The inaugural Fortune Global Sustainability Forum was held September 4-6, 2019 on the shores of majestic Fuxian Lake in Yunnan, China

Global Sustainability Forum 2019

Those of you here from China will will know Hao Shaoping very well. He is absolutely one of China's most dynamic, successful, and I think, courageous entrepreneurs. Huge success with his venture. Sold Ali Baba, he had a fantastic Crucial position, at China's most influential Technology Group, and still decided that there were more things that he could do on his own struck out, a second time on his own as an entrepreneur, and so far it's had a great success with his. Electric vehicle car company which is named Xiaopeng after his own first name Xiaopeng. So Xiaopeng tell us a little bit about why you decided to try this new venture? Why I start a business again? So rationally speaking You know that the technology is so advanced that we may live 100 years old or even 120 years old, if I retire at 30 or 40 or 50, it's too early. And I have my first child at that time And if my child ask me what job do you do dad? And I can only tell him I'm an unsuccessful investor that's why I decided to start business again. So service, product, something else. So, So will be a great thing particularly for those who has already start of a business. So that's why I decided to start again. What prompted you to sieze on the car as, literally the vehicle for your next venture, why did you decide that that was the paricular industry you wanted to get into? [ BLANK_AUDIO ] [ FOREIGN ] I start my first business with mobile web browser with investment from Nokia. And Good China, and the globally speaking, I sensed the changes, technological changes, And I understand that a software is so important. so the automobile industry is more than one hundred years old actually the quite a few giants in this automobile industry but in the last decade or so, the few automobile giants in [ BLANK_AUDIO ] Mobility will become more efficient and become safer. So if my company can make some humble contribution, then we will feel very proud That's why we choose to enter the automobile industry and we believe it is the right moment, that so many people are so fearful that they are deterred from entering these things. Industry, that industry. It's a very crowded space. Obviously, there are lots of automobile makers and especially as we discussed yesterday. Lots of electric vehicle manufacturers. We heard from one of them, WM Motors Freeman Sean. Help us to understand where x pawn fits in this industry. Are you at the high end with Tesla Are you with the kind of lower end with the hundreds of companies that are competing what's unique about shopping [ BLANK_AUDIO ] It is important to find the right point to start our business. Tesla was launched about 15 or 16 years ago, and it has been very successful. For Chinese companies Actually, they are at their mid- range or below mid- range. So we believe that in mid- range you can achieve a larger scale. But the bigger you grow, the less gross margins that you can have. So with less gross margins, you do not have money to do research and development. So for the automobile industry we want to have marginal returns from our RND. So from my company we focus on mid range and above. And we will at the factor of smart. Smarter factor into our products. So, we will be a little bit lower than companies like Tesla but higher than other companies you the middle range. So usually we while it is means that we will compete with joint venture automobile manufacturers in China and as some other companies. So if we can survive in least market segments in the next three to five years, we believe that we will become successful. So we are already five years old. If we can continue to work for the next two or three years, if we have A complete chain and we have more products models then we have become more successful. Your first vehicle I don't know, do we have a picture of this that we can show? There we go. For those of you who don't know, it's actually a local Guangzhou company. I was over to your headquarters the other day and had a chance to sort of sit in one of these and get the feel of it. It's the G3 right, and it's a sport utility vehicle. It's surprisingly roomy inside for as compact as it is. You've sold about, what, 12, 000, 13, 000 of these? Is that right? Yes, you are right. We [ UNKNOWN ] this car model, G3, in April this year. And for the red car, it's a SUV and we deliver you largest scale in April this year. And next year we will also deliver a new car model. So we are very happy that this year for about a six to seven, so we already We we have sold about 50, 000 cars and delivered 12, 000 cars. We first sell our cars and then we produce the cars and then we deliver the cars. This means that our customers need to wait longer for our cars. I believe that as a lease business model. Yes, very important as well keep our inventory low. So, we've actually made a lot of efforts to build a lease business model but it's a, this model proves to be working. We've got cash coming in before you actually build and deliver the vehicle itself. UE so this next model is the P7 is that correct? And it's a it's a sedan. And the G3 is priced at around 200 something thousand, which is about what 30, 000 US dollars around in there. Where will the price point be for the P7? [ SOUND ] 4G three, I wish to share with you some interesting figures so it's around 200, 000 of it before government subsidies, And actually, on most of the cars that we sold, actually we use the best equipment and the facilities, installations within the car. So we are happy that we have established ourselves as 200, 000 yen The mid range, the next auto show in Guangzhou, we will have our new car model. So PGP seven will be more expensive than G3, as well be the third generational car with assistance of autonomous driving So you can see the our assistance or function of driving the assistant or driving. So well only take four seconds for you to start it to the full speed. So it will give you a very good at driving experience. Thank you Right now you build these under contract, you build them with another manufacturer. But your aspiration is to have your own plant and build them yourselves, what has to happen for you to be able to do that? [ BLANK_AUDIO ] Thank you, we are working on that actually. Actually, we have a factory that is under construction. Now we are working with our partners in Guangzhou of central china. The company called Haimao, we are working together with them in manufacturing. So I believe that for Chinese companies to go global, I think I wish the love for the mobile smartphone industry, if there are OEM manufacturers to do flexible manufacturing for us, that will be very instrumental for the Chinese automobile companies to go global Of course, there will be some actually many challenges. But so far I'm happy with the progress. If you could tell us a little bit more about your vision of what a car is, because it's a very difficult thing to go from being in the software business To being in the hardware business. But as I understand your view, you don't really see yourself as being in the hardware business. You see the car as more like kind of a mobile phone that happens to have wheels, and that just like the mobile phone, the value of the car is the software. And the data it can be connected to. And how you can upgrade the quality of that software on a very regular basis, almost like you would an app. [ BLANK_AUDIO ] Actually we update our car every two months. So if you are an expert owner, actually, a few other electric cars can update, their system equity driving system at AI every two months. So I believe in the next four to 10 years, We will see the [ UNKNOWN ] coming to is at the peak of the electric car industry. So the in the next four to ten years assistant driving will help each and every driver for assistant driving I mean that's For every 100 hours driving, it will help you in 50 to 90 hours. You can do states are behind the wheels, but the assistant function can help you 50 to 90 % of the time So with mass data of assistant driving at a well bring disruption to the automobile industry, so how many sections of the road Automous driving can replace a human driver in the future, so from the software perspective or from traditional perspective, cases, suspension system and many things else will be changed, so I think the shape of car will also be changed in the future. So for a startup entrepreneur in the automobile industry, we are very excited because we are going to create a completely new car. For example, the future car will look like a egg. So that's a very futuristic view of the driving experience. And I'm just curious as to how close you think we are in China to that becoming a reality. I mean, this next model that you're selling is going to be capable of a certain level of autonomous navigation on the roads, right? But Are the are the systems necessary for that far enough advanced that that's going to be a seamless positive experience for drivers or, you know, I've spoken to a few people here who were mentioning to me that they've tried it in the United States and actually, it's still not anywhere close to where it needs to be, that the GPS and the software doesn't work together very smoothly at all, but the cars are too slow and stopping at intersections, they're cautious in approaching driveways, that it doesn't feel like a regular driving experience. Where are we in trying? Are we Close to pure autonomous vehicle navigation being a reality. [ BLANK_AUDIO ] [ INAUDIBLE ] [ BLANK_AUDIO ] There are two categories. One is autonomous assisted driving, one is driverless driving. For the first category, it will take about four to five years. Then autonomous assisted driving can recognize traffic lights. And they know how you prefer to turn your car to right or turn right. I think it will take about four to five years. For the singular category, when it will become pilotless or driverless, actually there are a lot of tests. But I think that we should work out two things. First is that he is as dangerous as the security I think just should have. Absolute are very high degree of security in order to be run on the road. And the now on the pilot testing, it's about 80 % A secure, that's not enough and a year for further experiments. They need to move further and the mass data. And, I think that's, we need about a hundreds of millions of kilometers of data to make, to make these kinds of machine learning, move forward. So we are still in the primary stage of the signal category. Every month about 80 % of parking actually used to our autonomous parking function. And for about the autonomous changing of lane, yes about 70 %. Every months, so actually they're the first steps autonomous assistant driving. So we believe that we're making progress, every day, every week, and every months. So our objective is kind of clumsy autonomous driving, or generation 3. 5. Autonomous driving. So I think that in the years to come in one or two years, we can have assistant autonomous assistant driving in most of our roads in China but so far we cannot achieve it. We need to work on. You expect that people will be able to do that with the piece of it. Is that correct? [ BLANK_AUDIO ] [ UNKNOWN ] That's the third generation car for P7. So I hope that's when P7 yes launched next year and we can help the driver. Reach a 50 % of all driving hour, 50 %. 5G help you to advance capability and autonomous navigation? [ BLANK_AUDIO ] 5G technology is very important. For autonomous assisted driving and the for future complete driverless driving. For example traffic lights. 5G technology will enable you to plan your routes earlier and also help you to have a human machine interaction So, this 5G technology will enable you to have a better and a smoother interaction and 5G makes it possible. And 5G will also make virtual driving possible, remote virtual driving possible So, I think that 5G will be applied in the automobile industry earlier than in other industries. I want to take questions if there are questions from the audience. Here is one right here, yes, if you could stand up and tell us your name? Hi, this is Lydia from Hong Kong Stock Exchange. I'm gonna ask the cashier in Chinese to know. For our Hong Kong Stock Exchange and question is that, you start here to have business choice or [ UNKNOWN ] industry. So which other technology interest you? You will start another business again with a certain kind of technology. So I was toiled with the idea about the protection of human brain freezing of a human brain but it did not work. [ UNKNOWN ] Another imagination is to establish a CD on the water body. So biggest technological advancement is in the Energy Information Exchange. Even the entities, maybe some others would be engaging in these forums. Thank you. Interesting. We have a question from the stock exchange. Speaking of that, I'd like to ask you just maybe one quick question about funding. There's been debate and rumor and speculation about whether you would seek funding. In Hong Kong, in China, go to the United States. Do you wanna enlighten us a little bit about your plans there, or where you're thinking of listing, and when that might happen? [ BLANK_AUDIO ] It's indeed a very challenging question for me. We are still doing the reflections think very hard beat in Hong Kong, beat in US. I like both of them. Maybe it's too early to tell. Next year I will be sharing with you this idea. Thank you Have to come back and update us at next year's Fortune global forum. Will you join me in thanking Hoshal Kong. [ APPLAUSE ] [ BLANK_AUDIO ]

He Xiaopeng On Career and New Innovations

Tech

It's now time to present the winners in the third annual Fortune China Innovation Award competition. We started by seeking out nominations from highly qualified sources, the top venture capitalists and other experts who track emerging companies. This is an extraordinary group of high quality entries. Those were narrowed down to nine companies, who were chosen by our panel of Fortune editors. Over the past two days, each was asked to present and pitch on this stage. And our finalists impressed the judges with their amazing talent and concepts among a highly skilled field of companies. We are so pleased to bring the three winners in the Fortune China innovation awards competition to the stage, and to help us do just that, please welcome Fortune's Ellen Murray and [ FOREIGN ] [ MUSIC ] And then we'll present each winner with a certificate from fortune and Mr. Li will present each with a prize from Guangzhou Pharmaceutical Holdings. The company's very generously awarding each of the three finalists, a fabulous trip to visit Huang, your group cultural attractions. [ BLANK_AUDIO ] And now let's meet these talented innovators. Our first runner up is robot plus, plus. [ UNKNOWN ] [ APPLAUSE ] Robot ++ is replacing spider man through aerial works with robots. They work for CPRs, [ INAUDIBLE ] construction, and other industries aiming to reduce cost. Increase in efficiency and most importantly ensuring safety. [ MUSIC ] [ MUSIC ] [ MUSIC ] Next we have our younger app. Casivision. [ UNKNOWN ] Casivision offers high tech and innovative AOI machines. And the solutions for advanced manufacturing industry [ MUSIC ] in your mind. [ MUSIC ] Now, I'm honoured to announce Fortune China Innovator of the Year Waterdrop Trey Diego [ UNKNOWN ] [ APPLAUSE ] Waterdrop is the leading provider of personal medical phones in China and the pioneer in social insurance technology sector. Congratulations. [ APPLAUSE ] [ MUSIC ] [ MUSIC ] [ BLANK_AUDIO ]

 Award Summary and Presentation Ceremony

Winners of the 2019 Fortune China Innovation Competition

Welcome to Jack Jing, Executive Vice President, of Sunning Technology, and Martin Reeves, Chairman of the BCG Henderson Institute. Martin, let me start with you, please. This is gonna be a conversation that I'd like to think of it as being applied technology. We're gonna go deep with you two about how businesses Are using the technology that we've been discussing for the past two days, both in China and around the world. You recently completed a major study on AI with MIT, I believe. Tell everyone about it, please. Yeah, so the aim was to survey the reality of what's in all of AI in the context of business. So we surveyed about 3, 000 companies globally And that will so what they would do with the I. we look to which ones were actually extracting card valley from may I and we looked at the the characteristics of a successful company as I think of some of the main conclusions why that time everybody's doing it so 80 % the companies that we we separate investing in a I. About the same number expected to be transformation within five years but only 30 % are actually extracting current value. And some of the things that those companies do, actually mostly of the organizations interestingly, are, they don't run a little controversial, but they don't run their projects out of the it department. That's a failure factor. they have a variety of projects. They have a portfolio, not just one big bet. They're actually focused on the revenue side and not the cost side. The covers [ UNKNOWN ] on the cost, a generally not successful. Okay, I'm gonna pause you because you just made 17 great points. And I wanna come back to the first one which is that almost everyone's doing it. What is that mean to do AI? And I will let Jack be very specific about what his company is doing in a moment. But generally what does that mean? How do I do AI? Well, most of the companies are actually investing in AI projects. But the ones that are merely doing that rather than interpreting the business, generally running as a technology project. Other the technology function focused on improving the efficiency or the cost effectiveness of existing processes, and that isn't enough to generate current value in general, generally speaking. Whereas the successful companies are really treating it as an integrated part of their strategies. So tell me if my paraphrases is fair that an unsuccessful company will buy an API product and run it for some purpose for some discrete purpose. A successful company is investing in incorporating AI into its business. That's right. And this telltale language that the successful companies >> Used actually. So if companies talking about AI strategy, one should generally be suspicious. That's a bad sign because obviously there's no such thing as AI strategy that isn't driving the general business strategy, and also to make AI successful, it needs to be connected to data, it needs to be connected to cloud, it needs to be connected to business strategy. So it's kind of a talk about And A I driven, an A I first business strategy, generally the successful ones, but an A I project, an A I strategy generally buys towards failure. And it's like thinking of a company that would say they have an electricity stratergy. [ CROSSTALK ] Okay, I'm going to come back to you Martin, and I'd like you to. I would want you to talk about the same thing, how Suning is doing AI. But first let's just make sure that especially our non Chinese audience, has a good grounding of Suning. Which is a very large multi- fascinated Chinese retailer. Yeah. May be you could give a quick over view, please. Okay. Thanks to have me today, is quite an excellent conversation for this topic. Recently I have been asked about AI cloud and big data. Most of the people talk about AI, they come back to technology. In my mind AI, Big data, kind of the digitalization, not only for technology but mostly important means of strategy, for company, for organisation, strategy based on the strategy we have different operational model, different talent required And then come back to the technology. So today the digitalization included AI big data and cloud. We define the new business model. We define the new product. We define the new services. That's Suning We practice the transformation, digital transformation in the past 10 years Before you get one that's sitting began as an electronics appliances, retailer but you're now far more than that. You're a supermarket retailer, you own your department store retailer. And talk about the journey of going from physical you're still a very large physical media retailer to digital. Yeah, come back to shooting Suning. We are the biggest omni channel retailer type in China right now. In 20. net nine years ago. We come from a chain store for electronic only. In 2011, our sales revenue almost hundred billion. I'm being in China. We made a decision means we go digitalization transformation. Today This year, I believe will reach almost 600 billion revenue, sales volume, including globe, how we did kind of six times growth in the past eight years because we do kind of the digitalization transformation The transformation, I personally think, we come from three different dimensions. The first dimension means, we do electronic in the beginning. The electronic is all our type of the retail business. But, today We have whole product category included GIFs 16 different type of store. And we have total 13, 000 retail store alone China included Sunni online, and apps. So today's assuming we have a digital metrics In the Y Eric's we have online store, supermarket, convenience store, sports store. Almost every retail type we have. Let me interrupt you. I'm sorry. I'm curious. You have all these different kinds of retail stores and online stores and brands. Yes. Is there one technology group serving them or are there several? Single platform? And yeah, please tell us about that. Why we we do this kind of transformation from three different dimensions. I just mentioned first dimension. We come from different kind of store. We have lightning China. And in the XY dimension means we have six different diverse logistical in China. We can pick up in the store immediately. We provide half hour, 1 hour, 4 hour, 8 hour and 24 hour. The mazing say means Delivery. Delivery? Yeah. Six. I'm sorry, you said half hour. Yeah, half hour. I will mention later about we have a new accounts that means while our lifecycle. Yeah. I mention later. So today in China. More than 95 % of the city around China, we cna deliver it to doorways in 24 hours. Most all of the first teir, second teir cities, we can deliver it to doorways in four hours. And then the second dimension. The third dimension means We provide from electronic to odd category, especially we acquired car for China two months ago. Need will be increased and improve our supply chain for the consumer products come back to technology. Okay, no before I wanna go to Martin in a moment, give us one example of how you're using artificial intelligence. [ UNKNOWN ] Okay let me make example including online totally we have to 15 tools building products online. 5 point 0 like this individual store almost a 3000. So how to match around China, 13, 000 retail store. Each is store. To pick up 3, 000 floorings that 52 million products on line totally. Basically, if we have just a single store we can base on the human brain right, which means the, the by experienced person, but today including when you will use AI and big data. Firstly, we will analysis what kind of a customer around the single Real store. And based on the characteristic of the consumer datas we get AI analysis. What kind of a product can match for this store. And the server serves the consumer around the store, like this. So the AI has become your buyer? Yes. In a very meaningful way. Martin, you said something I think controversial a moment ago, which is that this successful companies investing in AI think about revenue, not cost. Would you elaborate on that? Yeah. So it's interesting I think I'm not surprised that assuming was in the fortune future 50. Which is this list of companies with the highest predicted growth actually using AI driven analytics. Because. The features that you described of your use of AI, I think, are precisely the success factors. You're revenue growth oriented, Yes. You're not running it out of the IT function, you have multiple applications and fundementally you're using it in service of an integrated business strategy. You're not Not as a technology project. I think it's a perfect real world example. Yeah. But now in the United States, and I think to some extent in China as well, companies focusing on revenue to the exclusion of profits is becoming very unpopular. Is your advice Does your advice conflict with the trend? Well, it's, it's long been the case that value ultimately in the long term has to come from growth. You can't cut your way to value in the long term. But we do see that the polarization of the economy College while research into primarily companies which are , you know, very high growth, high p ratio but low profitability and ones that are quite profitable and have good cash flow but a low growth incumbent companies and of course the trick is to have both to actually be generating cash flow now. To pay for future growth. There are few companies that can do that. We got that strategic company exterity, but that's the goal. You are suggesting by the way that companies that don't have a good business model or who have poor margins, almost by definition will not be able to invest in artificial intelligence and big data. Yes, I mean it's a scale driven business strategy to requires a lot of investment to actually have the biggest data set and the biggest proprietary ecosystem driving the biggest learning machine with AI. So have to afford that investment on a sustainable basis indeed one needs, a path to to positive cash flow. So This year is a fortunate future 50 index that we did together we actually included that as one of the criteria which is, a path to cash in anticipation of, possible slowdown in the global economy. I think that becomes very important. Great. Jack Alibaba is a major investor in Suning. Yes. They do a lot of their own artificial intelligence Data research. Can you explain how your two companies work together on technology? Yep. Sunning, we have independent IT department, around 12, 000 IT specialists around China, including [ UNKNOWN ], we have a lab in there. Suning and Alibaba way long different business models. Alibaba is IT commerce platform. Suning way long term business [ BLANK_AUDIO ] It means one hour working cycle. Previously, when you came to China, the model was like this. Today I make order online and then delivered to door tomorrow. But most of the city around China fast most of the cities areas, they're not satisfied. This model means one day buy and the next day to delivery. They want to buy and get the product right now. So in this model soon we have advantage means, we have a store, real store around the people, around the areas. So we use AI and ability to do analysis. For example, we already have this business in Shanghai and Nanjing. We not only provide the product from store, but also we provided the product based on the AI analysis from the regional warehouse and that the customer will predict what kind of product the customer will be interested then we per Transfer the product from our central warehouse to the regional warehouse. When the customer make order online, the regional delivery team, just the delivery the product to the to the door with our not only for electronic but also for the consumer products, even fresh food. So this kind of model why we can do this kind of model because we have AI technology to take a technology not only for the e commerce but also very deeply to understand the consumer offline around our store in our area. [ UNKNOWN ] What I think is so illuminating listening to you talk about an offline company going online is your emphasis on the backend technology that is so important, given your physical nature. You're obviously interested in serving consumers as well. Talk a little bit about things like Facial recognition and virtual reality how important is that for Suning? Yeah. In the past 10 years, internet plus the retail is really in means the push the retail business growth in China, right? So in the internet The all of the behaviors for customer can be record from the first page to second the page and what kind of picture you have your state how many times like this, but in offline, the traditional technology cannot solve lightly this kind of the information Today in Sunni, we cost matter retail, especially for the real store. We use the AI camera to mourn it, the consumer two income our store. And what kind of the trends from the first layer to second layer to third layer and how many store you just a visit. And for example, you just [ UNKNOWN ] TV, and how many times [ UNKNOWN ] front of the TV. So this kind of information will base on AI Camel, and we can pick data. It's just is so interesting, you say, you're doing exactly the same thing that e- commerce companies measured, in terms of how long someone stays on a website. You're measuring how long they stand in front of the television. Are you doing this in every store, or some are only, some stores? Most of the all of store we can trace the consumer behaviors offline. And most of fantastic see means. Two months ago, we just opened the first wave of the automotive store in China. The ultimate store not only kind of the free shopping and open shopping but also we included Facebook nation your previous you don't need to take a wallet right as a mobile phone but today including uk just experiencing in Nanjing you just use your face Just walk in the store, pick up your product if you want and just leave. Okay, so this is a limited beta experiment for Suning in Nanjing. In Nanjing. How's it going? Yeah, where we are [ UNKNOWN ] our ultimate store. Along China from next year. How many stores? We have a plan in the next 3 years, around 1, 000 autonomous store will be open in the next 3 years in China. These are new stores, not existing stores? New stores. Fascinating. Martin, an interesting part of your study. You reach conclusions about the United States and China being ahead on artificial intelligence compared with Europe in other parts of the world. Let me play devil's advocate with you. I'm curious to your response. Why does that matter? Isn't this technology available for purchase by anyone who can afford to pay for it? One of the algorithms, of course, are public domain, open source. The data isn't. The data is proprietary. So it's a race for data and the business systems that actually [ BLANK_AUDIO ] Will be driven, its own national security will be driven by AI. So it is a very relevant question, who's winning? So we looked at that question very closely and our conclusion is that absolutely America and China collectively are in the lead. They're getting between 75- 90 % of any metric that you wanna measure, whether it's [ BLANK_AUDIO ] So unicorns or venture capital funding. So what does Europe do is a huge question. And then in terms of is American leaders trying to lead the truth is are in the lead on different things. So the, the the statistically looking at across the 3000 companies, Chinese companies are extremely application oriented and The number of competitors per area application is huge. The number of applications per company is huge. So, you could say it's a very competitive and fast learning application poll. The Chinese actually, at this point have more academic papers. But the Americans still have more citations per paper more, high quality papers. So I think the Americans still lead on next generations of AI technology, but huge policy question for Europe is what is Europe doing in that scenario? And can you make a generalization based on your research on how American corporates compared with Chinese corporates in artificial intelligence. Well, it's basically the same game but there are some nuances. So Chinese companies are more revenue oriented. So the revenue orientation was very important. They tend to have a bias towards more multiple applications. The average number of applications per company is higher. Also one one hallmark of the maturity of the technology but a lot of companies out there that are playing with pilots and studies and some that were is really driving the business. The ones that are still playing tend to tend to be focused on the opportunity of AI the moment it becomes real It also becomes a competitive threat and Chinese culture. I think I definitely we mentioned this acutely aware of the competitive threat. There's a competitive race in the areas. Jack, I want to end with you on a different competitive threat of in the previous panel, there was a conversation about many apps and how well they work inside of the 10 cent We Chat system. How does a company like Sony, which is allied with Alibaba deal with that ecosystem? Yeah, I'd like to have a opinion based on the markets. Just talking about the ability for the AI for company. My opinion like this In the past five years, or five or 10 years, the biggest company, they invested resource to AI to cloud right they own the ability to close their business. But today, mostly important means how be more attention about the middle or small size of a business. Because they are limited resource. They have short of IT staff in inside their organization. So as a bigger company, we already got beneficial from the AI, from big data, right? So today we are thinking about how to enable Based on our result, our ability how to enable how to support them work together to help them to close together. Because retail always domestic capacity diversity means we not only do business alone when we need to do business together so soon as a team we have mission means. We're open for all of panel, even the wrong retail business. We want to export our solution, three and then we can. Support our ability, what can we numb together to help them especially for the middle or small piece. I think you've done the right job. Yeah. I am. Yeah. I think you touched on a couple of issues that will be worrying about in the future that one of them is AI ethics, the acceptability of the way that we use AI and the other one is. Justifying the existence of the sort of monopoly power that accrues to AI to use that responsibly two big issues. Since we're out of time I'll just ask you, yes or no is Suning at a disadvantage because of the the mini app system that operates within the WeChat environment. Yeah, we definitely will be one of the best channel for retail business and, and the kind of online traffic's. So we have this kind of collaboration with We Chat by honest Today, as a retail company, we always more attention means we are bridge between the consumer, and the brand, and the manufacturing. So later, based on the AI and the big data, we are working on restructure the relationship Between the consumer platform brand and manufacturing, I believe will be lot of the benefits will be India Gentlemen >>is a huge. Very stimulating conversation. Thank you very much. Thank you. Thank you. [ MUSIC ] [ BLANK_AUDIO ]

