Daniel Hooft: I hope there are people who are looking at what we're doing and thinking, "Gosh, that's exciting, that's brave, but it's fun and hope it works." And maybe I should do something like that. Andrew White: Hello and welcome to this edition of the Leadership 2050 podcast from Oxford University's Saïd Business School. I'm your host, Andrew White. In this episode, I'm in conversation with a pioneering blue water entrepreneur. Daniel Hooft is the founder and CEO of an offshore kelp farming enterprise, Kelp Blue, which he hopes will provide a solution to climate change and a healthy bottom line. Daniel shares how his fascinating life story equipped him with the skills to do, in his words, something ambitious at sea and at scale. What can this former professional sculptor turned offshore oil and gas engineer teach us about leadership that's fit for the 21st century? Andrew White: Stay tuned to find out how indigenous wisdom can help you manage for the long term, getting your team to embrace continual change and why letting people go is key to creating a forward facing company. I began by asking Daniel to tell us more about Kelp Blue. Daniel Hooft: So Kelp Blue is a company I set up a couple of years ago. After 20 years in the oil and gas industry, I was with the Shell for 20 years. What we do is we grow giant kelp in offshore environments and the idea is to take the seaweed industry from a fairly high cost manual industry where markets are not very developed into a space where it's somewhat more industrialized. Daniel Hooft: I mean, the intent is to have positive impact on carbon and on the ocean's biodiversity. So we also seek to do things in a biomimicking fashion, but it's a combination of an impact business which should have a very healthy bottom line. Andrew White: That's really interesting. So for those of us who just see seaweed on beaches and don't understand the offshore environment and don't understand the commercial uses of seaweed, could you give us just a bit of insight into the process, but also then the harvesting and then the use of the product as well? Daniel Hooft: Yeah. There are thousands of kinds of seaweeds and you do actually use them quotidianly in quite a lot of products without being aware of it. So the beer foam, when you get a beer from a tap, it typically has algenate in it, seaweed extract to keep the foam nice and stiff. You typically have seaweed extract in your ice cream to make sure the ice crystals don't get too big. It's in your shampoo. It's in your yogurts to keep the fruit suspended. Daniel Hooft: The challenge the industry has is that it is typically all the supply comes from either wild harvest or from very small owner operator of small manual farms in the tropics, typically Indonesia, Philippines are the biggest producers. And then you got the food industry, which is mainly focused around South Korea and China, and Japan, and is also very manual. So while there are applications for seaweed products in much larger industries, as long as the industry sources from either wild harvest, which is seasonal, erratic, and much frowned upon nowadays or from small seasonal suppliers, you'll struggle to develop a market of meaning. Daniel Hooft: So that's our first sort of bold step is to see if we can produce seaweed at scale all the year at the volumes that let's say a cargo could be interested in. The whole of Europe today produces maybe a thousand tons of seaweed. Cargill, I think, becomes interested once you can provide that every day. And so to do that, we grow a species. We grow giant kelp, the biggest of the seaweed kind. So you might be familiar with it from pictures and footage from California. Daniel Hooft: These are enormous plants, 15, 20 meters high in the water column and they grow to the surface. And then at the surface you've got this thick canopy of leaves. So they're incredibly majestic forests teaming with life, crustaceans, fish. They form a hiding place obviously for prey and for predators to ambush their prey. They form a place where creatures live, where they procreate, where they lay their eggs. Daniel Hooft: So they're an enormously important foundation species environmentally. And this species is perennial. So it grows 20, 25 years at a time, which means that the seeding costs that are typical for a seaweed farm disappear for me more or less. And it's also possible to mechanically harvest it, which has been done since the first world war when it was harvested to extract potash from it to make gunpowder. Daniel Hooft: Mechanical harvesting is also essential because the sort of manual harvest that most seaweed farms have to undergo means that is about 30 or 40% of their unit technical cost. So at a fell swoop, we remove those 60 70% of the cost. And then the rest is around economies of scale, growing it in places where you're not subject to any seasonality. So we're offshore in cold nutrient rich waters. The seaweed grows well all year. Daniel Hooft: So all my vessels, or my factories are occupied all year rather than in a typical seaweed context. They would be occupied for a few months, a year and idle for the