Jules Kortenhorst (MBA 1986) is CEO of the Rocky Mountain Institute, a leading think tank focused on sustainability and energy use. It has become a go-to source of analysis from the transformation from fossil fuels to renewable energy. Bulletin editor Dan Morrell spoke with Kortenhorst about his career path and how the world can make renewables a reality.

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Dan Morrell: Jules, tell me a little bit about what Rocky Mountain Institute does, and what your role is there.

Jules Kortenhorst: Rocky Mountain Institute is a 35-year-old institution. We have been working on the transition to a clean, prosperous, and secure low carbon energy future for the last 35 years.

I joined the organization three years ago, with a specific mandate from the board to take the organization to the next level and move us from being thought leaders to also, driving impact. We've gone through an interesting transition over the last three years. We've shifted the organization from a traditional NGO to still, a not for profit, but a partnership.

We've grown the partnership significantly. We now have 15 partners. And we have scaled the organization, both in terms of our global footprint-- now 50% of our work is outside the United States-- and in terms of our size. All was a clear-eyed focus on accelerating the transition to a sustainable energy future.

Morrell: And I want to go back early into your career, you worked for Shell in Bulgaria right after the Berlin Wall fell and was right when Bulgaria was beginning its transition to Democracy. Now, I've read that you and your wife, Searl, were actually a part of that process that helped create Bulgaria's democracy. Can you talk a little bit about that?

Kortenhorst: Yes. So interestingly when Searl and I left HBS in 1986, we pursued careers in industry. I joined Shell and Searl joined Procter and Gamble. And we moved to Europe first, but then, the normal ex-pat routine in Shell took over and initially, together with Proctor and Gamble, we moved to Hong Kong. And from there, I was asked to take a posting in Bulgaria.

And Searl came along and found herself, relatively quickly, leading the local office of the Bulgarian American Enterprise Funds, which was a private equity fund set up by the US government, to help the transition to a market economy.

Between the two of us, we were the largest foreign investors in the country. We were also, the only foreign investors in the country. Bulgaria was at the bottom of the list of countries that people were pursuing after the fall of the Wall. Hungary, Poland, the Czech Republic were a lot sexier.

But Bulgaria, equally, needed to make the transition from a communist planned economy to a market economy. And we felt incredibly privileged to be part of that process.

We became good friends with the then, Prime Minister Philip Dimitrov. We started the International Chamber of Commerce. We hosted many CEOs from around the world who came to look at Bulgaria as a potential destination for their investments. And we generally felt that we were part of shaping a liberal market economy in a way that very few people have a chance to do.

Morrell: You've mentioned that, that experience in Bulgaria was revelatory for you. That afterwards, you felt this pull to do more than build successful companies. How did that impact your career in the near-term and in the long-term?

Kortenhorst: In the near-term, after my stint in Bulgaria, I spent a number of years helping run a private equity-backed companies and growing businesses in multiple sectors. But I also continued to have this desire to look for ways to have impact and to make a difference. And in building businesses, we do that. We create jobs. We create economic growth. We do have an impact.

I continue to be interested in broader societal issues and when an opportunity presented itself to take a sabbatical, I took some time off to think about, what was next? And decided that it was time for me to focus more on those more broad-based societal issues. And I concluded that climate change is, in fact, the single biggest challenge that we face as humanity.

So over the course of the last nine years, I have, pretty much, worked exclusively on the energy transition and addressing climate change. But continuously, by looking for ways in which business can be a force for good. And can be the scaling mechanism that it needs to be, to create that low carbon society of the future.

Morrell: I wondered, why you took that sabbatical? And why coming out of that sabbatical, that climate change became the thing that you wanted to focus on?

Kortenhorst: So I had the privilege of doing a leadership safari in South Africa-- a quiet walk with seven other CEOs, in the bush of Africa. We hiked for about eight days in the bush, far removed from any civilization. No roads. No cabins. Slept under the stars in between the animals.

And one day, our guides told us we were going to hike to find some fresh drinking water and he knew a watering hole about a two hours hike from there so that we could replenish our water supply. As we got to the watering hole-- looking forward to the cold, fresh water-- we found a dry hole. And somehow, the inside struck me-- how dependent we are, as humans, on this planet we live on. It was sort of a blinding moment, where I realized that if we don't take care of this planet, the planet can't take care of us.

I think there are two lessons from that. The first one is, take time for reflection. As leaders, we are so busy and we have so many responsibilities. It is hard and it's often, not common to turn off our mobile phones, put our out-of-office message on, and take time for reflection. And I was very privileged to do that, and it's been very helpful in my life and in my career.

And the second thing is, when you do that and you listen to your inner voice, you listen to mother nature, you listen to those that are dear to you, think about, what it is that you were really meant to bring to humanity. What you were meant to bring to your family. What inspires you. And that's what I did.

So 10 years ago, climate change becomes your driving passion. Your first stop is to run for Dutch parliament. Can you talk a little bit about that decision?

So when I became convinced that climate change is this moral challenge of our generation, I figured that the best way to address this issue at scale is to change the rules of the game. To work on the policies and regulations that would enable the transition to a low carbon future. So maybe somewhat naively, I concluded that the place where you change the rules is in the political process.

And I put up my hands to serve in parliament, partly because I felt that somebody with business experience and somebody who has an understanding of the energy system, could have that influence in the formation of policy and regulation.

Several of my business school friends alerted me to the fact that this was possibly, a somewhat naive perception. And that maybe, people who spent the last 10 years of their life running private equity-backed companies as CEO might not be the most ideally suited to serve in parliament. But I tried. I made some progress. I got some things done. But it was a hell of a lot harder and the process was moving much more slowly than I wanted.