Artificial Intelligence, Real Opportunities

In the AI world, data is the new currency and analytics competency a crucial competitive differentiator across business lines

What's in Store: The Future of Retail

Retail

Technologies are transforming the way we spend, save and move our money.

many years ago of Britain Famers, British professor in Israel Imperial University. In that for you, you fall out of favor. Still does. Well, doing a research project. Aye, aye algorithm. So analyzing the pixels on a screen can understand a game also operated later on the student on two, Kimberly's friend created a company which we call one of the fuel British company Unicorn Company. The student is who? Peter Lipka, Improper company. The first question, Peter, the 1st 1 you liked a lot. Peter. There's a media report headline. If all of us leave in a virtual world, maybe your company will be able to create the war at the same time yourself. Marshall, you want to create a matrix? It's the major. Accessing the fumes. You know, Peter Coyote. Charvis. This, like a seemingly crazy is this idea. What is that, Derek? I think we're already living in The Matrix right now. We just don't know it. No, but in all seriousness, Improbable Believes in a future where we all live in multiple worlds at the same time, with most of them being virtual world. And obviously the physical world we live in today not this kind of scary future That matrix portrays way believe these new worlds are gonna be a vital to us and we're gonna bring a lot of meaning and we're gonna enjoy our existence in them on so formal aside, re believe that kind of way. Believe that the world will come from a variety of places way they come from social media, for example. People already live and breathe social media. They interact within these wells. They make money from these welds on thehe other what place that they're gonna come from his game Wave games will become the basis off these new virtual What? Well, there's a great statistic that earlier this year they made a survey for kids that played for over 1/3 of them. Found that fortnight is more important to them than many parts of the real world In China, over 50% of gamers say that gains let them interact with their family, become closer to their family and their friends to create these kinds of online experiences Very key to have innovation. So we've created a product. Special web allows them to create new types of innovation on the risk, the experimentation with innovation to create these very great experiences that really helped them and make that enjoy the life more. Okay, Thanks, Peter, with Peter, give us a very smart answer. He was talking even though we don't have to care. What kind of war is that? What you are? Not many of us today already leaving. I'm braising in this war also in the games. The question for Mr Young, China's ah gaming market, you know, is very unique. Very few gaming companies actually capture half of the market. Are you? Haven't will be the A share the top two company leading off artists and all the other companies. How do you define that? Gave me industries content creation, games content Curation actually content and grooves many air by his future is toe become orm or elegant? Writing all the biggest market share You feel like talking about games resistance fighting on the PC Also mobile games. But if you look at the smartphone proliferation by starting in 2012 but it's now become or more popular at the very beginning here, there's the lack health products in the market. Whatever games you along, there will be many people coming over and play that So our pursuit or quality demand on quality thought I hire, we want just wantto quickly false allows new, productive on to capture the market share. But today that when the population dividend is the superior, so become more and more customers become fewer and fewer. But how come we capture meaningful customer? You have to come up with very food. College games neither, but are in constant actually in cool the artistic quality off the games on the conference. You want outlook that the approach of gaming, whether it's the game, is a small so not on experiences you can provide to the customers of player you want to do well in all this aspect, the input into this game, cars and cycle will be very, very high at the very beginning, to trick us only six months to come up with a game in reverse order. But all we found you may take 1 to 2 years or even three years. So the development cycle is longer, Barris higher and higher. You want to do a good content game. This is why this is what we see today. Why the barriers higher and higher the competent would you wear well before the company's accumulated human Thailand's of funding? They have the resources to have the time to come up with better games, but with smaller companies or start ups, you know they lack resources, so the game to produce quality will be lower. Compare it with the big wife. However, in a market that market only recognize the best ones. This is why, in the process of double oven of industry, gradually it will have this situation more bell games, market My look at that, their situation will continual. The future of the country will be better and better quality. Five. G technology The thought of speed of preservation cloud computing cetera later. All the technical changes will enable your games to become or more excellent the image quality better and better transportation farther and faster. Onda Bigger, bigger you, Michael Society pick aside hundreds or thousands online the same time or 100 people fighting each other. This type of game will be there, but some new devices from PC to the mobile terminal. The carriers are changing a Are we our equipment on the merge? It's not being very Republican, but still they Are you merging for new startup they applied for a new company mean represent an opportunity because on this platform for many traditional existing, uh, gaming players, you know they may have different experiences. This may represent a new study, important. Even though you have accumulated a lot of the resources, we'll start off the challenge of fame. This might be a challenge for a smaller one. So human talents and motion devices will be, well, be that important. Okay, we'll have for the question feel later. Questions for Mr To at the investor We've been fighting where hard have a your own set of strategies like a tribal. Our strategy, Why you select area you. We go all out within 23 months to find all the investment opportunity to see the good window problems. Why you succeeded coverage in him. Elijah on other new platforms after that gave me industry, you know, uh, Unicorn Company or the appeal. So I just training media industry Do think there will be a next wrong opportunity. New opportunities, new opportunities will be lived. There would be money. So regret. Sorry we missed, you know, working with your company. Actually, two years ago, we have a main soon the next generation entertainment platform. We believe him. Elijah content or games in the tree. The all digital realization will bring about a new enhancement off opportunity, the interaction with the people in machine, on people to people interaction or even further. We want to find out people in the game how they can't being interact with the human. You re award. We want to find such a magnetism to do that. So in the process of 30 of all of this, we Miss Peters Company. But we still believe going forward all the entertainment content will beam or interactive. We'll have more UTC So may I mean I agree with Mr Yeah, all the games will be more cool, more more cool and big, larger and larger. Maybe your platform provide opportunity. The smaller, wise great in a bigger war, a small gaming war. But when the date monopolized the big award, but nobody what? There will be many new opportunity of many different ways of playing this games. The one pays off. These are interaction my name nongaming players in the future or no normal countem participant in the process, they will participate or somebody degree a literary translations. Chinese online, normal readers, you know, actually are very popular. Kind of, you know, is happening. It's more more popular going forward money, entertainment on other things, player, the participants can become a organic part off this whole thing. I changed the road map, but there's another way of saying we want to focus. The validation is drunk are stronger, closer closer communication between people close circle with be tried and everything. So the school made, you know, have to see that they can't get together on the neck. So people feeling lonely is a major problem like in Japan. Loneliness for we pay a lot of attention toe people in the game communication with people in real life. Well, it will pay special attention. So the next generation off Ah, situation what kind of changes? So, actually, this is something we think will happen in the next years. So basically, Mr Young believes, uh, Mr Yeah, I'm Peter. Give us their specific idea. So if your platform, like people, Google and Angel can be more open providing a ecosystem with Ally as Angel and the soul of a gaming company in Jungle Kind Piquet the global competitors, so we should be more open on the affair for people to compete, The video's other MR told Mason Hey, say, reminds me of a destructive platform product Special West Off your company. Your mention if you use financial industry frequent are trading, uh, mechanism into the Caymans. Arrest special West technology, Create many new values. Maybe it can surely what kind of a new murder will you were talking about? Hide a lot of people that were outside the games industry, from Google to Amazon to Goldman Sachs on way set up to create the ability to create these new, huge virtual worlds on that people were talking about here today. However, you very soon realized that games already a very risky endeavor. Often they cost hundreds of millions on. So, you know, Mr Yang mentions looking more and more expensive and take longer and longer on so realize. Actually, the key is about reducing risk, reducing time to market on actually incremental innovation. Let them do what they already do. Very, very well building call of duty 16 or 17 I think on this year let them do that little bit extra that little bit more, more interesting I or more interesting on kind of a simulation or more people on, let them incrementally innovate rather than jump straight into these large natural world. So that's why we created Special to enable them to reduce that risk off game development, create a experimentation off innovation on defectively. Make better and more compelling games in China were quite lucky because now partnered with Netease really believe this. You know their investors well in building games on top of our technology as well as a 10 cent cloud as well who are building the creating the kind of fundamental infrastructure which we can run on the cloud infrastructure. So that's the value that we bring. Thio you did for 10 cents on their ease. They are so visionary, does that they have seen the value that can be created by your company. So for the existing other managers, Mr Young So we're not too you enlighten us. That's a big data. Well, have a big impact on give me development into me. Even changed our life cycle off game. You didn't write? Yes, you are very right there, Kirsty. The era or you the digital era Big data Yes, essential, including in the gaming industry. So we used the Big Data Analysis system. For example. We have collected a lot of data from existing games, various activities and the scenarios favor opposing aerials. So these kind off information connected will be very helpful for our future. Give me development. And when we are searching for customers and we need to find a market position howto target the right market position. We also depend our big data so that we can reach our rights kinds right customers as quickly as possible. So when it comes to our customer behavior, how long they stay with our game? We were used big data analyses in order to you prove it. So a big data helps us a lot. Now we would like to go deeper, a little bit of Peter, because we know that your focus is the game. And maybe in the future you will you will go be young to gain, for example. For example, a mining simulation. Ah, urban stimulation. We have a fire breaks out. You needed to do a simulation. So maybe the future there will be competition across factor competition and for off Otaka castle. So for how do you viewed Ah across a factor? Competition and the opportunities Gaming is in a very interesting space at the intersection off simulation visualization as well as human interaction. So there's definitely applications of something special that's outside of giving. You mentioned quite a few areas that we've already explored on a good picture. I like to paint it. Imagine large scale disaster recovery. What happens when, for example, in the earthquake happens in a place that you didn't predict before. You can try and predict what the impact would be on buildings and on infrastructure. How do you train thousands of first responders? The thousands of people help save lives on and save the environment that Rin via the Fire Department, the police department, the medical department, government officials they often don't work together. They don't know how to go on go toward a particular objective together. So how do you train them? If you created a virtual world where they could all interact with each other on a train for these kinds of scenarios, you can save lives and could save a lot of money on, so that's where we see our potential application areas on dhe. Some of the other businesses that do just a portion of it, either. Visualization simulation. They haven't put it all together, so we see way See potentially others as partners. Right? OK. Yes, I know. I told you that Peter Dion asked a question. Mr. Joe, what do you think off Peter of you? To think that that investors well, increase their evaluation off your value. Your valuation years? Yes. Not so solid. We wouldn't like to increase our value. For example, high resolution three dimensional map will be something that will consider Thank you. Thank you, Mr Joe. And, uh, Panelists on DDE. And why would Electoral conclude with a quote from Mr Joe In this world, we would like to create a species that people have never seen. These species will create a new world. Thank you.