remainder. Andrew White: So I'm guessing, from what I can understand, you're creating economies of scale. This is actually probably replacing other products that are more harmful to the environment. You're also creating a habitat whilst the seaweed is growing. So it's increasing the biodiversity in those places. Is there a carbon benefit as well? I mean is seaweed a carbon sink? I don't know what the right term is, but is it beneficial from that point of view too? Daniel Hooft: Yeah, that's correct. There is a carbon benefit not yet properly quantified or let's say the scientific consensus is not there yet to underpin a methodology or carbon credits. That's something we're working on. In the scientific community, therefore you have a lot of dissension because they like to have arguments. But it's clear that carbon does leave seaweed systems and is then sequestered in sediments, shallow sediments, deep sediments. And the potential for carbon sequestration of these big kelp forests is very significant. Daniel Hooft: It could be an order of magnitude or two larger than your typical land forest. So while some scientists dispute that, I think it's very worthwhile to do the further research to discover if that's in fact the case. Our business model doesn't rely on this very much. So even at optimistic carbon prices, it contributes something to the revenue but not particularly significant. It is very significant for us in terms of pull for customers, for staff, for investors who want to be involved in things that have a positive impact on climate change. Daniel Hooft: It's also very significant or will become very significant once we can access debt financing because there's a lot of debt financing available that comes at very much more generous terms when you have a positive carbon impact. Andrew White: So can I take you back? You started your life, I think you said in the oil and gas sector. What got you to this place? And in a sense, what were the the leadership lessons or the life lessons, the inflection points, the turning points that led you to the place where you are now as CEO of Kelp Blue? Daniel Hooft: So I am Dutch, but I grew up in Dubai where my father was setting up a merchant bank in the mid-70s. We then moved to Canada. I was very keen to follow in my father's footsteps, not as a banker, but as a Russian speaker, as a spy. My father spent some time with military intelligence, which Dutch military intelligence, with hindsight I should have maybe already realized is not quite that impressive. Daniel Hooft: But that's what I wanted to do. So I was studying Russian at school and when I finished school at 16, the plan was to go and continue learning Russian in either Paris or Munich because that's where a lot of emigres lived. But then suddenly the Soviet Union fell apart and I said, "Well, why wouldn't I go and learn Russian now there now that this is a great free country?" Daniel Hooft: And that was quite a bold move of the family to support that because the ex-Soviet Union was a very, very wild place to put it mildly. So there I was suddenly wandering around the caucuses with a machine gun over my shoulder at 17, thinking this was a normal gap year. Among other things that I picked up there was sculpting. I interned with a sculptor in Moscow for the remainder of that year. Daniel Hooft: In fact after coming back to the Netherlands and doing my engineering degree and sculpting all the way through, I did continue as a sculptor professionally for a few years and thought that... I suppose I would do that for the rest of my life. What led me to join the oil and gas industry was very unusual. It was just this feeling that being a sculptor in Amsterdam wasn't exposing me to enough life, death, poverty, the big themes that art should be about in my opinion, because Amsterdam is a very comfortable place where it's very difficult to die of hunger there. You'd really have to try quite hard. Daniel Hooft: So my girlfriend at the time suggested, "Why don't you join the oil industry and go into drilling and then you have lots of free time because you have these rotational jobs and you go to strange, unusual places where you see a lot of things that might inspire good art?" So that's what I did. I joined Shell went to Nigeria for three years and certainly saw a lot of unusual and inspiring things there. I spent a few days in a cage in the middle of a village while people negotiated for how much I was worth. Daniel Hooft: That was an enlightening moment as well at 25 to realize that I wasn't worth millions and millions. I think ultimately I was traded hands for $700, which was a sobering thought. So the drilling world and the oil and gas world for all its flaws and it's of course not popular now, it's just as much as to say that you're with the dark side and that you're one of the Sith Lords. Daniel Hooft: But for all its negatives, it is a very inspiring world with fast moving projects. You're in exotic places. I was at Shell, which is, I think, particularly good at hiring interesting people, people with an interesting story, not just capable but also diverse in thought. So