Business can help make the world a better place by driving the solutions to problems like climate change, food security and rising energy demand.
“I firmly believe that the companies who will lead the 21st century will be the ones that invent solutions to these mounting global challenges,” said Andrew Liveris, speaking last night at the RACI Centenary Chemistry Congress.
For Dow that’s meant developing a paint that removes toxic formaldehyde from the air, innovative packaging technologies that reduce food waste, and new methods of desalination that allow us to put more of the planet’s water to use.
Last year the company was awarded 754 US patents – eight times the number they were getting a decade ago.
“More and more companies are seeing that we can do well by doing good,” Andrew said.
But we also need governments to set smart regulatory and policy frameworks that enable innovation to flourish, and that’s not happening enough in Australia he said.
According to the World Economic Forum, Australia ranks 25th in the world when it comes to “business capacity for innovation”. And we’re also falling behind in our competitiveness in teaching young people maths and science.
Andrew says our quality of life will go backwards “if all we are is a farm, a hotel and a quarry”.
Full text of Andrew Liveris’ speech below.
Royal Australian Chemical Institute Centenary Opening Reception Address
July 23, 2017
INTRODUCTION
I want to thank the Royal Australian Chemical Institute for inviting me here tonight – and for the incredible work you do to promote chemistry across the country.
It is always a joy for me to be in a room full of scientists. Because even though I no longer get to spend most of my time in the lab, I have always remained, first and foremost, a chemical engineer.
For those in the room who are early into your career journey, I remember well what it felt like to be at that point: the excitement at understanding what is possible when we harness the power of chemistry… the exhilaration at beginning to master that power yourself.
Back when I started studying chemistry and chemical engineering at the University of Queensland, and still today, my goal in life – above everything else; above excitement, above financial security, above personal achievement – was to find solutions to problems. That was my “North Star” – the purpose that motivated me, and helped me motivate others.
I chose chemistry because it, I believe, gives us greater power to do that than perhaps any field. Chemists and chemical engineers are trained to look at any problem by breaking it down into its basic component parts – down to the molecule, even down to the electron.
And then, by understanding those essential hidden processes that shape our environment, we can design solutions by manipulating the very fabric of our world.
Like when chemists Fritz Haber and Carl Bosch combined atmospheric nitrogen and hydrogen into fertilizer – helping us feed the world by getting plants the nitrogen they need to grow.
Or when, a decade after Alexander Fleming’s famous accidental discovery of penicillin, the chemist Howard Florey – an Australian! – figured out how to purify it so it could be used in hospitals.
These discoveries have saved – literally – billions of lives.
Today, we need innovation like that more than ever before. Because the challenges we face today are daunting, to say the least.
By 2025, 1.8 billion people will live in regions where clean water is scarce. By 2030, 40 percent of the Earth’s people will lack adequate housing. By 2040, global energy consumption is predicted to nearly double – and unprecedented extreme weather events are likely to become the status quo, rather than outliers. And by 2050 – as the global population tops nine billion – demand for food will increase by 60 percent.
We are already getting a precursor to some of those challenges here in Australia, where climate change is degrading essential natural resources, destroying ecosystems that make Australia unique, and causing extreme weather that
threatens people’s lives.
Daunting, as I said. And yet I am not scared, and I am not depressed. Far from it. I am energized.
Because, as the 2015 ratification of the Sustainable Development Goals demonstrated, there is increasing commitment to solving these challenges – from governments, from academia, and, more than ever before, from businesses.
In fact, these challenges provide a roadmap for a completely new business model – one where solving the world’s intractable problems presents boundless opportunities.
This is because of multiple breakthroughs. New technologies are allowing us to experiment more rapidly, and more boldly, than ever before. And digitization is redefining how we process data and obtain new insights.
I still believe that chemistry is at the core of the solutions the world needs most: the science that enables all other sciences.
Which means that you all, in particular, have an incredible opportunity to rise and meet these challenges – and, in doing so, usher in a new era of progress and prosperity, both for Australia and for the world.
REDEFINING THE ROLE OF BUSINESS IN SOCIETY
I can already feel that so many of you are eager to make a real difference. And there was a time, not too long ago, when that sense of purpose might not have found an outlet – at least, not in industry.
