The Year of Living Realistically

Ten Predictions for the New Year

Call me optimistic but — fingers crossed — when it comes to private sector environmental initiatives, I think 2022 will be a year of 1) less talk, more action; and 2) less emphasis on reducing harm, more on preservation and restoration.

So to start off the new year, here’s a brief list of things I’m hoping, and expecting, to see in 2022.

1. Be Here Now.

Critics often lament that business leaders err by not taking long-term views. We’re regularly told that companies worry too much about the next few quarters and neglect the longer term.

(I’ve mostly resisted this argument because there are so many contrary examples. For example, EV players like Rivian and Tesla make huge bets on the long term and the market rewards them with sky-high valuations).

But when many companies are falling over one another in a rush to make net-zero commitments as far out as 2040 or 2050, I say to all CEOs: Please, bring on the short-term thinking. We need it.

For example, tell us your plans for the next one to three years.

  • Disclose your ghg emissions
  • What immediate steps will you take to reduce them? How?
  • What obstacles block progress?
  • Have you prepared a marginal ghg abatement cost curve?
  • How expensive are your opportunities to reduce emissions? Will they put you at a competitive disadvantage?
  • Will you ask customers to pay more for decarbonized products?
  • What specific public policies would support your decarbonization opportunities?
  • How will you collaborate with the various players in your supply chain to reduce respective Scope 1, 2, or 3 emissions?
  • How will you use offsets? What offsets have you purchased and at what price?
  • How does your offset purchase price compare to your cost of reducing emissions?
  • How will you address biodiversity challenges?
  • And so on.

If business leaders focus more on these nuts and bolts issues and disclose more about them, progress will accelerate.

2. Something in the Way She (Re)Moves Me

I’ve been clear about my views — I’m pro carbon removal.

Meanwhile, climate-pledging companies are learning that it is difficult and expensive to reduce emissions quickly. As they fall behind schedule to reach net zero, expect to see them increasingly turn to offsets.

I expect these companies will strongly prefer removal projects versus ones that avoid emissions (see Microsoft’s offset purchases). That’s because only the former aligns with net-zero goals.

I also expect that because so much of the decarbonization challenge for companies connect to Scope 3 emissions in their supply chains, we will see keen interest in so-called “insetting.” And — here’s a place where environmental organizations can help — offset buyers will place more emphasis on co-benefits/side effects, such as biodiversity or community outcomes. (Updated Greenhouse Gas Protocol guidance will help).

3. I’ll Have What She’s Having

4. Where’s Waldo?

New private sector players are already responding to these signals and jumping into the carbon offset market. Many of these new entrants aim to broker, verify, or finance carbon projects. All good. But what we really need are more players originating carbon removal projects.

This opportunity strikes me as a great place for private-sector collaboration with NGOs. Each player brings different capabilities: NGOs (science, boots-on-the-ground, biodiversity expertise); companies: (speed, capital, technology).

5. Why Can’t We Be Friends?

I expect more collaboration between environmentalists and companies with big footprints and less positive environmental reputations. Some of these companies are launching ambitious climate projects. See Rio Tinto’s pivot toward clean energy with the acquisition of Argentina’s Rincon lithium project. See Bayer’s programs to scale soil-based carbon removal and digitally-enhanced farming — both promising ways to address agricultural emissions. See Shell’s efforts to reduce the emissions of its customers (a whopping 85% of its Scope 3 emissions). The list goes on. Cooperation between these companies and environmentalists is not always easy but offers important ways to make progress. Further, collaborating on specific matters doesn’t mean enviros have to agree with everything these companies are doing. But imagine the potential gains, for example, if environmental organizations and these companies lobbied together for the climate policies that would bolster these specific initiatives.

6. Revenge of the Nerds

These folks see opportunities to: improve the fast-growing carbon offset market; use AI to modernize NGO fund-raising; put robots on farms to reduce pesticide usage; make direct air capture cost-effective; and much more. I think these are all promising bets.

I’m always in favor of ambitious people with goodwill from any sector joining the environmental field. We need new ideas, strategies, and technologies. I remember when people like me transitioned from Wall Street to the environmental sector. Most enviros kindly welcomed us into the field. And I think we newcomers were able to make some positive contributions, like coming up with creative deal structures for conservation initiatives. Let’s encourage this trend and welcome all new allies.

7. Truth or Dare

8. Dancing with Wolves

These trends will lead to more carbon-intensive business units being owned by private sector players (PE or hedge funds). Expect assertive efforts to encourage these private owners to step up and match the climate and other environmental commitments of public companies. I welcome the entry of private players into the field of climate leadership. They will bring a short-term and realistic approach to environmental goals. And if we’re correct that doing the right thing environmentally makes business sense, these private market deal pros will figure that out and embrace such opportunities. Let’s hold them to that.

9. Mr. Smith Goes to Washington

10. My (Re)Generation

Positive momentum is building. It better be, because time is not on our side. Let’s all push hard to make these expectations come true.



Former CEO of The Nature Conservancy CEO. “Nature’s Fortune” author. Family man, yogi, ice climber, vegan.

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Mark Tercek

Former CEO of The Nature Conservancy CEO. “Nature’s Fortune” author. Family man, yogi, ice climber, vegan.