The Entertainment Industry's Digital Transformation

Entertainment

Its changing everything from content creation to IP protection.

the global media and entertainment industry. Tectonic shift The next panel of entertainment and media experts contemporary How the digital age is changing the way we create markets monetized and protect contents. So please welcome Peter Lipka Young Dream on Joey Welcome many years ago of Britain Famers. British professor in Israel Imperial University in the US For you for a while. How service still does well, doing a research project. Aye aye algorithm. So analyzing the pistols on the screen I understand a game also operated Later on the students onto Kimberly's friend created a company which we call one of the fuel British company Unicorn Company. The student is Who? Peter Lipka, Improper company. The first question. Peter, the 1st 1 I liked a lot. Peter, there's a media report headline. If all of us leave in a virtual Lord, maybe your cup a day will be able to create the war at the same time yourself. Marshall, you want to create a matrix? It's the major accessing the fumes. So if you don't you think so. Peter Coyote. Charvis this like a seemingly crazy This idea. What is that? Derek? I think we're already living in the matrix right now. We just don't know it. No, but in all seriousness, Probable. Believes in a future where we all live in multiple worlds at the same time. Uh, with most of them being virtual worlds and obviously the physical world we live in today And I'm not this kind of scary future that the Matrix portrays. We believe these new worlds are gonna be a vital to us. And we're gonna bring a lot of meaning and we're gonna enjoy our existence in the so formal aside, re believe that kind of we believe that the world will come from a variety of places way they come from social media, for example. People already live and breathe social media. They interact within these wells. They make money from these wells on the other. What place That they're gonna come from his game. Really. Games will become the basis off these new virtual. What? Well, there's a great statistic that earlier this year they made a survey for kids that played for over 1/3 of them. Found that fortnight is more important to them than many parts of the real world. In China, over 50% of gamers say that gains let them interact with their family. You become closer to their family and their friends. To create these kinds of online experiences is very key to have innovation. And so we've created a product special wet that allows them to create new types of innovation on the risk the experimentation with that innovation to create these very great experiences that really helped them. And make that enjoy the life more. Okay, Thanks, Peter. He did without Peter. Give us a very smart answer. He was talking. Even though we don't have to care. What kind of war is that? What you are? Not many of us today are leaving. I'm braising in this war. Also in the games. The question for Mr Young. All right, Trainers. Ah, gaming market, you know, is very unique. Very few gaming companies actually capture half of the market. Are you happen to be a share? The top two company leading for artists and all the other companies? How do you define that? Gave me industries content creation gains content, curation, actually content improved many air by his future is towards become orm or elegant writing all the biggest market share you feel like talking about games resistance fighting on the PC? How's a mobile game? But if you look at the smartphone proliferation by starting in 2012 but it's now become or more popular at the very beginning here, there's the lack health products in the market. Whatever games you allow, there will be many people coming over and play that. So our pursuit or quality demand on quality thought I hire, we want just wantto quickly false allows new, productive and to capture the market share. But today that when the population dividend is the superior, so products become more and more customers become fewer and fewer. But how come we capture meaningful customer? You have to come up with very food quality games, either by the inconstant. Actually, it's in cool the artistic quality off the games on the conference. You know what outlook that the approach of gaming, whether the game is a small so not on experiences you can provide to the customers of player you want to do well in all this aspect, the input into this game, cars and cycle will be very, very high at the very beginning. The trick us on a six months to come up with a game where you were sort of, but not all we found. You may take 1 to 2 years or even three years. So the development cycle is longer, Barris higher and higher. You want to do a good content game. This is why this is what we see today. Why the barriers higher and higher the company would you wear well before the company's accumulated human Thailand's of funding. They have the resources to have the time to come up with better games, but with smaller companies or stuck up, you know they lack resources, so the game to produce quality will be lower. Compare it with the big wife. However, in a market that market only recognize the best ones. This is why, in the process of development of industry, gradually it will have this situation more bell games market. While you look at that, their situational continual, the future of the content will be better and better quality. Five. G technology. The thought of speed of preservation cloud computing cetera later, all the technical changes will enable your games to become or more excellent, the image quality better and better transportation farther and faster and the bigger, bigger your micro society kick aside hundreds or thousands online the same time or 100 people fighting each other. This type of game will be there, but some new devices from PC to the mobile terminal. The carriers are changing a R V E r equipment on the merge. It's now being very publicly, but still they are you merging for new startup they applied for a new companies may represent an opportunity because on this platform for many traditional existing, uh, gaming clears, you know they may have different experiences. This may represent a new study important. Even though you have accumulated a lot of the resources, we'll start off the challenge of the same. This might be a challenge for smaller one, so human talents and motion devices will be, well, be that important. Okay, we'll have further questions for you later. Questions for Mr To. As an investor, we have been fighting where hard have a your own set of strategies like a tribal. Our strategy, why you select area you. We go all out within 23 months to find all the investment opportunities to see the good window. The problems. Why you succeeded coverage in him, Elijah on other new platforms after that came in this tree. Uh, you know, uh, unicorn come, Billy or the appeal so entertaining the media industry do think there will be a next wrong opportunity. New opportunities, New opportunities will be lived. There would be money. So regret. Sorry. We missed, uh, working with your company. Actually, two years ago. We have a main the next generation and the taming play for I believe Himalaya Mountain or Games in the Tree. The all digital lionization will bring about a new enhancement off opportunity the interaction with the people in machine on people to people interaction or even further. We want to find out people in the Games holiday country being interact ways. The human real words. We want to find such a magnetism to do that. So in the process of 30 of all of this, we Miss Peters company. But we still believe going forward all of the entertainment content will beam or interactive. We'll have more UTC So may I may not agree with mister. Yeah, All the games will be more cool, more more cool and big, larger and larger maybe your platform for my opportunity, the smaller, wise great in a bigger war, a small gaming war. But when the date monopolized the big ward, But no matter what, there will be many new opportunities for many different ways of playing. These games they want is off this interaction. My name nongaming players in the future on a non contact participant in a process they will participate. Or somebody degree a literary translations. Chinese Online normal. The readers, you know, actually are very popular. Kind of, you know is happening. It's more more popular, going forward. Money, entertainment. I understand player. The participants can become a organic part off this whole thing. I changed the road map, but there's another way of saying we want to focus. The validation is stronger, stronger, closer, closer communication between people closer, clo with be tried and everything. So the school made, you know, have to see each other. They can't get together on the neck. So people feeling lonely is a major problem, like in Japan loneliness. So we pay a lot of attention toe people in the games, communication with people in real life. Well, it will pay special attention so the next generation off. Ah, uh, situation. What kind of changes? So, actually, this is something we think will happen in the next years. So basically, Mr Young believes, uh, Mr Yeah, I'm Peter. Give us their specific idea. So if your platform, like people, Google and Angel can be more open providing a ecosystem with Ally as an angel and the soul of gaming company in Jungle kind Piquet the global competitors. So we should be more open on more fair for people to compete with you, Mr told Mason. Hey, say, reminds me of a disruptive platforms product special west off your company. Your mission if you use financial industry. Frequent trading, uh, mechanism into the gaming is arrest special West technology, create many new values, maybe a car service. What kind of a numerical you're talking about? Hide a lot of people that were outside the games industry from Google, Amazon, Goldman Sachs. So we set up to create the ability to create these new huge virtual worlds on that people were talking about it today on However, we very soon realized that game's already very risky endeavor. Often they cost hundreds of millions on, So you know, Mr Yang mentions looking more and more expensive and take longer and longer on. So we're like Actually, the key is about reducing risk, reducing time to market and actually incremental innovation. Let them do what they already do. Very, very well, you know, building call of duty 16 or 17 I think on this year is that. But let them do that little bit extra that little bit more either more interesting I or more interesting kind of stimulation or more people 11 incrementally innovate rather than jump straight into these large natural world. So that's why we created Special West to enable them to reduce that risk off game development. Create that a experimentation off innovation on defectively Make better and more compelling games in China were quite lucky because now partnered with Netease really believes this. You know their investors well in building games on top of our technology, as well as a 10 cent clouds as well who are building the creating the kind of fundamental infrastructure which we can run on the cloud infrastructure on. So that's the value that we bring to you for 10 cents under Nancy's. They are so visionary now, that they have seen the value that can be created by your company. So for the existing other managers, Mr Young So what can I tell you? Enlighten us. That's a big data. We'll have a big impact on Give me development into me. Even changed our life cycle off game. You didn't write? Yes, you are very right there, Kirsty. The era or you the digital era. Big data, Yes, essential, including in the gaming industry. So we use the epic data analysis system. For example. We have collected a lot of data from existing games, various activities and the scene. Aerials favor opposing aerials. So these kind off information connected there will be very helpful for our future. Give me development. And when we are searching for customers and we need to find a market position howto target the right market position. We also depend our big data so that we can reach our rights kinds right customers as quickly as possible. So when it comes to our customer behavior, how long they stay with our game? We were used big data analyses in order to you prove it. So a big data helps us a lot now we would like to go deeper, a little bit of Peter, because we know that your focus is the game. And maybe in the future you well go you you will go be young to gain, for example. For example, a mining simulation. Ah, urban stimulation. We have a fire breaks out. You needed to be Oh, a simulation. So maybe the future there will be competition across factor competition and for off Otaka Castle. So, for how do you view across a factor? Competition and the opportunities Gaming is in a very interesting space at the intersection off simulation visualization as well as human interactions. And so there's definitely applications of something special that's outside of giving. You mentioned quite a few areas that we've already explored on a good picture. Dialect painters imagine large scale disaster recovery. What happens when, for example, in the earthquake happens in a place that you didn't predict before. You can try and predict what the impact would be on buildings and on infrastructure, but how do you train the thousands of first responders, the thousands of people to help save lives on and save the environment There in the fire, the fire Department, the police department, the medical department, government officials. They often don't work together. They don't know how to go on go toward a particular objective together. And so have you trained them? If you created a virtual world where they could all interact with each other on a train for these kinds of scenarios, you can save lives and could save a lot of money on. So that's where we see our potential application areas on dhe. Some of the other businesses, that dude, just a portion of it, either visualization or simulation, they haven't put it all together. So we see way see potentially others as partners rather than competitive. Okay. Yes, I know, Peter. Mr Joe, What do you think off Peter of you? To think that that investors well, increase their evaluation off your value. Your valuation years? Yes. Not so solid. We wouldn't like to increase our value. Fox and cold, high resolution three dimensional map will be something that will consider. Thank you. Thank you, Mr Joe. And, uh, the Panelists on DDE and the intellectual conclude with a quote from Mr Joe in this world, we would like to cook age of species that people have never seen. These species will create a new world. Thank you.

Technology is often touted as a solution to the world's environmental challenges. But it's also part of the problem and industry executives are facing rising pressure to clean up their energy and resource intensive businesses. And to evaluate the environmental cost of tech and how to minimize it. Please welcome experts by David Yang and Tao Zhang. With Fortune's Michal Lev- Ram, thank you. [ MUSIC ] Hey everybody. Okay, I'm gonna Put this on. Just to start out, we have a lot of different topics to get to. But I'd love for each one of you to very quickly introduce yourselves and your organizations. And just say what your respective companies do. Do you wanna start, Bo? Sure, if you can hear, then I can just start. So US China green funding is a great impact investment firm that was it initiated a by fossil institute under China organization 3 years ago. are we really define ourselves as a through private equity investments in the growth stage and later stage deals and trying to drive the growth of the company in green consumption and green transportation in green energy and environmental protections by combining the US and the western technologies With Chinese market demand to help solve China's environmental issues, over the past three years, we have invested in more than $ 500 million, mostly in China. And we are in the process of closing our second found close to $ 1 billion. So glad to be here and thanks for the invitation. Great, David. [ UNKNOWN ] [ BLANK_AUDIO ] You all know today is eighth of November. After three days, there's going to be double 11. It's a Shopping Festival just like your Black Friday. If you purchase anything from e- commerce platforms, how can you make sure those products can be delivered? promptly. express service? Exactly. I'm from Chauvin group, SF group. You all know that SF group is Courier Service express delivery. What I want to say is we used to be a delivery or courier service company but if you still have the viewpoint towards our group today You are very wrong, because in parallel to our Career Services express delivery, we invest a lot in the sustainable development, grain development, and also science and technology. Our current strategy is very different from other career service companies. We position ourselves is spearheading the science and technology call solution provider. Where science and technology go service provider without being engaged in this arena. I will not be the panelists that sitting on the stage. This is my second point. SF group is not just a simple Korea express delivery service company. In the past years along with China's reform and opening up we enjoyed very rapid development. You all know that the reform and opening up in the past four decades we already lost the good momentum For from the policy point of view, so as I've in recent years is trying very hard to do the transformation including the supply chain business and to cope with the new challenges. Adidas as the ladder to Oreo. All these are brands when they enter into China. We help them to do their supply chain business. Last year, they acquire the DHL greater China business or the McDonald's delivery. [ UNKNOWN ] this company delivery company for McDonalds. We are part of them as well last year. From my short presentation, now you know We are in the transformation. We are not aggressive [ INAUDIBLE ] anymore. We are a technology company. We are going to have higher bars in the future. So I'm here to represent two organizations that I founded or co- founded. So the first one is Dao Ventures. Dao Ventures is a US- China consortium of various impact investing entities. So the consorting with has a focus to basically support Chinese environmental small, medium sized enterprises. So similar consorting over the years. So basically, over the past decade we have supported over 1000 environmental small, medium size enterprises in China and also some social and environmental enterprises From overseas. So the second organization that I co founded and also of which [ UNKNOWN ] is holding company is called [ UNKNOWN ] International. So I co founded this firm together with a couple of other stakeholders. To focus on introducing plant based protein products to China, so we're doing that from environmental perspective. So basically the reason why I doing that is that we want to introduce plant based proteins, actually which is a concept that is very popular right now runs out. So to replace our animal meat products and hopefully by doing that reduced the burden, [ UNKNOWN ] burden on China's livestock industry. So that's probably thank you first of all to all three of you. That's probably a good segue to just talking about and giving some context for The scale and the scope of some of the environmental issues that we're seeing, and it would be great to hear from the three of you on, specific to the Chinese market. What are you saying? I mean, can you talk for example about the consumption of meat? How many of you by the way Are vegetarians. Show of hands. Okay. [ LAUGH ] Yeah, that's just, basically the reality we need to do was in China, though, as we always talk about it, everyone in China is more like a flexitarian. So when we eat you'll win your soup, right. So we have both plant based and also we have meat. But how you can replace right the meat products and people eat and and also back it up with tasty cost competitive and accessible good alternative protein products. That's a challenge we we want to overcome so then entrepreneurs we're going to support. But from the environment to prospect, I don't think China can afford to have the kind of livestock, agriculture as do some of the developed markets do like the US simply because if you look at China, so China nowadays consumes more meat than any other country So responsible for one quarter of the global meat consumption and one half the global pork consumption. And- One half? One half, yeah. So that's definitely a [ UNKNOWN ] Serious environmental challenges to China on various fronts, like water, arable land, transportation, greenhouse emissions, all the different type of environmental challenges. That's the logic behind what we do as a impact investor, and also a accelerator incubator But at the same time we understand from a consumers perspective, especially mainstream meat eaters perspective, they still want quality meat products. So you cannot tell them you know, stop eating meat, right be environmental friendly. That's not what we do. But we want to, Identify, engage and invest in the kind of entrepreneurs who know how to come up with the good produce good quality products, alternative protein products, and so the mainstream media eaters they can continue to have good food, gourmet food. By the same time they can also become part of China's environmental solutions. So, go ahead. If we, [ INAUDIBLE ] some coment in here, the real world situation turns out to be a trigger to solve. Each China person eat about half a pig a year. So next time think about those for pigs. So what happened with the high rise of the pork prize, is a result of at least two factors. Why is the African swine flu has created a huge issues for. The situation here in China and the tool was related to environmental issues. Three or four years ago, China's government began to shut down there was a small mom and pop farms and to have them more concentrated other than that reduce the whole stock and as a result, today. To some extent, the government was forced to go back, to go back to some of those less environmental friendly ways to raise the pigs because they have to solve the pig price issue, pork price issue and social unrest issue. So I think that there is a VC way of looking at some of the startup companies and slight difference with a private equity firms. We look at technologies from Israel from Europe and the US as well to raise for example, salmon on the land base, the salmon raising technology and all those to hopefully bring more protein to For the system as fast as we can we also help support some of those more environmentally friendly, large pig farms, hopefully to have that have a balanced approach this issues And David, I wanna get to some of the issues that we're seeing because of transportation and packaging and everything involved with the shipping industry, but just real quick, staying on the food topic, are there learnings from some of the companies in the US that are providing alternatives to meat that you are able to kind of glean from? Today with impossible needs and- Yeah, actually one of our equity stakeholders of Davos International is a company called New Crop Capital. So New Crop Capital is investment specialists in alternative protein space. So they invested in Beyond Meat at the very early stage. They were so heavily invested in over 35 [ UNKNOWN ] in US and other parts of the world. So, the experience we have learned from new crop capital is, you know, and combined with the reality of China, because if you look at China China's already has a long history of plant based food, right? So, if you talk to people a lot of people know you know there's like, you know kind of plant based meat or we call it plant based meat one dot one dot O, which is basically more of like Buddhist you know, vegetarian kind of community. But at the same time how you can mainstream, right? Mainstream that kind of we call it plant based food 2. 0 or 3. 0 to meat eaters. So that's the challenge we need to overcome and also the entrepreneurs we support. So that's why when we go out and look for entrepreneurs. That was basically a just a quick background on Dao foods. It was setup like two years, almost three years ago. So we spent basically a year just doing feasibility study on this sector in China. And try to explore the right pathway. To help mainstream plant- based food in China. So basically, the right pathway, as far as we can tell, is to identify and nurture the right entrepreneurs. To do that, and that's why but by the same time the right entrepreneurs, like the US entrepreneurs like beyond meeting possible still few and far between in China right now. So this is very, very nice kind of sector. So that's why we start actually we are planning over we just launched the boot camp last August and. Multi city boot camp for plant based entrepreneurs to promote sustainable development of plant based food in China, entrepreneurship in China. And we did the first one in Shanghai, we're planning to do the second boot camp for plant based entrepreneurs in Beijing on December the 12th. We're gonna do [ UNKNOWN ] and [ UNKNOWN ] after that. And based on that, we're also planning to, over the coming months, plan to launch an incubator to focus on identifying and nurturing Japan based entrepreneurs with the goal of incubating and investing in Some days to alternative put in ventures, study alternative put in ventures over the next three years. Okay, great. David, I won't ask you about pork, I promise, but can you talk a little, again, just going back to giving some context for the scale of some of the issues that we're seeing Partly as a result to this very robust e- commerce and delivery, you know, ecosystem that we have now. And can you quantify for us some of the issues with packaging with emissions from transportation and any any other environmental issues Actually, you may not know, I started 2015 January, I stopped eating pork. I was thinking, maybe because I did not eat pork I wouldn't have any opportunity to Discuss Furthermore, but now it's my turn. So the topic I like to talk about is that every day updated in so many fast express delivery every consumer may have noticed while receiving that there are many boxes, tapes of alien stuff Express delivery in China contributing half of the global total. Every year about 100 million pieces by China is 0. 5 billion pieces or puzzles. So the government members last year put out a proposal About the overpackaging of the express delivery industry before us practitioners in industry were very clear, actually the one you received. They're already called the primary packaging. Before we do our packaging, there's already prepared for the secondary packaging. Packaging by us. The total number quality 2017 whole year it's about 40 billion parcels that year in China. The plastic bags is about a billion plastic bags, bought paper boxes of 4 billion. In the process the packaging will use a lot of different kind of fill in like. It's about 46 million ton stuff we have to put in the in the box to make sure the glasses things won't break So this is a huge number, astonishing number for us. Secondly, if you look at this industry again, one will use transportation vehicles riding on Main route or bounce route, or in the countryside or the city to your doorstep. They burn gas Disel as the transportation of vehicle every year in China for Carbon is contributes 31 % of carbon emission. So from others practitioners we are very concerned about this Started in 2016. My company I self establish a packaging lab. All the work we do is to help reduce the quality of packaging materials. We did a recycler packaging box. You do not need to feel the added stuff If you fall from a two meter let you, there's a red light in the box. You throw that for 10 times, no problem intact. So we have ready input into the Barclays 600, 000 boxes like this. So each YN can be reused 50 times, so one year will reduce 25 million. Paper boxes. With all his stuff inside. We also use the paperless order. Order Sheet paper lists. So. In this process we save a lot of ink, paper, you know, we reduce the waste in this way. SF Group every year managers reduce the usage of paper Close to 100, 010. At the same time, we are also in the process of R & D of other ways to make our plastic bags for the 40 % of the plastic bag are in this kind of a new tab which [ BLANK_AUDIO ] So we have done a lot of work in this area. [ BLANK_AUDIO ] So we can, degradation is the word. Which can be degraded, the plastic bags. The government's advocating energy saving vehicles, we're in the process of changing, replacing the old cars with new energy saving cars. [ UNKNOWN ] Okay now everything you said thank you. [ LAUGH ] So, okay, it's interesting because your company started as a courier service basically and then kinda transformed to meet this opportunity. For the two of you, Bo and Tao, you're seeing opportunities as well. We've seen over the last decade, decade and a half, or even beyond that, quite a lot of investment in clean technologies and Green tech and a lot of those failed, at least in the US, but also abroad to some extent. So what's different this time around for each of you, and how do you make your investments more wisely, hopefully, today? I'll use the recyclable packaging investment area as a follow up and then to demonstrate what we're doing differently now compared to about 10 years ago, in that a clean tech 1. 0 time horizon. So the recyclable packaging has been great and then it helps tremendously under environmental issues, but the challenges Overall, the cost is high. And part of the reason with the overall cost high was because of the loss ratio of recyclable packages are high. And also the turnaround rates are not sufficient. And hence, whoever deals with it has to suffer higher [ UNKNOWN ] cost. If you go down the Environmental Protection side, so the question always surrounding green investment is, can you make something sustainable not only environmentally, but also commercially. So that's this time around. I think the green found green impact found has a tremendous opportunity. We invested a company that has started working with some form as we speak. They develop develop this IoT system, to put on their manufactured, recyclable packaging operation system, as well as the manage the whole operation system so that they know exactly every single boxes whether it's used for flowers, or for car components, or for oil, where they are and how they get transported and then how they gets recycled. Wash down a little released by green so they were able to reduce the turnaround rate by substantially behalf and reduce the overall cost. So we can have more customer to adopt this technology of recyclable, trackable packaging solution, not because of their more frankly, partly because they're lower cost for those customers. Now That's where we found very different this time around is a lot of this technology has become so mature compared to before. Cleantech 1. 0 at that time I was I was in New York. We are more venture capital approach way back technology company and from lab to commercial exercise. And those companies tend to have a higher capital intensity to move to the large scale and they seem to be 100, 200, 300 million dollars range. That's just unbelievable amount of money for venture capital to try that, under the incumbents are very strong. So what we're doing differently this time is we have a whole bunch of growth capital private equity firm, we are incorporating not only this hard process technology and But also the IoT technology, artificial intelligence technology more of 5G technology into these solutions to reduce the consumption of resources, to improve the efficiency reduce the environmental impacts. This is not only in the packaging solution, we have a company doing artificial density parking for Beijing. That solves a lot of those transportation issues faced by the traffic jam caused by hard fund taxi or a lot of the solutions actually can potentially work. Okay and real quick We have thirty seconds left. [ LAUGH ] Yeah, so basically for us, what we do differently is we're always trying to, you know, kind of, look for the paradigm shift kind of companies so like, like, for example, what we are doing in a plant based alternative protein space. So we're looking for Game Changing companies. I think that's key because you have to you don't you have a problem then you come with a band aid solution. You always say cannot catch up with you know, the problem is you need to deal with right so for us we want to like we talked about at one of the panels yesterday I think is healthcare panel, you need to be prevented. How to do that, you need to look for the game changing kind of entrepeneurs to support. But at the end of the day, the reality with entrepeneurs is that some of them fail. But even if fail, if they created some kind of impact or even kind of some role model for other entrepeneurs to follow. To model on, think on the stupid, good impact .>> Okay. My perspective. That's how David I'm sorry we are out of time bow. Thank you so much for being here and maybe next year we'll get to have some alternate. Alternative pork to serve to everybody here. Yeah. So thank you guys very much. Yeah. Thank you. Thank you. Thank you. [ MUSIC ] [ BLANK_AUDIO ]

This Is What Technology Can Do In the Fight Against Climate Change

Hear from entrepreneurs who are trying to solve the problem.


