Last week I visited Saudi Arabia, the United Arab Emirates and Bahrain. I spoke with ministers, those in the oil and gas industry, and investors about the challenges of the global energy transition and the practical steps we can take to achieve net zero. I was struck by the boldness with which nations known for the richness of their oil and gas reserves are turning their attention to sustainability. Given the capital at their disposal, the potential to drive change is enormous. The UAE is investing more than $160 billion to become the first Gulf state to achieve net zero. And Saudi Arabia has announced the creation of a vast net-zero city, Neom. These nations can teach us about the speed of the energy transition to which I will now turn. I want to make four points.

First, we should set the transition in context. Hydrocarbons still provide more than 80 per cent of our energy, and are still expected to supply more than 70 per cent in 2030. Together with nuclear power, natural gas needs to provide a large portion of our baseload electricity supply. This means that we need to succeed in decarbonising natural gas through carbon capture and storage on a large scale. It also means that we need to be realistic about the pace of change. It will take more than a few decades to do away with an energy system that has been built over more than twenty decades.

Second, we should take action not only on the sources of energy supply, but also on the nature and structure of demand, because our objective function is to reduce greenhouse gas emissions – and there are many ways to achieve this. For example, steel production, which accounts for 8% of global greenhouse gas emissions, can be made green by removing metallurgical coal from the refining process, replacing it with hydrogen generated from renewable energy. The manufacture of a car with ‘green’ as opposed traditional steel would likely only add 1% to its cost. The effect of this on the climate would be real, but the end-impact on the consumer would be minimal.

Agriculture is another example and represents 20% of global emissions. The replacement of crop-based animal feed with insect-based protein, for example, has the potential to make meat production more much climate-friendly. Given the size of agriculture’s contribution to global emissions, the adoption of new practices at scale could accelerate the transition even further.

Third, we should make better and more widespread use of energy efficiency and demand-management technologies. Population growth and the industrialisation of emerging economies require more and more energy. Demand continues to grow, but the behavioural forces driving that demand remain poorly understood. However, digitisation and machine learning relieve consumers from having to make the explicit choices necessary to optimise or reduce their energy consumption. Instead, these decisions can be devolved to a piece of software. The shipping sector is a good example. Small changes to the way a vessel is operated can dramatically change its fuel consumption and hence its emissions footprint. Analysis suggests that the same vessel on the same journey but operated in a different way could generate four times as much greenhouse gas emissions. I am the Chairman of Windward, a maritime intelligence company, and we are developing products which are already helping companies to optimise shipping activity and reduce emissions in the sector. By analysing vast quantities of data, we are able to reduce cost, conserve energy and reduce emissions. If the shipping industry were a country, it would be the world’s sixth biggest emitter of greenhouse gases, so there is real potential for driving change at scale.

Fourth, we must deliver the transition – and every part of society has a role to play.

Governments have remained committed to the net zero targets they have set, but they need to go further, much further. They need to set policy incentives to reduce greenhouse gases. A carbon price or carbon tax at an appropriate level would send the right signal. I have been calling for something in this area since the 1990s, as have many others. There are clearly difficulties in implementing such a system but I don’t think we should give up.

Consumers have more power than ever. By demanding information about the goods and services they consume, they can demand significant changes. More of this is needed in different areas of everyday life, by biasing purchases to zero-carbon products.

Business leaders and corporate executives need to lean into appropriate legal and regulatory changes to ensure that companies are treated equally and that change is brought about more quickly. Substantive corporate ESG policies are essential, not simply desirable. They need to support actual measurable actions – for example, the use of science-based targets against which to track greenhouse gas reductions.

Investors, for their part are responding to pressure from shareholders and taking a more nuanced approach. They need to avoid encouraging simplistic actions such as requiring divestment of high-carbon assets – this makes very little difference to the climate. Instead, they should take responsibility for the impact of their investments by applying pressure on corporate strategies and executive compensation to drive emissions down.

Twenty-five years ago at BP, I became the first leader of a major oil and gas company to acknowledge the risk posed by climate change, and pledged to do something about it. Back then, the science was not settled, and we were uncertain of the actions we should take. But today, the science is clear, and our task is one of delivery. My preoccupation has always been with the real-world delivery of solutions to society’s problems. Today I chair BeyondNetZero, a climate growth equity venture which has been established in partnership with General Atlantic. We invest in companies that are developing and deploying the next generation of climate solutions, seeking to address climate change at pace and at scale.

Ladies and gentleman, to be in business is to be an optimist. That is why I have always believed, and continue to believe – whatever the challenges of the present – that the best is yet to come.

The views expressed in this commentary are the personal views of Lord John Browne and do not necessarily reflect the views of General Atlantic Service Company, L.P. (together with its affiliates, “General Atlantic”) or BeyondNetZero. The views expressed reflect the current views of Lord John Browne as of the date hereof, and neither Lord John Browne, General Atlantic nor BeyondNetZero undertake any responsibility to advise you of any changes in the views expressed herein.

General Atlantic, BeyondNetZero and others associated with it may have positions in and effect transactions in companies mentioned or indirectly referenced in this commentary and may also perform or seek to perform services for those companies. General Atlantic, BeyondNetZero and others associated with it may also offer strategies to third parties for compensation within those asset classes mentioned or described in this commentary. Investment concepts mentioned in this commentary may be unsuitable for investors depending on their specific investment objectives and financial position.

This commentary does not constitute an offer to sell any securities or the solicitation of an offer to purchase any securities. This commentary discusses broad market, industry or sector trends, or other general economic, market or political conditions and has not been provided in a fiduciary capacity under ERISA and should not be construed as research, investment advice, or any investment recommendation. Past performance is not necessarily indicative of future performance.