Stockholm (NordSIP) – Between June 25th and June 28th, Sweden’s political, finance and business elites flocked to Almedalen, a small park in Visby, the beautiful medieval walled capital of Gotland on the Baltic Sea, to discuss the state of the world. An annual event originally triggered by the speeches that Sweden’s late prime minister Olof Palme gave during his summer holiday on the island during the 1960s, the event has become the main democracy festival in Sweden for some time.
Given the event’s prominence, the last years have seen sustainability leaders from the region flock to Gotland at the start of the summer to promote, discuss and network on the topic of sustainable finance. This year, the transition to a net-zero economy appears to have been the main sustainability topic on the agenda. Three panels in particular, hosted by Swedbank, Dell and SEB caught our attention this year.
A Successful Green Transition
One panel on the transition, “Watt’s next – how do we succeed with the green energy transition?” brought financial specialists from Swedbank (as well as from other organisations) to weigh on the issue of the transition.
Johanna Fager Wettergren Head of Group Sustainability at Swedbank noted that banks have a crucial role to play in facilitating the green transition. “Banks have two super powers: We can channel funds to the right activities and we have a large client base, with which we can dialogue and help solve problems.”
Wettergren noted that partnerships play a crucial role for Swedbank, noting its relationship with Ramboll Sverige and Hem. “It is important to be open to outside experts. We have our expertise in finance but our partners Ramboll and Hem are experts in energy efficiency and real estate and can help provide our clients with a deeper understanding of these issues.” Going forward, Wettergren believes that sustainability will remain high on her agenda, but that the discussion will be more concrete and specific.
Karin Beltzér, Head of Fixed Income at Swedbank Robur, Sweden’s largest fund provider, noted that Wettergren’s view of banks as channelers of funds also applied to fund providers. “We have a responsibility to ensure that the funds go to good projects, not to harmful ones”. She noted that integrating sustainability into fixed-income investment decisions has become easier thanks to improvements in data quality. This has allowed Swedbank Robur’s to channel funds to bonds whose contracts earmark funds towards sustainable (green or social) projects, Beltzér explained. Going forward, she notes that better data and clearer regulation (e.g.: CSRD and the Taxonomy) will help improve decision-making and help Swedbank Robur channel the funds necessary to facilitate the green transition.
Transition and the Role of AI
Another panel focused on the “Twin Transition and AI”. The discussion focused on how digitization and AI could be used as tools to increase competitiveness and solve various sustainability challenges.
Hanna Widenberg, presales manager for Sweden and AI lead at Dell noted that AI assists her company in gathering all the data to inform clients about their carbon footprint and the sustainability performance of their activities. It could also be used to manage digital infrastructure and minimise the GHG emissions associated with her company’s activity. Niklas Vinge, Head of Digital Solutions and Analysis at Ethos agreed with the importance of AI for collecting data from various sources and making sense of a company’s profile. Karolina Eklöw, Head of Communication at ClimateView, noted that cities, one of Climate View’s main clients are keen to see what other cities are doing and that her company uses AI to scrape and organise all available public information on municipal activities to provide a clearer view to its clients.
Discussing the challenges of using AI to help companies navigate their transition to a more sustainable economy, the panel agreed that data was the main hurdle facing companies. Dell’s Widenberg and Kenne as well as Ethos’ Vinge argued that one of the main challenges is that AI requires a lot of data and it is not always clear that organisations have the right data or the necessary skills and tools to manage these resources. Eva Fors, Nordic Manager for Google Cloud, noted that it is also important for AI businesses to know what activities to stay away from, such as war or monitoring individuals. It is also important to democratise its use, she notes warning that “AI won’t take your job, but someone who knows how to use AI may take your job.”
Carbon Capture and the Transition
A panel from SEB discussed how to increase the pace and support for carbon capture investments as a part of the energy transition. Fredrik Ekström, Chairman of the Board of Nasdaq Stockholm, argued that it was imperative to invest in carbon capture now given the fact that the technology is still quite far from being commercially viable. Although this technology is not yet a priority, Ekström argues that it will be too late to invest in it if we wait until we need it.
The panel agreed that investment and R&D of carbon capture was taking a long time but Joel Flitton, director, Carbon Removals, Aker Carbon Capture Sweden, put the issue in the broader context of the slow pace of global decarbonisation.“Global decarbonisation is not moving fast enough. This is just one part of it. Unless we get our act together and start to make meaningful investments in the broad spectrum of technologies that are going to be required to tackle this issue, then we are going to overshoot in a massive way. We won’t be able to meet any of our climate goals,” Flitton explains, noting that carbon capture is particularly pertinent to the specific case of Sweden and its conditions.
The panel also agreed that the development of carbon capture technology cannot depend on public grants alone. The private sector has to be involved and the technology has to become commercially viable. Anders Egelrud, CEO of Stockholm Exergi, notes that the success of his company’s carbon capture projects in Värtan, (with the potential to capture 800,000 tonnes of CO2 annually) would be crucial to ensure a path to net-zero emissions for Sweden and its international competitiveness. The panel also expressed a hope that the scaling up of carbon capture projects and a favourable regulatory environment would assist the development of carbon removal credit markets, also known as negative emissions markets, which are still in an embryonic stage according to a recent Oliver Wyman report.
Not Just the Transition
The Stockholm Environment Institute (SEI) also hosted a panel on the transition, focused on transportation and a fair transition. The event appears to have been inspired by a new publication on this issue, which argues that “as much as 40% of Sweden’s population is at a relatively high risk of being adversely affected by plans for a low-carbon transition if they do not receive supportive complementary measures to ensure a just transition.” Still on the transition front, SEB brought together another panel discussing whether Sweden’s municipalities have enough energy to reach climate targets and meet local growth.
The aforementioned panels are a small but important fraction of the discussions that took place. Almedalen is a packed event. This year saw as many as 2123 meetings included in the gathering’s programme. Another two panels, not directly concerned with the transition deserve to be mentioned for their focus on the social aspect of sustainable finance. UN Women Sweden hosted two events titled “How can companies bet on and invest in gender equality?” and “We all know someone who hits – stopping men’s violence against women and girls”.
