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How green start-ups like mine are being squashed by big corporations

As Cop28 comes to an end, green tech entrepreneur Magnus Willner reveals what he learned as a first-time delegate – and how the unlikeliest barrier to fighting climate change is our global consulting firms

Monday 11 December 2023 17:33 GMT

Surf’s up: a surreal indoor water feature at the Cop28 climate change conference at Dubai’s Expo City (EPA)

So, I survived my first Cop climate change conference.

Despite some negative pre-publicity surrounding this year’s event in Dubai, I am leaving it cheered that quite so many talented people – more than 97,000 delegates in total – showed up to help put the planet on a more sustainable path.

I am also pleased that the United Nations chose to hold it in the UAE, a petrostate with a big part to play in combating climate change. By motivating the Middle East to be involved in solving the most critical issue of our time in a practical way, the region is more likely to become a useful player.

And, as the CEO of a pioneering carbon-capture company, I take the sheer size of the delegations sent by big corporations as a sign that they too may be ready to help – to put their vast sums of money where the climate protesters’ mouths are. Corporate involvement could yet form a bridge between the legions agitating for action and the policymakers looking for ways to deliver it.

At times, Dubai’s vast Expo City felt more like a trade fair than a UN conference – which was no bad thing, even if it meant I found myself doing more steps in a day than I would normally do in a week.

But Cop28 also served as a reminder that scaling up is not without its challenges. I believe there is now a structural issue holding back progress in the green innovations sector – one that means money is being diverted away from the grassroots projects helping to make the world cleaner and greener, and towards the giant firms offering professional services.

Where we once had to concern ourselves with limiting the rise in global temperatures, now we must also deal with the rise of the sustainability manager.

As CFOs and COOs acquire ever more significant budgets to invest in green businesses, so too grows the power of ESG professionals. Those who work in “environmental, social and governance” safeguard an organisation’s long-term success – but, to my mind, they are highly in the claw of the world’s foremost consulting businesses. ESG can now account for around 40 per cent of a green tech’s workforce, and while they’re doing good work, it’s paperwork.

I know first-hand how that can drain resources. At my company, Arbon Earth, we are farmers. We create negative tonnes of carbon by using the oceans. Our pioneering carbon-capture offshore ocean technology takes one of the planet’s most plentiful and fastest-growing crops – bamboo – to grow algae, which absorbs almost the same amount of carbon as all of the plants and trees on land combined. When the macro-algae eventually sinks to the ocean floor, the carbon it has absorbed during its lifetime is captured for at least a century.

In the spring, I spent 12 days in the Atlantic, sailing from Antwerp to New York, to watch our operations in action and to conduct further experiments in the middle of the ocean. On the way, the ocean was vast and beautiful, but we saw almost nothing – except for some exceptional birds and dolphins. There is so much space out there. We’re currently setting up a similar carbon-capture operation out of Kenya, and have had interest from Japan and South Africa. This operation could be rolled out to any open-water location.

But scaling up creates its own difficulties.

At Cop28, I spoke to the sustainability manager at a big European insurance company who is so keen to invest in green tech that his budget for the coming year had quadrupled. Environmental start-ups are vital to them, as new customers increasingly look at green factors. For this, they like to have ESG at the forefront of any investment – meaning the vast majority of that extra budget would be absorbed by ESG reporting costs, both internally and from the big global consultancy firms.

But for us, ESG is not helping to solve climate change, it’s merely adding a layer of bureaucracy to our operations, one that diverts investment capital to the pockets of big business.

These days, even the most direct roads to net zero are paved with consultants keen on inflating the need for their expertise, and oil companies promoting expensive carbon-storage solutions to decision makers, where the huge cost-per-tonne of CO2 is hidden in big numbers.