accidentally 20 years later, I found myself having gone up the ranks and doing very much general management stuff, just a layer or two under the excom, and had been wanting to leave big corporate world for a while. Also, had a feeling that oil and gas was maybe of the past. Daniel Hooft: At that juncture by serendipity, my wife went to a lecture by an Australian scientist called Tim Flannery who talks about... Among other things, he's a mammalogist originally, but he talked about seaweed and its ability to draw down carbon and boost biodiversity and address our stock carbon problems. Daniel Hooft: So not the problem of the carbon that needs to stay in the ground, but the problem that we already have too much carbon in the air and direct air capture is very difficult from the atmosphere directly. She was both inspired and slightly bemused because this academic, of course, had no idea how to pay for putting seaweed in 10% of the world's oceans. I started looking into it auto didactically. I enjoy the sea, but had never been aware of these big forests. Daniel Hooft: And then suddenly the penny dropped that perhaps all of the skillsets I'd learned to date were eminently suited to doing something at scale at sea in exotic places. So I never looked back. I quit and I started this company a month before COVID, just managed to squeeze in my first scouting trip to Namibia and then lockdowns came. Daniel Hooft: So that's sort of the story of how I got here. In terms of the leaderships aspects of that formative thing, I think it's a mix of things. So I grew up a lot of my youth in Canada on farms. And when you're on a farm, you put yourself to work even if your parents don't. But at a very much earlier age than I think city people, you are handling a gun to shoot vermin. You're driving tractors and almost cutting your foot off with the mowing machine. You're building walls, you're repairing things, not only work but also for leisure. You're building dams in the river. Daniel Hooft: And so the early stage at which you're autonomously dealing with quite a lot of equipment and often doing this with a number of other kids your age, or older, or younger, I think is an underappreciated form of leadership training, early leadership school that parents should seriously think about. And if you live in a city, that doesn't mean you don't have these options, but extracurricular programs, programs of which children are encouraged at a much younger age than normal to handle equipment that is considered dangerous and feel the responsibility of that. Daniel Hooft: Yes, it comes with risk, but it comes also with an early appreciation of what these things mean. I think that's a first step in an a self-awareness that's maybe larger than others have. The years in the ex-Soviet Union, because I kept going back as a student to Kyrgyzstan and Mongolia riding horses up in the high mountains in the mid-'90s. I did an internship in Baku working with Glencore. They incredibly grew a bunch back then. I think they've very clean nowadays apparently. Daniel Hooft: But that was mid-'90s. Then went to Georgia and kept going back to Georgia and suddenly found myself with some real estate and vineyards in the late '90s. And the whole experience from the early '90s, seeing the failed states in which nothing functioned and nothing had functioned frankly for a very long time 'cause wasn't a strong suit of the Soviet Union to take care of its people. Daniel Hooft: So meeting these peasants in the middle of Siberia in 1992 whose lives had not gotten any better since 1892, arguably a lot worse. At the same time seeing all these different republics and the different ways in which people historically have filled in their lives and the sheer just variety and diversity of people and opinions. And then particularly also the schizophrenia of the Soviet citizen, which I think we see recurring now in Russia where they both love and hate their state and they will support Putin perhaps on the face of it, but at home in the kitchen might have a totally different opinion. And that I think was a great insight into human nature and not necessarily only a positive one. Daniel Hooft: So those early exposures to much higher risk and much more diversity than most people have the luxury of seeing, I think bred a confidence, also a cockiness and an arrogance certainly when I was younger. But it also bred a lot of curiosity and a lot of humility and a lot of open-mindedness, and a cheerful stoicism because you're not in charge of the luxury around you. These are rough places. There isn't any luxury to be found. Daniel Hooft: Toilets tend to be a hole in the ground. And so if you've got Delhi belly, then there you are, you're not feeling very good. You might as well laugh at it because that's more fun than crying about it. So I think those were very formative experiences. When I then moved into Shell, I was in the very lucky position of which I didn't realize at the time that it's very unusual how the oil industry develops young drilling professionals because you go straight into a drilling rig and after six or nine months of a combination of just