing and it, and it slows down the progression of Parkinson's. The problem with it is is that patients need to keep coming back into the neurologist and with the Metronic um person there as well uh to reprogram the device as the disease progresses with A I and, and, and, and cloud computing, we can do this automatically and personalize it to that person. Uh their, their needs. So that's an example of another one that I'll give you one more example of surgery surgery today. Uh is becoming more and more robotically driven uh with uh all kinds of enabling technologies, imaging and navigation and visualization and tools. A I now we're collecting enough data that we're not too far away from. I'll call it a driver assist technology in the or for surgeons. So we're, you know, A I is not gonna replace the surgeon anytime soon, but surgeons using A I will be replacing those that don't. Uh because this, this technology is, is just democratizing good health care uh where you're not so reliant on training, it's taking average docs and making them really good docs and that's not out in the future that is today. So these things I can give you more, those are two different types of examples. Um And to this point, I mean, like taking an electrophysiologist that treats cardiac rhythm and and atrial fibrillation in the United States, you know, there may be a ratio of 100 to 11 of those electrophysiologists for 100 people, you get into the developing world, it's a million to one. I mean, you can't, you can't train enough. So the technology is the only path forward and it, and it is exciting, it is a golden era as you all are thinking about keeping up how as CEO S and executives, you think about keeping up with the pace of innovation. Um There's a few avenues to explore obviously your own R and D budgets, um acquisitions partnerships. Um Sha I know that you guys made a big investment in the US and health care system here or uh there, I'm from the US um recently. Uh and uh Jeff, I know you've done partnerships with all sorts of companies including spacex and Apple. How do you think about when to do what and what can accelerate fast enough for your businesses? So, um health care, when we know technologically has always been behind the other industries, you know, while the rest of the industries are racing towards the four ir health care in most parts of the world isn't stuck in the tail end of the second or the beginning of the third. And that gives us immense opportunity to go in into these areas and to leapfrog them towards the four ir so I think so, first of all, a just to add on to the previous question, COVID was the Chief Transformation Officer for Health Care Technology, the way that it was adapted and the way that it was absorbed by not just medical professionals but patients, it accelerated it. And that's why we're in that golden era of technology. Now we're growing obviously at an exponential speed. But the way that we want to grow is to be able to reach the areas where there is a shortage of health care where there is that ratio of one is 200,000. You know, you know, uh pa patients, one physician for 100,000 patients or where there is that dirt. So we're wanting to go into those areas. We're wanting to take them into the fold and to bring our technological investments from Abu Dhabi to the rest of the world to take them with us on this journey, you know, for us in the, in the med tech space, there's a lot of different technologies and it's, it's hard to invent everything yourself. Uh And the barriers to get in are, are relatively, have been relatively low. So we're very proud of our organic R and D. We, we spend, we invest, not spend, invest, you know, over $3 billion a year in, in, in R and D clinical trials plus technology development into products. But we do have a venture arm that's investing in start ups and a and a healthy mergers and acquisitions team because sometimes somebody, uh you know, often times, you know, innovators from around the world, it's, it's global now, you know, you're seeing that this happened all over the world, come up with something uh very unique. And so we'll invest and, and, and maybe by that company. Uh so the answer is when somebody comes up with something that's truly innovative, uh and they're, they're ahead of us that that's when we really, it's something that we're interested in is, is where we'll, we'll do m and A uh in terms of buying technology, but we also do um COVID, it was a transformational time and that's when we started to do it. We realize that maybe we should look beyond the medical technology industry for R and D innovations. That's where we partner with spacex as we uh open sourced our ventilator. During COVID, we, we had some real challenges scaling it. There's a particular part called a proportional solenoid valve. Never heard of it. But it turns out if you think about a ventilator as a life support system, guess what they need on spacecraft life support systems. And it turns out that SpaceX had a, had a, had a real, a good product there, a good component. And they, you know, Elon helped us there quite a bit. So, you know, we've, we've done more open sourcing since then. It was a real lesson learned uh is to not just think about other medical technology companies, but the broader tech industry. And uh so we've got a lot of more big tech partnerships these days. And the, the last type of partnership we're doing is with health care providers because the key for us is to make sure this technology is fully integrated into the care pathways of the different health systems and health systems operate differently around the world. So it's not a one size fits all. So we find ourselves inventing the technology and then having deep partnerships with uh different health delivery uh organizations, big hospitals, small clinics, what have you to make sure our technology we know how to integrate it into their work flow so that they use it. Uh I just want to give people a little bit of context here. Uh Jeff is being modest. I think he had the hardest job in COVID. Maybe of anyone on the planet, he became CEO of Metronic 23 weeks, maybe before COVID hits. Uh, and Metronic supplies a third of the world's ventilators. And if you remember at the beginning of the crisis, I mean, there was such a short and you made a bold move to open source. Um So others can make this like spacex. Um So I'm curious actually from both of you, if this was such a transformation agent, um not just for your company but for your leadership, like what do you take forward from the COVID era to further accelerate your companies now? Um How are they better future proofed because of what you had to go through in those times? So I think what um we underwent a transformation ourselves as healthcare entity, you know, during COVID COVID was a wake up call to everyone who was taking it just as, as like we said, you know, business as usual COVID accelerated the need for change. COVID accelerated the need for preventive care even more. So, uh it accelerated the need for a physician for you to have health care at your fingertips, in the comfort of your home, in the palm of your hand and it, it provided everyone the tools to access it out of necessity. So the learning that I think we took from COVID was that while technology may be a luxury, still in certain parts of the world, for hospital providers, for health care providers, it is an absolute necessity for all of us. If you're wanting to take this towards the future and towards that preventive care, it is an absolute necessity. Uh We invested a lot in the R and D. We, we again, you know, like you mentioned, it was absolutely necessary to go into clinical trials into seeing what we needed to do when it came to stem cell regeneration. When it came to uh you know, tackling sick care when it came to taking the population, population health management say, for example, so all of these things came in as a part of learning of COVID and when we applied them, it was how aptly and uh and, and, and agile we were, you know, in, in this application that gained us the momentum to move forward. Now, I think for me, you mentioned, you know, becoming CEO right at the beginning of COVID. And um you can look at that as a challenge and, and I look back at it as a as AAA great learning experience and opportunity. And you re one of the, the, the things I, you know, COVID struck me as, you know, we're in health care and it is a privilege and, and just how important health is, is to, you know, humanity and society and to the global economy and, and that we need to kind of think a little bigger and the partnerships, open sourcing. Um you know, a company like ours with a lot of technology, but we have gaps and making yourself vulnerable, taking the risk and, and, and, and, and having these partnerships, the partnerships has been real accelerator for us and in our innovation and how we think about it. So that's one, the second is less um uh sexy uh uh but supply chain. Uh how, when we as, as the world is globalized, uh how long supply chains have gotten and how we've lost sight of where our components are coming from and, and how geopolitics or climate, you know, issues can affect our supply chain. We saw that during COVID and, and it caused us to really revamp uh one have a, a deeper understanding of our supply chain, 345 layers deep um and building that resiliency as well. Uh So those two things uh are, are big ones, partnerships and supply chain. Well, thank you both so much uh for your efforts to make the world healthier to help us all live longer. Um And thank you for joining me on stage, Jeff. Thank you.

Emily Chiu, Co-founder and COO, TBD, Block, Inc. Dimitrios Dosis, President, Eastern Europe, Middle East, and Africa, Mastercard  Moderator: Jeff John Roberts, FORTUNE  

Fortune Global Forum 2023: Cross Border Payments And The Path To Financial Inclusion 