Building Technology that Will Incorporate Everyone

Under-served communities still lacking basic infrastructure and services.


Next up is Gillian Tans, who is ranked high on Fortune's most powerful women's list. She is the chairwoman of booking. com, one of the world's leading digital travel companies. It was founded in 1996 in Amsterdam. It's grown from a small start- up to a company with a revenue of 7. 5 billion Each year and offer services and 43 languages and according to my notes over 200 countries. Is I say according to my notes because I tought their only 197 countries. So she seems to be operating more countries and we have, well ask her about that. And here's your random fact in the morning. Seven guests per second check into a place to stay on Booking. com. The companies also at the forefront of innovative AI solutions to create a better customer experience, a more robust business model. And they believe a better world. Please join me in welcoming Gillian Tans. [ MUSIC ] [ MUSIC ] Gillian thank you so much for being here with us. You have a fascinating business. I think most people are familiar with the bookings business. But what they may not know is that you've also invested heavily in DD, what nearly half a billion dollars. [ UNKNOWN ] and Grab. Which makes me wonder, what are you building here? [ LAUGH ] What we are building. No, I think if you go back to booking. com and China for instance I think we already started working in China a decade ago. If you think about travel, and technology companies in travel, they cross borders a lot quicker just because of the nature of travel. And I think we started But in China, many Chinese travelers will use Booking. com to travel overseas. And we've learnt very quickly that our motto was being globally scalable, but locally relevant, but in China that even had a different meaning and localization, we had to take it to the next level. Which meant that we had to think about partnerships but also we had to think about creating our own business unit which we have in China today. And these partnerships started off sea trip for instance because that's not the biggest investment we have in sea trip. And then, Which and sea trip is in a very similar business right? Correct. Booking hotels. Yes. Yeah, so we've partnered with to trip and later on we partner with DD and also with mate one. But that suggests that you're going well beyond hotel bookings that you want to control the transportation, the entertainment, the food, the whole travel ecosystem. Well if you think about travel and the connected trip. I think many customers today who wanna take a big trip you need so many elements. And that's why you see a lot of more corporation in travel as well. Because you need each other to really build this connected trip for consumers and I think the work we're doing with [ UNKNOWN ], for instance, is a good example where we can actually deliver transportation and a variety of services in little southeast Asian countries. And also [ UNKNOWN ] can actually showcase properties to their consumers. So these corporations are really valuable. Because many people don't know, right? Many people don't know if they arrive in an airport in a certain destination, how is the best way to get from the airport to my accommodation? Sometimes it's better to take the train if you arrive in Tokyo for instance, and sometimes it's better to take A taxi etc, so and that's something that we are very involved in and trying to solve for consumers. So when you think about it that way that connected travel with all the different pieces tied in together, who is your competition? I mean are you competing with DD? Are you competing with grab are you? Who do you? Who do you in your mind when you wake up in the morning? Who is it you think you have to beat? Yeah, I think I meant as many companies out in travel, right? I think if you think on a global level, then probably Expedia is the biggest company out there on a such a global scale. But then in China you also have CTrip, who is very powerful. Of course, here in China you have to travel Loka in Indonesia You have made my trip in India, so you see these many companies all over the world that are very active in travel and if you think about it, travel is almost 10 % of global GDP, so it's a huge industry. People tend to forget about that. And what do you think is your secret weapon for winning in that battle? Our secret weapon if you think about it, we've built I think the most global business. If you think about our inventory, we have 29 million listings on booking, I think you think about the breadth of selection. We've managed to build that far less globally than anybody in the world. Also think about the customer experience and how much effort every day. We still any technology company out there, that's how fast we innovate for consumers and then there is the quality of service, the expectations of customers, so you see that specifically in HS world is very high So we need to make sure we keep delivering on that. And that's may have, I mean booking has always been extremely focused on consumer and it keeps measuring through data for actually doing the right thing. And that's we're taking further and further I want to come back to that in a minute. But you talked about the global reach of booking. com. I said in the introduction that you're in more than 200 countries and I didn't know there were that many countries is, maybe I should ask you, where aren't you? [ LAUGH ] Yeah, I think we're one of the most global businesses out there. We actually count countries and territories that, I see This number is more than the countries there are in the world. But we operate in every country in the world because there's Is there any place you can't operate? Well, we can't operate in Cuba for instance. Cuba is, yeah. Okay. So we're an American List of companies should look for instances where we're not today. Yeah, but that's it. Pretty much. Yeah, that's it. There's a few areas where we don't operate. How big is your business in China these days? Yeah, it's a very important market for booking. com. We don't give out specific numbers. But as you can imagine, it's a high growth market for us as well. If you think about that we started off in China so early on, and many Chinese customers use booking to travel outside of China but also now we're building up more and more of our business in China. And you see a lot of inter inter Asia connections that we are facilitating today. Can you talk about size as a share of your total business? Yeah, no, we don't give out his name. You even this is a small group of friend Yeah I know and so [ UNKNOWN ] a film star. [ LAUGH ] A. I you're investing, you said you were investing heavily in technology. To do what? Yeah. If you think about like I spoke about this experimentation culture and how data plays such a crucial role. And making sure we understand where to innovate for consumers. And then you take the connect, the trip into account. And to be able to do that well, you need to do more personalization. Because otherwise it's almost impossible to bring that altogether and make sure you can deliver the most perfect trip for a certain consumer. Then if you think about machine learning AI plays a crucial role in that and since booking always has been so extremely data driven, the step into machine learning we have been doing for many years. every customer touches machine learning today, somewhere through the funnel and even AI We predict that probably in the upcoming years 50 % of customers will touch AI somewhere as well. So, you see that these technologies are becoming very important for the future, and innovation we're also I can deliver much more to consumers ,. And if you think about it. Today, we can reccommend destinations to customers which you can't do it wouldn't have these datasets. Is it based on your knowledge of the individual customer? How much you if I come to the site, how much you know about me? Well, we know from customers if they have used booking before. Yeah. But and there's also data that we use from a large group of customers, right? Yeah. So that's booking is with data concern. Quite straightforward. We only use data from customers to make the experience better on booking. We don't do anything else with data. We don't buy data from somewhere else. So it's pretty straightforward in that sense. But how, since you mentioned tbis so carefully, how big a difference does personalization make in your ability to turn a visitsbooking. com into a booking? Extremely. You all ready see that today in destination recommendations in suggestions for accademiations to consumers you and I will see a different type of product all ready today. You will see it in the pictures that we can show to consumers as to what their interested in Review data might be different because of what you need to know to even customer service and how we expect customer service flows. And that's all based on data translations. I think we translate 2. 2 billion words already for machine translation. So there's so many examples in bouquet, we're over the Machine learning plays such a big role in what we're doing. Do you have any trouble getting the talent you need to build those algorithms? Yeah. We have the main part of our talent if you think about product and technology and data science all set in Amserdam we are Dutch originated company so we still have our headquarters in Amsterdam we have for the Chinese market. We have people sitting in Shanghai who do that specifically for China and also, we bought a company called Overture in Tel Aviv. And we've built around it, also machine learning and AI and office in Tel Aviv specifically focused on that. You have a technology background yourself, right? No, I don't. You do not. No. But you have had a big commitment to diversity. Yes. At the company, including making sure a large part of your technology workforce is female? Great. Yes? Can you tell us a little bit more about how you did that? Yes. Booking. com, actually from the start, has been a very diverse company, on many fronts. We have 140 nationalities working at Booking. com In total we have over 50 % women working at Booking. com. We've always felt that if you want to make sure that you are successful in innovation and if you want to make sure you build the best culture out there, diversity is crucial and diversity needs to be in your core values and that's what we have always been focusing on. On our technology part we have 20 % women, even though that is already, okay, it's still not where we wanted to be. And we have 30 % of women in our leadership community. So these are still not two numbers that we would like to get up and we focus a lot internally but we realized that we also need to work externally to get these numbers up. So we do several initiatives. We do mentorship programs at big tech conferences. For instance, I just came from the web summit in Lisbon where we do own site mentorships, and we have a big women in technology lounge and this year there were 46. 3 % women. So that also shows the summit. Yeah. And I was in a 70, 000 people there that shows that there is interest more and more for women to start working in technology company. So that makes me really happy. And second part we do is there's not enough role models out there. And that really is a problem because if women don't see other women succeeding Then it's a different step to make. So we have. How about in your Shanghai operation? Yeah. We have, she's sitting here, [ UNKNOWN ] who's leading our China business unit. A very powerful woman. [ UNKNOWN ] Yeah, we have many women here in operating in China. Booking. com has also made green travel a priority. I saw you had a recent partnership with Prince Harry, what is green travel? Yes, so, go back to the mission of booking. com, the mission of booking is really To help people to experience the world. And very early on when we defined this mission, we said we also need to make sure that we make the world a place where generations to come can keep exploring the world. And that's why we started working on our whole program within booking for sustainable tourism. Which started first with our own employees and their time. They were dedicated to improving the destinations all over the world. And then we said okay, what what else can we do to have a bigger impact? So we basically developed a program which is called the booking booster, which every year, we select ten startups all over the world that are active in sustainable tourism That we basically help growing so their footprint actually gets bigger and it brings our passion for technology together with our passion for sustainable tourism. Is there big demand for sustainable tourism? It's enormous and that's what I keep saying to everybody. We, we do a lot of. [ LAUGH ] How you say it. [ LAUGH ] That's the jetlag. [ LAUGH ] I know the feeling. We search, we do a lot of research with consumers and we've seen on our latest research that 71 % of consumers, they want travel companies to offer them sustainable choices. Yeah. But what you see happening is that today consumers don't always know what is a sustainable choice or even an accommodation park will not always know what do I need to do to become more sustainable. So there's still a lot of work to do and even doing that well. And that's also when we realized that with booking. com it would be very difficult to do this. And that's why together with the royal foundation we formed Travelist which has travel companies together to see how we can actually define these type of standards and make a bigger ->> the problem of course is the largest part of the carbon flip point of any trip is the airplane ride Air, yes correct. You can't do much about that. No. [ LAUGH ] No. Well today, I mean there's a lot happening in air as well but for booking that will be more complicated because we don't operate airplanes. So we don't. It's not Your business. Well we have the first pilot with air but But you're in so many other businesses maybe you should invest in an airline and see if you can tackle that one to what I want to open it up for questions or comments if anybody has them. I get a show of hands. Yes, go ahead. [ BLANK_AUDIO ] Just very curious, because. I'm sorry, please introduce yourself to Gillian before you begin. Okay, sorry. I'm Henry from Mosiker. So, as family member actually my wife, lots of booking, heavy user. However, my personal favorite is LBMB. And in China, we actually as company leader, we work with Shenzhen, LBMB. Not booking yet but the question to you is when I hear about your future strategy to really combine the travel trip and accommodation into one package But that brings a lot of questions for me because the trip between the airport and accommodation relatively standardized, and for accommodation for different purpose is kind of related to the personal favorite, everyone has their own taste. So I just want to hear out from you. As booking when you are, let's say made your plan for this journey what's your future differentiation to differentiate yourself from the other competitor and to providing at the end is for business trip or it for family trip or calls for everything? Good set of questions. Very good question. And so let me start off with the alternative recommendations. Airbnb booking. com. Already today, like I said, we have 29 million listings and we have, if I'm not mistaken 6. 7 million listings in the alternative recommendations, apartments, home and anything else in between. So We are very active in this space accommodations today is still a huge focus of booking a congress still growing the amount of listings and you see in many countries in Asia. You see that there's still a segment which is coming online. Many people are putting their homes online I've just been to India where you'll Enormously growing with [ UNKNOWN ] for instance. So this has a focus of booking and I think it's a big differentiator of booking. If you think about having all of this diversity and accommodations, we have 30 categories on booking today which are customers Handbook. And we keep growing into the future. But besides that I think we realized that the differences is as well is building this connected trip. And building a connected trip is not through cross sale. Just saying okay you can book a flight, you can book an accommodation, or you can book a car. But it's really making sure That is integrated and we've done a lot of experimentation when people arrive in the destination and what help they still need today. We all think that they guest have nowhere to go, but today they don't know when they travel to a country which is unfamiliar for them. I don't know if this answers your question. Can use Sue just a little bit more on the difference between the connected trip and cross selling I mean on Expedia they, when you book your hotel they book your airline you book your hotel you book your car, but you're talking about something different. Yeah, it's a bit different because crusher has been out there for a long time that this that is not new, but This is something that broken could have done already a long time ago to just to put all of these segments online. But we feel that if you want to build a truly good experience for customer needs to be more integrated because I think you realize yourself if you want to take a long trip, it takes an enormous time. To either plan and get everything booked and that's actually where the friction that there's still out there that we are trying to reduce that time and make it much more efficient for consumers to do that and we'll take it in steps but we already took steps. We offer attractions for customers in 180 destinations We have transportation now in over three hundred destinations. You see that we are growing these type of products for customers. You know a lot about customer travel preferences. That's what your scientists do, that's what they study, that's what your data is on. Look ten years in the future and tell us something that will surprise us about what travel is going to be like. 10 years. Well, I always say that ideally you will get two trips in front of you and you can just choose and then everything will be planned and booked and that I mean that basically systems know where you like to travel what you like to do. That actually you don't need to think about that anymore because I think in travel with technology, there's still a lot to gain. Yeah. Because of the complex nature of travel. Fascinating vision. We hope you make it there. Thank you for making it here. Thank you. [ LAUGH ] [ APPLAUSE ] [ BLANK_AUDIO ]

What the Future of Travel Will Look Like

Travel

Booking.com’s Gillian Tans talks about what’s next for the travel industry. 