hard labor to realize what the work is about, and training programs, you're suddenly dumped there and you're in charge of a few hundred people, dozens of different contractors, a very difficult and complex activity and set of activities. And you are tasked with taking care of that. Daniel Hooft: Comms weren't what they are nowadays. You've got a rig spread that may be costing a few million dollars a day. So your decision-making, if you linger too long on a decision, that's $1,000 a minute. Every [inaudible 00:17:11] is $15 a second. And so while on the flip side, if you make your decision too fast because you get nervous about loss of money, a wrong decision in a context like that could be 20 days of delay, which is $40 million down the drain. Or it could be even worse. It could be lives. It could be oil spills. Daniel Hooft: So the sheer responsibility and the realization that everything about leadership is around being able to stay calm in a position like that to be able to continue to trust in your values, but to make those judgment calls between velocity and quality of decision-making, it's a very unusual lesson to learn so early in an environment that's both utterly unforgiving. Because if you make mistakes, you really hear it. But extraordinarily forgiving because they've all gone through this, they've all made the mistakes. Daniel Hooft: So nobody is firing you if you make the wrong mistake and lose the company $40 million. They're firing you if you make decisions that are wrong in terms of values or life or risk. So that was an extraordinary experience. And then just being able to go from country to country and see greenfield operations and brownfield operations and then run greenfield operations of brownfield operations. Daniel Hooft: So for those of the listeners who don't know what that means, a greenfield is a extractive industry word for a new oil field. So you have a forest and you start and try to develop that as cheaply and harmoniously as possible. Brownfield means going into an existing asset and tackling whichever opportunities or challenges there may be. Daniel Hooft: So seeing this variety in a fairly sports space of time every three years moving jobs, and each time it's a more senior job, you see an enormous variety of different challenges. So you quite rapidly realize that these are not... It's not about, well, you have to be on top of the content quite rapidly. You cannot be on top of the content. Being on the top of the content gets in the way. It's about the same type of challenges everywhere. Daniel Hooft: Are the values clear? What's the corporate culture? What's the vision? How are decisions made around here? Those questions, and either it's right and you arrive, and you only have to polish or improve or try to slow down the natural atrophy or it's deeply wrong and you have to tackle those and you have to tackle them boldly and rapidly and it's going to be very unpopular. Daniel Hooft: So that was sort of the pre Kelp Blue leadership experience. I think it prepared me extraordinarily well for what we're doing here, which is by no means extractive. It's a very positive environmental business, but in fundamental in terms of hardware and people and the sort of challenges of operating in difficult spaces, it's quite similar to what I'm used to. And the big difference I suppose, is you don't have this enormous juggernaut with all of its cash and all of its skill sets and people and capability to draw on. You're very alone when you start a new business. Andrew White: Incredible story. I mean, just the way you go from Amsterdam, it's too safe for the art that takes you into the oil industry. You talked about Canada and what you got up to as a very young man in terms of machinery and adventure, heading off into Russia, seeing another opportunity there, heading off into different parts of the world with lots of complicated kit and responsibility. Andrew White: When I listen to you, you've had this ability to see where opportunity is, to see where adventure might be, but also to see changes in the world. And particularly on that latter point, when you look around the world, what do you see as the biggest challenges? And in a sense, at listening to you, they seem to be, some of them are embodied into Kelp Blue, both in terms of the leadership style you're talking about, but also the impact you're trying to have as well. Daniel Hooft: Okay. I mean, if we start at the sort of gloomy end of the scale, I think that we're in one of those phases of history in which people are very polarized and getting more and more polarized. So sort of 1930s, 1870s, these recurrent moments at which people start to define themselves, not by what the vision of the future is they want to embrace but define themselves by who they're against. Daniel Hooft: We followed the Brexit discussions and wherever you stand on those discussions with hindsight, I think anybody who looks at the historical record would remark on that it was a discussion that was led around making the other side look like idiots or bad people, or effeminate, or whatever the word is. Trump, a lot of the discussion