In fact, one of the most promising developments I have seen in the past few decades is not a new chemical, but a new way that businesses perceive their role in the world.
When I was first starting in business, if you walked in and started talking about how you wanted to make the world a better place for everyone, you might get shown the door. So even if you had that ambition, you likely kept it to yourself.
To many, businesses delivered a profit for their shareholders. That was where their work – and their responsibility – ended.
But over the past four decades, things have changed. And they are evolving still – at a rapid pace, and in a positive direction.
Just look at the Sustainable Development Goals.
When the UN launched the Millennium Development Goals in 2000, it barely occurred to anyone to bring the private sector into the conversation.
When they launched the Sustainable Development Goals in 2015, the private sector was a key player. Companies like Dow were at the table. Initiatives like the UN Global Compact and Impact2030 called on companies to do their part in this global effort to improve our world.
This is clear evidence of something I have witnessed in my career: a remarkable evolution in the way companies think about their responsibility to society – and the role business can play in solving problems and improving people’s lives.
For those of us at Dow, that effort is what drives us. It is what gets us out of bed in the morning, in whatever time zone we wake up!
We are asking: What materials can we invent to help make housing more energy-efficient – so that this wave of people entering the middle class across the planet does not mean skyrocketing carbon emissions?
What new ways can we purify water, so that everyone has access to it when traditional water sources fall short?
How can we craft carbon fiber to make cars safer and more lightweight, so they use less fuel? After all, for every five kilos taken out of the weight of a car, five to eight kilos less carbon dioxide gets emitted to the atmosphere.
For us, developing this social consciousness – this sense of citizenship and community – is not charity. It is a business strategy.
For one, there will always be a market for meeting essential human needs.
And we know that in order to attract today’s brightest young minds, we need to help them fulfill their aspirations of making the world a better place. Employees who feel they are working for a good cause are up to 30 percent more productive – and four times more likely to say there is high employee satisfaction in their workplace.
I firmly believe that the companies who will lead the 21st century will be the ones that invent solutions to these mounting global challenges.
So you can see why more and more companies are seeing that we can do well by doing good – that we do not have to choose between the two.
Today, I am willing to make a bet. If you walk in the door at a science-driven company and start talking about how you want to make the world a better place, they are not going to suggest you go find yourself a spot in academia or government like the old days. They are going to say: “Alright. What’s your plan?”
INNOVATION DRIVING INNOVATION
So that is one reason why it is an extremely exciting time to be a chemist.
Here is another: new technologies have made us better at inventing new technologies.
Futurist Ray Kurzweil, who is the Director of Engineering at Google, calls this the Law of Accelerating Returns. It means, basically, that innovation drives innovation.
Advances in transportation, communication, and information technologies have transformed our world, driving two big trends.
We are increasingly globalized – meaning people and economies are increasingly interconnected.
And, as already mentioned, we are increasingly digitized – meaning computers are playing a more and more important role in every aspect of our lives. Machine insights are enabling human insights. AI is being put to work on complex problems.
This means very exciting things for the pace of innovation.
Scientists here in Australia are working with scientists in Asia, in Africa, in the Americas… learning from one another, benefiting from each other’s discoveries.
And computers are magnifying the capabilities of each individual mind, as well… opening up possibilities for experimentation once thought impossible.
It is difficult to overstate the importance of this shift.
At Dow, our scientists across the world together run over two million experiments a year, each involving hundreds of thousands of individual data points. And then, by harnessing the power of big data analytics, we are able to synthesize an astounding amount of knowledge from those experiments.
And we see this paying dividends. Last year, we were awarded 754 U.S. patents – 8 times the Dow of a decade ago.
Many of these inventions are as good for the world as they are for Dow… such as a paint that removes toxic formaldehyde from the air, innovative packaging technologies that reduce food waste, and new methods of desalination that allow us to put more of the planet’s water to use.
If individual companies are seeing their innovative power grow like that, and more and more companies are committing themselves to solving these challenges… then we could be at the cusp of a golden era of innovation.
