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New carbon emissions figures cast a shadow over Paris

Hopes China was on track to cut pollution appear overly optimistic, writes Pilita Clark

New figures showing global carbon emissions in 2017 are likely to rise for the first time in four years make a gloomy backdrop to the UN climate talks in Bonn this week that were already looking difficult.

Climate-warming emissions were almost flat in the years between 2014 and 2016, despite a growing global economy. This had bolstered hopes that the world had finally found a way to “decouple” economic growth from carbon pollution, a goal that had seemed unimaginable only a few years earlier.

Many scientists say emissions should peak by about 2020 to have any hope of preventing dangerous levels of warming this century.

But the data published on Monday by an international consortium of climate researchers suggest levels could rise by 2 per cent this year, driven by a rebound in fossil fuel burning in China, the world’s emissions superpower.

It is too early to know if this will prove to be a one-off spike in a trend of decoupling, or the start of a fresh pattern of growth. Either way, it casts an unsettling light on the Paris climate accord that virtually every country in the world adopted in December 2015.

That agreement is supposed to hold global temperature rises “well below” 2C from the pre-industrial era, and preferably no more than 1.5C. To achieve this, countries have each published an initial round of plans to cut or slow their emissions. The trouble is, we already know this first round of pledges is nowhere near enough to meet the Paris accord’s goals.

The plans currently add up to only a third of the reductions needed to avoid 2C of global warming at least cost, according to a UN Environment Programme report last month. That leaves what the UN calls an “alarmingly high” emissions gap. This will be even harder to close if we are on the brink of a new period of carbon growth, considering the state of global climate politics.

Negotiators in Bonn are supposed to be crafting a set of rules, due to be finalised next year, ensuring countries ramp up future action enough to meet the goals of the Paris agreement.

That effort has been complicated by the decision of US president Donald Trump to withdraw from the accord. The US is the second-largest emitter after China and although Washington cannot legally pull out of the pact until 2020, Mr Trump has made it clear he has little interest in the Paris pledge made by his predecessor, Barack Obama, to cut US emissions by at least 26 per cent from 2005 levels by 2025.

Numerous US states and business leaders say they are still committed to the Paris agreement, despite Mr Trump.

But that still leaves a large question mark about China. Beijing has leapt to fill the political gap left by the US in global climate leadership. And there had been signs that China was on course to meet its Paris plan to halt emissions growth by 2030.

That hope has been dented by the new figures. It is hard to see the Paris accord succeeding unless they prove to be a temporary blip.

Michel Doukeris, chief sales officer for the global brewer, will take the helm of the U.S. subsidiary, Anheuser-Busch, on Jan. 1, succeeding João Castro Neves, who has run the division since 2015. Mr. Castro Neves, 50 years old, is leaving after 22 years at the company “to pursue other opportunities,” AB InBev said.

The shake-up includes a handful of other executive changes, including the promotion of a PepsiCo Inc. alum and former U.S. intelligence officer, Brendan Whitworth, to vice president of sales for North America, succeeding Brazilian Alex Medicis.

AB InBev’s sales in the U.S. have fallen as Americans shift away from domestic lagers toward craft beers, Mexican imports, wine and spirits. The company’s share of the U.S. beer market, its largest, fell to 44.1% in 2016 from 48.2% in 2011, according to research firm Euromonitor International. That slide has continued this year, especially for its biggest seller, Bud Light.

The management changes mark a new phase for the company’s U.S. operations, said Carlos Brito, chief executive of the Belgium-based behemoth. The first phase, after InBev’s 2008 takeover of Anheuser-Busch, was aimed at cutting costs and paying off debt. The second focused on expanding the portfolio with craft beers and growing higher-end brands such as Stella Artois and Michelob Ultra, Mr. Brito said.

“Now, we’re going to have a more commercially minded person at the head of the business” with a background in sales and marketing, Mr. Brito said in an interview. The new chief’s mandate: to boost revenue.

Mr. Doukeris, a 44-year-old Brazilian, joined the company in 1996. He worked as vice president of soft drinks for Latin America before moving to China, where he rose to become head of the company’s Asia-Pacific operations in 2013. He is currently based in New York.

The new Anheuser-Busch chief said he aims to increase speed to market and pledged to invest more in data and analytics to do more targeted local and regional marketing. “We need to understand the consumer needs,” Mr. Doukeris said in an interview.