Welcome to the stage, Fortune executive editor, Asia Clay Chandler. Hello everyone and welcome back. Um For those of you that are watching out in the in the foyer in the lounge, please come back in and join us. Uh We look forward to getting our uh great program for the afternoon uh underway. There's little doubt that digital technology is reshaping the future of finance by leveraging innovation to create a more inclusive and sustainable financial future. According to the World Bank, two thirds of adults worldwide now make or receive digital payments. Technology is empowering individuals. It's broadening access to financial services and it's driving efficiency and competition in the financial sector, but there are still some clear obstacles to overcome. Please welcome Fortune crypto editor Jeff John Roberts to discuss these obstacles and potential solutions. Joining him will be two leaders in this space. Emily Cho is chief operating officer of TBD at block and demetrios. Dois is president of Eastern Europe, Middle East and Africa at mastercard. Please welcome them to the Fortune Global Forum. Jeff. Hello everyone. Thank you so much for joining. Uh I'm Jeff Roberts. Um I'd just like to open with a quick couple of questions. Um Who here uses mobile banking. How about Google Pay or Apple pay? How about Cryptocurrency, Bitcoin or anything else? Not so much, but everyone uses the first two. And the reason I'm asking this are payments have changed a lot in recent years and have made it a lot easier. We benefit from it. More time, more connection. There's a lot of people who don't have access to this. And for me, access to finance and payments is sort of like access to infrastructure, like roads, like education, like health care. It's something that can really help people, but there's a lot of people of populations who don't have access to it at all. And I think that really limits what they can do and where they can go. So that's what we're going to be exploring here today. How to get these technologies into the hands of more people. Emily, I'd like to open with you. You are part of the division called TBD, which is part of block, which used to be called Square. I think you probably all know it, this little pa rail thing, you know, a farmers market might have it to pay a company run by Jack Dorsey. But Emily, tell me what is TBD and how are you expanding finance to people? Sure. So TBD is the newest of four businesses at block, formerly known as Square and we founded the business in 2021 in response to one of the most pressing global financial challenges that we saw at the time. And this is when the World Bank had just come out with a report, citing that 1.7 billion adults in the world lacked access to a basic bank account. And yet two thirds of them actually have access to a mobile phone and internet connectivity. And so the problem that we saw was that while the internet had given us amazing infrastructure to connect everyone to information. Um Clearly the world of money and payments hadn't kept up. And this is the problem that TBD is looking to solve. The internet is missing an identity layer and it's missing a native value layer. Um And through the power of decentralized technologies, we believe we can make sending money as easy as sending um an email in the world. Um And uh this is actually something that we think is really exciting through the protocols that we're building where we can allow any individual and institution to send money and value cross board in a way that's much more inclusive and affordable. Give us an example of this in action, you make it a little less abstract. Who are you helping? Yeah. So there's a lot of different people and small businesses that were already helping take like a person who's trying to send money across borders for your average like remittances, use case sending money to a country such as Nigeria is incredibly fraught, you know, many times like you don't have a US dollar banking account to even receive these funds. It's expensive. It can cost upwards of 20% using a traditional remittances provider. Um And often times, you know, we actually ran an experiment, you went to four different branches only for them to tell you like return to sender, right? Um And through the power of uh digital currencies and for us, it's Bitcoin and stablecoin that we're really um really focused on investing in. You could send it at a fraction of a cost. It goes through, we actually sent a transaction in 40 seconds and through our protocol, we're bridging the world of digital currencies and legacy finance. And so not only did we use the digital currency as a bridge, but it landed in someone's mpesa account, it landed in someone's bank account, it meets people where they are today and this is primarily in Africa, right? Today. We are in Africa. We are also looking to expand into Latam. The Global South is a big focus for us, Tame. I want to bring you in here, mastercard. I'm sure we all know a very famous brand, you know, in the U. Anyways, it's my credit card, but I think a lot of people are not aware, Mastercard is a lot more than that. So how is Mastercard promoting financial inclusion? I assume you're not running around giving credit cards to people in the Global South I mean you are but like what's you know, what else are you doing? Sure. Thanks Jeff and thank you also for having a Mastercard. That's great. That is your credit card. So Mastercard is all about connecting people. It's about connectivity. So for connectivity, you first need to have a digital identity without an identity. There's no connectivity in the last World Bank report, we saw that over 850 million people in the globe are still without an identity. That's not good. So we need to fix identity. That's number one on top of identity. As you said, we need connectivity rails which I think we started little by little building up. We have car rails, we have ach rails, we have um your radar that you're building up. So this is connecting people. But I think for this to be successful, there needs to be value, there needs to be value for the end consumer. There needs to be value for the for the sme behind it. Let me give you an example. In Ethiopia, we started a program which is the farmers, the farmers connects the farmers, the rural farmers to a marketplace so they can have a much better price point for their product. So they don't need to go through intermediaries. So you have a direct connection to a marketplace through those rails and you add value. That's why people are connecting to them. I think this is very important rails without uh, value are not worth it. Yeah, that makes no sense. Let's step back one sex though. I mean, suppose we have a farmer, you know, who has money, they might keep it under their bed and, you know, unfortunately, you know, inflation might destroy its value. It's prone to be stolen and so on. But they probably do have a phone. Right. Almost everyone's got a mobile phone. Right. So, how do we kind of get it to the point where they can have, you know, something on their phone that will work and solving that identity thing too. You know, because the bank needs to know who they are. So Emily, just take us through the process of someone who's, you know, in a very kind of low technology, low income place. Do you get that first step? That seems like a pretty big hurdle. Yeah. So we're all familiar with physical credentials in the world, right. So, if you have a driver's license, it's a physical credential that gives an attestation of your ability to drive or operate a motor vehicle. If you have a university diploma, it's an attestation of you having graduated from a university. Unfortunately, we don't have a great layer of identity on the internet and scanning that physical driver's license or faxing that physical diploma is not really a great tamper proof or privacy preserving way, right? And a farmer is probably not going to have a driver's license or a diploma Exactly. And the fact that so many people are missing the basic credentials is a huge deterrent to actually being banked in the very first place. Right. And so through a lot of new standards being set by the W THREE C, which is open standards set by the World Wide Web Consortium, there's actually really great ways to now represent your physical credentials in a digital realm in a way that's scalable in a way that can reach the farmer in a way where he can independently represent who he is in a way that is independently verifiable privacy, preserving tamper proof and allows him to actually access the global economy. So that's something we're really excited about is bridging trust, identity and financial access and bringing all these things together demetrios. How does mastercard solve this problem in terms of, you know, this person can't, they might not have an ID. How do you get them to use the financial, you know, if they can't prove who they are? So here's the reality, many people already have a mobile phone and this is a great starting point because mobile operators are actually able to at least identify you. OK. So there is, if you want a basic identification already, the question then becomes is how do you first add value to those mobile rails? Uh Remittances is one of them which I think is a great use case because similar to you, I believe they cost too much they're too slow and they're kind of archaic with the time they take to solve. And, but then the problem also becomes, how do you make those closed loop wallets effectively interoperable? If you go to Africa, you, you mentioned mes a, uh MP ESA uses one wallet, but then there is another wallet from another mobile operator. How do you make them into operating? But I think this is going to be super critical if we want to make sure that the Pharma and the people who are using those wallets can, can operate in the proper way. That's interesting. So using the sort of the mobile carriers recruiting them to be part of it. And I think standards to a common standard, where does governments fit into this too? Because my, you know, covering crypto, one thing I've learned, governments are very good at identifying you, you know, they know that's what they're best at. They're terrible at technology. So how can governments do a better job to, you know, facilitate this or who is, you know, what's happening on that front? Well, one of the things we're really excited about is actually partnering with different authoritative sources of credentials. So that could be your DMV, um to issue verifiable credentials where your driver's license is actually represented as an identity credential that can unlock banking access um or different forms of, you know, your passport can actually be represented as a verifiable credential also to unlock financial accesses or services. Um And that's something that we're really excited into bringing into the digital realm for us. Governments are true partners and one of the things which for partners like our governments are very important is safety and security. What Master Card does is we're using A I. People only talk about A I with J GP T but you know what A I drives also a huge benefit. For example, the last two years, our A I solutions have have covered over 30 billion in fraud globally. This is a huge number that would have gone through. So with the government, we work together to make sure that we make safe and security in our all in payments across all our race. I think that's number one and the other one is obviously also making sure that when people identify themselves, that they are who they are and we also have um cipher tools to make sure that when a transaction goes through through, for example, through a crypto wallet that let's say the end side of this are not dodgy and they are the ones who they say they are. I think those tools A I and making sure that the crypto transaction is being passed through the right methods is, is, is, is what we're trying to help governors with. Basically listen, let's go back to remittances for a sec because I've covered Cryptocurrency and payments for a decade. And that's something that means. So hard. It still seems like Western Union. No offense to Western Union. But this notion of showing up with some cash at a store and then waiting three days and some goes to another store and they get it, you know, I think the margins like five or 6% maybe it's getting better. But it's why is that so hard to solve, you know, if you want to, you know, I've heard some people say, maybe start with the B to B that will figure it out and then trickle down. But where are we? I'm going to stick with you, Demetrius, you know, where are we on that? You know, how is, is the technology improving? What is missing to make that happen? So let me give you a real time example. I'm I live in Dubai and I came from Germany. So seven days ago, I wired the money from my bank account here to my bank account in Germany using traditional methods. And both of them were, let's say seasoned banks. It took five days for the money to arrive between, I didn't know where the money was. So I effectively called both banks and nobody could tell me where it is. The only thing that told me is I need to have uh an investigation run uh to understand and it would take me two days to understand where the money is. Luckily it arrives. So it's archaic, the system of remittances with um correspondent banking is archaic. That's, that's the problem because the rates are just not interconnected. You need to have, as you correctly said, correspondent banks in the other part of the world that is holding the funds. I don't think this is the way to go. I think the way to go is to use other rates to use. For example, your ra to use the card races to use interconnected. Ach R I think this is the only way because the race exist. You do not need to rely on your correspondent banking. You can go down to the other ras and really try to make sure people understand the value which is safety and security, which is speed and also cheaper. Yeah, I mean, Jeff like the the term global payments is a lie when it comes to the legacy financial system, these are systems that were built largely in the seventies, they're inherently domestic and you know, it's a ledger system that allows you to think that your money is actually moving across borders. This is the real, real innovation when it comes to digital currencies and Blockchain. Bitcoin is actually an internet native currency. It's 24 7, it spans borders. Um It's really the first global payment system and I think those who are focused on the speculative aspects of it. Miss that, that is the true innovation of this technology. Yeah, I entirely agree with you. I cover crypto, it has a dodgy reputation in some ways, but I honestly believe the technology is superior because swift messaging system, you know, ac great in the seventies. But, you know, just like, you know, airports built in the seventies are badly out of date. This stuff is too. But you know, how do we persuade companies, consumers and governments to use Blockchain? You know, especially through a more conservative company like mastercard, you know, do you guys touch Blockchain at all? Yes, absolutely. We do. And for us, it's about giving the consumer choice. We want to give the consumer choice to use Blockchain. We want to give the consumer choice to use the car ras to use. Ach, that's all it is about. We are invested in Blockchain. We believe it's a future proof technology. It needs to come with the right guard rail, the guard rates in terms of safety and security, but also in terms of data protection for us, data is in the center of whatever we do. We need to make sure that if it's about you, the consumer, you own your data, you control your data, you should actually benefit from the data. And that's why you might be using some of the rails that we talked about and we need to keep it secure, you own, you control, you should benefit and we keep it secure. I wish we had more time. We only have less than a minute. But I want to ask you both really quickly what friend or product? Are you most excited that we're going to start seeing, arriving in the next year or two that you think is the most interesting thing to watch Emily. So for us, we're pioneering work around verifiable credentials and in particular, bringing verifiable credentials that can prove KYC and AM L. And when you talk about what it's going to take to bring institutions into the fold, actually establishing a layer of trust and compliance is what I think is going to unleash like activity and liquidity like we haven't seen to date and that's something we're really excited about. Makes sense and Demetris very quickly. I think we'll see much more biometrics. I think biometrics is what will make the consumer experience easy. I'd like to call it Pay with a smile. That's what we introduced now and I think this will be the future. Yeah, I can't wait to have this talk in five years. I think we're going to be a very different place. So please give a hand for the panelists. Thank you very much.

H.E. Ahmed Jasim Al Zaabi, Chairman, Abu Dhabi Department of Economic Development (ADDED); Chairman, Abu Dhabi Global Market (ADGM) In conversation with: Alan Murray, FORTUNE 

Fortune Global Forum 2023: Charting The Path Of Economic Growth In Abu Dhabi

So one of the things that's fascinating about being in Abu Dhabi is to see how strategic the emirate has been in developing an economic plan for the future. The Abu Dhabi 2030 vision plan provided a kind of a road map since it was written in 2005 that the country has followed to diversify industry beyond oil and also to prepare for a post oil world. And we've seen a lot of the evidence of it since we've been here for the last 48 hours. But we're going to uh talk about that a little bit more with our next guest. He is our host, his Excellency Ahmed Yasim Al Zabi, he's chairman of the Abu Dhabi Department of Economic Development, also heads Abu Dhabi global markets. He is a leader of the efforts for economic growth to further enhance the falcon economy and please welcome him to the stage now. Good to see him. I I first of all, I have to thank you for a fabulous dinner last night. That was quite a spec spectacular show you put on for us. Thanks very much. In fact, uh give his excellency a round of applause for him. No pleasure. It was great. So, so it's clear being here in, in Abu Dhabi that, that oil is a great boon to your emirate. Uh But it can also be uh we've seen in, from historical examples, it can also be a burden and because you know, it won't be there forever to drive you and the efforts that this, that Abu Dhabi has made to diversify, its economy are really quite spectacular. Can you talk a little bit about how you keep the focus on diversification and how you're thinking about a post oil economy? Well, uh first, uh thank you for having me. Uh And I hope you guys had fun last night. Uh We did, we all did. I think uh the world is looking at uh a transitionary period. Um And I think more so than ever, that transitionary period is more important to countries that are uh oil and gas uh dominant. So us too, we have to go through that transition. Probably we have to go through it way more than what uh other countries have to go through. So we've been uh diversifying away from uh oil and gas. We've been uh we've reached uh this quarter in Abu Dhabi, around 54% of our uh GDP is non oil. So we're heading towards a uh to in the future to 80% of that to be non oil. Uh We have a strategy, a diversification strategy. Which we have specific sectors that would be so focusing on going forward. Uh It's been, uh it's been going very well and uh hopefully in a couple of years, the results are gonna be more and more apparent for, for everyone to see. And the 80% non oil uh economy uh that comes when, what's your target date? The, uh we're still going through the uh the numbers. Uh you know, there's, there's always a debate between economists on when is the right, uh, and responsible date of actually pulling a target, but we're still going through it. However, I, I do not foresee it in the next 2 to 3 years, of course, but this is AAA much longer period, uh, strategy. Uh, and however, I think we'll be there, uh, way faster than what people anticipate faster than anticipated, faster than what people would anticipate. All right. So let's talk about some of the pieces of that, uh, finances a piece very near and dear to your heart. I'm not sure. Uh, everyone fully understands what you built over there at, uh, AD GM. But can you talk about, uh, where you were taking Abu Dhabi in terms of, uh, being a financial hub? Well, I think Abu Dhabi has all the, uh, the attributes of a major financial center, uh, global, major financial center. I think we've got, we're the safest city in the world. We've got, uh, uh, amazing infrastructure. We've got a progressive regulators and progress, progress regula regulations in general. Uh, and I think it's, uh, it's only, uh, uh logical for, uh, the financial center of a w to become one of the biggest. We're, we're on a trajectory probably to be, uh regionally, probably one of the biggest, if not the biggest in the next 2 to 3 years. Uh, post that I think will be uh competing globally on that first place. And I think we're, we're on track to do to, to do so and talk about how you've done that. I mean, th that's the, that's an impressive comment you've made, you think you're on track to be potentially the largest financial center or one of the largest, one of the largest, I think, uh it's very simple. Uh Just, you know, I think my problem with regulators and before I became, uh you know, the chairman of the financial district of the Financial Center is they never listen, you know, regulators never listen. And so the first thing that I did when I stepped into the uh to the, to the Financial Center is I sat to the regulators and said to them, I want you guys to listen to the market and according the uh uh work towards uh whether re regulations or deregulations vis a vis what the market uh is asking for. And I think that made a big difference and, and uh and how people perceive uh the, the ad GM and why it became so attractive and why it attracted a lot of companies and assets into, into the center. And I think that's why we're growing exponentially. And we've, we've been doubling every year and I think we'll, we'll continue with that rejected and concede from the application. And it's not just regulators, it's also a court system. You showed me when I visited you this summer, your virtual courts at AD GM you have your own court system that is working very, very well in terms of encouraging people to move here. Yes. So the uh the Financial Center, AD GM has a, it's an English common law jurisdiction. Uh It, it's a direct application of English common law uh in the region. I think there's uh uh uh three that are direct applications. It's uh ad GM Hong Kong and Singapore. And I think there's an advantage of having the direct application of single com English Common Law and we've got an English Common Law court. So we've, I think we've got my belief, I think we've got the best bench of judges uh worldwide, I think. Uh and that bench is getting stronger and stronger. It's attracting a lot of the best judges in the world into this, into the court system. It's a, it's also a hybrid court so you can come physically or you can come. Uh you can do it uh electronically, we've got an equ uh from end to end. Uh That's why during COVID, we weren't really affected because we had it end to end uh uh electronically. And are you seeing people move financial offices from Hong Kong and Singapore to Abu Dhabi? I think uh uh there, there has been a big move. Uh I mean, the most notable one was, of course uh Ray Da, the DA family office moved to, to, to a DC M and I think uh big names are already there. Uh You know, on track to be there soon. You know, some of the very famous team have already moved into Edgm. Uh the blue chips that we know of uh Ray Dalio will be here tomorrow. So we'll ask him about uh why he made the move. Maybe he'll have some good words to say about what you've done. Let's talk about some of the other industries, health care has been a big focus. Can you talk about what you're doing there? Yes, I think life sciences in general is gonna be, it's gonna play a pivotal role in our diversification. Uh uh You know, going forward, I think, uh you know, we're, we're investing a lot in life sciences in general, you know, and uh you know, whether it's uh we've, we've already made the first step into vaccines, but we, we're expanding even more in other areas. Uh You know, we think health care in general is gonna be a pivotal uh not only uh as a, a cornerstone of attracting talent into the country, but also uh health care in, in, from a perspective of actually exporting uh uh uh you know, that industry outside to, to other countries. So that's where it's not only health, life sciences and health care. We're also focusing on uh we've spoken about fin uh finance services, but we also are heavily focusing on technology, which is gonna be AAA major uh sector and, and the UAE specifically, I think we're also investing a lot into A I. Uh we've got several initiatives that we have. We're investing a lot in autonomous vehicles. We just announced the Savvy cluster, which is the smart autonomous vehicle industries that has been attracting a lot of big players in autonomous vehicles also to come here. Yeah, we're diverse uh sector mix. We're gonna talk about some of the things going on in the area of A I in, in uh the UAE later on today with the uh the world's only uh minister of A I I believe. Uh um but, but I want to talk to you about alternative energy a little bit because I know that's been an area of focus and there are clearly people in the world. Uh Former Vice President Al Gore is one of them who, who, who believe you can't be producing oil and investing in alternative energy at the same time that there's a conflict of interest there and you can't be trusted with the transition. Tell me how Abu Dhabi is managing that making so much money off the sale of fossil fuels. But at the same time, serious investing in the next generation of technologies, you know, I wish the world is uh is, is uh is a switch. Uh because that statement would have been uh uh very accurate. However, you know, unfortunately, and disappointment to a lot to a lot of people, the world is not a switch, you know, it needs, that's why it's called transition. You need to transition into something else. Uh countries do not move, the world cannot move from one uh energy source to another energy source just by switching a switch and saying, let's go all renewable. It's, it's, it's much bigger than that. So naturally, you know, it's important that uh you know, we transition responsibly also uh going forward. What we have been doing. Renewable energy is not a new sector for the UAE or Abu Dhabi. You know, we've, we've invested in the renewable energy since 2005 when people didn't believe that uh renewable was uh you know, uh important at that time. You know, we've invested, we've put a lot of money into, in, into that. We have one of the biggest companies in the world that Mazda that is doing that. So we've always believed in new and we've always believed in transitioning. We always knew that it's time to transition. We have the cleanest lowest cost battle in the world we know, we know when you look at it's, it's when I talked about people, I said to people that battle of oil was not the cleanest, out of coincidence. We've worked on that throughout the years, you know, uh zero flaring policy were there since the nineties. You know, and, and, and a it wasn't a phenomenon that we just came across. So, uh we've been using that those funds that we're generating out of the oil and gas sector to actually transition transition and renewables and transition into other sectors. Uh like financial services, tourism, health care, life sciences and technology in general. So that's how you transition. Uh And I think it will do the world that this service if we switch off the lights uh in one go, I think everything is important. We need to transition responsibly and we need to be aware that, you know, not everyone is privileged around the world as, as, as some are in some, in some places. So we need to be aware of that. When do you think you will turn off the switch on oil if ever? I mean, the discussions in general in the world is about peak oil. When will that peak oil be? You know, and that, that, that point has been moving from one year to another. So we used to say 2040 then 2035 and 2030 no one really knows, you know, uh when that peak oil is but what's important is, is when, when is not, when will we switch off the, the, the, the, the lights on, on oil and gas is actually, when can we actually be uh carbon neutral? When can be, when can we reach a stage as a, as a globally where we actually do not need oil anymore? That's what's important, I think for us and I think that's, that's not any time soon. I don't think it's gonna be in 20 uh 30. I think it's going to take some time, but I think we're getting very close to that. Yeah. Uh last question to do all you're talking about, you have these ambitious technology plans, healthcare, finance, alternative energy to do all of that. You need talent. Uh uh Abu Dhabi, the UAE fairly small population. Can you get the talent? You need to meet your grand ambitions? I mean, I mean, 100% I don't think that there is anywhere in the world that is as attractive as the UE. Uh you know, I think progressive regulations has 200 nationalities, uh you know, a tolerant country, neutral country objective. Uh you know, amazing weather, most parts of the year, let's say nine months of the year. You know, we, I was here in August. Yeah, and very safe and, and the safest city in the world, four of the safest cities, uh 44 of the top 10 safest cities in the world are uh cities of the UAE. So that tells you why talent will all be always be attractive in here. So, uh II, I think we've all, we're already doing that. We're attracting a lot of talent. But I think, uh uh you know, in the next couple of years, I think the UEE and probably the region also, I think will, will be a magnet to a lot of the talent uh around the world. Uh You're excellent. So, thank you for that. Thank you for the dinner last night, your partnership for uh with this conference. We hope we can do it uh again in the future. Thank you very much. Thanks. Thanks for having. Thank you.