is the same. And so we find ourselves in a time when people are defining where they stand, by who they are not, by who they're against. Daniel Hooft: I think that's very unwholesome. It's also, in my opinion, not particularly useful. Once you've defined yourself as, "I'm against that, what do you do next? How do you act on that?" While if we move to the positive, if you define yourself by saying, "The world I want to live in is one in which humanity is more in harmony with nature is a world in which we have a much healthier balance between what we take from the planet and what we give back." Daniel Hooft: Well, then the first step is quite obvious. You make the changes at home or you look at your business and say, "Well, this is the wasteful bit that I've always disliked," and you change it. So it's very important that we somehow drag ourselves out of this negativism. And that's true, I think both culturally and business wise. A good example in the space that we operate in is how the discussion has gone from Al Gore's Inconvenient Truth was I think a great piece of work, but was really around highlighting the danger. Daniel Hooft: 20 years later, too many people are still talking only about the danger and the doom, and the gloom. I don't think that's very helpful and it doesn't tell people what the next step is. So I think the people we should be admiring are people like Paul Hawken who set up Project Drawdown, because as far as I know, and I'm probably insulting a whole bunch of people who did do work on of the similar sort before him, but Project Drawdown to me was the first time that I came across a rigorous piece of work. Daniel Hooft: So for those who don't know, Project Drawdown, it's a fairly science and economics based approach to say, what are the ways in which we can tackle climate change in which we can reduce greenhouse gas emissions? So its approach is to say, "People talk a lot about electric cars." Fine. What's the opportunity cost? What's the bang for the buck as far as we know?" And of course you need to make some wild assumptions. What's a better bang for your buck offshore wind or onshore solar? And so it maps out these hundreds of opportunities and ranks them in terms of the costs, the co-benefits. Daniel Hooft: I think that's a spectacular piece of work. So anybody who is keen to do something in the climate change space, but doesn't know where to start, well, for a start you could open Project Drawdown and get a lot of inspiration. And whether that's direct or indirect inspiration doesn't really matter. Daniel Hooft: So that's, I think, one aspect of it. Another one that I think is very little talked about is that I often have the feeling we live in a time with a strange generational dysfunction. What I mean by that is look at the average age of the Apollo cruise that NASA sent to explore the moon. It was sort of early to mid-'30s. And it was only that old because the whole program was delayed as far as NASA was concerned by five or six years. Daniel Hooft: Look at the cruise of the ISS now, and the average age is I think 56 or 57. Look at airline stewardesses. Used to be something that you did in your late '20s. You were paid nothing. You had a champagne lifestyle as a way to explore the world. Now, we have people doing it in their 40s and their 50s. It's lovely that those people still have that opportunity, but I mean we need to look at it also as a perspective of what is the entry point? Daniel Hooft: What funnel and opportunities are we creating for young people to become astronauts? Why would you want to become an astronaut at 20 if you think it might take 36 years to be sent to space? C-suites is the same as CEOs seem to be getting older with longer tenure. I find that strange. Our whole life we... Well, I think that most of your life you spend in a certain role and as soon as you've made yourself redundant in that role, then you've had success. That's really the success criteria of that you've really mastered that role. Daniel Hooft: Obviously, then you should also move on and pass the baton to the people who are doing the actual work for you. Why does that suddenly change when you're in the C-suite? I didn't think it does. So this was very much my frustration or my realization, let's say at Shell, was that I thought being quite a lot younger than most people, most of my peers, I thought, "Great, I have the opportunity to affect some real change from an organization that is extraordinarily well suited to affect real change and is full of people who want to affect real change." Daniel Hooft: But I realized quite quickly that this problem I just described also leads to an enormous stasis, a sort of swamp like behavior at the top of the decision-maker's level because people have spent 30 years of their life getting to a position that they might have some power, and once they're there, they're four years away from their retirement. So by then what's more important? Are they well-trained for making those difficult decisions? Daniel Hooft: I think that has to change. My personal ambition is certainly not to hang around any longer than I need to as