Mr. Doukeris and Mr. Brito said they would continue to develop the brewer’s portfolio to offer brands that work for different occasions and didn’t rule out further acquisitions. The company is still digesting its $100 billion merger with SABMiller last year, which lessened its reliance on the U.S. market.

AB InBev has been unable to arrest a nearly two-decade decline in Budweiser sales, even as it has moved aggressively to expand Budweiser distribution around the globe.

At the same time, its profits have increased. North America is the biggest profit contributor for AB InBev, with the U.S. and Canada contributing about a third of profits, according to analysts.

The world’s largest brewer was built by a group of Brazilian businessmen who brought a private-equity approach to the industry. It grew into a global giant through deals for Anheuser-Busch, Grupo Modelo and most recently SABMiller. The company has proved adept at acquiring businesses and cutting costs but has struggled to increase its share in key markets.

Retail store sales of Bud Light, the No. 1 U.S. beer brand by volume, fell 5.7% this year through Oct. 21, according to Nielsen data compiled by Beer Marketer’s Insights.

Wholesalers, industry observers and former Anheuser-Busch executives have faulted the company for frequent changes in its Bud Light marketing campaigns, high turnover in its brand leadership, and a lack of understanding of U.S. culture among those in charge of reviving an iconic American beer.

From the Archives

Boss Talk: AB InBev CEO on Leading an Open Office

Carlos Brito, CEO of Anheuser-Busch InBev, talks about the no-frills culture of an open office, and how to attract and keep top talent. (Originally Published June 27, 2010)

AB InBev in March addressed some of those concerns with the announcement that Andy Goeler, a three-decade Anheuser-Busch veteran, would return to the helm of Bud Light, a brand he led in the 1990s.

Mr. Brito said that for a brand so large, “it is sometimes a challenge to find the right tone. You need to appeal to a large group of consumers, but you need to have a target audience to really focus your communications. So how do you do that without alienating people?”

“Today with Andy Goeler, Bud Light, I’m sure, will be in a much better place,” Mr. Brito said, adding that he is optimistic about the brand’s two current campaigns emphasizing friendship and the quality of the beer’s ingredients, and its recent push to court Hispanic consumers. “Of course, if you have people that understand the local culture and understand the business and love the company…this is a great combination.”

Noting that Mr. Doukeris has a record of developing “local talent” in China, Mr. Brito pointed to the promotion of Mr. Whitworth, who joined AB InBev in 2013 after five years in PepsiCo’s Frito-Lay division. Mr. Whitworth, 41, previously served as a U.S. Marine Corps officer and as an operations officer for the Central Intelligence Agency’s clandestine service, according to his LinkedIn page.

Amazon is developing a free, ad-supported version of its Prime Video streaming video service, according to Ad Age.

The free tier will complement Amazon's ad-free, on-demand Prime Video service that is included with an annual $99 subscription to Amazon Prime, which provides free shipping, deals, and other perks to its online shoppers.

Amazon is reportedly in talks with TV networks, movie studios, and other media companies about programming for the service.

For the ad-supported service, Amazon wants to dive into back catalogs of TV and movie studios, looking to beef up its children's programming, for example, one TV industry insider says. It is also going after lifestyle, travel, cooking and other shows that are a good fit for an e-commerce platform.

Amazon, which is reportedly already estimated to have spent almost $5 billion on content by the end of the year, is said to be doubling down on its content efforts as Apple and several other tech companies push into original programming.

Last week, for example, Apple reportedly outbid Netflix for a new TV show that will star Reese Witherspoon and Jennifer Aniston. The series is said to revolve around the lives of morning talk show hosts, based on journalist Brian Stelter's book Top of the Morning: Inside the Cutthroat World of Morning TV.

Apple's push into original content is being led in part by former Sony executives Zack Van Amburg and Jamie Erlicht, who joined the iPhone maker back in June. Van Amburg and Erlicht are known for their work on many popular TV shows, including Breaking Bad, The Crown, and Better Call Saul.

Of note, Amazon Prime Video is still not available for the Apple TV. Apple said the app will be released by the end of 2017.

The last lineups were designed for the spring 2018 season as Moncler chairman and ceo Remo Ruffini plans a new strategy starting in February.

MILAN — All good things must come to an end.

Behind this tried-and-true Geoffrey Chaucer proverb lies Moncler’s change of strategy. The last Gamme Bleu and Gamme Rouge collections, designed by Thom Browne and Giambattista Valli, respectively, were presented for the spring/summer 2018 season.