[ MUSIC ] [ FOREIGN ] Thank you for coming to our event so early in the morning I would like to continue with the third round or fortunate China Innovation Award competition. And the third round is the last round. And [ UNKNOWN ] Dennis Song, Anna Xu, and Zhou Wei. Please welcome our judges. [ APPLAUSE ] [ BLANK_AUDIO ] Please take your seats. [ BLANK_AUDIO ] Now, we will meet each of the three finalists in this round of competition. The first, please welcome, Li Zhang, CEO of WeRide. Let's welcome. [ BLANK_AUDIO ] Now it begins. Distinguished guests, ladies and gentlemen, dear friends, good morning. It gives me great pleasure to introduce my company. WeRide established in 2014 in Silicon Valley for autonomous driving. Now we leading air for class autonomous driving company. At the same time we are also a smarter mobility company. Our vision is that we change mobility with our technology. It is our hope that autonomous driving technology will help us overcome various difficulties in traveling So, for example, traffic accidents, we want to improve safety. At the same time, we focus on the trading dollar mobility market in the future. China, then United States, are two leading countries on mobility. And in the United States, you have A number of leading companies like Cruz like we Mo, like Uber, and either in China we have a we ride by two and DD and we also hope that we will have a more reasonably priced mobility companies in the future. So in the past two years, we have received the support of our investors we have received. We are the first to receive the investments of our autonomous Alliance for rental, Mitsubishi and Nissan. At the same time, we have also received the investment from hacker companies. As well as other investors. So far we are the first in China. That's why investors have put so much hope upon us now. We have rapid research and the development process. We have the pilots testing in a tunnel under the river. And we also have a safe driving and dust storm in. October 2018, we introduced a faster air four class autonomous drive in taxi which is compliant with regulations. And in June 2019, in August of 2019 we established the first Autonomous driving taxi company and we have made progress in four areas. First in technology, we introduced products our level algorithm for our solutions. So we is when general algorithm we have accumulated We have tested about nearly one million kilometers. So the safety of our products has been proven. At the same time, we also have a multi- sensor integrated solution. With 5G technology we have real time synchronisation as well as comprehensive coverage across verification of sensors as well as our frontelator. So a fleet of taxi has been launched In terms of business model we have established first Robot XZ joint venture in China so that we have a complete industrial chain, from manufacturing to the services. We have about Over 300 staff. One- thirds of them are [ UNKNOWN ]. Many of them are distinguished graduates from top universities. So we are going to have the commercial [ UNKNOWN ] test in 2020 in [ UNKNOWN ]. Thank you. [ INAUDIBLE ] Thank you Mr. Li Jung for your presentation. Mr. Sung so I [ INAUDIBLE ] familiar with re- write because in the past few years, we write for a leading company in China Autonomous driving industry and I'm thinking about one question. And I'd like to raise this question with you, the biggest value of autonomous driving is to add replacements of human beings. So many areas and refuse actually autonomous driving he performs better than human drivers. Autonomous driving. It seems that it's quite easy for human, it would drive a car to take a machine for example. For example, Google has spent hundreds of millions of And even more billions of dollars. And better the tester driving so far, you're still limited to one state or another. In many structural arose, actually autonomous driving is quite easy. However, in unstructured roles, there are a lot of technical challenges. That's why in the early 2018, we relocated our headquarters from Silicon Valley to China. And we believe that a pilot testing in United States for one year, could be completed within one year, for example, in China. So, we hope that our theory could be applied into practise. So we have used DHL a lot. We have invited a lot of experts to work for us. And I think in the future you can see our pilot performance, pilot operation in Quam Cho for autonomous driving. Autonomous driving is developing faster than we imagined. [ BLANK_AUDIO ] I know something about WeRide and so I have a partner which also works in the automobile industry. For L4 class or L5 class, maybe it will be applied after 2030. So there's still ten years to go And what kind of progress that you would like to make in the next 10 years, and now you have some pilots testing on the road and the word about your business plan in the next decade. 2030, actually is the target year for many, for major automobile manufacturers. But for tech companies or starts up business like us we believe that it will arrive earlier than 2030. So, many [ UNKNOWN ] years a role model for many companies. Now they have autonomous driving taxi in the States. Our feelings are kind of commercial rollouts. So we believe that in the near future, these robot taxi and other companies will emerge. To develop autonomous driving technology, at the same time present a good case for it in the near future. So in October 2019, we established a rubber taxi with a number of local partners. So that we have, we can land that the operation of autonomous driving. Time fully said that we will have China and we also strive to be that Thank you. [ BLANK AUDIO ] I have a dream hree years ago, I sat on various platforms and the occasions there's autonomous driving in three years will have in a 100 % autonomous driving in a limited scope of space. But has not come true after three years. China has a few advantages for example, administrative resources. For example, we may know that within the signal ring road of Beijing may be no vehicles will be allowed other than autonomous driving. So with administrative intervention, it is possible to improve the driving experience, driving environment. And second, [ BLANK_AUDIO ] China is capable of commercializing some technologies before they become mature. So I think that your pilot testing in Guangzhou is quite encouraging. My question for you is, is there any alliance among the tech companies like you in order to bargain with the Ministry for Governance and have complete [ INAUDIBLE ] in Guangzhou? Thank you very much for your question for autonomous driving, and we need to make a break through your four areas. Atlanta technology, establishment of taxi fleets testing of the business model and compliance with law and the regulation. So, the first point here not something can be changed by a private company. Nevertheless, in the past few years. [ UNKNOWN ] And now we are committed to autonomous driving in a limited scope of space and we are going to get the approval of the authorities. We are pending the amendments to the traffic law. We still need some legal support for that I expect that the two autonomous driving Australia will come true in the near future. I believe autonomous driving mobility in such cars we have Safety personnel and we have been working with many authorities in China. So when conditions are possible, they also open enough with us for them to share data with us. so I think in the future you will see true autonomous driving in China soon, so our judges and do you have any further questions > so thank you Lee Jong, COO of We Ride [ FOREIGN ] The second, please welcome Yang Guang, partner of Waterdrop Inc. [ BLANK_AUDIO ] For Waterdrop we are an insurance technology company driven by Science and Technology. So in the future we want to establish comprehensive and the supplementary medical service payment system. And for we have three units, the first way is about a pool of our customers Which stands at 218 million people. And the average monthly donation is about to 1. 2 billion again, and the number of donors each year, each month reached about 13 million and the more. And what a job can also provide a mutual assistance and commercialization of the part of their policies. So we can we are driven by social media, we can see the low and low cost access to customers. So, the say ditto, he actually is the front runner of our, of our organization, a function unit. And with social media, we would like to encourage our users into our insurance initiative. This initiative provides some basic products in this our system, we can improve the interaction among policy members >> [ FOREIGN ] We can also solve this basic education to guarantee the coverage of the insurance. And additionally, we can expand this to the commercial insurance. So we launched the platform for two months under the premium already exceeded 700 million RMUN, top two, right? After Ali We established the company in May 2016. After three years in 2016 and 2017, we had two new products being launched. Currently we finished a $ 2 billion Financing rounds of financing. And our investors including by EN capital, blue run ventures sinovation ventures the ICC capital. As I mentioned, we have this online dissemination channel from one to N to N We also establish the service platform. And nationwide we have 500 plus promoters for our water job platform and they are working at different localities in the hospitals to promote our products. And this year we are going to enter into the tier one and tier two cities and through our offline salesperson will will target the high end white collar people as well. I'm very proud to say that our company is also pay special attention to the CSR cultural, social risk, corporate social responsibility. Our core competencies is the data and and also the visitors of our platform. So we resolve the Payment. A house payment issues for the different types and patients, and we got a relevant license as well. Thank you, Mr. Younger, the commentators, please. The water drop is a very innovative model. What I care more is from the initial platform and to the mutual help a neutral assistant platform to the final water job insurance. Tell us about the involvement Secondly, how can you guarantee the credibility because after all, it's the donation from the mass and from the public. To be honest, at the initial stage, we wanted to make some breakthrough for online insurance. By the way, are starting from scratch. We didn't have the license, we didn't have enough threshold, the visitors and also we need to do the risk mitigation. So as a result, we believe that the first step is the visitors on the platform. And to do so we need to, like educate the general public for the house insurance, it's very difficult to even light or encourage the public to purchase the insurance for health. Because we all know the finance and also the accident related insurance are relatively easier to promote, but for the health insurance, we believe that That is their friends or family members if they were suffering the major diseases. This would lead to the Public to build up their awareness of the necessities to purchase the house insurance. That's a reason we have this platform established if they have the relatives and the family members suffered from major diseases, they can get these donations online. And gradually we Promote the mutual assistance, comparing to the insurance the premium of mutual assistance is relatively lower. And the coverage is larger, through these Mutual assistant platform. We educate the general public and through this mutual assistance based on the local communities, then they would have more like an interactive process and in the end that we can have the insurance products established Offline, as I mentioned we have a full time 500 persons as our promoters and the sales force. They focus on the major disease, patients, and they also establish a kind of. Working relationship in the hospitals. Sorry time is up. Miss, she first congratulate water drop for your mobilization of the capital ventures. In the future, how could you balance the short term and the long term insurance. Now you have many mutual assistance, but it's not easy to convert directly to the long term house insurance scheme. Notice that you are applying rate insurance license. In the future, what are the focus of your company? [ FOREIGN ] We got many visitors on our platform and we focus therefore more on the short- term insurance scheme. But for those patients already had the chance to purchase the long term insurance online. This is a very reason as I mentioned the way higher offline 500 Salesforce. We already got this data for the visitors and they had a short term insurance scheme. And for the reinsurance license yes, we are in the process of making applications And in the future we are going to help our customers to do including the insurance companies for analyzing the data from the users and provide services and to provide better quality services to them. [ BLANK_AUDIO ] My question is related to this Miss Xu is you're talking about mutual assistance, but those actually are the underserved population from the commercial insurance scheme. And in the end, you still have to convert to the commercial insurance. So after this conversion can. How can you be sure your users still be active? My second question is in China, if you have the platform you have many visitors and clicks on your website, you would expand your business scope and then you would dilute your business and how can you guarantee the momentum of the visitors Our platform is different after the donation is being made or after the patient that received this donation and what they get is the overall health guarantee. So we keep high frequency interaction with the users. We also educate them and try to raise awareness of the importance of purchasing insurance. But we would announce for them, to purchase the insurance they have the free choice So it's kind of a house guarantee education, and insurance being combined. Sorry, time is up. [ APPLAUSE ] Next, from, Mr. Josh Zhang from Ucommune. [ BLANK_AUDIO ] Disillusion three judges from you commune and very glad fortunate to provide me this opportunity to brief you about our company. The founder of our company used to work in Banking Group moderating, our mission Is through smart office space to help more as a small and micro companies and to increase their productivity and efficiencies. So At the very initial stage, we received a lot of support from Jen founder and other senior of founder and because we establish our company in 2015, we receive a lot of favorable policies as well in the past four years. We cover almost all major cities nationwide that we enjoy the fully Government preferential like policies. In 2017 we started our going global strategies, including United States, Southeast Asia countries and Hong Kong and Macau. In 2018, we made some M and A and acquire some regional companies after M and A and going global. We covered 44 cities domestically. Almost all like Tier 1, Tier 2 and also representative tiers really like us, you Lassa shalyah at the end of 2017. We want to a global. We wanted to provide facilitation for the companies to be easier to settle down in overseas countries. We also want to attract the local companies who want to expand their business into mainland China. So link China Go Global is our strategy. We had a very good special distribution. And then we would provide them value added services. So we cannot start without talking about space. We needed to improve our spacial products you can see. You commune with car, this is a kind of a maker space and we had more than 1, 000 companies there's a eco systems a We also cultivated to be service atmosphere and ecosystems. We also try to facilitate the community exchanges. Through this process, we put together our resources more and more brand paying attention to our [ UNKNOWN ] Camille, and that they wanted us to provide services to them as well. [ BLANK_AUDIO ] Our positioning is the startup companies because of the country's development, the micro and the small companies are of vital importance. So we wanted to provide services to these small and micro companies. Thank you [ BLANK_AUDIO ] You Camille is the first search company in the industry for the Maker Space during your involvement. What is your core business model? Operation YZ. How can you guarantee the healthy development? Yes, we had some bottleneck problems, thresholds UQ, Camille the size, the scale In the past we use module and acquisition. And a lot of representative or brands, because why? Those companies wanted to be acquired by us, they couldn't achieve scale of economy. This is also the threshold in China for the business model. We believe that we the tenant, we are not the owner of the apartment and houses But what we can offer is the value of services. We have more than 200, 000 users, and what we can provide is the added value to them. It's nothing to be ashamed for. I think everybody is interested in this WeWork topic, sharing space, office space But the whole business model being challenged, this is a very good innovation. But under this national economic downturn trend you would have Many loss of tenants, and how can you cope with the challenges, because we have 40 million small and micro level companies, according to statistics, each year we have 10000 micro Companies adding each day during the peak year. Even if 40, 000 micro companies added each day in china, indeed you mentioned that economically, we're on a downward trend but Because of this, even as always, and the large scale companies, they want to reduce their office costs. So they would consider the work modality as well. [ INAUDIBLE ] The first half of this year. I chatted with the chin. While we have dinner together with then Secretary General [ UNKNOWN ] We said How could you define yourself? Because after all, you just rent out the apartment. And can you call yourself the technology company? And you told me during the dinner, you said, you have the IOT and cloud based services and you have a 50 plaza. To be software partners. After this kind of initial deployment, what's your profit margins coming from? Whether it's by providing hardware and software, the rent fee. Well from other business models, we tried out the different types of profit models in China. After all, it's a young industry, three to four years. So our fundamental key pillar is to make our space more reasonable. Spatial is very important. On top of the software hardware, we did some education related the business. In the interest of time I cannot elaborate. We also had the summer memberships For these. We would also like export our, like put together resources to the local industrial parks local government because. We rally together a lot of small and micro companies and then we would export these services in a package to local government and local industrial parts. We have some time left, any follow up questions? Do you have additional points from Jumpong? [ APPLAUSE ] [ UNKNOWN ] Okay. Thank you for the three contestants, please. It's the voting time please. Pick up the voting device on your desk Press one, four we read press two for water drop. Press three for you commune [ INAUDIBLE ] Get ready everyone, please vote now. [ BLANK_AUDIO ]

The Third Group of Finalists for the Fortune China Innovation Award

Finalists include Li Zhang, Yang Guang, and Josh Zhang.


Designing a More Sustainable Planet

Environment

Artist Dan Roosegaarde explains how we can do it.


Using Data to Slash Carbon Emissions 

And how it can revolutionize the transportation market.


A Conversation With China's Chief Planner Of Natural Resources

Zhuang Shaoqin joins Fortune’s 2019 Global Sustainability Forum.

ministers wrong. First of all, thank you for being with us. We're honored to have you here. I come from the United States, where national planning sometimes seems like it doesn't extend beyond the next presidential tweet. So I am amazed. Toe, I have been in conversations over the last 24 hours about the deep detail of planning that the Chinese government undertakes. I wonder if you could talk a little bit about that process and tell us, for starters what your top priorities are as the chief planner of the Ministry of Natural Resources. Okay, What? Don't. For me, the most important job is to develop a planning system for the national land space. As you know, last year, the Chinese government organized the Ministry of National Resources on decided that the planning of our land space will be part of our responsibility. You made this year, the CPC Central Government issued document number 18 which require the development for a land space planning system on put it into implementation. This is my top priority. And can you talk about how sustainable development, which is the issue we've been talking about here for the last two days? Figures into your land space planning process. Ah, the Organization of Ministry of Natural Resources uh identified the international document is to develop a ecological civilization constitutes a primary task for the perpetual development of the tiny nation. So development of a land space planning as part of our responsibility also means about in doing such planning, we have to bear in mind sustainable development as the most fundamental principle. How to promote sustainable development through this planning, I think Wait, I would like to make the following points first. Well, China hunters into the new era is Natalie. Since the 18 National Poppy Congress, ecological civilization has become an important part of our overall plan E, which are closely linked to sustainable development that is sustainable, economical, social and environmental development. The five in one over your patent covers balanced development of the economy, society, ecology, culture and politics. You may have noticed for sustainable development away stressed economy, society and environment. For the five, you won progress besides the three, we also stress Kotal on political practice progress. Furthermore, in the future of environment until we used the world equality or ecological civilization, so I think it is fair to say that the Barbie one progress is aligned with sustainable development, but with Chinese characteristics. Culturally, it focuses more on human beings on human beings, behaviors into himself, politics, waist dress, the significance of government. Wait, stress. Start for any system, we have to have a workable policies. Ways two boxes on so well, we produce a plan on the national land space. We will have to consider the five. The progress is that have to be achieved in five different areas which incorporated the concept of sustainable development. Second, so planning has to be future oriented. Otherwise, we have to have new development Kong zapped that is suited to future development. And we focus out five concepts of development. The first why is innovation, the purpose of which is to change the old model of scale based development, is that we must stress the Jola of sons on innovation Seconds. Development concept is coordination coordination across regions, including coordination between different interest groups. And the third comes out. It's green way cheese, very important. In my view, traditional industrial development has to a large extent needle actor. It is a question of natural resources and environment. Even some major economic theory didn't take environmental constraints as a condition in there analyses. But now we have to change that. We have to stress green development, which is revolutionary and which is a nasty matter that we have to prioritize in the planning process. We need Thio Identify a green. How of leave being way of leaving on grain production? Baltimore is opening off China firmly promote globalization. In our view, globalization mustn't be is reversible. So opening up openness is our ass. Back to that we have to consider in the planning on the fifth floor is sharing a development. Results must be shared on the development. Have to be joined by all the people. It is a proof of sharing, but that's a very good description, an abstract level of the planning process. I wonder if you could give us an example of how you because those air a lot of different concerns to be taking in into taking into account. At the same time, I wonder if you could give us an example, perhaps from your experience in Shanghai, on how the environment figured into the planning process. New fiddle with it. You mentioned my experience in Shanghai. I was quite fortunate about when I was working in Shanghai. I was part of the eh thoughts to organize the Shanghai 2035 Master Plan. That plan would actually formulated here. I could start off China's new year, uh, which therefore reflects the new development Kong zapped at the requirement of sustainable development and how the environment is off. Sustainable development fit in the planning. In the Shanghai experience, we identified three objectives. The 1st 1 is innovation driven development. In other words, economy economic growth is driven by innovation. The 2nd 1 is the culture or humanistic supporting other words way focus on the role of human beings and the quality of leading for all people under 3rd 1 is ecological support, which was in its narrow sense. In other words, the sun. Hi planning stressed the green development, so you can see that is also the economic Asato and thievery mental dimensions taken into account. There are also many indicators, including response to climate change, about diversity, urban security. Attach a in the planning process. Sean, Hi. Do a few bottom lines first. In other words, those life that you want must not go over in seeking sustainable development. For example, ecological redline. The ecological functions are sensitive. Zones have to be protected first in China. Another red line is the protection of basic farmland, which is related to food security even though shall hae a rather developed city in China. But eight has responsibility with regard to food security. Because close supply of foot can be part off green development and the 3rd 1 is a dynamic redline. For example, Shanghai is successful, the boto stifle attacks, so the city has to be revealing. Another regular guy is cultural protection. In our view, for needs of the people, there are material knees, they're also cultural knees. Whether we can carry on our history so that our people will identify with our history and our city is a challenge for us. John has identified those areas to protect. Well, they're saying that Shanghai, the city were the buildings for you. Other for you to read on the street are there for you to wonder and enjoy the culture and tradition. So these bottom lines are well critical. Your planning wrong. You clearly have a very complex tasks ahead of you. But thank you for taking some time today to be with us. Appreciate it