H.E. Omar Al Olama, Minister of State for Artificial Intelligence, Digital Economy, and Remote Work Applications; Director General, Prime Minister's Office, UAE Gary Cohn, Vice Chairman, IBM In conversation with: Geoff Colvin, FORTUNE

Fortune Global Forum 2023: A Roadmap For AI Governance

H.E. Omar Al Olama, Minister of State for Artificial Intelligence, Digital Economy, and Remote Work Applications; Director General, Prime Minister's Office, UAE Gary Cohn, IBM, Geoff Colvin, FORTUNE

Taso Du Val, Chief Executive Officer, Toptal Renée McGowan, Chief Executive Officer, India, Middle East & Africa, Marsh McLennan In conversation with: Ruth Umoh, FORTUNE

Fortune Global Forum 2023: The Global Skills Gap: Scaling Human Potential

Changing subject. Over the past several years, there has been a massive change in the way we work triggered in large part by the pandemic and its after effects. Now there's another transformation underway. One prompted by rapid advancements in technology, including generative A I expectation for gen A I's impact among C Suite executives are high. According to a recent mckinsey and company survey, three quarters of all respondents expect generative A I to cause significant or disruptive change to their industries in the next three years. There's concern and some excitement about what these changes could mean for workers. While there is no replacement for some tasks that are considered uniquely human, there are functions that technology can enhance or replace, completely freeing up staffers for more important duties. So next, we're going to talk about the future of work and how business leaders can harness the power of innovative technologies while improving the experience and productivity of their workers. Tasso Duval is the founder and Ceo of Toptal and Renee mcgowan is CEO of Marsh mclennan, India, Middle East and Africa. They join fortune leadership editor Ruth UO for this conversation. Good morning, everyone. Thank you. So much for joining us and welcome to the both of you. Delighted to have you at Fortune Global Forum. Thank you for joining, quick reminder for the audience. We will be taking questions from you all. So do keep that in mind as we kick off today's conversation. Uh Renee lots to discuss. So let's kick things off with you A I will and already is fundamentally reshaping nearly every aspect of the way we work. How will artificial intelligence and related new technologies impact the future of work? What are you seeing at this point? Um So we do a lot of work. OK. What happened? Oh, and well, we didn't do the images because we didn't get on to that bit of a conversation. I think there is a microphone issue. Can you can you quickly? All right, they don't do well, a few technological issues, please bear with us. But do I? Apologies, I'll start again. So um A I is definitely changing jobs, but it's also changing work. So what we're talking about and what we're studying and working with clients at Mercer is how is that changing first up is that is changing the nature of work? Um And that's where we talk about jobs, skills processes, the w the work that we, we're doing every day, it changes the workforce. So starting to think about what's the workforce that you're going to need and in particular, what are the skills that you're going to need into the future. Um And that's something that is fairly embryonic for a lot of large organizations in particular. Um And then the third thing is that the future of work will change the organization. So these hierarchical structures that typify a lot of large organizations around the world will ultimately be replaced with a structures that will be far more agile work. There will be far more fluidity of people doing tasks and skills. Um And so that's gonna be this fundamental change that's actually going to materialize, not just the way that we work, but the way that our organizations are structured and prep social structures as well. Yeah, you have a front row seat. Given your role at top goal, you mentioned skills earlier, what skills have been elevated, given the premium due to A I and conversely what skills have been downgraded? Well, there are a variety of skills that relate to the new A I fields, I suppose you could label it as such and those are all still developing. And so the role of a chief A I officer or a similar type of role is a new role that didn't even exist two years ago. Now, companies are hiring C levels who are introducing A I strategy into the organization and those individuals are responsible for increasing the productivity of all the workers in the organization, particularly at the operational level. And so what we've done at top t just as one example is we worked with hurst to be able to help them with their operational strategy and how A I interp plays with that, even having them hire one of our talent to become one of their sea levels, to instantiate an A I strategy within that organization. And you're seeing that across all different types of large organizations globally. We're helping to lead that. But all, all of the other consulting companies are as well to be able to look at, where are the operational problems? Where are the A I opportunities and how do we actually ensure that those challenges are solved through A I? Yeah, we'll soon circled back on that. I do want to go back to you, Renee looking at the intersection between A I and human capital based on Marsh mclennan research. It seems to me as though hr leaders in particular are ill equipped and maybe much of the sea, we are ill equipped to navigate this new era of human collaboration with A I? Why is that what needs to change in the immediate short term? Yeah, it's um it's fascinating. So Mercer has done a, a number of studies in this case, CEO S are focused on, on A I. So in our later study, about 40% of CEO S are considering A I and considering how it will fundamentally change their business. Interestingly though uh the hr departments in those organizations are not as focused on it so less than uh 14% of hr departments have any specific dedicated focus on A I. Um And so what's standing up is this momentum around A I the impact on jobs, of course, employees are hearing that jobs will be eliminated and these types of things, organizations are starting to think about um where it impacts. Uh but the hr departments that will actually be important for helping to change that workforce um do not have as much focus on it. And that could be a big gap that's emerging. Yeah, let's talk about that job obsolete and, and whether it's warranted, you know, one thing that I hear a lot of people say in this space is that A I will remove a lot of those wrote tedious tasks. One thing I have noted and especially in the US is a number of corporations have this apprenticeship model where in entry level employees or interns really get their feet wet by doing some of those repetitive. Um And, and road task. And so do you see a future in which companies use A I to replace junior level employees? And what's the impact on future generations of professionals? I'd love to hear the both of your thoughts on that. So certainly a lot of Alama statistics out there about the number of jobs that will be eliminated. Um But the same sort of Alama statistics that have happened with every technological evolution, I think along the way, no doubt. About it. A I will eliminate uh mundane routine type tasks. Um I think talking about sort of taking out a category of a workforce at early entry career level. Um, isn't the way that we'll be thinking about it though. I think we'll be thinking about as you're coming into your career in your early career. What are the skills that you're going to need to learn and how do we expose you to those skills throughout the organization? Um to map to, you know, either the leadership models or the the technical models that we need into the future. So I think it's about redeployment. Um and, and thinking about uh work differently, I'm sure everyone is familiar with the BC G study that was corroborated by Harvard where the consultants at BC G were greatly improved in terms of their productivity once they started using generative A I. And so the immediate impact I see is the reduction of workforce in areas that A I generative A I namely can actually impact directly and has proven track record in improving the efficiency in those areas. Consultants are one of those, but that doesn't mean consultants are going to go away. It means that they're just going to be made more efficient. And so you'll need less consultants to be able to do the types of work that a consultant does stay on you. Uh in a now, you know, widely viewed interview with uh British Prime Minister Rishi Soak. Elon Musk said that A I is the most disruptive force in human history. It's smarter than the smartest human. And as a result, he envisions a future where in people don't need jobs, um, they might have jobs just for personal satisfaction, but A I will be able to do everything so jobs will not be a necessity. Do you share those sentiments? Curious to hear your reaction to that? Well, if I could do my job, that was great. But I don't see a future any time too soon where A I is going to be able to do all the executive level functions and tasks that are needed. And it's currently in a state where it's still hallucinating on rather mundane tasks. And so I think we'll get there maybe eventually, but I'm not sure in my lifetime. Um I think it's an episode of Black Mirror for sure. Um But I'd have to agree. I don't think so in my lifetime. A I will just augment the work that we do um And executive functioning should also be also changing, evolving uh in there. So, um I think that we'll see a whole new range of jobs. We'll see a whole new range of jobs that will be augmented by, by A I. Um I don't see work if you like uh disappearing entirely. Yeah, quickly one question. Does anyone have a question in the audience? Raise your hand and then Mike handler will run to you anyone at all. All right, let's keep the conversation going. Then I wanna talk about the skills gap. Uh While most CEO S uh say that A I advancement is of utmost importance. They do acknowledge a significantly high share admit um that they do find those efforts hampered by a lack of suitable employees with the understanding, expertise in this field. What's the solution here to address the global skills gap? I'll hand over in in just a moment because um I think that you will be well placed to, to talk about this. Um No doubt organizations around um the world are grappling with, with skills. Um As we think about A I, there seems to be two camps of organization, those that are focused on it for productivity use. Um And they're looking at the skills that will uh deliver that immediate productivity improvement if you like. Um it's probably a smaller number of organizations that are looking more holistically at how this A I will actually impact their business, their business model, uh their distribution or their customer base. Um As you get into that second camp and more organizations will obviously need to uh the skill need increases enormously. M Mercer and and Marsh mclennan are doing some work with organizations at the moment to map those skills that they need in the future. Um But it's going to be a pathway to getting there and there is going to be um a specific demand for, for specific skills which I think certainly tass you can talk to at the moment. So a very interesting finding from doing a fair amount of sea level consulting work with large companies and their A I strategies and how they're working to implement A I in general is the finding that the new skill set is not really the issue. It's really teaching people who are within the organization how to leverage A I and taking the current folks who are either running operations or running different functions, how to make sure their function is leveraging A I most appropriately. And so that finding was a bit surprising to me because I think most like a lot of folks, you would think, OK, we need a new person or a new set of folks to create A I strategies and execute on them. In fact, it's a small group that enables everyone to leverage A I and those efficiencies from that strategy really in order to the benefit of the organization. And so not focusing so much on the new skill sets that need to be brought into the organization, but really how to augment folks who are currently working there and just enable them to have a sidekick or a generative A I component to their work that they can use fluidly, that really helps drive efficiency in their work. Yeah, to your point, I am seeing an enhanced focus on reskilling and upskilling employees. And I think one part of that is a financial aspect, it's considerably cheaper than finding new hires, but it does still require a sizable investment in driving some of those efforts. So what metrics should organizations use to measure the success of reskilling initiatives, upskilling initiatives and really the integration of A I in the workplace, adoption of sidekicks or these new types of tools and the outcomes from those. What you find in generative A I, especially within coding or some other areas that it's been heavily leveraged in is that there are certain folks who are really proficient at using it and certain folks who are not and the reasons underlying that are often quite surprising it has to do. In fact, in large part, as we've seen with the psychology of the user, if a user thinks they're more expert, they're actually likely to be less proficient at using the A I because they're not going to ask the relevant questions. And so teaching folks how to use A I in a way that inures to the benefit of the organization and having feedback loops to be able to know whether that's being successful or not is critical for the last 10 seconds. How do you incentivize the adoption of A I and get employees to explore its many possibilities? I think you've got to incentivize it with enthusiasm and with transparency around what the organizations were doing. People will be scared if the organization isn't being open and transparent and also enthusiastic about it. Um And so that has to be the critical piece. Ultimately, we'll get to pay for skills. Um And we're seeing some organizations move to there, but that's going to come over the next few years. Very well said Pao Renee, thank you so much for your time. Next up is Fortune Media, Ceo Alan Murray. Thank you.