So when the opportunity came along to influence policy from the side by creating a philanthropic organization that has become the largest philanthropy on climate and energy in Europe-- the European Climate Foundation-- I was happy to trade in my role as a parliamentary representative for a foundation CEO.

Morrell: That is, again, another new transition for you in terms of your career because that's the nonprofit world.

Kortenhorst: That is another transition. And it is an interesting transition, in that, I was surprised to learn how much that world is different from the business world. And how civil society does not always do a good job in learning from the business world.

So working with NGOs and building a philanthropic foundation, it struck me how much we could benefit from importing in that community, the management skills, and rational decision making, and the logic that I had been trained in, in the business world for the first 18 years of my career.

Having said that, there are also some things that are dramatically different and quite exciting. Working in civil society, you are surrounded by people who are deeply passionate about the calls that they serve. And issues around motivation and organizational focus are relatively easier in that sort of a setting, than in a traditional business.

But it was a very interesting transition and I learned a lot and I very much enjoyed it.

Morrell: These are two fairly radical life changes. They are certainly fairly radical career changes. You and Searl have four children so there's family considerations, too. How did you weigh all of this?

Kortenhorst: Well, first and foremost, I have been incredibly lucky to bump into Searl on the day before classes started, in the Boathouse Bar between the business school campus and Harvard Square. And to have her side by side with me for the last 30 years. And so, we talked about it and we considered this, but often, her counsel has been and her inspiration to me has been, to follow your passion.

And interestingly, if you do that, you also find yourself in a new and in a different dialogue with your children because what you choose to do can be an inspiration for your kids. Certainly, in some form or fashion, always is a role model for your kids. And if I look at the choices that they make, they have discovered that sort of passion for themselves, as well.

So yeah, you make some trade-offs. We probably, could have accumulated more wealth if we had stayed the course in the business world. But I think we love what we're doing. We're inspired by it. We see our children being inspired by it. And we don't regret the choices that we've made.

Morrell: I've seen you describe the goal of your work at RMI is nothing less than a complete change of the global energy system. Now, that would seem to be a massive challenge. What are those things that keep you optimistic? Those things you hold onto?

Kortenhorst: So first of all, we have no choice. If we do not make this transition to essentially, a zero carbon energy system over the next 35, 40 years, then the risks we face, in terms of climate change, are unacceptable. So the imperative is there.

But the good news is that there's also, a tremendous amount of momentum-- two words-- a new energy system, that even if you were to not believe in science and ignore the warnings on climate change, there are plenty of reasons why a cleaner, more resilient, more competitive energy system in the future is something we should pursue. And you look at the speeds at which the new technologies of our energy system are now becoming a reality, it is nothing short of the next Industrial Revolution.

The cost of solar energy and wind energy is coming down relentlessly. The learning curves point to improvements of 20% every time the globally installed capacity doubles. And already, in many parts of the United States and beyond, wind energy and even, solar energy, is now more cost effective than traditional fossil fuel-based electricity.

So it is an incredibly exciting story. And by the way, it's not just exciting here in the United States. About a third of our work is in China and the speed with which the Chinese government and Chinese industry is deploying these new technologies is mind-blowing. It's pacing well ahead of what we are seeing in the developed world. And is very promising in showing a pathway to address greenhouse gas emissions in emerging markets.

So yes, there are many moments of optimism and of excitement, as we see this new Industrial Revolution unfold.

Morrell: It seems to me, that what you're describing in China-- that rapid adoption-- wouldn't have been possible 10 years ago. Tell me a little bit about, what's driving that change? Has it been a change in approach? Where is it coming from?

Kortenhorst: I think there are three major shifts that really, have had a huge impact on the debate. The first one is that, the energy technology of the future were largely, early inspirations and dreams 20 years ago. And now, are competitive in increasing parts of the world. And so, what was an entrepreneur's dream or an inventor's dream 20 years ago, is a hard core business reality today. And that shift is only accelerating.

And that has a huge impact on the second major trend and that is that, 20 years ago, this was not on the agenda of most businesses. Some companies had the foresight to understand this 20 years ago, but most CEOs were not focused on climate change, as both a major challenge and a major opportunity for their business.

Now, there are very, very, very few CEOs who do not acknowledge that climate change both, represents a major challenge and a significant opportunity. And who are not actively positioning their companies for the future, whether it is BlackRock who came out with a report just a couple of weeks ago, saying how their portfolio needs to be adjusted to be climate change resilient. Or it is Shell, who have committed themselves to a net zero emissions energy future, by the middle of the century. Or a multitude of consumer goods companies that have come to appreciate that being clean is part of the proposition that they provide to consumers.

CEOs are on to this issue. And there's only very few left, who are either denying or ignoring it.

Which gets me to the third point and that is that 10 years ago, there was significant debate about the magnitude of the challenge. The degree to which there was scientific uncertainty around this. And the way in which we needed to address climate change as a major risk factor for businesses, for markets, and for society as a whole. That uncertainty has gone around the world.

Whether it is the government of China, or business executives, or households and families, people now know, that this is proven science. And that this is no longer an issue we can ignore.

And there's only one very, very small pocket left of climate deniers and it's such a small group, it's really, quite insignificant. It just happens to be one of the parts of the political spectrum here in the United States, but it's only a matter of time before the facts and reality will catch up with that part of society. And then, everybody will be on the same page.

Skydeck is produced by the External Relations department at Harvard Business School and edited by Craig McDonald. It is available at iTunes or wherever you get your favorite podcasts. For more information or to find archived episodes, visit alumni.hbs.edu/skydeck.

Featured Alumni

Jules Kortenhorst

MBA 1986

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