CEO of the company that I've set up. And that's probably even more difficult because it's my baby and I sort of own it. But I think that's essential. It's essential to move on in time probably before people realize that you've made yourself redundant. Daniel Hooft: I think you realize this before other people do. If other people are realizing it, you've left it a lot too late. So we've had an interesting discussion in the team where we said we suddenly thought "Well, we need a policy around redundancy and how do we keep people from leaving and attrition?" We suddenly thought, why is people leaving the company a bad thing? Why should we create a KPI that then needs an HR department to figure out how we can keep people? Daniel Hooft: The underlying assumption if that's how you operate is that people of themselves will want to leave. Well, I think, why don't we celebrate those people who do leave as long as it is for the right reason, which is that they're going to do something else. So it's a slightly longer KPI that we're looking at, and I'm not sure we will actually measure it, but it's a philosophical one, which is saying, "What we would like to do is we would like everybody that we work with now to leave us at some point before their pension to go and do something even better. Something even more important, something that's theirs. Turn the whole thing on its head." Daniel Hooft: I think by doing that, what I'm getting at is that whether it's the stasis or the generational dysfunction or the way C-suites operate or HR, it's get people used to constant change. Get them to love change. This stoic philosophy of amor fati, love your fate. Instead of embracing the fear of change that is wired into us from our Savannah roaming days. We are great at change. Everything good that happens to us in our lives is because of change. Daniel Hooft: Sure, everything bad that happens to us is also because of change, but fearing the bad and therefore not getting the good is not a very rational way of approaching life, I would say. So I think it's important that as leaders, we create organizations that are where change is normal and embraced. And as soon as something, a process, an engineering step, an HR routine has been around for several years, people should automatically say, "Well, no, that must be wrong. If we've been doing that way for two or three years, there must be something wrong with it." Daniel Hooft: Which is the opposite, I think, of what people do in most organizations where they said, "No, that's the way to do it." Why? Well, because we've been doing it that way for 20 years. Andrew White: So super interesting idea, and I've done research into transformation and one of the questions that keeps coming up when we present the research back to companies is why is change so difficult? I think I've probably come to a similar conclusion to you that over the last 40 to 50 years, we've created organizations that have been based on predictability, stability, hierarchy. Andrew White: It's what stock markets want when you're looking at dividend stocks. It's come out of the automotive manufacturing and the factory mindset. I just love what you said because you could see the legacy of Kelp Blue as having produced five CEOs that go out and run similar types of businesses, not necessarily the same, but think about the multiplication effect of that. Andrew White: So it's not just the impact this business is having, but it's what you create in terms of a pipeline and people need to leave to do that. So actually managing attrition and saying that low attrition is a good thing is the opposite. Yes, it could be problematic if you're losing people for the wrong reasons. It's also an indication that your culture is creating people who grow up and isn't that nature. The bird flies the nest. You're in Namibia at the moment. We were talking about wildlife and the male little lion ultimately becomes the alpha lion with its own pride. Andrew White: There's a pattern here, which is not about the stasis as you talked about, which is about this continual change and being in a state of evolution rather than episodic events of change. Daniel Hooft: Just leading on from that, there's another seemingly counterintuitive thing that I think is changing and hopefully will change for business and leadership and how shareholders markets view investments, businesses. We see the sort of nascent efforts in ESG, in climate in trying to give people credits for this and credits for that. I think they all have their flaws and their strengths and they're developing and will develop. Daniel Hooft: I think the fundamental of it is that we are swinging back on the pendulum from a very short term sort of this quarter's profits and next quarter's forecast. Any problem that is longer than 10 years down the line, well, on your discounted cash flow model, that doesn't matter. So it's a truth that I think people don't look at often enough. The oil and gas industry is a good example. You've got billions and billions and billions of dollars of liabilities in terms of cleanup costs. Daniel Hooft: Everybody knows them. Well, what