Trevor Neilson, Co-founder, Chairman and CEO, WasteFuel In conversation with: Ellie Austin, FORTUNE


Fortune Global Forum 2023: Climate Innovation Spotlight - From Dump To Pump 

The world is suffering from an ever growing solid waste problem. According to the World Bank, more than 2 billion metric tons of municipal solid waste is produced globally every year by 2050. That figure will increase by 70% to 3.4 billion metric tons a year. The increase is driven by factors such as population growth, urbanization, economic development changes in consumption patterns and our lifestyles mismanaged waste contributes to an increase in greenhouse gas emissions and it can also increase the spread of disease in our climate innovation spotlight. Today, we're delighted to be joined by the chairman and CEO of Waste Fuel, a company that's working to address the climate crisis by converting waste into low carbon fuel. He's also the chair of Apco Worldwide Climate and biodiversity team. Please welcome to the stage, Trevor Nielsen. Hi, Trevor. Thank you very much for joining us. So we heard in the introduction about the huge amounts of waste that is produced globally each year. Let's start at quite a basic level. Can you explain to us what the goal of waste fuel is and the technology it uses to achieve that goal? Sure. Well, you know, the basic situation is that the world is choking in the waste that we've produced. You cited some of the numbers as I came out. And a way to think about it is that by 2050 we're going to have more plastics in the ocean than fish. If you imagine the amount of waste that's produced in the world, it would be enough to fill all of Manhattan two miles high with waste. We are choking in the waste we've produced. And so at waste fuel, we started with the thesis that our waste could be our fuel. That's, that's the name and that this crisis could be an opportunity. So basically in the municipal waste stream, somewhere between 30 40% of that waste is organic in nature. So this is food waste, largely agricultural waste, other things that end up in there that are organic. We take those organics, we separate them from the rest of the waste stream. And we basically create a gas which we then turn into Methanol, including some proprietary technology that we've developed, that Methanol is then sold into the market. BP is our largest investor. Maersk is also a big investor of ours and we made a bet that the global shipping market was going to Methanol. So as a transition fuel, that shipping would not really use LNG, it wouldn't use hydrogen. No offense to the hydrogen people, it wouldn't use ammonia, no offense to the ammonia. People but instead it would go to bioethanol because bioethanol is pretty easy to produce compared to those things, also easy to move around the world. And how does bioethanol compare to other energy sources in terms of its emissions? So, on a life cycle analysis, which is the way you need to look at these things, bioethanol that waste fuel produces will burn at about a 90% reduction in carbon dioxide to fossil. Now, that's because of how it's produced on the molecule level. This is the same molecule that's burned if you're deriving it from oil and gas. And what's the carbon footprint of the process itself of taking waste and turning it to energy? Because that sounds quite resource intensive. Yeah, you know, we, we use a gasification process that requires some electricity. So if we can get that from renewable sources, we're happy to do that. But really this is nature doing what nature does. Um We've entered into a technology partnership with BP that gives us access to some proprietary enzymes that they own. So not to bring you back to, you know, high school biology, but these are bugs that catalyze a organic process that creates a gas which we then capture and turn into a liquid liquid fuel. So it's not that complicated and geographically in the world. Where are you doing this at the moment? Where are you sourcing this waste from? So we have projects in places where there's a lot of waste, perhaps not surprisingly in the Philippines, for example, we've got a great project with prime infrastructure which is the leading infrastructure developer there. We have a partnership here in the UAE with Verda, one of the leading waste management companies here. We have projects in Uruguay, a project that's happening in the United States, but pretty much anywhere where we can access large volumes of waste is where we want to be. And you mentioned that you a partnership with BP and also that you target the shipping industry specifically, which other industries do you see waste fuel expanding into? And why over the coming years? Well, we're just going to focus on shipping. And the reason for that is that there's a huge disconnect between supply and demand. So there are about 250 new ships that have been ordered that are going to run on Methanol. Those ships basically have none of the supply that they need. So waste fuel could keep itself busy only in the global shipping market if it wanted to. The flip side is that Methanol including bioethanol is an important feedstock for other projects, products, the pet CMS industry formaldehyde, for example. But for now, we're really focused on shipping and doing that in partnership with BP. And you mentioned the project um with A V which is I believe the first commercial waste to renewable energy plant in the Middle East. Can you talk us through the status of that project and maybe one of the biggest challenges that you're facing with it at the moment. Yeah, I mean, we're working through the details up at Dubai Industrial Cities. The, the truth is we're almost there. We're, we're dealing with things now like electricity prices and sewer, sewer prices and sort of the boring minutia of, um, of these projects. But we believe that will be the first in the world or among the first in the world. We have other projects here in the region as well. And you know, I think it's a place that the UAE can be very proud that it's leading like on a lot of these other issues playing devil's advocate, I guess you could say that if we find a solution to our huge waste problem in turning it into energy that could disincentivize us from trying to cut down on waste in our households or recycling. What's your response to that? And how does what you're doing coexist alongside the recycling movement? Yeah. Well, we, we are working with the, the organic fraction of the waste that's not being recycled. So, you know, whether human beings can decrease their, their consumption to that degree is I think a different matter, I mean, it is wild levels of consumption that are driving the emergency that we're in. It is relentless consumption 24 hours a day, seven days a week. And I think that in a certain way, whether it relates to carbon dioxide or relates to the plastics that are in the ocean or many other issues, humans are going at some point to, to understand that infinite consumption on a planet that by its very nature is finite doesn't work. And I actually think that, that, that basic reality, call it a call it a mathematical reality or just a common sense, reality needs to be brought into the conversation a little bit. You know, it seems as if people are behaving in a way that we would never tell our Children to behave. You know, you would never say, you know, you know, I've got three kids. Sure you can buy whatever you want on Amazon. Your allowance is this, but you can buy whatever you want on Amazon in effect. That's how we're acting on these issues. A lot of people are trying to work on it. You know, you mentioned Ap C's climate and biodiversity practice that has been set up by the founder of Apco Marjory Kraus, who's a mentor to me here in the audience that's set up to help companies try to deal with this, you know, create strategies to recognize that, that, you know, infinite waste on a finite planet does not work out very well. I should also point out that Bill mcdonough is here somewhere and they can maybe see him in the back. The father of Circularity, the author of Cradle to cradle a hero to me. We wouldn't exist without Bill and his work. So there are exciting things happening. But I think we also have to just check ourselves a little bit and say, you know, are we behaving in a way that would make sense if we were explaining it to our kids? And I think sadly, the answer to that is no, I want to change tack a bit. So in addition to waste fuel, you do many things, Trevor And one of them is that you founded the Climate Emergency Fund CE F which is a nonprofit that supports climate activists, including groups such as Extinction Rebellion and just stop oil. Now, I know you're no longer actively working with the organization I believe. And you've been quite critical over the past year about some of the aggressive activist tactics that those groups are using. You've called them counterproductive. I wonder in your eyes, what does productive climate activism look like in this day and age given that we are in this crisis that you've spoken about? You know, the, the, the climate activists are an interesting bunch. And the first time that I met Roger Hallam, who's the founder of Extinction rebellion. He told me he didn't trust me because I was a capitalist. Yeah. And I couldn't run from that because I had a long career as a, as a capitalist. And I think that the place that climate activism has gone off track is that they believe that disruption alone will create change. And I think the evidence suggests the otherwise I think that you could block every street in London for the next year. I think you could paint every building orange. I think you could glue yourself to anything that you could glue yourself to. And as of right now, labor in the UK is still going to support drilling in the North Sea because they're concerned about energy security. So what the activists I think have gotten wrong and I respect them by the way because they're coming from a place of deep concern about the future of this planet and they're not wrong about that concern, but we've got to move to a new phase where people with the engineering know how the commercial, know how the people that know how to transform our energy system also see themselves as climate activists. We kind of need to move, move to a new era in this. And it's one that, that requires partnership between people that often don't like each other very much, you know, and, and certainly don't sit at the same table and I think that when that starts happening, you'll see real progress. And I have to say, despite the controversy associated with this cop and, and Dr Sultan's role, you are seeing the UAE lean into this conversation in a unique way that we have never seen an oil producing nation lean into it and they're going to be criticized and they're not going to be perfect and people are going to come up with this problem and that problem, some of the problems may be real, but you have to hand it to this country for being willing to drive the conversation to a new place. It's very admirable. It's never happened before in the history of the world. And I think we, we all hope and we need something important to come out of it. Does anyone have any questions for Trevor? Before I continue, you mentioned um Trevor Trevor, you spoke about infinite treasure. I appreciate that you, you mentioned infinite consumption. And then also talking about people that we might not expect being um becoming climate activists and thinking about activism in a different way. What would be your message to the leaders in this room about tangible things that they can do within their organizations, their governments to really ensure that this issue stays at the top of the agenda and that they're contributing to change. You know, there is a, I had a really interesting and beautiful moment the other day that thanks to terrible jet lag because I live in California. I was walking along the corniche and I heard the call to prayer. Um I happened to be right in front of Adnoc um when I heard it and it led me to stop and think a little bit about the Islamic traditions around environmentalism, notions of khalifa, which is a notion of stewardship. And I don't need to lecture people in this room about the teachings of the prophet and, and, and the deep, deep guidance within the Koran around environmentalism and stewardship. And I think that the key with this cop is rising above the day to day PNL revenue even. But the, the those day to day drivers and stepping back a little bit and thinking about the future and right now the signs aren't good about our future. I mean, with 420 parts per million of co two in the atmosphere, we are seeing ecosystems collapse, the biosphere is beginning to collapse and you have plant and animal species that are sort of the first version of that. But the problem with the biosphere collapsing is that we are a part of the biosphere. We are a part of these ecosystems. So I would just hope that leaders be the CEO S or government leaders or others that are, that are here. And at the table are thinking generationally about this, you know, thinking about where are we in 50 years or in 100 years and think about what can occur. Look at where this country was 50 years ago, you know, anybody that thinks that this isn't possible, look at the history of the UAE and what it accomplished in 50 years and imagine with the same level of commitment, the same level of entrepreneurship and engineering talent and dedication to something where we could be in 50 years, you know, humans are, are capable of incredible things. And this country is a wonderful example of that. And if we dedicate the same sort of focus to this, I believe we can, we can achieve what we need to achieve. Um um Around for four. Um My final question is you mentioned that disruption maybe isn't the answer to grassroots activism at the moment? If that isn't the route, you believe we should be going down? How do you bring people into the climate conversation? Who maybe think it isn't for them or it's not a priority? How do you make people take note who haven't done until this point? Maybe because of the political side of the aisle they sit on or whatever, you've got to get people out of their reptilian brain, you've got to get people out of a scarcity mindset and get them out. You know, as a CEO I think about PNL, I think about my next board meeting. I think about the annoying email I just got from one of my investors. Not that any of my investors are annoying for the record, but occasionally they have requests and things like that that you have to deal with. You know, that's, that's my like, you know, daily. How do I get through it mindset? But if you speak to me about my my kids, you know, if, if you, if you speak to me about their future, what you know what sort of world will they live in if they have Children? What will their lives be like? Will they have birds chirping? You know, will there be animals in the wild? You know, are, are, are, are animals going to be something that my seven year old, you know, only knows from children's books that he read and he knows that they used to be out there but they're not anymore, you know, I don't want that and I don't think any of us want that. So if you speak to people in those terms and if you engage them in a way that gets them thinking long term, rather than short term, I think powerful things can occur. Trevor Nelson. Thank you so much for your time. Thanks for having me.