“Every company must innovate and it’s a choice shared 100 percent with the designers,” Moncler chairman and chief executive officer Remo Ruffini explained in a phone interview on Saturday. “I need to create a new project that will bring new energy to Moncler. It was a very difficult decision, stemming from the need to evolve, to create a solution that would naturally create a new and alternative project to one that was launched 10 years ago and was feeling somewhat dated.”

Ruffini praised the designers’ commitment to the collections and defined Browne and Valli as “two geniuses each in their own way. The creativity and surprises Thom produces are unique in the world, and his excellence, there are few that would contest this. And Giambattista’s elegant and modern vision is unique. I have always admired his style. Each is a number one.”

With the aim to commit themselves to their respective namesake brands, both Browne and Valli “entirely agreed” with Ruffini on the decision. “It’s been a great run, and lots of fun for so many years. But, as we defined a new growth strategy for the Thom Browne brand, I have realized that my focus should be on my own business,” explained the designer. “The fact that this happened when Remo was starting to rethink Moncler’s future made our decision mutual and effortless. I wish to thank the teams who made things happen, together with Remo, who through the years has allowed me complete creative freedom.”

Browne has been expanding his retail footprint, opening his brand’s first European store in Milan in April, followed by a unit in London in June, in the wake of Sandbridge Capital’s acquisition of a majority stake in the company in May 2016 from Japan’s Stripe International. Stripe retains a minority stake.

Expressing his pride in contributing to the success of the brand, Valli said that “conceiving the wardrobe of the Moncler woman and infusing it with the Valli DNA was a real challenge. It brought creations for every moment of her life, from a morning in Gstaad to an evening at the Met Gala in New York. I want therefore to thank Remo for his foresight in choosing me for this exciting project and his support throughout these 10 years where I was able to build a team and bring to life unique collections under the Moncler Gamme Rouge label.”

The last Gamme Bleu collection showed in Milan in June, while the last Gamme Rouge collection showed in Paris in October.

Ruffini underscored that “it’s not that we don’t want to participate to the world of fashion, but we are obliged to give new energy to Moncler.”

Asked to elaborate, Ruffini kept his cards close to the chest, but said that, starting in February, he had “a project in the pipeline that I believe will be very innovative for the sector and will bring new emotions.”

While the two labels have allowed the company to be part of the international fashion weeks, Ruffini first hinted at a possible change of course in a WWD CEO Talks last June.

”This market needs its own strategies. The customer is tired of these ratified fashion caravans,” said Ruffini at the time. “Yes, what we do for the industry is important, it gives prestige, but I strongly believe that we must be closer to consumers, remove the filters between us and the customer. I don’t know how many of our customers even see our shows. We must find new ideas, and each brand must have a strategy closer to its own identity, while everyone, from sports to couture, follows the same strategy.”

Responding to a question about whether he was revisiting the format, Ruffini said at the time that he was working on finding “an approach to our communication in sync with our DNA.”

While the company does not reveal figures for the two lines, the executive said he was very pleased with the performance of both. “They were doing very well, they have been super-strong.” He emphasized the brands’ very selective distribution and niche positioning. The lines are available at 150 doors of specialty stores and in 45 directly operated Moncler boutiques.

The Gamme Rouge project took off in February 2006 when Alessandra Facchinetti was appointed creative director. Valli succeeded Facchinetti in 2008, launching his first collection for the label for fall 2008. The Gamme Bleu brand was conceived as the male counterpart to Gamme Rouge, and Browne unveiled his first designs for the label in January 2009. He blended his sartorial touch with Moncler’s sporting spirit, extending his theatrical creativity to the brand’s shows. Last January, for example, he created a set of winter wood with pines, birches and artificial snow celebrating the art of hiking, with ropes wrapping and connecting the models, but also as the main motif printed on many of the pieces. In June, the set at first glance presented pine trees and snow, and beyond the pines were palm trees — and the snow had become the illusion of white sand — targeting customers in both Hemispheres.

Valli staged what was to be his last show at Moncler Gamme Rouge in October at the Grand Palais around dozens of glittering disco balls, large and small, with a ballet company that performed hip-hop on pointe to Ed Sheeran’s “Shape of You.”

“There were beautiful dresses in soft pink and white lace, tulle slipdresses worn under embroidered robes and boleros — all delicate, ethereal and pretty,” WWD said at the time.” But the stuff that resonated most was the fancy athleticwear, the red-white-and-blue striped tulle bomber and a white robe-like windbreaker with lace inserts.”

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