do you do? You stick them 15, 20 years down the line and given your cost of capital is what it is, that means nothing to anybody. Hey, it's after your retirement date and it doesn't mean anything to any analyst. So what do you do? You pile up more liabilities. And that's very relevant because those liabilities are cleanup, environment, carbon, all the things that we're struggling with. Daniel Hooft: So my personal opinion is that the Paris Accords, the sort of tackle this at the demand side, pay people to clean up carbon is a big mistake. It's going to distract us for 10 years and then at some point we're going to say, "This is a really inefficient way of tackling this problem." If we have too much carbon in the air, what you do is you slow it down at source, not pay the garbage men more. Produce less garbage. Daniel Hooft: So the old simplest ideas for handling excess carbon, which is to make it more expensive, to take it out of the ground, I think still make most sense. And there are political and lobbying reasons why we end up with where we are, but we'll come back to it. What I meant to say is that I think leadership needs to realize that we're in an environment in which the timeframe that you look at a business and what you're running and your liabilities and your opportunities is extending. And so the life cycle cost of what you do is much more important, but also the opportunities of what you do are much more important. Daniel Hooft: This is not really about how you change your financial models because those aren't going to reflect it. Although it would be useful to have some economic tools that reflect what it means to set up a business that could be generating spinoffs or positive impact financial or otherwise 100 years down the line. Daniel Hooft: We don't really have the tools for that at the moment, but talking to, for example, the Maori led organizations in New Zealand where they talk about having a 200-year vision for projects that they invest in and a 400-year vision as an investment fund. I found that fascinating because it's easy to say, "Yeah, that's great. We do that as well 'cause we're nature based." Daniel Hooft: But that's not all. That's not what they mean. When you drill down and you ask why 200 years, it's actually to make sure that your decision-making is not still focused on making sure that your grandchildren have it better than other people's grandchildren, which is always in the back of a human's mind. But 200 years down the line- Andrew White: You can forget it. Daniel Hooft: That's far enough that nobody is really thinking genetically anymore. And so you're thinking about- Andrew White: Society. Daniel Hooft: ... humans and your tribe as a species like any other, and your concern is, "My God, will they have any fish? Will they have any trees?" Of course you want them to be living in Akaroa Harbor or Bluff or wherever you are in the flourishing environment that was encountered by the Maori 800 years ago when they found New Zealand. Not something that looks like the moon because of human activity. Daniel Hooft: So the Haida in Alaska and BC who we are talking to for licenses there, it's similar. They talk about forest management plans, which recognize that a forest has 1,000-year cycle because it takes a thousand years for a temperate rainforest to achieve balance. That's a difficult concept for a leader, a business leader to embrace. But I think it's very essential that we do embrace it, that we do start to develop the tools and the training and the techniques for business leaders to take responsibility well beyond their pension. This is beyond their lifetime. It's beyond their grandchildren, and that's difficult to do. Daniel Hooft: So we try to forecast for 50 years, which has already been difficult enough and I think the tools we have are not suitable. So that's food for thought whether those tools are out there. And if you or your listeners hear about them, I'd like to hear it as well. So the way we try to do this is a framework that's common to a fair number of companies, which is called the 4Rs, where we frame returns also not only as financial returns, but you talk about four returns, the top one being return on inspiration, the next being return on social capital, return on natural capital and return on financial capital. Daniel Hooft: We have started to zoom in on how we want to quantify or not each of these. So inspiration, we've concluded after a fairly short discussion that it's quite nice that you can't quantify that and put it in a KPI. A bit depressing if you could. Daniel Hooft: Well, it's tempting though. It's tempting. So people say, "Yeah, let's look at our social engagement figures or how many people follow us on LinkedIn." Well, it's- Andrew White: It's always going to be reductive, isn't it? Daniel Hooft: Yeah. Inspiration to me is yesterday getting an email from an 11-year-old in India saying, "I came across your company and I want to write something for my school." Now that's incredible. "Can I talk to you?" Sure. Of course, you can talk to me. It's my kids coming home and saying, "What if you put these things on the