Mounir Nakhla, Founder and CEO, MNT-Halan Mudassir Sheikha, Co-founder and CEO, Careem In conversation with: Hamoud Almahmoud, Editor in Chief, FORTUNE Arabia

Fortune Global Forum 2023: Mena’s Startup Ecosystem 

Fortune Global Forum 2023: Mena’s Startup Ecfoosystem 

Alan Murray, Chief Executive Officer, FORTUNE; Co-chair, Fortune Global Forum

Fortune Global Forum 2023: Welcome From Fortune

Welcome to the 2023 Fortune Global Forum. I think many of you know that fortune has been holding these forum, these forests since 1995 in various cities around the world. But this is the first time we've held a forum in the Middle East. We're very, we're very happy to be here and we're particularly pleased that Abu Dhabi is hosting us for this first event, first Fortune event in the Middle East. The theme of our event is a new era for business. And Abu Dhabi offers an interesting perspective on the three big mega trends that are both driving and defining that new era. The first of those is a technology revolution. Some of us I see some of you in the audience for this morning at the Mohammad bid Zayed University of Artificial Intelligence where we got an interesting look at some of the things that are happening here in Abu Dhabi to drive that technology revolution forward. The second big mega trend of course is the energy transformation. And again, Abu Dhabi offers an interesting perspective on that being both an oil producing country but also invested heavily in energy transformation and the third big mega trend is rethinking of globalization. We live at an interesting moment where there are two wars going on in the world, one in Europe, one in the Middle East simmering tension in Asia. Every CEO I've talked to over the course of the past year is rethinking their supply chains, rethinking their global footprint to take into account the realities of a very different geopolitical environment. And again, Abu Dhabi offers itself as an interesting uh uh positioning between Europe and Asia uh for corporations to place offices and facilities. So we're going to be talking about all of that over the course of the next three days we have a lot to talk about. Um And we've got a great lineup of, of speakers, thinkers, innovators doers to be part of it. Uh But those of you who have been at fortune events before, know that what's particularly important is not what you hear from the stage, but the people you meet in the networking events, the opportunity you have to talk to each other. Uh take a moment to introduce yourself to the person on your left, to the person on your right. Uh It's the conversation that happens among all of you that makes this event important. And let me tell you a little bit about you. OK. Most of you, you represent the, the uh largest, most important companies in the world. Most of you are from companies that are on our Fortune 500 list, the Fortune Global 500 list, uh Fortune 500 India, the new 500 Arabia list, the new 500 Europe list. So uh you are, you have earned yourself a place on these iconic listings of global business success. Together. You represent companies with $4.3 trillion in revenues. That's higher than the GDP of the US or China. Uh uh truly impressive. Uh You have the power to change the world and we hope the next three days will help inform you and inspire you to do that. So please make the best use of them. Uh Our goal of fortune is always to make business better and in the process to make the world better. Uh Now, before we get started, I want to say a few. Thank you. First of all, to our, our uh hosts our partners who make all this possible. Top of the list of course, is our host partner, the Abu Dhabi Department of Economic Development. Thank you so much for your support for this event. Uh I want to thank our premier partner, uh Xa, our partners G AC group honor mubadala paypal T com and Toptal, our knowledge partner mckenzie and company, our support partner, Finance and our media partner, Apco. Please round of applause for the partners who make this event possible. I also want to acknowledge and thank my fellow Fortune Global Forum co chairs, fortune editor in Chief Allison Chantel Allison. Are you in the audience somewhere or backstage? All right, you will, you'll see her shortly if you don't see her now. Uh Fortune executive editor, Peter Van Peter. Thank you, Peter and Fortune editor at large. Mahal Love Ram, who unfortunately not be with us but played an important role in putting together the program you're going to be seeing over the next few days. A quick reminder about our reporting rules. Everything that's said on stage or in a round table session is on the record, but conversations you have over dinner in the hallway, whatever they will all be considered off the record unless you agree otherwise. And now let's dive into the substance. I talked about the three mega trends that are driving this new era of business. We're going to start with a panel to discuss those mega trends and how companies can adapt and grow and prosper in such a tumultuous environment. The fortune, senior editor at large, Jeff Colvin will lead the conversation with Abdul Nasser Bin Kalban, the CEO of Emirates Global Aluminum, which is the largest premium aluminum producer in the world and the biggest industrial company in the UAE outside of oil and gas. Also Mik Gerk, who is CEO of the Global Technology and Investment Group, E and International Christian Ulbricht, who is president and CEO of the global real estate investment management firm, JLL and Nigel. Vaz Ceo of Public Sapient, the Digital Business transformation company focused on helping companies thrive in a digital world. So a diverse representation of industries to kick off our conversations here. Please welcome them to the stage.

Abdulnasser Bin Kalban, Chief Executive Officer, Emirates Global Aluminium   Mikhail Gerchuk, Chief Executive Officer, e& International  Christian Ulbrich, Chief Executive Officer, JLL   Nigel Vaz, Chief Executive Officer, Publicis Sapient In conversation with: Geoff Colvin, Senior Editor-at-Large, FORTUNE

Fortune Global Forum 2023: A New Era For Business

Abdulnasser Bin Kalban, Emirates Global Aluminium, Mikhail Gerchuk, e& International  Christian Ulbrich,  JLL, Nigel Vaz, Publicis Sapient In conversation with: Geoff Colvin, FORTUNE

H.E. Reem Al Hashimy, UAE Minister of State for International Cooperation; Chief Executive Officer, Expo City Dubai Authority In conversation with: Hala Gorani, International Correspondent, Journalist, and Author

Fortune Global Forum 2023: UAE On The World Stage 

 Photograph by Katarina Premfors/Fortune.

H.E. Reem Al Hashimy, UAE Minister of State for International Cooperation; Expo City Dubai Authority In conversation with: Hala Gorani, International Correspondent, Journalist, and Author

Well as Fortune's Ceo Alan Murray spoke about a little earlier, Abu Dhabi is a key player for international Business and trade and a place where conversations of global significance continue to unfold in the form of high level gatherings like this one. The same can be said for the entirety of the United Arab Emirates. It's established itself as a formidable player on the world stage, showcasing its leadership through its commitment to innovation, sustainability, and cultural exchange and fostering meaningful dialogues that resonate far beyond its borders. We're honored to be joined today by one of the UAE ministers who plays a key role in bolstering the U AES position on the world stage. Her excellency, Reem Al Hashemi is the United Arab Emirates Minister of State for International Cooper Operation and she is the Chief Executive Officer of Expo City Dubai Authority. Her excellency joins international correspondent and journalist Hala Gorani to talk about the future of the UAE. Hello, it is my distinct pleasure to be here uh today and thank you so much for your Excellency uh for having this conversation with us within the context of this really already fascinating forum that is talking about so many of the important issues regionally, which we're gonna talk about with you and globally as well, which you're so much a part of in your role as Minister of State, as well as in your role as CEO of uh of Dubai Expo 2020. Uh This was a huge international event that you were for many years tasked with putting together and we're going to talk about the lessons that you drew from that. So, thank you. Thank you. Once again, let me ask you. First of all, about the U AES role internationally, we were discussing backstage that the center of gravity, whether it's economic, diplomatic, political of this region has shifted to the UAE in particular and to the Gulf in general. How do you capitalize on that? Thank you, Hannah and thank you to all of the audience here and to Fortune Global Forum for inviting me. Um traditionally, if one is a student of history, one would see that the center of gravity has been moving further and further towards the east. And as a young nation, the UAE is only 52 years or so. Our focus has primarily been built on how we foster strong relations and friendships and collaboration within our direct parameter as a nation but also with countries around the world. Now, in the beginning of our journey, we started very strongly with a focus on necessary hard infrastructure to really build up a society in a manner that could bring economic prowess, but also incredible ambition. And that's where mustard came about. That's where Irena came about. Um Expo 2020. Uh We're hosting cop in a few days. We'll be hosting the WTO Ministerial next year. And this gives you a sense of how my country looks at itself. But more importantly, that important um constructive and positive role we must play in the region beyond it, but also towards the planet. And so we've always had a sort of like a can do approach, uh always looking at uh new forms of technology, but also new forms of doing things. So a really innovative approach to tackling the challenges around us. And in recent years, and we've all learned a lot from COVID and COVID should have taught us a lot as well, which was not to rely on global supply chains, which was to really focus on that angle of innovation. But also how do you deepen ties? And so since COVID, we really looked at deepening SEPA agreements, these are the comprehensive Economic Partnership agreements. And so we've signed quite a few um with India, with Indonesia, uh just recently finished with South Korea. And so when you speak Hala of things moving towards the East, you will see that really, that's where a lot of the trade and investment uh angles take for. And that, that's a great illustration of it. This move East. So what does that do to your relationships with the West, uh doesn't really do much with them. Actually, it's, it's not one or the other. It's about how deeply do you lean in, in terms of investing more and um paying more attention to how you could deepen it further. We have some pretty strong uh strategic relationships in the West, but now also increasingly in the east and where, what industries, what sectors are you most excited about in the future when it comes to moving East first? So and this was also a little bit in your earlier panel, there is a lot around digitization. And so we've seen this um demonstrated uh quite a lot in some of the partners that are here in this forum, but also in some of the new flagship companies within the UAE. And the focus is beyond digitization is how do you look at stronger infrastructure development? You focus a lot on health, on agriculture, agricultural technology, underpinning it though is this new reality we're living in which is a planet that is struggling. And one of the main drivers of hosting cop 28 is what is a positive contribution from the UAE in partnership with everybody present for this larger cause, which is the planet that is struggling. And here I think it would be a little crazy for companies that are interested in uh going into the future without going in with a really strong willed and strong minded ESG 2.0 approach. And I think the UAE has already picked up on uh how to mobilize that and how to strengthen that. And in many ways, that's also um why Expo City Dubai today is really looking at positioning herself as a place that could attract that caliber of company and entity. And it, it's what lessons did you draw from that? Because if you mentioned cop 28 is coming up, you also had your experience with Expo City Dubai 2020. All of that put together it, it's, it's not just um the, I mean, it's not just the knowledge that we need to be more environmentally conscious, certainly more friendly to the climate as the world continues to heat, et cetera. But it's how do you implement that? How do you put that in motion in a way that makes business sense, right? Because that's where you have to strike that note as well. So today increasingly you'll see companies that don't have a purpose around the planet, not actually making business sense in the long run because the public no longer wants to associate with an entity that isn't more environmentally focused or climatically conscious. I should say. Um when you speak of lessons learned, I can, I can only say that from, from my humble experience um with Expo 2020. If you're not listening carefully, you're going to miss the boat and the world today is consistently and pretty loudly saying, and we have seen mother nature demonstrate also that the planet isn't doing so well. If we're not responding to that, we will no longer have a place to be in, but also we will not no longer have a relevancy in the overall equation and it will bypass us completely. And so there's a real commitment to focus on what does green technology look like and how do you leapfrog as best as you can yourself, but also your partners and friends in that journey. And what does it look like? What, what, what do you think it looks like? Especially a a and one of the I was here for a, just a few weeks ago and some of the representatives of companies and nations in the global South said there's an, there's something unfair about expecting us to adhere to some of these carbon reduction um standards when we haven't benefited from uh the very um polluting technologies that Western countries they adopted for 100 years. How do you, how do you come up with a global approach when actors around the world do not believe that they, for instance, should be held to the same rules? That that's something I heard a lot and, and that's a very uh prominent uh narrative and that's why the cop 28 team will be going through intense deliberations around it. But what it also says, hella is that today, everybody knows what's going on, the speed and the scale in which information and knowledge gets transferred is beyond our wildest imagination. And so the global south, they know right now we don't have our phones with us, but the phone, which is almost like, um, another body part at this stage, they see who has access to what and they wonder, well, why not us? Do we not have the right to have roads and highways and airports and hospitals? And therefore why should our developmental agenda come at the cost of an energy question? Right. And so we're dealing with a very different um scenario now because it's no longer about you sit here and we're gonna do what we need to do up there. We're all on an equal platform, an equal playing field. And sure there are, you know, none of us are naive. Nobody in this room is naive, there are strengths and there are power influencers, certainly. However, having said that the global South and the countries who are on a quest for a developmental agenda also deserve to have that agenda addressed. And that's why I mentioned leapfrogging earlier because there are ways to now do this in a manner that doesn't necessarily need you to go through every step as past developmental agendas have been. So there's no retrofitting, you can kind of leapfrog to the newest technology and that's something that obviously countries in the global South would embrace and it would make economic sense for let's talk a little bit more about the UAE here because it's this panel and this conversation is also about your country's role on the world stage. You mentioned the move East, you mentioned that that doesn't come at the expense of some of the alliances and agreements you have with Western countries. Let's look in the next 10 years or so because from what I understand, you worked for practically almost 10 years on, on the Expo, right? So talk to us about the next 10 years in terms of industry, in terms of sectors, where should we be looking? So I think technology is going to be a very strong enabler across several sectors. So think of technology as a horizontal that will run across quite a few verticals. One important vertical for the UAE is food and agriculture. And we're going to do a lot in that space. We have been doing quite a bit. Um and our minister and those who have been involved in this have really looked at it. But again, because you have the horizontal of technology, you're not looking at typical agricultural approaches, you're looking at really embedding a technological way to increase yield and to also increase efficiency of farming, et cetera, et cetera. The second pillar I would probably say is infrastructure. And you probably noted that when our president is a Sheikh Mohammed bin Zaid was in India for the G 20 we were very much involved in a corridor that linked up the subcontinent through the Arab world and further out. So we, we need to recognize that connectivity and linkages are important. The UAE already has strong ports, it has strong airports, it has a really um really effective uh physical infrastructure, but also a very strong digital infrastructure. So you're going to see more of that beyond the direct parameters of the UAE but engaging with those other partners, I would also say that health care um is probably another space that we're going to get more and more involved in. And again, that horizontal of technology, you don't seem to age at all. But I think as we, as we also define our relationship with our own health, I think a lot of, a lot of times uh you look at getting older but not necessarily feeling better. And so how do you connect wellness? And I hate to say the L word, but longevity in a way that doesn't come at the cost of, of that. And so these are some of the areas of the UAE is looking at and for Expo, for example, and you're right, it was 10 years ago when I was, in fact, it was 10 years ago today, November 27th, 2013 birthday. That's when we won the right to host Expo. That's why I said yes to this forum when they said November 27. That's a special day for us at Expo. So that was when we won 10 years later. I look at how far we've come. And I, and, and to my mind, one or, or two of the things that we did that was important was that we built to last, we didn't build something and then had to take it down. We built something that stayed on. And then the second thing is we built it in a clean way. So all of the best sustainability measures in place at that time, we had put in place. So all our buildings are lead and we have a few platinum and we have um quite a strong, efficient and effective infrastructure that is really ready to host everybody again. Uh At COP 28 just lastly and we have a minute. Uh We're in a very challenging time. I don't have to tell everybody here. Uh There are so many crises simultaneously in the world health conflict, et cetera. If you had to, if you had to look forward and think of one challenge that the UAE needs to overcome, what would it be and why the UAE must continue to be the force of good that she is in this world, in this region and with her partners and friends across the globe, we, we, we believe intrinsically and it's mostly if not entirely based on why and how we were founded as a nation. Have a very strong commitment to the dignity of people, to the need to bring prosperity for us. But also for those that we work closely with and to continue to explore and engage with new and exciting things. So there is a strong level of ambition in, in my nation. And like I said, 52 years in the next 10 years are going to be more, I think, exciting and ambitious for this nation and her people. All right. Your excellent. Thank you so much. Thank you. Thank you very much.

