Amazon Deepens Climate Pledge Adding Microsoft and 12 Others

The News: SEATTLE–(BUSINESS WIRE)–Dec. 9, 2020– Today, Amazon (NASDAQ: AMZN) and Global Optimism announced that 13 new signatories—Atos, Brooks, Canary Wharf Group, Coca-Cola European Partners, ERM, Groupe SEB France, Harbour Air, ITV, Microsoft, Neste, Rubicon, Unilever, and Vaude—have joined The Climate Pledge, a commitment to be net-zero carbon by 2040, a decade ahead of the Paris Agreement’s goal of 2050. Read the full news release at Amazon.

Analyst Take: Amazon has been vigilant in shortening the timeline in which the company meets the Paris Agreement’s goals to be net-zero carbon by 2050, seeking to outpace the ambitions of the agreement by a decade. But the company has also been incredibly active in bringing other leading enterprises into the agreement to give greater visibility and accountability to the program. After all, 20 years is a long time, and to get optimum results here, the investment needs to start now. Speaking of the investment, there are a few components to opt into the Amazon Climate Pledge, most notably, signatories to The Climate Pledge agree to:

Measure and report greenhouse gas emissions on a regular basis;
Implement decarbonization strategies in line with the Paris Agreement through real business changes and innovations, including efficiency improvements, renewable energy, materials reductions, and other carbon emission elimination strategies;
Neutralize any remaining emissions with additional, quantifiable, real, permanent, and socially-beneficial offsets to achieve net-zero annual carbon emissions by 2040.

As I see it, the program shows a robust interest in the tech and large enterprise space to take a more aggressive leadership stance in global issues such as sustainability and climate change. Given the substantial influence that companies like Amazon and Microsoft have on a global level, their commitment to these types of programs will likely have a butterfly effect that will yield impact at scale across the massive global supply chain to do more for the planet.

Of course, Amazon’s announcements have been far more big participants than just Microsoft. This particular announcement had a dozen others, including Atos, Brooks, and Unilever, all of which are household names in their respective industries. Past announcements have included other big tech firms such as Infosys–and I’m certain more big participants will continue to join.

In recent months Amazon has also made climate commitments in its Device Business to offset the impact of manufacturing Alexa, and the AWS business, which has a big power consumption footprint, has continued to invest in architectures and technology to reduce power consumption required for the growing demand for compute resources from industry. A scaled approach for Amazon and its participants in the Climate Pledge will be required to achieve the desired outcome. I’m optimistic about the promise of this movement by Amazon as a global influencer across many industries.

Futurum Research provides industry research and analysis. These columns are for educational purposes only and should not be considered in any way investment advice.

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