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IBM is out with a new climate pledge this morning, promising to cut its greenhouse gas emissions by 65% from 2010 to 2025. Jim Whitehurst, IBM President joins Yahoo Finance Live to discuss.
BRIAN SOZZI: IBM is out with a new climate pledge this morning, promising that it will cut its greenhouse gas emissions by 65% from 2010 to 2025. Joining us now for a Yahoo Finance exclusive is IBM President Jim Whitehurst. Jim, good to speak with you again here. So how will you go about doing this? And what will change inside of IBM's business as a result of trying to reach this goal?
JIM WHITEHURST: Well, there are three aspects of our goal. As you said, there's, by 2025, reducing our actual greenhouse gas emissions by 65%-- or our energy use by 65%. We then, by 2025, will move to 75% of our energy that we do use will be from renewable sources. By 2030, that'll be 90%. And then importantly, that last bit of greenhouse gas emissions associated with that last 10% of energy, we are going to offset using technology.
And so a lot of companies that talk about getting to zero net emissions are getting there by buying carbon credits. And there's nothing wrong with buying carbon credits. It's good to support planting trees. But we feel like we need to take a lead in actually developing the technologies to help us remove carbon from the atmosphere.
And IBM has a history, because of our work in material science as well as in quantum and AI, to be able to take a leadership position in materials. We've done that with batteries and new types of batteries. And we're looking at working with specific molecules and substrates to help remove carbon from the atmosphere. So we believe by 2030 that we can actually use technology solutions to remove carbon for that last amount of energy that we can't source from-- from renewable sources.
MYLES UDLAND: You know, Jim, when you think about a project like this, is the impulse from the investor side? Is it something that you talk about with your board? Or is it something that your employees are coming to their management or their leaders about and saying, this is something that matters to us and you think about recruiting on campuses and being able to say something like this? Where does that push and pull kind of come from?
JIM WHITEHURST: Well, I think it's a little bit of all of the above. I mean, IBM has been around for over 100 years. And actually, 50 years ago this year in 1971, IBM issued its first statement on the importance of the environment. We talked about, in 1974, using the word conservation. We've, since 1990 have released an environmental report.
This is our fourth pledge around carbon and carbon emissions reductions. So we've been doing this for a long, long time. And I think part of that just stems from the fact that if we're going to have a sustainable world for companies like IBM to be able to be around for over 100 years, it requires us to have a sustainable environment in which we work.
So certainly our investors care now. Our employees care now. But broadly, you know, we've been doing this since well before most people even thought about greenhouse gas or environment more broadly.
JULIE HYMAN: You know, Jim, all due respect, it's-- it's too late. I mean, not just on the part of IBM. It's too late on the part of almost everyone, right? I mean, this stuff is happening. What's happening-- what's happened in California, what's happening in Texas, I mean, you can't draw, necessarily, always a direct line, but certainly climate change is a factor in some of these big weather events.
So I would ask yes, you might have made these incremental moves, but why this particular pledge now? And I'm also curious about mitigation at IBM. I mean, you guys are a big global data company as well. And I'm sure you're doing work-- I know you do work on weather, also, in terms of trying to predict some of these trends. So talk to me first about the timing of this, and then talk to me about the data piece.
JIM WHITEHURST: Well, I think the timing of this-- and I think the importance of this statement, again, versus a lot of others, because a lot of companies are doing announcements around getting to zero, they typically involve, again, purchasing carbon offsets, which is fine. We are actually investing in technology that we believe will create new polymers and membranes that'll capture and absorb carbon. We think, for the first time, we can confidently say 10 years from now we will have those technologies to the point where, at scale, they can remove climate from the atmosphere.
And back a little bit to your point about is it too late, I mean, obviously, we are already suffering some of the impacts of climate change. And those are real, and they are there. So trying to actually get to draw down where we actually get to not just neutral, but being able to actually remove carbon from the atmosphere, I think, is a very noble goal that we think that we can play a real part in.
And the reason for now is we finally think that we are getting there with the technologies and where we think the technology can be in 10 years to, at scale, remove carbon from the atmosphere. In terms of mitigation, again, we're working-- obviously, we have a very large set of businesses around weather and working with businesses.
So whether that's climate modeling, whether that's working with various types of industries to, you know, predict, you know, kind of weather events and how to work around those, you know, we're working on batteries and battery solutions, both on cleaner batteries, as well as doing modeling using quantum computers around longer lasting batteries than today's lithium ion, so we're working not just around directly in climate, but in areas around climate as well.
You know, the environmental ecosystem has issues beyond just carbon that we're working. Like for-- for instance, in 2019, we announced a whole new way to recycle PET, which is a type of plastic. It's very common that, like, 8 million tons ends up entering the oceans every year because it's hard to recycle. So we've invented new technologies around that as well.
So while I think people think of IBM, and we are a-- a technology company around computing, all of the work that we've done around material science that has typically gone into things like semiconductor manufacturing, we're able to take some of those technologies and expertise in science and combine with AI and quantum, where we're clearly have leadership positions, we're able to make advances in material science to-- to help with climate and environmental issues more broadly.
BRIAN SOZZI: Jim, on the topic of semiconductors, you've been around the tech industry for a while. You're the former CEO of Red Hat. What stops this really massive chip shortage we're seeing in tech right now?
JIM WHITEHURST: Well, look, vaccines. You know, a lot of this is just a set of supply chain issues from around the world, and I think we start to see how fragile that is. I think in the long run, you'll see a lot more work done to think about robustness of supply chains. But these are big multi-billion dollar, you know, facilities that go into that supply chain.
So frankly, right now vaccines, I think, is going to be particularly critical to getting people back to work and the current supply chain working. And then I think over the next decade, we're all going to be thinking about our supply chains and robustness going forward. We've all kind of learned hard lessons, but those aren't ones that can be fixed, you know, even in a year or two.
BRIAN SOZZI: So this is a problem we'll have to deal with-- I mean, this is not just a 2021 issue.
JIM WHITEHURST: Well, you know, it depends on the specific area and relatively where there's over or undercapacity. So where can we ramp up to meet demand in specific areas versus other areas where you're close to capacity, so even if you get back to normal you can't make up for the shortfall. And that just differs in a bunch of different areas. But I do think by the time you get towards the end of this year, assuming vaccines against variants are reasonably effective, I think you'll start to see it subside.
BRIAN SOZZI: All right, we'll leave it there. IBM President Jim Whitehurst, always good to speak with you. Stay safe. We'll talk to you soon.
JIM WHITEHURST: Thanks for having me. Appreciate it.