Alexander Sukharevsky, Senior Partner and Global Leader, QuantumBlack, AI, McKinsey & Company
In conversation with: Alan Murray, FORTUNE

Fortune Global Forum 2023: Generative AI - The Next Productivity Frontier 

Alexander Sukharevsky, Senior Partner and Global Leader, QuantumBlack, AI, McKinsey & Company In conversation with: Alan Murray, FORTUNE

Fortune Global Forum 2023: Generative Ai - The Next Productivity Frontier 

Now let's talk about another elephant, yet another elephant in the room. Lucky. It's a big room here which is rapid technological advancements they have of course, come to impact, inspire and yes, alarm people all over the world. Probably none more. You could argue than generative A I I think we've all seen that particularly in the last week with open A I. It is a powerful tool, of course, uh becoming more and more ubiquitous every day. According to mckinsey, our knowledge partner, generative A I get this could enable automation of up to 70% of business activities, 70% across almost all occupations. So whatever you're doing, watch out between now and yes, you got it 2030 which could add trillions of dollars to the global economy. But of course, also displace a lot of jobs and the tech industry says that this is only the beginning. So how and when should business leaders take steps to get into the action and implement A I, I'd say the best time was probably yesterday and the next best time as they say is today. But we can get some insights on this question from Alexander Sukurs who is a senior partner and a global leader of Quantum Black A I by mckinsey and company and our own Ceo Alan Murray. Thank you Alexander. Thank you for doing this. I I think generative A I is sort of the topic of the year. I have lots and lots of questions for you. I appreciate you taking the time to do it. Thanks for having me here. But before we dive in though, can you explain to people what mckenzie quantum black is? That's what you run? Sure. So quantum black is one of the largest A I companies on the planet with 5000 colleagues in more than 50 countries. Five are in these centers across five countries as well as an ecosystem of external partners where, where we have the IKAR is clearly Stanford University for Human Artificial Intelligence, but also the upcoming leaders in generative A I space. So it's a big player in this area. Yes, one of the largest ones. Yeah. So, so look, I I had never heard the term generative A I until about a year ago. So this has happened very fast. I've spent four decades watching business adoption of technology. I don't think there's been a new technology that exploded in business as quickly as generative A I has. And I think the question everybody's asking at this point is, is this real or is it hype? I mean, what's the, what, what's your sense from all the companies you've worked with. Well, I think, first of all, it's real, but we are extremely early in our journey while we all believe that it has been a while. And actually what the concept that was introduced in 2017, essentially only in July beyond a few privileged organizations, 10 million software engineers got access to these tools. So whatever we are seeing today is actually pre awareness and pre deployment. On the other hand, and you're right, we got it wrong many times with dot coms and crypto and few other things. But I truly believe it's the first time in the last 15 years that we see a real platform shift as platform shift happens when the cost of production goes down 1000 times. And if you were a comparison similar to what internet did to distribution, generative A I does to creativity, meaning the marginal cost of producing a movie, a slide, a legal recommendation goes close to zero in significantly faster rate. That's number one, number two, we are actually able to interact with technology in our human language, right? So think about you and I having our virtual assistants that schedule our day shop for us, provide us emotional support when we need. And also in the organizational context, we manage quite a few virtual assistants to help us to do our work. So the combination of really different cost curve and being able to interact with technology in the human language, that's what makes it? So that's the potential, the potential is huge. But how far along the curve are we towards reaching that potential? Right. And I think you are spot on here, we are just at the beginning and your colleague mentioned the number of 70%. So if we look around this audience, 70% of employees task today could be automated in 20 years, 50% of them will be automated. At the same time when generative A I appeared last year, the magic number was 11% only 11% of use cases ever made it into production. So one out of 10 is real. Now, if you fast forward to generative A I, considering some risk considerations and cost consideration, this is a single digit number. So what we are trying to do within quantum black is really bridge this gap between 70% promise and single digit implementation in the enterprise context. Yeah, so give some examples of where you see the big opportunities actually going into production. So I would say, although 90% of the world is focused on productivity and I would touch upon it. I do think the bigger thing is actually to step back and considering the changes that we just discussed to think what is the mode for your business? Because all of a sudden you allow to intermediate, this intermediate businesses, you are allowed to deliver the same value for few cents the dollar and you're able to acquire new users pretty much for free because if you look at recent generative A is their RP is three times higher and the traffic is organic. So I think while we all focus on productivity and playing with different tools, it's really trying to reimagine your business and industry. That's hard work. I mean, it's easy for everyone to talk about how they can improve the productivity of their software development of their marketing department. But you're saying you really have to re imagine the business. Exactly, to avoid disruption. Exactly. Because while the new kid is generative A I it's only 1/4 of potential of A I. On the one hand, on the other hand, you have seen quite a few other technologies that get mature. Now be it virtual reality, be it web 3.0 round toch organization. So if you were to combine these three and think about what does it mean for your industry, it might be a consumer industry, it might be a basic material industry. I think the shift is quite fundamental. How many companies do you see actually doing that? Fundamental rethinking of their business? So, as I said, unfortunately, it's 1 to 10, probably 10% of the companies are focused on fundamental rethinking while others might arrive there, but start with the productivity. Yeah, so we still I talk to ceos about this a lot and, and I hear a lot of caution concerns. They talk about data protection they talk about IP. And then the one that really scares me is the continued hallucination, the tendency of this technology to make stuff up. It's very scary. Like what, how do you, how do you deal with those very real problems? Right. So I think I'm less fond of the notion of artificial intelligence. I'm more into hybrid intelligence, bringing the best of humans and machines. Now somebody says that hallucination is a feature and when human being hallucinates, sometimes we don't pay attention and we actually ignore it. So I think while we very focused on a few of the risks that you describe in the short term, I think it's important to have human in the loop. But I do believe there are quite a few powerful tools that could allow you to protect your IP protect the data, ensure that the machine works in the right way. Again, having human in the loop. What are the things that I'm more concerned as a leader in this sector? Also as a human being is the longer term implications and some of them are unit, some of them are esg implications. Some of them are ethical. I think we as humanity need to decide what we would like to take and what so highlight the two or three top concerns you have about the long term term implications of this technology. No, I think first of all, it's the ecological use of the technology and application for environment. Second thing if by that you mean to mitigate environmental problems or are you talking about the compute use to run these large models? I'm talking about the balance of the contribution. Basically, how do you minimize the harm to the environment? On the other hand, you solve the most difficult monar problem that actually we as human beings cannot solve. Right? Second thing is how do you really empower human beings with this technology? How do you allow the superpowers that discuss your employees to develop themselves and just to become stronger with the technology? Yeah, other impacts on society that you're focused on. Well, I think as I said, the moment each one of us is able to interact with technology in a human language. And all of a sudden we find ourselves working not just with human beings but with virtual assistant. I think both the corporate rules or the governance rule. Be it the societal rules be it? Let's think about retail. So think about my virtual assistant shops with your virtual assistant and they're trying to find what exactly I need and provide me these goods. What are the implications for advertising industry? What are the implications for bricks and mortar? What are the for my own choice? And how do I train my virtual assistant to actually act in my best needs? Yeah. So what are the industries where you see this happening fastest? You just talk about retail but give some other examples where you see big implications coming quickly. I think it's quite fascinating because if you look at the impact that we discuss, it's around four trillion that is essentially bigger than GDP, all the United Kingdom. It's massive. And I think it's what is one trillion over what time period? If we think about the theoretical potential that could be actually achieved today, if you kind of remove all the barriers. Now, what I do believe that if you look at our research within 20 years, 50% of the potential will be realized. Now, I think what is important that essentially if we and again, we are now focusing on productivity, not reinvention of the business because that's where you could put a number. Uh There are four use cases that provide this potential. One is concision ability to take any database to summarize it and to interact with it. So be it blue collar workers for a mining company, be it knowledge workers, it works. Second thing, it's really knowledge creation and content creation where you could create a picture, sound movie essentially with a single scriptwriter number three. And I think that's we also is really coding and software development. They take legacy into modern software or accelerating development. And then last but not least, it's all that has to do with the customer interface and customer journeys. So four C is essentially that brings most of the value. Yeah. So let me ask you a debate that I have heard uh conducted between CEO S. There's one group of CEO S, let's say more legacy companies who look at this and say, hey, this is really interesting technology, but it's also a little scary. I'm worried about my data. I'm worried about IP I'm worried about hallucinations. I think I'll be fine as a fast follower. Let somebody else go first and hit all the landmines and then I'll go And then there's another group who say you can't do that. If you're a fast follower, you're going to be a fast loser. You've got to be on the cutting edge in order to be a part of the transformation. Which of those is right? What do you tell your clients? Listen, I think life is always in the middle and I think it is the strategy. At the same time, I would propose two by two approach where on the one hand to our previous conversation, you step back and ask yourself considering all these technologies out there. What is my mot and how defendable is my mode? And do I have an opportunity not just to protect myself, actually re invent myself, re invent my industry. And I think this is a very exciting place that I'm personally passionate about and work with a lot of clients on. And then number two is really going back to productivity use cases where you could clearly create a lot of value in a very short term based on the levers that you have today, that frankly, you could involve your organization. Now, it allows you to educate yourself. It allows you to educate the organization. It allows you to focus more on the risk side as well as on the tech side. So I would kind of do two of them but would not ignore posing and stepping back to find the remote. Good advice. Thank you for that. And, and, and, and how do you uh uh how do you come down on the the jobs debate? Is this going to eliminate jobs or is it simply going to change jobs? Well, I think the devil is in the details. Now we discussed, that's what you're here for, to give the details. So the details here are the debate around the future workforce was around an automation. So this thing spit it out. Number one, number two, you really need to go ro by role and understand the implications and put it slightly in the broader context in a sense. Number one, it creates a lot of new content and new opportunities and as we know, the creativity demand is elastic, so it creates more opportunities. On the one hand, on the other hand, it also able to solve to our previous, to your previous question. Quite a few mon questions, aging questions and a few other things if you ask me, I don't think there is a debate how many human beings or jobs it's going to eliminate. I think it anything is going to augment what we have today and coming back to see all the questions that we asked every day is really what does it mean for the future of your workforce? What type of talent you would like to hire? But more importantly, how do you educate the rest of the organization? Because you and I grew at the space where if I'm not able to explain you something in a few minutes, I'm probably not competent enough. And the underlying assumption here that you and I speak the same language that might not necessarily be the case in A I. And therefore you need to teach the organization the common language to be able to understand A I and it's opportunity. Yeah. Last quick question. Uh For the last few decades, I think it's, most people would agree that technology has tended to exacerbate decision uh divisions in society between uh the, the skilled and the unskilled workers. Some think this may be different that this may empower the bottom half of the distribution, less skilled workers, give them more superpowers. What's your view? Well, I think we're at the beginning of age of creativity because creativity is based on inspiration, inspiration. And many times based on the research, if you use generative A bi you could fast forward the research and unlock potential pretty much of every individual while eliminating some of the routine parts of what we are doing today. So if anything, I think it could close the gap and allow each one of us to be creative of our own destiny. Fascinating. Well, we'll have you back in a few years and see how it's playing out Alexander. Thank you very much. Thank you very much.