Companies have long claimed to be green but there's a difference between sunny public relations campaigns and concrete corporate corporate disclosure. from China to the US to Europe market regulators are pushing companies to disclose the material financial risk of climate change in a specific and structured way and ramp up greener investment mechanisms including green bonds Nowhere's the shift more potentially sweeping than in China. To share insights on the cost of being green, please welcome [ UNKNOWN ] and [ UNKNOWN ] with Fortune's Jeff Ball. But first, our partner [ UNKNOWN ] has some insights on [ UNKNOWN ]. So let's take a look [ MUSIC ] [ MUSIC ] [ MUSIC ] [ MUSIC ] [ BLANK_AUDIO ] Good afternoon, thank you for being here I know the afternoon is getting late but we are as Clay Chandler say earlier starting to get increasingly to the node of the issue. If we've done this conference correctly you're gonna start to get tired of hearing. The notion that what we're trying to do here is to explore how issues of the environment and sustainability are moving from public relations to core corporate strategy. And the question though, is whether that movement is sufficient to make meaningful environmental change? We've been peeling back the layers over today in various industries. You've heard about energy, you just heard about textiles. And now we're gonna get to an industry that is perhaps the most bedrock fundamental industry in the economy, and that is finance. I want to just take off quickly four things that have happened quite recently that add up to, I think a tectonic change that we're going to explore here in this session. In June. In the United Kingdom, the Bank of England said that it will work. It will require insurance companies to assess The risk that ensures face from climate change as part of what the United Kingdom calls a stress test what the insurance industry calls a stress test the test of the financial health of insurance companies, the same month in June in France, the governor of the Bank of France, Said that central bankers around the world should consider exposure to climate change banks exposure to climate change in deciding how much collateral the central banks will require from banks when the central bank's loan money to banks here in China next year as a result of the decision by a decision by the country's securities regulator All publicly listed companies will have to disclose environmental risk data, including climate risk data. And as a bottom line, if you needed any more persuasion, Moody's the rating agency, has said that in 11 sectors across the global economy, there is 2 trillion US dollars worth of debt outstanding. Trillion with a T. That is at risk because of climate change. So, we have here two people who are really in the middle of this in China, which, as you've heard again throughout this whole discussion is the country that matters most in this and We're gonna start with In Hong. In Hong is at the Industrial and Commercial Bank of China. ICBC which happens to be the world's largest bank by assets, assets totaling about $ 4 trillion US, and In Hong has been engaged for many years in an effort to bring to the fore What will strike you as a buzzword. Green finance. But we're gonna try to unpack that term. We're gonna do two things here. We're gonna talk a little bit about what that includes, and then we're gonna ask the question of whether it's actually doing anything. Is it big enough to actually do anything. And then we're gonna leave plenty of time for your questions. So I wanna start with one question having to do with something called the Stress Test So I mentioned that the UK has imposed a stress test on insurance companies. The CBC has been engaged in essentially looking at how risk from climate change affects the financial health of a whole range of industries including coal and steel. And because, partly because [ UNKNOWN ] is quite involved in coal as well. I wanna ask you to unpack for us, what is the ICBC doing to force the coal industry to look at its exposure to climate change and then what is the ICBC doing with that intelligence that it gathers? Thank you, Mr Jeffrey. Let me Speak Chinese. Yeah, [ UNKNOWN ]. Thank you, Jeffrey. I will speak Chinese to answer this question as Jeffrey has pointed out. ICBC has been the first bank to deploy stress testing to assess The impact on the risk exposure of commercial banks as a result of climate change. Back in 2015 we started using stress tests to calculate the amount of climate and environmental risk faced by a commercial bank like ICC back in 2016. at London Stock Exchange, we issued this report risk receiving a lot of feedback about it and the key Achievement is like this. First, we are using stress test to quantify the risk and environmental risk or environmental exposure to see how big Is the exposure or how severe it is so that commercial banks will be able to take targeted measures in response to the exposure. Second, the methodology of the stress test, technologically speaking Is to conduct the analysis all the way through our customer base. And the conclusion is the credit rating of our customers will be impacted with the presence of environmental or climate exposure. Their data service capabilities might be compromised thus giving rise to a credit risk on the part of the lenders, the banks. So far, our stress test has incorporated all the key energy- consuming, heavily polluting, and the resource- intensive [ UNKNOWN ] For example, we have covered the thermal power cement, iron and steel. [ BLANK_AUDIO ] Alumina and water risks, the water risks alone cover 15 sub- sectors And also we're also looking at risks associated with carbon trading. And talk for a second about coal. And what have you found in the coal stress test? Have you found a large difference among different coal companies in China in terms of what you regard is their climate exposure? And then number two, what have you done with the bad actors they're paying more for debt from the CBC is that the unresolved. [ FOREIGN ] Yes, we've done that. China, at the very beginning we focus on coal- fired powerplants. And because we believe the consumption of coal is Key contributor to climate change was C02 emission. In China, in the electric power industry, coal accounts for a very big part. For the key commercial banks coal firing power plants are major loan customers. If there is growing risk experienced by that sector, it might worsen our asset quality. So we identified coal- fired power to start using our stress testing. And China is in increasing, is in [ UNKNOWN ] it's environmental protection standards Pushing the overall economy to go green. The green companies and green industries are encouraged to grow faster, while resource and energy and pollution intensive companies are being restricted. The result of this exercise at the ICBC is that coal companies that are seen as more climate Risky, climate riskier, have to pay the ICBC more for debt than other coal companies do. Okay, so do we have a microphone handler in the room and Priscilla Lou, where are you? Could you please bring a microphone over here and we'll come here in just a second. FuChang I wanna ask you You've been involved for many, many years in trying to shift the needle to move the needle in China away from coal and the electricity system. We've heard signs, in fact this morning indications that China's coal use may peak earlier than people thought and therefore its carbon emissions may peak earlier than people thought. Is everything that [ UNKNOWN ] is talking about, green finance with regard to coal, actually behind the shift away from coal in China? In other words, are all these fancy finances really doing anything in the coal sector? Or is what is happening in coal happening for other reasons, and is green finance not doing enough to make it happen faster? Yeah my answer simply is yours. Because .>> Yes Why ?>> Because the banker now they have faced a great risk if they still invest in a coal industry. We understand now China have the token consumption have at least the peak already. By 2030 not after. So, I think that is a give a pleasure you compare to before is now compared to the 2013 and China co consumption reduce the 400 million time already. And so, some small medium And Samoa Komai now is the bank row. I even know that last scale cope company and still facing difficult to get financial support from bankers. And so far is a bankers now are in a high risk and maybe they can not get return of their investment in a co- company Priscilla, I just wanna ask you, can you stand up? So Priscilla Lu is at DWS, an asset management firm, but also is a member of what's called the Green Finance Committee of the People's Bank of China, the Central Bank of China. And Priscilla you seem to be on airplanes all the time. So you have a global context here and I just want you to kind of pull the lens back for us and give us a sense of how Much difference what we're talking about here is making in the finance system and therefore in the energy system, and how what China is doing fits into the broader global picture? So I think something that's in China that's unique is that lead by the PBoC. The banks are working together with an awareness as well as guidelines for issuance of green bonds and also criteria for assessing risks in terms of loans. That is kind of a semi standardization effort. Although is not Lee, you know, technically Stated as standed. But the community of banks that are in this forum, in the Green Finance Committee forum, is sharing the thoughts, the experience, and also the work in terms of the loans that they are issuing and The risk and so on, and that cooperation and discussion and collaboration if you will, in understanding how to continually improve through the experiences of the various plans that are in this committee which is all the things in China Is really moving it a lot faster than anywhere else in the world because there isn't that collaboration elsewhere in other countries. And your sense is that as a result of that the emissions profile in China is different from what it would be otherwise. It's too early to say but I think that That sharing of experience, that sharing of really working together to understand how to improve and help make it better. In general is helping to move the needle faster. But still early days. I believe so because the Green Finance Committee of course still is only let's say five years to its beginning. And I think that the banks have only started to really work together. Their first issuance was 2016. And so I think that it's too early to say, but I believe that, that sharing and that, that collaboration and cooperation and, and working together is very important. Of course ICBC is very active and has been very instrumental in leading the charge in this area. Great. Thank you. How Harvey were you? How could someone get in my cow please? So let me ask while that's happening the two of us something else we We have little time for the session so we're moving quickly, but we talked about essentially a push. A push which is the bank saying you company will pay more if you are dirty than you will pay if you are green. I wanna talk for a second about a poll which is you company will pay less for debt if you are green And there is a fancy term called a macro prudential assessment. This is an assessment that a bank does of the financial health of a company that wants to borrow money from a bank. And there's a really wonky but interesting effort going on, particularly in China. That would integrate in a core way a banks assessment of a company's environmental risk and to the extent that the bank sees that the company's environmental risk is lower. That is that it is a cleaner company. That company would pay less would actually get its lending costs reduced. Futon, do you have any insight into whether that's actually changing anything for instance than in the coal sector or in energy intensive sectors? Yeah, in the coal sector if you use a pay more or less. My question is not that question. My question is the bank, they can curb their investment law May be paid back is zero. So that is a high risk for instance. because you prognosticate the coal may go bankrupt regardless of what it's paying on its debt. Yes. For instance for the medium and small coal mines and many is bankrupt. And so the bank actually with the money. For coal power power pan, now China over build coal power power already. If you invest and that is a huge substance cost which you will not recover. Covered. And Hong, what about that? I mean, is it, Futon is essentially saying that the preferential lending rates for dirty industries are not preventing the expansion of dirty industries. Yes. You agree with that? Yeah, I agree with that. And I have the data could share with Everyone this room [ UNKNOWN ] One data could be shared with you because ICBC realized that co- factor power generation is facing increasing risk. So when we adjust our portfolio, we have been doing portfolio readjustment for a fairly long time. Every year, while we're making investment to yin power generation, 77 % were invested in clean energy. The rest, less than 30 % was invested in co fuel power generation. So in our power generation portfolio, 60 % It's clean energy. The reason. It used to be 60 %. Yeah. Okay, I'm sorry to do this but I wanna cut you off and I wanna go to Hull for a second. So there you are, so do you buy this Hull? Do you buy the notion the preferential leading can significantly move the mill economy like China to achieve the sort of results that you just told us the world need to achieve? So the word one has to be very careful with his preferential capital finds returns and more specifically, it finds risk weighted returns. If coal plants are more risky, they should be priced more highly. I completely agree with your panelists on this. What I find troubling is when you offer concessionary finance for green In other words if you tell people you have to accept a lower return in order to build a solar farm or a wind farm then your self limiting because most people won't accept a lower return over time it has to be a reasonably risk weighted return. Let me turn for one sec what does that mean. There's a bunch of risks you face if you want to build a huge solar farm or huge wind farm. Can you get it cited? Can you get transmission access? Can you get the construction permits? At what price do you sell the power? Those risks raise your cost of capital as they should in a good capitalist economy or good free market economy. But government can drive those risks way down by pre zoning citing, by pre specifying power purchase agreements, by pre issuing construction permits, if you meet all the right criteria. So the way I think to use the financial system is to take advantage of what it does, capital finds risk weighted returns, and reduce all those risks a lot, and then the capital will really flow. You don't have to call that a green bond. You don't have to reduce, you don't have to change the very nature of capitalism. You simply have to restructure the deal, so that more capital flows. Hung, do you want to comment on that? I- That is, the notion that it's actually not so important to reduce the landing rate. What's more important is to create broader conditions, in which the market's wanting the green stuff. [ FOREIGN ] I totally agree. I think what how has been set is completely correct, in my view. For banks when we choose customers, on the one hand, we will check the individual profit profitability of individual product. We will also research into the overall risk of the whole structure Probably one project is profitable now but in the future [ UNKNOWN ] is challenged by climate risks. Then for the overall coal factor or coal feud, power generation in our decision- making, actually we have a prior readjustment towards the sector. [ FOREIGN ] We put in the green bomb or not actually is have to move out Out of the green [ INAUDIBLE ]. Okay, thank you very much. Obviously, more to talk about. Thanks so much for your time. Thank you. [ BLANK_AUDIO ]

Green Finance: Accounting for Climate Risk

Leadership

Climate change presents material financial risk.

Fashion: A Minefield for Sustainability

How outfitters make environmental action fashionable.


[ MUSIC ] Greetings all and it's an honor to follow Tanaka son who is a global strategist without peer. I have studied the accumulation of carbon in the atmosphere for far too long and one of the things that teaches you very quickly Is that we have to do all the right things and we have to do them promptly. There's no more room for error we have as a world squander the possibility. So what I want to talk to you today about is what I call the four zeros. How do we get to a zero carbon grid, zero emissions vehicles, zero net energy buildings? And zero waste manufacturing. Before I do that I need to mention just a couple words about US, China relations as part of this. This a picture that I like a lot, it's our Governor of California, Jerry Brown together with the leader of China, Xi Jinping. This is important because when China and the US work together we get a whole lot done. One of the reasons Paris was successful was because prior to Paris, China and the United States sat down and hammered out an agreement that other countries could live with. And they made enormous commitments themselves. I've had the fortune I think I've made 70 trips to China. Over 20 years working with Chinese experts, when our countries work together on the global commons, we solve things. I know that US, China relations are fraught right now. That's all the more reason in this realm to join arms and stay together. So I don't wanna forget that Why do we have to stay together because there's no way that one of our countries can solve this problem without the other the two giants in the energy world or China and the United States. And it's impossible to keep New York from flooding unless China does this part on climate change and it's impossible to keep the greater Bay Area And Shanghai from flooding, unless the United States does its part. There's no way to separate the solution here. This is common sense, perhaps. Not practiced as well as it should be. First, some slides you'll be very familiar with. The key to magic in climate change solutions are the learning curves. When we drive down the price of zero carbon technology during incredibly low levels, a whole vast array of solutions becomes possible. And it no longer becomes an economic choice to do the right, a political choice to do the right thing, but also an economic choice. This is solar TV prices dropping down over time, and the volume rising. I sometimes say there was an unwritten agreement between Germany and China. Germany agreed to overpay and China agreed to over produce, and together they achieved a relative miracle. The same thing happened with wind offshore wind, watch this space. Offshore wind prices have dropped by half in the last four years. And they make an incredible contribution to a clean energy system. Batteries powering electric vehicles, staggering price drops, and where by no means done, and they're many more. And these have come again because of subsidized demand in the early days over production and the China price helps us all. So how do we get to the four zeros? Start with the electrical grid. This is the easiest and the fastest sector to decarbonize and it also enables all the other three to decarbonize. So this is a crucial step we have to make. I show that electricity from wind and solar is incredibly cheap already but what are the policies that we are required to get us as far as we need to go? The first policy is a mandate to drive to 100 % carbon- free electricity on the grid. Soft targets won't do it. Long- term signals are required. It's now cheaper to move to solar and wind than to continue. We analyze every single coal plant in America and discover that 75 % of them cuts more just to operate Then if we replace them with brand new solar and wind farms. But that doesn't make it happen automatically because incumbent industries fight back and they fight back hard and this is why we need good policy . So the first one is 100 % clean energy standard phased in over time over the next 10 2030 years depending on the state of the economy. Second, we have to align power markets with the carbon market. China is developing a carbon ETS, emissions trading system. It needs to help accelerate the transformation of the grid. I should have put a third one on. We need better strategies to balance the grid. Intermittent sources of energy are not that difficult to manage. You have a good strategy that includes demand response and more transmission and heterogeneous electricity sources hooked together and occasional use of speakers. I spoke last week to the man Steve Barbara who runs the California grid. And he told me he can get to 80 % decarbonised electricity without worrying. 80 % in the fifth largest economy on the planet that's impressive how do we get to zero emission vehicles go to shenzhen they have 18, 000 electric buses all the taxis are soon to be electric DD will be electric the price drop is making this feasible. If you have a solar system driving your energy grid and an electric vehicle, you've accomplished two things with one. You also as an incredible bonus, cut out noise and air quality problems. What are the requirements ever stricter efficiency and pollution standards for internal combustion engines combined with a steadily increasing mandate? For electric vehicles. You'll note that I have very few bullets on what we need to do with policies. And the reason I've reduced this so much, is it turns out with energy policy, there's a small number of things that make a huge difference. And most energy policies are not that important. We have to focus our energy on a small number. That really drive change. We don't have time to waste. We cannot do the wrong things, and this is the list for cars. It's not the entire list but it's the core elements. If we do these two things we come out okay. Buildings. My first job was Construction, building buildings. And then I started a Construction company with my brother. Back in the 1980s. And we designed and built solar homes, and it was not difficult. You put in insulation, you put in great windows, you put in super efficient appliances and air handling system. You put overhangs over the windows and voila, your energy goes down by 80 %. A well- insulated, well- designed building is a 100 year assets. Because operating costs are so low. A poorly designed or poorly insulated building is a 100 year liability because you're condemned for the entire life of that building to pay utility prices and to emit carbon emissions you don't need. What makes for good buildings? Only two policies deliver great buildings. A very strong building code that's well enforced Really important and appliance that equipment standards so that we do not put bad air conditioners into good buildings. So those are the two that drive the zero net energy building. The last and the most difficult is industry, industry because it's complicated. It has huge capital investments. And because steel is different from cement is different from chemicals. But Tanaka- san mentioned the hydrogen economy. We need to reinvent chemistry so it's not powered by hydrocarbons but by hydrogen, which is entirely feasible. There's a company in New Jersey That makes cement, it's called Solidia, that's 60 % less carbon than the best conventional cement power plants. We need concentrated, extensive research on each of the principal energy- consuming sectors of industry. And when we have that, we will come up with these solutions. Also, We can electrify much of industry. And again, if you have a low carbon or zero carbon grid, then electrification of industry is pretty dramatic. So those are the four zeros. Zero carbon grid, zero emission vehicles, zero net energy buildings. Zero Waste manufacturing, every one of them is possible. Every one of them can become cost effective if we take advantage of the learning curves that I mentioned. Learning curves don't just happen. They require much more vigorous r & d than we have in either China or the United States. They require early support when technologies are out of Out of the price range, but still promising. And then they require commercialization. The strategies I pointed out here will induce so much demand, they will create a vast amount of innovation. And that's what will really deliver the goods, it's when saving the earth is cheaper than ruining the earth. Not just cheaper counting [ UNKNOWN ] but cheaper in the narrowest possible sense, it's already happening with the grit. So we're on our way there. But the only way to get there is to build those policies, that list of policies that I mentioned, quickly and make sure they're strong and make sure they're well- enforced. I wanted to end this on, with this slide about diplomacy. I know this is an international conference, much more than just the United States and China. But with the friction we have, right now, caused by my government, which I'm not happy about, it's important to remember how much good is going on. In the United States States set energy policy, not the federal government. There's nobody in Washington who has energy policy in their title. I started with a picture of Jerry Brown. California has the fifth largest economy on the planet. And we're going to, we are on target to zero carbon emissions by 2050. And we're the most prosperous state in America to anyone who tells you you can have To choose between a strong economy and a strong environment is not doing their homework. The only way you can have a strong economy is if you keep your environment clean. And the only way you can have a clean environment is if you take care of your economy, they go together. And that's requires us to work together. So thank you very much. [ APPLAUSE ] I guess we stay up here. You're in the middle .>> I guess .>> Please. Wow. So we're really getting into it now. Those are two fantastic presentations. One of the things that I was really struck by listening to both of you is that despite your different backgrounds. The way you think about problems with energy and climate are in some ways, very similar and I covered the trade ministry for many years in Japan. And there modus operandi was that they would always say, okay, what are the things that we can do that will have the most impact? Let's focus biggest bang for the buck And you're all about that. I love how that you've kind of identified this kind of, what, is it 20 / 4 / 10 formula? Maybe can you explain a little bit about that about? You know what I'm talking about here, so 20 countries. Yes. 4 sectors, 10 things. So because we have so little time to solve the climate, the carbon accumulation problem, the climate problem. Yeah. We have to Focus on the small number of things that make the biggest difference. 20 countries are responsible for 75 % of carbon emissions. If we win in most of those countries, we're gonna be fine. If we fail in those countries, we're not gonna be so fine. There are four sectors that matter in the energy space, which I mentioned already, the grid, vehicles, or transportation I should say more broadly, Buildings and industry. And for every one of those, there's between two and four policies to make a difference. So if we focus on getting those policies established in the biggest countries, we actually land on a reasonable corporate climate future. And every one of those policies has been tested and proven somewhere. Nowhere except the Nordic countries have they all been tested and proven. And what's great about this, I think is that it kind of hurdles the perception that a lot of people have, that this is a complex technology issue, that we're waiting for some sort of, you know, dramatic breakthrough to be able to tackle. I mean your whole message, no, no, we've got stuff that's on the shelf. Just start doing it. Yep. So how much time do we have if we start doing it? [ LAUGH ] Minus ten years. [ LAUGH ] No. [ LAUGH ] [ UNKNOWN ] I cannot agree more. The earlier the better. We should have started much earlier. We have graduates moving, but still we are discussing about the global carbon prices, so how to reduce as a whole tax. So you stop talking about that but just doing what we What is necessary to do. That is probably just as how said it is the way to proceed, and One of the things that really struck me in your presentation in [ UNKNOWN ] was this focus on how China is implementing renewable technology faster than you expected and than anybody else expected and that's That's a surprising driver that that is fascinating to hear you talk about this that so you're saying that that may help us on the climate side, much faster than we thought. But it may have all kinds of other destabilizing complicated geostrategic implications we haven't really thought through .>> This is really interesting because this morning we had discussion about with China stands about. Co2 emission reduction now peak. When the emission peak happens, yes, China committed in Paris to, before 2030 but some experts it may be 2022. Three years from now, the China may peak the co2 emission and capping on coal already happened. And cup of oil. The peak demand of oil may happen 2025. I thought it before 2030 and Saudi Arabia is very much growing. So China's speed of changing transformation is much much faster than nobody ever thought of. And your message here was that not only does that have a payoff for China in terms of sustainability and protecting the environment, it has a big payoff in terms of energy security: It's almost like it's a security policy as much as an environment policy. Yes, exactly. I don't think China is trying to contribute to global world by reducing Mission. It's perfectly. It's hope, its own sake. I had a chance to talk with Mr. Fujita, the former president in Hokkaido. And he said, we do energy efficiency. We use lots of renewables, but it's not for somebody else. It's for us by enhancing energy security and economic growth. This is clear message. Really interesting. Hal, what do you think? There's an old term called the Resource Curse. Yeah, yeah. Most countries that are dependent on selling one natural resource Right. Gold, oil, whatever. End up with terrible problems. They end up with corruption because there is easy ways to make money and they fail to develop other aspects of their economy and they fail in their education system. So you can look at one country that has escaped the resource curse, which is Norway, and you can look at a hundred well probably 40 or 50 countries that have succumb to the resource curse. I think your slides about China not having these oil reserves means that China becomes a much bigger innovator in all these oil realms. Right exactly. It's a kind of gift if you take it as such, but let me mention one other thing on this front There's something at work called a virtuous cycle here. The resistance to clean energy is no longer economic, but it is incumbency. Yeah. It's the existing businesses who fight change. Yeah. And they exist everywhere, including in China. Right? Yeah. Now when you get momentum going when you're starting to put in 100 gigawatts of solar in a year, you're creating new incumbents. Right have a political force that can equal the old one but it takes a while for that to snowball you we have to get past the boutique stage into the mainstream. So a couple of things are we this point about the resource curse is a Profound one, I think that's just a tremendous insight because in a way in the United States is this sort of dismissive thing, we used to say about Saudi Arabia. Great, they have oil, but that's why they don't have any economic infrastructure to speak up. And having spent a long time in Japan, that was always the amazing thing about Japan, you showed to knock us on how Japan and South Korea are way up in that far corner of that grid of oil dependency. And poor Japan, poor Korea. But in fact, that was the thing that forced innovation and improvisation and thanks partly to MITI to figure out another way to grow the economy and make use of the one thing that Japan did have Which was labor. I'm afraid that United States is energy dominant now. And dominant energy policy means that resource cost may happen to the United States. Mr. Trump's United States, may suffer in a matter of decades may not necessarily be when he is the president right. But after that, United States may have a problem. If You should not moving towards more renewables, more electric vehicle more, all the things. So how the people in Washington get this, do they think this way, and is there anything that suddenly, this sort of windfall benefit of oil shale has fallen on us, is there anything that that the United States can do to resist the temptation to just fall back on that? Well, there are learning curves in solar and wind and they're learning curves in fracking. Yeah. And so forth as well. So it's a race. But again, look to the states. The states are putting in regulations restricting fracking, restricting methane leaks, promoting clean energy. The states decide how the greatest power, the states increasingly set fuel efficiency standards It's more awkward but that's where the action is. 55 % of Americans now live in states that have pledged to follow the California path, right? So Washington is the minority actor here, you can be happy about that. Absolutely. We have time for a question or two from the audience. It's not I've got one nuclear, we haven't talked about nuclear. But Japan obviously this is a big transformation for Japan. Obby is committed to getting these reactors started again, governors are resisting him. What's the future of nuclear in Japan and then after that, China because that's the other. Very interesting question. Because Quishima public reaction to the nuclears still very negative. Right. So, to builbind the new big water reactor is prohibitively costly because of the regulation of safety etcetera etcetera so probably only nuclear we have now only nine reactors are running. After shutdown all of them may continue to restarting but probably half of the whole. Nuclear fleet. So prolonging the life is one way. But meanwhile taking that and tried to move toward the fourth generation reactor is the future that is a small modular type reactor and fast reactor may be the future of the. Nuclear industry. Japanese company statute invested in UK but withdraw because of the lack of potential benefits of the subsidy or support. So nuclear future is very tricky. But now Japan and US made a coalition. A luxury of the fast reactor which was developed. In the United States called integral fast reactor could be give us the chance for the future promising technology. So China just fade away quickly. We've only got a few seconds but what do you think. Excuse me. China is has a huge level of building the nuclear power right. But the cost of renewables is getting so cheap. Can they continue to build the bigger lightwater reactor is? i? I have a question about it because the location is limited on the seashore. But there are many people who wants to have a nice buildings. Beer as in the coast and not in my backyard please. So people's reaction negative reaction on the nucleus still is happening in China. So nuclear is not necessarily promising even in China. Wow, fascinating. The surprising triumph of renewables. Gentleman, you've given us lots to think about. Thank you both very much. Thank you. [ APPLAUSE ]