anchors, then wouldn't you make more habitable areas for octopus and crustaceans?" Daniel Hooft: It's a master student from the north of Namibia who we bring here and on his first day sends us a picture of him smiling on the boat saying, "I don't think a camera has ever captured me as happy as this." These moments that you touch human lives in ways across continents in totally different industries, I hope there are people who are looking at what we're doing and thinking, "Gosh, that's exciting. That's brave, but it's fun and hope it works." Maybe I should do something like that. Daniel Hooft: So inspiration is an extraordinarily important one for us. I think the world needs more of that. Social capital, we work in a very unequal country. Namibia through various reasons, partly also because it actually reports accurately is after South Africa the most unequal country in the world. So there's a wealth of opportunity to do useful things here, which aren't just philanthropy. It's a small town. By setting up a quality school and improving the vocational training, that's not just helping people out, that's making sure that five, six years from now I have a better pool of people to hire from. Daniel Hooft: That's making sure that I can attract employees who have children. And so combining the business need with something that improves the lives of your neighbors and your peers and other businesses in town is what that's all about. Return on natural capital I think for us is evident. For some other companies that may be more difficult, but it's the core of why we exist to boost biodiversity in the oceans and to sequester carbon. Daniel Hooft: So those are both easy to define and measurable, difficult to measure, but obviously important for us to measure and we're working on that. And then return on financial capital is nothing unusual. We hope to reward our early high integrity investors with great multiples and provide nice, steady dividends once we make the natural transition into more of a sort of nature-based asset company that provides steady long financial dividends and some carbon, and biodiversity benefits as well. Andrew White: Daniel, that's been fantastic. We've covered a lot of ground. I want to end this podcast in the same way I've ended every other one, which is just to ask you seven quickfire questions. It gives me a bit of ability to compare and contrast across all the very, very different speakers. So the first question is, which leader from history inspires you most? Daniel Hooft: Julius Caesar. Andrew White: And then which leader today inspires you most? Daniel Hooft: Elon Musk. But I mean, I have to say, of course, I guess all your listeners probably understand which qualifications I have of that. Andrew White: Yes. Daniel Hooft: I wish he would tweet less. Andrew White: And which book has made the most impact on you? Daniel Hooft: The Meditations by Marcus Aurelius. Andrew White: And the characteristic you look for in those you promote? Daniel Hooft: It's a combination of grit and integrity. Andrew White: And then what inspires you when it comes to the younger generation of your employee base? Daniel Hooft: One of our amazing Namibian employees, Eria Jonah once said, and I think she was quoting somebody, but she said, "If you want to see change, be the change you want to see." I think all of them are doing that, and that's their creed and that inspires me most. That never occurred to me at that age. I think it's amazing. Very inspiring. Andrew White: And what makes you hopeful about the future? Daniel Hooft: What makes me hopeful is that people are moving from torque to action. We're by no means unique in this space and the diversity and creativity of people working on positive things of all kinds, and not just on climate change, but on social issues, and also mundane things like making financial services more streamlined and cheaper. We live in an era where there's a lot of innovation going on and a lot of creative destruction behind the scenes, and that's great. It's very positive. Andrew White: And then finally, where do you go for inspiration and renewal? Daniel Hooft: Nature. So preferably in the sea. If not in the sea, anywhere wild. Andrew White: My thanks to Daniel Hooft. My name is Andrew White and you've been listening to Leadership 2050, a podcast from Saïd Business School at the University of Oxford. This is the last episode in the current series, but while we're having our season break, remember you can go back and explore our archive of past episodes, including my conversations with Alan Jope, the CEO of Unilever and AI Pioneer Dr. Vivienne Ming. Andrew White: You can find all our previous episodes wherever you get your podcasts, and please help others to find us by taking a moment to rate and review us. If you'd like to hear more from Saïd Business School, exploring leadership, and how the business world is reimagining the future, please visit oxfordanswers.org. Leadership 2050 is produced by Eve Streeter. Original music is by Si Begg. Our executive producer is David McGuire for Stabl Productions. Until the next time, many thanks for listening.