Sasha Kaletsky, Co-Founder and Managing Partner, Creator Ventures
Caspar Lee, Co-Founder, Influencer; Co-Founder, Creator Ventures
In conversation with: Ruth Umoh, Leadership Editor, FORTUNE

Fortune Global Forum 2023: The Creator Economy - Global Culture Meets Business

Sasha Kaletsky, Co-Founder and Managing Partner, Creator Ventures

Caspar Lee, Co-Founder, Influencer; Co-Founder, Creator Ventures

In conversation with: Ruth Umoh, Leadership Editor, FORTUNE

Zak Brown, Chief Executive Officer, McLaren Racing Paul Hudson, Chief Executive Officer, Sanofi In conversation with: Alyson Shontell, Editor-in-Chief, FORTUNE; Co-chair, Fortune Global Forum 

Fortune Global Forum 2023: Driving Forward With Data 

Talal Hasan, Founder and CEO, 44.01; Winner, 2022 Earthshot Prize In conversation with: Ellie Austin, Deputy Editorial Director, Live Media, FORTUNE

Fortune Global Forum 2023: Climate Innovation Spotlight - Turning Co2 Into Rock 

The sustainability revolution and combating the existential threat of climate change are often the focus of conversations that Fortune has with ceos and global leaders throughout the year. Each day. Here at the Fortune Global Forum, we're going to put the spotlight on an entrepreneur working on making a positive impact on the climate through innovative ideas. Our first spotlight is on the work of Talal Hassan, founder and CEO of the start up 44 01. Talal is also the winner of the 2022 Earths Shot Prize. 4401 uses technology that removes co two from the atmosphere by minerals. It in a type of rock found here in the UAE as well as all over the world. Let's learn more about the process and how 4401 plans to implement it at scale. Please welcome Talal to the stage. Hello, Talal. Um Hello everyone. Thank you so much for joining us. So I want to start with what seems like a basic question um for people here who might not be familiar with the process of minerals, carbon dioxide in rock, how does it work? And I know you've got a very important prop with you here today as well. Absolutely. Thank you for having me. So yes, we turn co two carbon dioxide into rock. We do this using a special type of rock called peridotite which is typically found 40 kilometers in the subsurface. However, it's pushed up to the surface in certain parts of the world here in the UAE being a very large deposit that comes to the surface. Now, this rock is important because when it comes to the surface, it reacts naturally with carbon dioxide minerals. The co two converting it into rock forever. I've got a sample here with me. As you can see these white veins going through the rock. This is carbon dioxide that's naturally been converted into, into, into rock in the subsurface. And I think we've got some footage of one of your projects here in the UAE. Can we roll that footage and maybe tell you could talk us through what's happening? Have we got the footage? If not, I can come back to it. Oh, here we go. Here it is. So what are we seeing here, Tal? So this is our site in Fiji in the northern Emirate of Fir. Here in the UAE. We have built this site in collaboration with Adnoc as well as renewable energy that's provided by Mazda. And what we are doing on this site is we are pulling carbon dioxide out of the air so out of the atmosphere and we are taking that co two, we are combining it with seawater and we are injecting this deep into the subsurface almost about a kilometer deep where we can speed up this natural mineralization reaction using our process so that we can remove CO two in a matter of months. And because usually, I think in nature, it takes, it can take up to a decade to mineralize carbon dioxide. And so what role does this acceleration of the process play in your ability to scale? Absolutely. So this process is a natural process. I think that's really important. It's a natural chemical process that happens on the rocks all over the, all over the world actually. And what we are doing with our technology is we're speeding up this natural process, we speed it up by about 100,000 times. So rather than taking decades, as you had mentioned, it takes us single digit months. And that's really important because for us to generate a carbon credit, we need to remove net 1000 kg or one ton of co two to generate one carbon credit. And I mentioned earlier in the introduction that peridotite can be found, I think on every continent on earth. Why is it then that you've focused your work so far on the UAE and Amman? And you mentioned the rock coming to the surface. Can you talk about the environmental factors that make that happen in this particular location? Sure. So I am from Oman. That's, that's where I'm from. And I was part of the technology investment arm of the sovereign of Oman. And we were looking at technologies that could help us address challenges that we've had that we have in the region. And I came across CO two emissions saw how steep they've increased and that this could potentially be a challenge for the region. And so I started looking at carbon capture and what I quickly realized was that there was a lot of people who were looking at capturing CO two, but there weren't many solutions that were permanent, that could eradicate that co two. So this is when I started looking at what we could potentially do to remove CO two permanently and safely. And I came across the work of a couple of scientists from the US where they were doing mineralization and they had a hypothesis that these rocks, these ultra Matic PTO type rocks could speed up the process. And I discovered that there was some in our backyard. So it was a very natural step uh kind of serendipity, I guess, but uh to, to then try and explore how we can do this. And we did a pilot back in 2021 in Oman proved that this process happens. We proved that it was safe. We didn't cause any damage to the environment. And, and then now we have been lucky enough to partner with Adnoc to scale the technology here. In the UAE, if anyone has any questions, please get them ready because I'll come to you in a second. So you, you mentioned that this process is safe, it's also permanent. There's no risk of leakage. Can you talk to us about the cost of it and how the cost compares to other examples of carbon capture? Absolutely. So we are just three years young as a company. And what we do is we don't do the capture piece, we just do the the mineralization piece. So the the other options are geological storage, which is quite synonymous with, with the oil and gas industry. We're providing a solution which is a an and, and it's something which you can use alongside conventional storage for us. The type of rock we're injecting into, it's a metamorphic rock versus a sedimentary rock, which is what you typically use for geological storage. So we don't see ourselves as competing with them. However, we do have to match the price that a sedimentary geological storage reservoir would incur. So uh for us, we are aiming to be able to match that price. We have made some great strides. Um No one's ever drilled in this rock before. No one's ever done what we're doing in this particular type of rock. So every injection we do, we find ways to, to bring the cost down even further. And we're confident that within the next few years, we're gonna make this absolutely feasible. So we can scale it on a cost basis. Some critics of carbon capture say that as a process, it may be distracts from efforts to reduce emissions in the first place. What would your response be to that? It's a, it's a very good point. So we go by the IPCC which is the Intergovernmental panel of climate change. And what the IPCC have done is they've mapped out what the world needs to do for us to hit net zero. And uh decarbonisation is in there. Um you know, natural solutions such as planting trees, forestation is in there. However, there is a very large piece or a piece which um is for carbon removal technologies and they've predicted that by 2030 that number is one gig to per year that has to be used that has to be removed from the atmosphere using technology and that grows to about 20 gigatons per year by 2050. And just to put into perspective, one gig to a year, that is the equivalent of all of air travel globally. Um We mentioned, OK, so we've spoken about a man, we've spoken about the UAE I know that you're in conversations to expand into other countries and continents. The USA, I think Japan Europe, can you talk us through the decision making process of where you launch a project? And what might be a reason why you decide not to start in a specific location? So superb question. So when we look at a location, there's four things that we need on, on a specific site. We need the rock, we need co two emissions or access to co two, we need green electrons. So renewable energy and we also need water in our process. This does not have to be fresh water, it can be sea water. So we are looking at sites that can accommodate these four parameters. However, one thing which is really interesting about our process is we're quite complementary to existing uh energy companies. So what we are doing effectively is um when you compare us to what oil and gas does, rather than taking the hydrocarbon out of the ground, we're putting the carbon back in and what that means is we need the same partnerships, we need the same talent, we need the same drill rigs and there's a lot of um kind of close ties and tie ends there. So for us, when we look at a site, if it's a territory that has oil and gas or, or has had access to oil and gas, it helps and it's quite good for the energy transition for us to be able to leverage off those resources. I've got a question related to that. But first of all, I want to see if anyone in the audience has a question. If not, I will continue for now. If that changes, please just raise your hand. Um The countries that I mentioned in, in that list of places where you're thinking of expanding to are all developed countries. I wonder whether you have plans, goals of working in developing countries and linked to what you were just saying, what the challenges of that might be. Yes. So developing countries brilliant, we find that direct air capture which is pulling co two out of the air. Like what we're doing in Fiji is a really elegant solution for, for these types of countries because it's a decentralized solution. So it allows us to turn up to a site and we don't need to tie into a hard to abate emission or you know, a steel factory or an ammonia plant and we can develop our own co two from pulling it out of the atmosphere. The other piece is renewable energy. It is now becoming with technology, it's becoming much more readily available. So you've seen out of the videos just now we set up in fora solar panels backed up with batteries. So we actually charge up the batteries during the day and that site is now 100% powered by solar. We also have a biofuel generator in the background there. In case in case we get, I think we have three days of power on that site, please don't quote me on that. So if we have three cloudy days, then we also have a biofuel backup generator. So technology is allowing us to get access to green electrons. It's allowing us to get access to co two from the atmosphere. And these are the technologies that are going to help us drive and set these sites up in developing countries. Ok. And what do you think the timeline might be for that? So we are pushing really hard on the technology. We've made some huge strides, especially on, on this site in Fiji. They're the two deepest boreholes in the world in this type of rock. And as, as we continue to make these strides, we will bring the cost down, we will make the process more scalable. We are targeting to reach um to have a site that can do about a million tons per year. This is on one site uh by 2030 2030. OK. My final question um is that Bill Gates is an investor, I believe in 44 01, which we should say 44 01 for anyone who doesn't know is the molecular mass of carbon dioxide, not something that I knew, but found out in my research. Um has Mr Gates given you any advice on leadership on how to be an innovator who leaves a lasting impact on the world. So breakthrough energy is, is one of our investors. Yes. And um they have been phenomenal. They've really helped us uh with not only the right connections, helping us with financing, but also with coaching, mentoring. And we should say that breakthrough is the Bill Gates standard venture fund. So, uh so they've been great with uh coaching, mentoring. And, you know, it, it's, it's about people at the end of the day, it's about getting the right people in the right mindset, having that innovative uh mindset trying things which no one else has ever tried before. Um And especially in, in the field that we're in, no one's ever done this before. So we need to, we're constantly looking for people that are willing to challenge the status quo. And uh breakthrough really helps us, um do that. Well, very good luck and, and thank you so much, we'll be watching to see how you get on. Thank you to L.