The Climate Imperative 

What really needs to be done to fight climate change.


[ MUSIC ] Thank you, thank you, ladies and gentlemen it's a great honour for me to have a presentation about energy geopolitics. IEA world international energy agency is always disclosing world energy [ UNKNOWN ]. Two years ago, it mentioned about four revolutions in the energy market. Fast is the shale revolution in the United States. United States is now the largest producer of oil, and probably with gas and this is a really dominant. And status, so US is now enjoying energy dominance of the world. Mr. Trump's policy of this fossil fuel is magnificent. [ BLANK_AUDIO ] Second revolution, solar photographic revolution. [ UNKNOWN ] said, Solar portable take will be the cheapest source of new electricity in the near years. And this is really surprising for me. Solar has been very expensive energy before. But the future will be very different. What will happen to coal? What will happen to gas? What will happen to nuclear energy if that is the case? Third revolution is China. Green China, China's green revolution changed the world, by using more gas and renewable energy. The force is electrification. Energy is served through electricity Not [ UNKNOWN ] but digitalization, electric vehicle, AI, Big Data, this is the fourth revolution. Look, out of this four revolutions, three of them that latter three of them are happening in China or led by China. While US is still conventional leader China is changing the world by three revolutions in the renewables. But China is not doing it for sustainability. This is the geopolitical strategy of China, because by using more renewables, China can reduce dependency of oil from Middle East very unstable Middle East. Or from Russia by gas or from gas and oil from United States. This is energy independence policy of China. US is using renewed for fossil gas and oil China's using renewables who will win in this game? China is the largest user of energy. US is the second largest. This is the big change in energy market and everybody must be aware and impacted by this contrast. This is the oil producers game US the green is us is taking advantage of high oiled price. The red is oil price and increasing the production by 6 million barrels per day half of the Saudis capacity Saudi Arabia is blue and yellow is Russia. And now US is the largest producer and to face with shale challenge, Russia and Saudi Arabia made a coalition by reducing production and pushing the price up but that benefit always goes to the US. This is a big fight between US and Russia, Saudi Arabia. Where the Middle East oil goes in the future. China, India, Japan, Korea. Other importer of oil from middle east. 90 % of boys will go to Asia. Look, the United States will no longer need oil from the Middle East. Will US continue to defend the Persian Gulf free navigation of the Strait of Hormuz? This is a role for China, India, Korea, Japan and Asian countries. Japan and China is fighting in the East China Sea or South China Sea, but we have to work closely together in the Persian Gulf. This is the Persian Gulf Hormuz Strait. If this closure happens in the Persian Gulf, we are going to lose 60 million barrels per day of supply. He was problem for Asia Im am proposing to face this kind of shortage China should join IEA International Energy Agency together with India it is only limited to the way cd but it is China's necessity. To defend energy security of supply disruption of oil, together with India. India applied officially to be the member. It is China who should follow and come together the IEA. This is a really big change, because United States is no longer need IEA They are energy independent. The beneficiary of [ UNKNOWN ] is China in India. And also China is going to be the largest importer of LNG gas. United States is the largest exporter of the gas in the future. Two major players of the gas are fighting in the trade war. This will certainly impact the gas market. [ BLANK_AUDIO ] China is trying to use one belt, one road of pipeline and Diversity of the sources of gas. But this protection of the ceiling show the concern, raise the concern of the United States. This map, I copied from American Defence Department's China report. Every year it's getting more and more details and very interesting. Energy issue is geopolitical and national security or military related issue. This chart is depicting countries by gas or import dependency in the vertical line in the horizontal line is oil import dependency China now imports about 60 % of oil and 40 % of gas but eventually 80 % of gas and 50 % of gas should come from importation. India is much worse situation. Japan and Korea importing 100 % of oil and gas. It can not be worse. United Stated moved different direction. They are exporting already gas and exporting oil very soon. So US position is much closer to Russia and Middle East in a geopolitical advantage. China and India should work closely with [ UNKNOWN ] country like Japan, Korea, and Europe. To defend its energy security by joining. India is much worse situation so India applied first, but it's now that China's term cost of solar and battery is going so low. So China strategies and other strategies connecting grid lines around the country and together with neighboring countries, this big global energy interconnection is built on road initiative of electricity grid. very strategic geopolitical move of China. Asia SuperGrid. This is a. Japanese idea Matthias is from the chairman of the SoftBank is selling this idea by connecting. This is another interesting collective energy security and sustainability for Asia. Japan and China should work closely with Making these kind of scenario in the future. Nuclear issue is very interesting. This photograph is from the L'Aquila Summit in G8, in 2009. I was invited as an energy expert, and this is the first summit for President Obama. He patted on me And I, you are the energy guy. I know energy issues very well. In the lunch, there is a good number of African leaders together. And the guy who was sitting next to me was Gaddafi. And he talked about colonialism, colonialism is the issue. And then came Obama I know Africa very well. It's the corruption is the issue, he raised, and corruption has nothing to do with the colonialism, total silence happened. Mikkel said yeah corruption corruption but the session changed from colonialism to corruption. But Gaddafi was killed by the invasion of United Nations Army and US. And that sent a terrible message to North Korea, because Gaddafi said I gave up nuclear weapon myself, and I also try to convince North Korea to do the same. But he didn't make it. And his mistake should never be repeated in Kim Jong Un's mind. So, energy issue but, nuclear is very much issue of security. Well, ladies and gentlemen, Japan should work war Together with China to the non proliferation raging, peaceful use of nuclear, this is the only way to get the trust. Japan last after the Fukushima accident about a nuclear power. We have to buy the plutonium from North Korea and this helps together with China. The nuclearlization of the Korean Peninsula. I wish that nuclear issue is not only the economy or energy but very important national security and geopolitical issue. Thank you very much for your attention. [ APPLAUSE ] [ BLANK_AUDIO ]

The Geopolitics of Energy 

A presentation by one of the world’s pre-eminent experts on energy.


Grappling With the Great Pacific Garbage Patch 

A look at Craig Leeson’s  “A Plastic Ocean.”

How to Handle the Global Garbage Mess

Cities around the world are struggling to dispose of their trash.


Tackling Environmental Challenges Through Design

McDonough Innovation CEO Bill McDonough explains how.

Farming for the Future

The tools that will feed a growing global population.


Corporate Focus on Sustainability: 10 Years Later

A look at what’s real and what’s not.

[ MUSIC ] Thanks, Kat. So let's just take a quick poll. Who here has tried the Impossible Burger? Wow. [ APPLAUSE ] All right, still has some work cut out for you, Pat. But in the US at least, there's so much buzz. And excitement over plant based alternatives to meat. And yet, we've had veggie burgers for decades. So why is this different? what is this class of alternatives that we're looking at now so different from what we've seen before? That's a great question. And it's an absolutely fundamental difference. That here too for before impossible foods came along. The problem was framed as creating meat like products for people who wanted to reduce or eliminate meat from their diets. And that made the design spec basically To just, you don't have to be better than the cow, you just have to be better than the next best veggie burger. It's a completely different problem, okay? And because our company was founded with a very explicit mission, which is to completely replace animals in the food system by making products that consumers prefer To the products they get from animals. We could've said we're gonna be a super successful veggie burger company. And we could have but we have had not impact on the global environment. We took the global challenge of we're not gonna succeed until we make meat. That hardcore meat lovers deliberately choose over the meat made from animals, which means that we had to solve the hard problem. It's easy to match and do much better in terms of nutritional value, overall health value. Food Safety and definitely sustainability and even cost. You could do that right now easily with just you know edamame, but deliciousness is hard and For us to be able to take that on, we had to build what I would say is by far the best r & d team in the history of food, and I would say it's arguably one of if not the best r & d team in the entire biotechnology industry, to look at a really hard problem, which was the most important scientific problem in the world. By far, why is meat delicious? That was the most important scientific question in the world. Why is it the most important scientific question in the world? Because if you can answer that question, understand it well enough that you can produce the most delicious need in the world. Without using animals, you solve the biggest environmental crisis that humanity has ever faced. And that is the catastrophic impact of our use of animals. Okay, so I have to ask them why is what did you discover why is meat so delicious? Well, okay, there's a There's many levels of answer that question but I would say the first and probably the most important really breakthrough discovery is that the magic of meat flavor. What makes meat taste immediately recognizable and not from the plant world. Is essentially entirely due to a single molecule called heme. And heme is a molecule that's found in every living cell on earth. It's what makes your blood red. It's what carries oxygen in your blood. It's also essential to how your cell generates energy by burning calories So every cell on earth needs it, but animals have tons of it. And that very high level of him. An animal tissue, enables him to catalyze him as a great catalyst. And it catalyst is the chemical reactions that produce the bloody flavor of raw meat. The explosion of flavor and aroma you get when you cook meat that makes it so craveble to meat lovers. So we discovered that very early on. We've also discovered some fundamental things about what protein properties enable the product to be juicy and have the textural changes and meat so for there's a really hard complicated scientific problem that we're We're still working on but we made a huge breakthrough. When we discovered that he has basically the magic ingredient for flavor. How to go back to something you said early early on, you said that you want you want to completely replace meat. No, no, I absolutely do not wanna replace need I want meat lovers to be able to get all the meat they want. Okay, but I want to replace animals as the technology that we use to produce meat to ,>> animals as a technology. Yeah, it's like when when the automobile industry came along, it was not we want to replace transportation It's that we wanna replace the horse as the power system for transportation. We don't wanna take away meat from meat lovers. We wanna give them the best meat they've ever eaten, but not use animals to produce it. With all the catastrophic environmental impact of that technology. Okay, so instead you're creating meat with plants. Yes. Okay. Yes, with ingredients from plants. So I wanna talk a little bit here about Asia because US first market, Asia second market. Why is this such a critical, critical area for you? Well, I think probably most of the audience is well aware of the fact that. More than 40 % of all meat consumption in the world is in Asia. A quarter of it is in China. And China is by far the biggest meat consumer in the world. And it's also Where most of the growth in demand is happening. So about half growth over the past ten years in demand for meat has been entirely in China. So from a mission standpoint, and our mission is to completely replace animals in the food system by 2035, which we will do You by 2035 by 2035. And the timing is important, because because the rate at which this environmental catastrophe of the impact of animals and the food system is unfolding is so incredibly urgent, that if we don't, you know, essentially completely Replace this system by 2035. We are going to be in terrible shape. But anyway, Asia in general and China, in particular, are essential markets for us and also the opportunity is huge. For China to build a domestic plant based meat industry using ingredients that are produced by farmers in China. And production facilities that take those ingredients and turn them into meat. Creating jobs in China. But the biggest issue is that China right now is entirely import dependent, completely import dependent for a large fraction of its meat supply. And that's a big food security, vulnerability. And of course, as you've heard earlier The animal agricultural system is responsible, it's a major cause of water pollution in China. It's huge component to the greenhouse gas emissions from China. Basically when you see smoke coming out of the Amazon, that's a reflection of the growth and demand for meat. Mostly in China. So these are all important to send for, from China's perspective. The big opportunity is China has about almost the lowest amount of arable land per capita of any developed country and the lowest amount of freshwater. Per capita of any developed country. And animal agriculture is hugely water and land intensive. That's why China can't produce its meat supply domestically. But using the technology that we've developed, with the water efficiency and the land efficiency that we have today, proven. China could produce all the meat That all its citizens consume using half of its own arable land and its own water supply. Okay, it could be entirely self sufficient for its meat supply, if it's switch to plant based meat production, using the technology that we've already developed. So I think it's a win for the world a win for China win for Asia in general. And, [ BLANK_AUDIO ] There you go. So how are you approaching the market? Is it is it a different strategy than for the US? Fundamentally, no, I mean, the fundamental way we're approaching the market is, we're not deluding ourselves, by thinking that we can create veggie burgers, and hope meat lovers will buy them instead of Meat from animals. We know that the only way to succeed in our mission is to produce the best meat as judged by the consumers in the world. And that means that, to succeed in China just as to succeed in the US or elsewhere, number one you have to be uncompromisingly delicious as meat. You have to be better nutritionally. That's easy. You have to compete on cost. at scale. That's completely doable. If you can do those things, deliciousness first, nutritional value, affordability, convenience, etc, the things that consumers value from meat [ BLANK_AUDIO ] You can win in the marketplace. So that's how we're thinking about it, and we also know that consumers around the world, and certainly in the US, across the US, people love their meat. Everybody here, I'm sure you're all meat lovers, otherwise, you'll starve to death if you're in [ UNKNOWN ] But do you raise your hands with if you're a meat lover, please? Who loves meat? Come on, admit it, you do. Okay, and who loves the fact that the meet is made from the cadaver of an animal with all the environmental damage that that- [ LAUGH ] I doubt that somehow. What that means is if you can use plant based ingredients with a vastly lower environmental footprint and deliver the things that consumers really value, deliciousness, protein, iron, nutritional value, convenience and affordability, the market is ready So let's talk about the nutrition piece cuz there are some critics who have said, this is not as healthy as it should be as an alternative. Is that something that you're working on? Are you trying to address that in some way? Okay, the first order of business is we were not gonna sell a product. If we didn't believe based on the best available evidence, it's healthier for the consumer. Then what it replaces, okay? Well, that's kind of a low bar and we've cleared it. Our product has no cholesterol. it's lower in calories, lower in saturated fat. Same protein content, higher quality protein than meat, even though people don't think that's possible with plants. Yep, it's higher quality, better amino acid composition and so forth. You know better food safety. We don't have fecal bacteria and our product unlike all the ground beef in the world, made from cows. So from it's it's, it's it's a much healthier product already, but we're not satisfied with that. So the great thing about The approach that we're taking it's the same thing about moving away from animals as a transportation system. That it's not that you're better right away. Although you pretty much are. It's that you can never stop getting better. Unlike the horse, the horse is no faster now than it was 200 years ago and nobody cares. Unless you're a bit better on horses. And, cows are no better at making meat than they were a million years ago. They were never very good at it. They were just the best thing that was available, when cows were domesticated. We can get better every single day. And when we are better, when we have products that are better than the very best thing that a cow has ever produced The next day we can be even better because we have that ability just like with mechanized transportation, you can you can, you can define a goal to make it better and deliberately go after it. And we definitely want to make our product better in every possible way nutritionally, we have so earlier this year We launched the second version of the impossible burger. We launched it at the consumer electronics show, of course. Which is sort of the biggest, I think it's one of the biggest trade shows in North America. And it's kind of a showcased renovations. Anyway Our product won essentially every prize. It was voted by the CES itself as the most innovative product and the best of the best products at the show where we were competing against Google and Samsung and Sony and LG and all the rest. Anyway And what was important to us about that is that the earlier product was selling as fast as we could produce it, but we knew we could make it better. And we set a goal that we would make it measurably better in flavor, in texture, in versatility, and in handling in the kitchen. Better protein quality. Lower fat, lower saturated fat. Lower salt. [ BLANK_AUDIO ] Lower cost of production, everything. And we succeeded. And meanwhile, we launched that in January. We are already working on the next one. And the next one is going to be significantly better, in terms of calories, saturated fat, total fat, salt, and, you, as well as deliciousness, yeah .>> Okay, so I wanna go to the audience for questions here. We have one right up front, if you could just wait for the mic handler to get to you, and tell us who you are. [ BLANK_AUDIO ] Mr Brown during the break I've found it impossible to find impossible foods and to you but there you are, I had the pleasure of attending the governor's audience with you awhile ago. Do you express your willingness to explore the Chinese market and find a local partner? Yes. So my question is, what essential factors do you think, do you need to form such partnership between you and our Chinese company What kind of assistance and help? Do you need to make it possible for impossible foods to set up shop in when? In the place like this? Okay. Okay. That's a great question. So obviously, finding a good partner Someone we can trust who its just a based on integrity and then many such partner in China [ UNKNOWN ] partners in China. They need to have the resources and the capability to scales supply change the scale production and so forth. That's really the big challenger for us. We have excess demand and scaling is an issue, and then there are, you know, communication to a new market, having a domestic partner. Who is trusted by Chinese consumers to kind of help leverage that trust for our introduction. We also have right now the main limiting factor for us to be in mainland China, we're in Hong Kong. And Macau and doing extremely well. But in mainland China, there's a regulatory process for a new ingredient. So our heme protein, which is the magic ingredient for flavor, even though he [ INAUDIBLE ] Is in essentially every food you eat every day. But this particular protein, which is produced by genetically engineered yeast is novel, has to go through a regulatory process and that has a very unpredictable timeline. So anyone who can help persuade the people who are doing the regulation, not to cut us any breaks, do the diligence. Make sure you're convinced that this is a completely safe and healthy product, but try to do it fast. Regulatory agencies tend to take their own sweet time at things. So that will be helpful to have partners who can use their powers of persuasion and really communicate the message that we want to help China with its food security and in the process, sell the Greatest environmental threat that humanity has ever faced. [ UNKNOWN ], I think as a Chinese customer, we need this great envision on this great product. And on behalf of the Governor, we'd like to invite you to discuss results off the stage For some more discussion, deliberation and then later on maybe negotiation. I'd love that. Inviting you to come to Unan and to set up your shop, we will be ready to offer all the assistance and conditions that can make it happen, thank you. Thank you very much. I would love to talk to you afterwards. So let me let me ask. We have another question. I'll go to you first. Thanks. And if you could tell us who you are, please. Yeah. Don rose, garden artist and fellow speaker. And thanks so much. You talked about flavor and progress. And I'm just wondering, like, why are you spending all your time energy obsession with creating something which from an experience level already exists? And are you not interested in experiencing or developing, a new flavor, a new sensation, a new experience? And if the answer is yes, what would it be like? Also an excellent question and a very, very important question. So the key to understanding why Given we know a ton about meat flavor, we can we understand the chemistry of basically every animal derived meat, okay? Which means not only can we make products that have the flavor profile of chicken or pork or beef. We could make something that has the flavor profile of a Brontosaurus if if we knew what that was. Or something entirely novel, that many consumers might prefer to the small number of kinda meat that exists in the market. But our mission is to. Replace animals by competing in the market against the incumbent industry and, and taking their sales away from them. Does that make sense we want to remove the economic incentive for covering the earth with cows. And and that means that the customer we wanna target Is someone who would otherwise be buying beef from a cow. And the surest way to do that is to deliver for them what they're looking for when they're shopping for that product. So that's why we made this choice and but And we went after beef because beef is the most destructive of the part of the [ UNKNOWN ] sector. But I think 10 years from now, 15 years from now, when, when consumers understand that we're no longer limited by the animals that were domesticated 5000 years ago for meat flavors, I think that's gonna be an extremely interesting area for development. Sorry, just [ INAUDIBLE ] in your opinion, in the future, what does the sustainable future taste like? Man. Well, I'll tell you what it tastes like. It tastes like whatever consumers want. That's what it tastes like. [ LAUGH ] [ APPLAUSE ] All right, let me ask a question here about technology, brought it up several times. The genetic engineering behind him [ INAUDIBLE ] product at CS. A lot of consumers have an aversion to technology in their food. Are you worried about. Off putting certain segment of the population. No, I don't. I'm not worried about, maybe I should be but I'm not. Because I think that what consumers are sometimes suspicious of technology when it seems alien and they don't understand it. And they way we approach this is we over communicate to consumers. Two or three years before we even had a commercial product, we were talking to the press and on our website about how we're producing our product. We're very transparent about it, the fact that we're using genetically engineered heme, why that's important, why that's safe, why that's a good thing. And we're always happy to answer those questions. I think that what consumers need to understand is the use of animals in the food system. There's nothing natural about it, okay? The animals that we're raising for food Have essentially replaced all the diversity. So, the total, you know the total number of living wild animals on earth today, according to the World Wildlife Fund and Zoological Society of London and academic institutions is 60 % lower than it was just 40 years ago. There's less than half as many wild animals on earth today. There were 40 years ago. And again, according to these same researchers, it's almost entirely due to the catastrophic impact of animals in the food system. Everything else is a tiny rounding error. So what we've done is now replaced all that biodiversity With a handful of domesticate animals. The cows living on earth today outweigh every remaining wild mammal, bird, reptiles, amphibian by more than a factor of ten, okay? Just the cows. There's ten times more cow on earth. Then there are all the wild animals, mammals, birds, reptiles and amphibians put together. There's two times more pig biomass on earth than all the wild mammals, birds, reptiles and amphibians left on earth. Okay. There's nothing natural about this. I think the last time a cow was conceived Without the use of a long metal rod inserted into a cow, by, a technician wearing long gloves was probably 20 years ago. All the cows on Earth are produced by artificial insemination now. Everything about the industry is artificial We're about to get the rod. Yeah, okay. I'm sorry. But we will. It sounds like you will be back. You pushed my button there. Okay. It sounds like you will be back in Yunan, so we can hear more. Okay. So thank you so much. I really appreciate your taking the time. Great questions. Thank you. [ APPLAUSE ] [ BLANK_AUDIO ]