AUSTRALIA CAN LEAD
But while the private sector can do a great deal, it cannot solve these challenges alone. We also need governments to set smart regulatory and policy frameworks that enable innovation to flourish.
Unfortunately, we have not seen enough of this mindset in Australia.
Australia’s chief economist has noted that, by international standards, Australian businesses are slow to adopt new technologies – in the middle of the pack vs. advanced economies, rather than at the forefront.
The World Economic Forum reports that Australia ranks 25th in the world when it comes to “business capacity for innovation.” We have seen that even when Australia excels in fields like chemistry, our businesses often have trouble
turning raw knowledge into products that could change the world.
And most concerning of all, Australia has seen a major slide in its competitiveness in teaching its young people in science and math.
Last year, a study showed that since 2011, Australia has dropped from 12th to 17th for both year eight math and science. For year four, it dropped from 18th to 28th in math. The year four science ranking did not budge – because it was already at 25th. Countries like Kazakhstan, Cyprus and Slovenia have all leaped ahead.
This is particularly troubling when you consider that a study from Sydney’s Macquarie University showed a strong correlation between a country’s math and science scores and its overall competitiveness.
It does not matter if chemists have unprecedented tools at their disposal if they simply do not know how to use them!
Fortunately, we are seeing some progress, with organizations like yours doing excellent work to encourage STEM education.
And the government’s National Innovation and Science Agenda, which was launched in 2015 with $65 million in federal funding for STEM education, was an important step forward.
But these steps forward are just that – steps. And we need to redouble our efforts to make up ground, because the most innovative countries in the world are not going to stand still and wait for us to catch up. They are continuing to
invest in scientific research, programs to train their young people, and initiatives to attract investment from science-driven businesses.
Take Israel. The Israeli government has long supported innovation – funding start-up incubators, working closely with universities to help commercialize new technologies, and crafting policies friendly to venture capital investors. This
has created what some call an “innovation paradise,” fueling growth that allows the government to continually reinvest in this ecosystem. Today, Israel is a global leader in R&D investment as a percentage of GDP.
South Korea, too, is doubling down on innovation as a growth strategy. Bloomberg already rates it as having the world’s most innovative economy. Its government announced last month that it will increase spending on science and technology R&D by 26 percent in 2018. And last year, the country announced that it would invest a trillion won in artificial intelligence research by 2020.
Or consider the United States – where I have been privileged to work with the administration’s Manufacturing CEO group. Even as much of Washington focuses on reducing government spending, we are investing in reskilling our workforce for the digital age. Just last month, the U.S. pledged a $200 million investment in apprenticeships.
All of these are concrete steps that the Australian government could emulate. But it will have to start with people like all of you, advocating for change from the ground up.
After all, as Dan Senor and Saul Singer wrote in their book, Start-Up Nation: “A reform happens when you change the policy of the government; a revolution happens when you change the mindset of a country.”
CONCLUSION
I believe that the people sitting in this room today can help inspire that change in mindset – that we can work together to get people excited about how scientific advancements could transform this country and the world.
This effort – acknowledging the true, intimidating scope of the challenges we face, but believing, too, in our ability to come together and work hard to meet those challenges – speaks to us in ways that few other things do.
You see this in the frenzy that surrounds Elon Musk, which Australia is getting its taste of now that he is bringing the world’s biggest battery onto our shores. I recently spent a day in Los Angeles with Elon, and I saw how excited people got about every one of his initiatives: SpaceX, Tesla, Hyperloop, the Boring Company.
Elon is successful because he sells people not on any individual product, but on a fundamental belief: that scientists and engineers can work together to solve intractable problems.
There is no patent on this idea. It belongs to all of us. And we need to spread it, as far as we can. Australia’s future – and the world’s future – relies on it.
It is time for us to put forth a new vision for humanity: one where the challenges we face don’t incentivize happy ignorance or resigned pessimism, but instead inspire tireless determination….
Where we look to the great scientific achievements of the past not as remnants of some grand old age, but as stepping stones on a path to even greater discovery….
Where our idea of what is possible is, like the universe itself, in perpetual expansion.
So let’s get to work.
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