Majid Jafar, Chief Executive Officer, Crescent Petroleum Francesco La Camera, Director-General, International Renewable Energy Agency In conversation with: Peter Vanham, Executive Editor, FORTUNE; Co-chair, Fortune Global Forum  

Fortune Global Forum 2023: The Global Energy Transition 

Majid Jafar, Chief Executive Officer, Crescent Petroleum Francesco La Camera, Director-General, International Renewable Energy Agency In conversation with: Peter Vanham, Executive Editor, FORTUNE; Co-chair, Fortune Global Forum 

Majid Jafar, Chief Executive Officer, Crescent Petroleum Francesco La Camera, Director-General, International Renewable Energy Agency, Peter Vanham, Executive Editor, FORTUNE

So let's stay on the topic of climate and sustainability. A recent report put together by the United Nations found that if current projections hold 20 major fossil fuel producing nations will make approximately 100 and 10% more fossil fuels in 2030 than the quantity consistent with limiting global warming to 1.5 °C. The UN Secretary General says these governments are doubling down on fossil fuel production and that spells double trouble for both people and the planet. While the goal of limiting global warming is a challenging one, it's not impossible to reach. So let's talk about the innovative forms of renewable energy that are emerging in an effort to keep combating climate change whilst serving all stakeholders. Joining Fortune, executive editor and Fortune Global Forum, co-chair Peter Bum. For this conversation are Majeed Jaffa, Ceo of Crescent Petroleum, which is the oldest and largest private sector energy company in the Middle East and Francesco La Camera, Director general of the International Renewable Energy Agency which works to promote and accelerate the adoption of renewable energy sources worldwide. Please welcome them to the Fortune Global Forum. Well, hello, it's good to see everyone here and I must say, of course, we are going to address in this debate, obviously the elephant in the room. And I think you all know what the elephant in the room is for the gentleman here, which is tie or no tie. And you can see uh that we have two contestants here. Uh uh Francesco, you went for the tie in Madrid. You did not uh do you care to comment? Well, I don't have a cool shoes as Francesco. So neither of us does I have a few things in the, in the day where I need to have a tie. So I signed an agreement today and you know, just a photo, you must have a tie. We, we appreciate that. Now, I want to move to the actual elephant in the room, uh which in the energy transition debate, of course, is the role of oil and gas, fossil fuels versus renewables. And we're in a great place to talk about that here and have great guests to talk about that. I want to start with you Francesco because you know, you represent the International Renewable Energy Agency which obviously uh is advocating renewables. And you are also based here in Abu Dhabi. The offices are here. I think some of us actually passed by if you remember that this morning in Masdar City at your beau beautiful headquarters. So tell us how you see the role of oil and gas producing countries and companies in this transition towards renewables. So we have to set the scene for saying what could be the role. So for us, our Bible is the I PV C report only 1.5. So this means that uh at 2030 we have to decrease our co two emissions by 43%. This is global, global and naturally, this means that the fossil fuel sector is to decline for having less a mission there. In the same time, we have not to create a disruption in the uh in the energy market. So the gap between supply that should decline, the fossil fuel and demand should be covered, right? And this is what is renewable energy is from in this particular moment. And this is the reason also for us for calling on the triple of renewable solar capacity until 11 terabytes and 2030. So this is a number that is just a translation or what is the IPCC report in time of gigabytes? That's a scientific, you know, sort of consensus declined by 43% CO2 emissions. Now, obviously different countries and different companies will have different interests in, in that equation. Uh But are you confident? Are you um do you believe it's probable that everyone will be pulling at the same side here in, in that joint ambition for 2030 you know, the the the climate change puts everyone in front of the same question. So there is no one that can do something different from the others. So we have a, this is a common goal. We have to contribute to the goal and naturally country and their sector should contribute differently based on their circumstances. It just also the language of the Paris Agreement. II, I wonder if your previous life, you were a politician, Francesco because you treaded that needle very carefully. But we actually have somebody here who can talk about their particular interests, which is Majid. Um you know, you run a company which is called CRE Petroleum. Um So does that mean that by 2030 your company will be called Crescent Sun Winds and water or how do you see that transition for your company? So, first of all, I think we step back, we've only been given 20 minutes to cover global energy. It's which is an important topic and obviously I'm biased, but without energy, which is the lifeblood of the economy, none of the other panel sessions would have anything to talk about. So I think that's an and I encourage all of you as leaders understand energy, more understand where your own energy comes from, for your businesses, for uh even in your homes. Uh I think that awareness out there outside of our sector is lacking and that's important. If we look at the world today, we have at the moment, more energy used by the 1 billion people in the OECD in the rich countries than the rest of the world combined by the other 7 billion. And we still have nearly about 2.5 billion people without clean cooking solution, 859 100 million without electricity and that number is still rising. So we must remember the needs, the development needs of those developing countries. So it's not actually that is where that is where the net increase is coming from for emissions. It's not in Europe or the US where emissions have actually been falling. And that's where the more of the investment and the finance is needed. And the trebling of renewable energy is now a common goal. The UAE has called for President Xi and President Biden more recently. In reality, to replace the current system, you would need 100 times more, not three times more. And so far renewable energy and it's very important and it's contributing more and more and the costs have come down. Although there are limits set by physics to how far they can come down has been a supplement, a compliment. It has not, it has not met the total increase in global energy demand. It's just about now in the last year met the increase in electricity demand. I think important use has been at an all time high in 2022. So I think we need to recognize that we will continue to need. Now, when is it going to peak the demand of oil? Is it now already peaked or is it in a few decades? The reality is we lose 5 to 7 million barrels a day annually from decline rates of oil fields. So you need to add a new Saudi Arabia every two years just to maintain the current demand. A natural gas is playing a fundamental role, backing up renewables when the sun is not shining and the wind isn't blowing, you need something and it's 200 times more cost effective than using batteries, for example. Right. So I want to talk about that because I think you want to distinguish between oil and coal, of course, and then the use of natural gas is a fossil fuel. Why do you find that so important to highlight the role of natural gas in a transition towards a net zero economy? So I think uses of energy are what defines the difference. So gas is for power as is renewables and coal. Unfortunately, by not investing in gas, we've seen more of coal in developing countries, namely China and India, which uses the two countries use 70% of the world coal, which is why emissions have been going up and the cost was going up and we had energy supply shocks last winter. So we were failing on all three legs of the sustainability affordability availability that the so called energy trilemma oil. On the other hand, even if you replace light transport, we still have trucking, shipping and air and people are working on cleaner solutions for those and you have petrochemicals, everything the transition is relying upon whether it's the solar panels or the wind turbines or the electric cars themselves from their tires to their interiors is actually made of oil and medicines. And the reliance in the food sector. I think these are underappreciated, the different uses of energy and the continuing needs through the energy transition for the different forms of energy. So I think it's not a versus as you said, it's all of the above and a lot more and a key area where I'm not seeing enough investment is also in the grids and in particular, in transmission distribution, there's a focus on the generation only and there needs to be a lot more investment on that. If there's gonna be more electrification briefly before I get back to Francesco. When he talks about those 2030 goals, you know, decline of 43% of global Co2 emissions. Is that an ambition that you share that you understand that you stand behind on a global level. So I think for us as an industry, first of all, understanding how what we produce contributes positively. So we are in the developing countries, we're not in rich countries. We are here in the Middle East and we went from 50 years ago, an oil producer. Now we are 85% of the gas producer, the gas we produce in this region by displacing diesel for power generation avoids more than 5 million tons of co two a year, which is more than all the Teslas in the planet. But how we produce must be cleaner. So we've spent seven years reducing our emissions, reducing flaring to basically zero and then offsetting the remainder supporting wind power projects in China and Mongolia and places like that to achieve carbon neutral production two years ago. And we've sustained that. So how we use it is going to change and how we produce it must be decarbonised, right? Um But so do you support that analysis that we need to decline our dependency on? I mean, that that is a global, you know, uh target set by different organizations and there's debate and an upcoming in cop, there'll be a lot of work by governments on that. What I'm talking about is the role of us as private sector companies in our own businesses. Um Francesco, so now we've heard from somebody who obviously uh produces oil and gas. You advocate obviously for renewables, what are for you the most promising renewables? Acknowledging, of course, this other reality that we're going to ramp up production have to ramp up uh uh uh capacity. And that so far renewables have only played what Majid says is a complementary role. Uh So, first of all, uh concerning the complementary role, the fact is that in the last year, the last year, 83% of the new standard capacity was renewable, electricity, power, energy power. And concerning the a sector, uh the most uh clean way to, to to to manage it is through hydrogen. And the green hydrogen mainly and concerning transport along shiny biofuel also hydrogen could be used. So I is for you one of the most promising renewable, you know, I don't like this kind of question in which sense, all the type of renewables, I wish I could take it back. But unfortunately, with my Children, you know, and I always like to, to look at those as an uh uh uh answer to the problem. So for example, country that have a long hydropower uh capacity, so they have the the na the best natural battery in the world so they can arrange the system of vessel debt. So it depends on the character is that a country where wind is blowing, where the sun is shining. So what is important? And I think he completely agree with him if I can react on what they say that we have to post a lot of more attention to the grid, the the interconnectivity, the balancing the flexibility of the grid, but also the suit also the port will change nature. If you go to the Buy Port, you will see how this port is changing its nature to be ready for the next energy system, not to the past one. And do you believe because you've been focusing on, we've been focusing on 2030 which is almost, uh, six years away only. Um, do you believe that hydrogen can become widely available in six years? I don't think we bring me to the usual anecdote that I want to, to present here. Uh, it was 2021. So less than two years ago when Bloomberg come to during the summer, say that hydrogen was going to be competitive at 2050. Well, finally can be produced with $2 per ton. No far away. Of course, yes, we, we came later and said it was going to be competitive in 2030. Now, this country is already exporting hydrogen and it's there to be competitive. So this, I make this anecdote for showing how dramatic are the changes. You remember that uh renewables a few years ago was still considered niche. How is that what it is? No 81% you said last year, always a cap for power naturally. Um But if you hear that, you know, this incredible advances in technology prices coming down essentially, um you know, we can imagine of course, that you would be starting to invest also in renewable energy. If you do that, do you have the ability beyond your financial ability? Do you have the ability to do that with the people that you have and with the uh capacity that you have? So there's a lot of debate in the oil and gas sector. Should you also be a renewables? Company or should you focus on doing what you're doing? But decarbonize it and, and that debate is somewhat across the Atlantic now between the US companies that are more in the latter camp and the European companies that are transformer. My own view is it's quite a business renewables is more of a utility and it's a finance game and it's a different kind of risk reward balance. I'm not convinced that oil and gas companies can be the most effective in that sector. However, they do need to focus on decarbonizing their own products. We do as a group as the Crescent group invest in clean energy companies. I'm personally an investor in renewables, also in in hydropower in uh in Europe. So as a whole, those investments uh need to happen, right? But also recognizing, I mean, you mentioned about cost hydrogen today, it's cost prohibitive. And unfortunately, despite the amazing investments that are being made by Adnoc or a MCO and others, the market is not there. They have tried in Europe and elsewhere, people are unwilling to bear that cost, but there are these pilot projects trying to bring them down, including here, including here, energy is not however, like digital, you're not going to have more slow and dropping of costs, right? We are getting close to the physics limits for um both solar and wind. We're not gonna have 10 times the cost reductions. For example, we will still have some cost reductions but the big challenge is on storage, right? A battery battery today to store uh you know, a barrel worth of oil and energy is about $200,000 worth of batteries and it would weigh 20 tons, right? And, and, and that is a significant challenge. So there does need to be more investment as Bill Gates and others say in the technologies of the future, not just the incremental improvements in the technologies of the last century, which is what we're living with today. So you're doing that, separate your investments in renewable and your investments in oil or in gas particularly. Uh because you see a very big difference finally uh because we're going to wrap up uh Francisco, you're laughing because you know why uh you get the last question, that means the last 60 seconds, you know, um stresses on you. Um Can we do that? We're going to talk about it at COP 28 in a week's time. Can we see that ramp up in renewables or is it going to be more like Majid says we are not there yet. Uh We will see the COP 28 will come with a strong call for renewables. I have no doubt. Uh I think the president's designators already make this very clear and we are working on, on that. And what is good that the call of the president come on the basis of our number, our analysis and our outlook for we are so we are very proud of uh of that. Naturally, we have seen also some progress in the loss and damage. So we are quite confident that uh this and is inevitable. So I want to make this very clear. We have no choice. The question is not. If we have to do or not, we must do. It's a different thing. We have to reimagine our world where the ratio that there is today between renewables and the rest will change because it has to change and it will change. So no one can stop this process. The only aspect that is there and closing is the speed and the scale. That is the challenge. It is not where we are going, right. We have to ramp that up. We have tried to cover this debate in the time that we had and we hope of course, that the energy world will follow in the time that they have, which is about six years until 2030. We want to thank both of you for joining in the debate and thank all of you for listening to us. Thank you so much.

Fortune Global Forum 2023

Fortune Global Forum 2023: Cop 28 And The Path To Net Zero

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Jesper Brodin, President and CEO, Ingka Group, IKEA; Chair, The B Team Halla Tómasdóttir, CEO and Chief Change Catalyst, The B Team In conversation with: Ellie Austin, FORTUNE

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