A Look Inside the Future of Sustainable Meat Substitutes

A discussion with the founder and chief executive of one of the world’s fastest-growing meat-substitute makers, Patrick Brown of Impossible Foods. 

Thanks, thanks everybody for having me. It's great to be here. Actually it's the first time I've been in this part of [ INAUDIBLE ] and I was just blown away but what I've already seen. It's a beautiful area. So let's see, I'm gonna whip through these. I've had the absolute honor and the luck to be able to Be a part of some great teams leading the iPad design and engineering at Apple. And then also iPhone was on that team as well. You might not recognize me, a little bit more hair then. But those are amazing, amazing products. And so I set out after that to say, okay Knowing everything about those products and designing experiences and learning about that from Apple, well what can we do to save energy? And so that was the next thing, which was Nest. Nest was all about not just making a cool thermostat, but it was about saving energy. Basically artificial intelligence inside A thermostat to turn it down when it's supposed to be cool. Turn it up when it's supposed to be hot. And turn it off when you are not using it or you are not in the house. We actually turned it out to be billions and billions and billions of kilowatt hours saved because of that technology. And that was great. It was amazing. And so it worked out well for us. It's actually a 10- year anniversary at our first First discussions about nest just last week. So that was nest. But energy savings wasn't just all just something that I thought of right then and then in 10 years ago, it's something I've been doing since I was a kid. So this is me and my science fair project when I was 11 or, 12 1981 and that's a solar back then in 1981 or two. So this has always been a passion of mine, the environment is made of passion. And so what we did was after nest, We created a company, a investment company with our money in it. And we have a team that's both based in San Francisco and in Paris called future ship. And we are investing in global changing companies for the environment. So obviously you can see the first company, they're one of them we've invested in over 200 Companies around the world, and we have hundreds of millions of dollars out on the street in investments today, and making two to three investments a month. The first company you guys are all gonna hear from a brilliant team with an amazing product, and it's going to be a blockbuster company. You're gonna hear from Pat just next. After that, Phononic. Phononic is a company that is replacing compressors in all freezing and refrigeration across the planet. It's already for sale. We're going to be revolutionizing all kinds of commercial consumer refrigerators and freezers. Another amazing company Third, out of that part we're creating diamonds from just simply methane and hydroelectric power. We're creating that so we're saving the planet from strip mining, from blood diamonds, from conflict diamonds. So these are the kinds of companies we invest in. And so I and the team, we are always looking for new things to help the environment, help our societies, help our communities, and so I decided after we were living in Europe as well as Silicon Valley. We decided to move our family, To Southeast Asia, we've been there for over a year now. And why are we doing that? We wanted to be where things are happening, where the developing world is becoming just like China went through its moment. What is going on at Southeast Asia? And so By being there and speaking on the ground, we're getting real, real data about what's happening in waste to energy in recycling in materials, and it's been absolutely fascinating. So I set out a year ago after starting to live and see this problem, see these problems around it, start to design products. That start to address these things or use some of the waste materials that are generated. Started looking and looking. And so for over a year now been investigating and learning all about the plastics issues. I want to create some new products. And I'm trying to find the most sustainable way to use plastics. And it has been fascinating to me to understand what's really going on after you scratch the surface and you get through a lot of the greenwashing going on in the petrochemical industry. And so it's been very, very intriguing. So we've all heard about the others tons of plastics in the oceans. There's gonna be more plastics in the Ocean than fish by 2050. We hear that over and over and over. That's right. It's absolutely true. It's going on but it's a lot worse than plastic is everywhere. It's in the air It's in the water we drink, it's in the food we eat, it's in our bodies, it's in every single place. We found it at the deepest parts of the ocean, we found it at the highest parts of the mountains. We found it in air, we found it in bottled water, we found it in our feces. It's everywhere, microplastics. And people were like well, the WTO just announced that well, we don't know if microplastics are bad. What we do know though is microplastics and nanoplastics absorb like sponges bioaccumulative toxins that get lodged in our body. And in no fact and it goes from generation to generation. So you might say we don't know if it's going to be harmful, but we can tell you it's in your body and it's soaking up chemicals now, toxins and they're going in your blood stream without a doubt. Well I remember when we talked about it for smoking, well we don't know if smoking is bad We still don't know if RF emission or your cellphones are bad. But we're learning more and more everyday but I can tell you this, it's in our environment and it's everywhere. So, first thank you, thank you China, thank you for not taking and importing our waste any longer. Thank you, thank you. Why? We have been hiding this problem for way too long. This plastics problem has been buried, it has been incinerated, and it has been moved. And the developed world has pushed it away and said, it's somebody elses problem. Thank you for making it our problem again. Because of the things that China did, and is doing, it has now forced many countries in Southeast Asia to do the same. I'm seeing it on the ground in Indonesia. They're kicking back. They're kicking back waste, Vietnam, Thailand, they're all kicking back the waste. This is important and thank you again, China cuz you're making us wake up to the reality of the trash we're creating every day. So, we all know coal right? It's bad. We shouldn't be making more coal plants, right? Everybody agree no more coal plants. Well, why the hell are we making even worse coal plants for plastic, oil to plastic? Coal to energy is three parts CO2 for every one part coal Plastic five parts minimally five parts to create PET plastic from one part oil. We are actually just in the production of plastics making more co2 than coal plants and we're getting rid of coal plants. So why are we making more coal plants? They just happened to plastic production plants. Look at the emissions. The emissions are growing and it's staggering. We're looking at over 600 new coal plants for plastic production between now and 2050. But it's not about CO2, let's put it this way. Plastics, yes, we do need plastics. We need plastics for certain applications. There are lots of great reasons why we need them. But there's one class of plastics, if you looked at it, packaging. If you look at that pink or red thing, it is growing exponentially. The other ones you can see the usage of them. If you look at real estate or excuse me real estate if you look at some of the other categories that we use those four years, plastics, packaging plastics are used for weeks or months, and it's growing like crazy. Why do we care about that? Because plastics are around four years, 500 years. Once they're created, they're around. No matter what people tell you about recycling, they still are around in our environment. The problem is multiple multi layered. Of course we have to extract the oil We create methane when we do that, that's a 20 times more powerful climate warming gas than CO2. 20 times more, and that stays in our environment at least 20 years. Next, we then create the plastic. the CO2 from that, just like we talked about the coal plant, is going to be around for 80, 80 years or so. After that, we're going to use those package. We're going to use the package, okay. There's all those durable ones I talked about. Those other ones that lasted, that we used for 20, 30 years. And Bill McDonald tomorrow's gonna have a brilliant talk all about that I'm sure because I've heard many times, he'll talk to you about what we do about those plastics that are in our environment and what we do about them when we use them for 20 years and we have to recycle them or do something. It's a great top but plastic packaging is only for day a days, weeks or months. After that it sits in our environment for 500 years. Think about what was going on in the world 500 years ago if they were using plastics, it would just be decomposing today. All right. 500 years, so a few months of use for 500 years of trash that goes in our body that's bio cumulative toxin sponges. Recycling, we all hear about recycling. Recycling is so important. Yes recycling's important but let's talk about what's really going on. We have all these different labels. We see them all in our packages but guess what. Just because the label's there doesn't mean anything. The first one we got here is we got sometimes recycled. So the first two categories are sometimes recycled. One in two. So between 6 %, 7 %, some as low a 2 %. Not even, in a lot of places 0 % is actually recycled. It's recyclable, but it's recycled. And most people won't tell you that when they are recycled They can only be recycled two, three, or four times, because they're mechanically recycled, and may go and become trash because those long polymers become shorter and shorter, as you just they grind them up and then they try to make more products with it. That's why you have to put it in a road, that's why you have to put it somewhere else. It's not true recycling like aluminum, or glass, or paper, in a lot of ways. It is still only partially recycled and even then it can only it turns into trash very quickly if it is recycled. After that, we have more and more categories. All of those other things are either never recycled or can't be recycled because they're toxic just because you see them. Just because you see those labels, does not mean you're going to see them recycled at all. So is this truly a waste management problem? Is this truly a consumer problem that we're lazy? It's too hard to separate these things. If you look, recycling is more about not the process of recycling. It's the process of sorting. And cleaning. That's the problem that we have. And consumers need simple things. We all know, we're in the business. When we make something, we have to make it incredibly simple. Consumers are good at two choices. Three choices, it gets difficult. Seven, eight, ten choices, even harder. We have made or the industry has made it incredibly hard for the consumers to try to do the right thing, and it's made it really hard to make for the recyclers to do the right thing. Recycling is not the answer for packaging. [ BLANK_AUDIO ] So here's something you need to know a lot of people don't wanna tell you. Okay, you hear better recycling. I just talked about that. Well, no, it's not about better recycling for packaging. After that, you hear it's about what is that one? I can't even read it. Incinerate? Yes. We're gonna do waste to energy. We're gonna incinerate it. Well guess what? Those coal plants that are we talked about earlier, making plastic Well makes even more waste and toxic dioxins that are spewed out unless it's absolutely done right and it's very expensive to do it right. You cannot just incinerate it and waste to energy. ****. Next we got bio plastics. We hear everything about bio plastics. bioplastics are the answer. Well guess what? Bioplastics are the same thing as biodiesel. All we're doing is we're substituting one thing into another. We're just taking some biomass and turning it into petroleum. So it's kind of like going from coal and natural gas Something like that. But it's really not the answer bioplastics if it's not done right. Is not right. Next. So biodegradable or compostable. If you hear biodegradable, it doesn't mean it's good for the environment. Everything biodegrades into little pieces. Plastic biodegrades into nanoparticles, does it part the great into organic but nanoparticles that are sponges. If it's compostable, usually that means it needs to have industrial equipment to make it turn into something that's more like soil. It needs recycling. It needs collection. That isn't right. So what is the answer? Packaging needs to be bio- waste plastics, waste, from waste we turn it into plastics, and it needs to be consumer compostable. We can't just throw it in a compost pit. The organisms just eat it. We can throw it in the water, in the ocean, and it just dissolves into properly degradable Elements that do not hurt us and do not hurt the things we eat and live on this planet, bio- waste plastics and consumer compostables. So we need to build circular businesses. I don't need to go through this, we all understand that. [ BLANK_AUDIO ] So, what does it mean if you are in a business Today. Right now you have to understand many countries are banning single use plastics. If you are in using them, creating them single use plastics are getting banned and very rapidly. All of Bali in literally three months has totally changed from single use plastics in many different categories. And those Single use plastic definitions are growing wider and wider. After that, we have to eliminate composite plastics that means layers of film. They put different types of plastics together they can even be recycled. Many of the plastic packages you see that have food in them, their composite, they can't even be recycled. Definitely not mechanically, food delivery. Food delivery in Indonesia is starting to get regulated. What can single use? What packaging can it be in? There's all kinds of regulations coming very soon for food delivery services and what they can use. We have to limit petrochemical infrastructure. We talked about incineration. And of course we have to make sure the producers of these things don't just leave it to the consumers to have to clean up their mess that they helped to create. Long term bio and biochemical recycling is necessary. And we need to have the proper value chain, which Bill will talk about tomorrow. So, the biggest thing to remember, if we want this world and packaging to work, we have to make it easy. We have to make it easy if we're going to recycle it, and today we don't have it. consumers need easy to make it work. And it's not that way today. So anyone tells you it's a waste management problem. They're lying, it's not true. Thank you very much. [ APPLAUSE ] Hey thank you Johnny. Thank you. Sasha tells me that we've got time for one, maybe one and a half questions. Sorry I took too long. No, it was time well spent, it was absolutely fantastic. So, one of the things I love about this, is it's a designer perspective, where you take a designers sence of empathy and look at the whole system. And you say that, things that aren't working, don't work for a reason. It's because they're hard to use and the user experiences isn't what it ought to be. And I love your focus on consumers, So my question for you is, making this switch that you say is the way to go so that it's easy for consumers. What drives that? How do we get into that world? Is that the responsibility of designers to come up with some new materials? Is it the responsibility of governments to regulate as you described it in Bali? Or does it fall back on consumers again, just not to us, I think it's all three. Look governments are going to step up because they're seeing and they're really realizing the problem that they're having before their societies and their constituencies are saying this can't go on and hunger because they're starting to wake up to all of these greenwashing terms that the industry is using just like they did for oil and gas and tobacco and those kinds of things in the past. So people are waking up governments are waking up. Consumers are definitely waking up. And there's a very interesting study that came out about a month ago, which said global brands today when they come out with echo anything yeah, consumers don't trust it. They can think They trust new brands that have come from scratch with eco products. They much rather go to that than try to go to a global brand that's been screwing up the world for a while and they don't belive that they're doing actual good. So where does this leave the role of companies? I mean, we heard from Jim [ UNKNOWN ] A very kind of nuanced perspective on the problems and how it's a systemic problem and how companies have to do their part. And it's partly consumer product companies end consumers. And then there are things that regulators and waste management companies can do. But are you saying that just don't trust companies in general because there's nothing really? No, I don't. I'm not saying that. I think companies can do a lot to help. I think we need to scale up PHA production. There's all kinds of biomaterials that are available now, that if done right at scale can actually compete with the petrol chemical industry, to get us these bio waste, consumer compostable materials. They're there. They just need to be embraced. It's just a whole different thing than what they're doing today, these large companies. The other one is, this is their job to actually, to clock forward and get new customers and not lose ones, and not lose their competitive position. So this is a reality. We have to wake up to it and we have to stop the greenwashing. And consumers are gonna vote, and so are the governments are gonna vote. It started in China. Thank you again for not taking the waste. It's gonna continue and roll through many, many countries Many consumers, this is not a trend that's going to change. I can accelerate. Can we look for something along the material side from future shape company are we are investing now in biochemical recycling, we're investing now in bio materials. We're going to have some really, really great announcements there and I hope to have some really cool Interesting new products around this area very shortly to announce Come back and let us know. All right, Tommy thank you so much Thank you. [ BLANK_AUDIO ]

How We Can Kick Our Addiction to Plastic 

Nest founder Tony Fadell shares some bold ideas.


The Campaign to Clean Up China's Vital Waterway

A look inside China’s water risk and government initiatives aimed at protecting water quality of China’s longest river.

Dow Chemical CEO: Why We're Committing to Sustainability

Jim Fitterling joins the 2019 Fortune Global Sustainability Forum.

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