Leonardo Fleck works in Palo Alto but his ideals have taken him as far as the Pantanal woods and a floating house in the Amazon. He is an environmental economist and scientist at the Gordon and Betty Moore Foundation, where he’s been doing a remarkable work on sustainability and the conservation of natural ecosystems of planetary importance.
BayBrazil: You have a degree in biological sciences and master’s degrees in business administration and conservation biology. Most of your career has been based on the use of economics and business management tools to promote the conservation of natural ecosystems. Despite being in Silicon Valley, you are not a typical entrepreneur, are you?
Leonardo: I’m not a typical entrepreneur because I’m have not created successful businesses myself. However, I’ve always believed in the power of value creation through entrepreneurship. I enjoy creating and promoting solutions to wicked problems and I practice that as much as I can. Perhaps that makes me an intrapreneur? On the other hand, I would consider my career path as an entrepreneurial endeavor for all the things that I have tried and for what I have learned. As an undergrad in the 90’s, I was interested in combining economics, technology, and environmental conservation so I studied biological sciences and business administration and took an internship on biotechnology. But integrating those disciplines was largely uncommon and I struggled to find my space. The result was some stimulating but unusual career moves, which included searching for bacteria that ate oil and could be genetically modified to clean up oil spills; operating ecolodges in the Pantanal and the Amazon to create incentives and raise awareness of the importance of nature conservation; and exploring how local communities could improve the management of natural resources to reduce their impact on Amazonian forests. The common thread was an interest in demonstrating the value of nature to people based on evidence, and a belief that once revealed, stakeholders would use those values to enhance decision-making
BayBrazil: Did you have the opportunity to work in Brazil using economics and business management tools to promote the conservation of natural ecosystems before joining the Gordon and Betty Moore Foundation?
Leonardo: Yes. After some career experimentation, a Master’s degree, and some time living overseas, I returned to Brazil to join Conservation Strategy Fund (CSF). CSF is an international non-governmental organization based in California led by John Reid. John is an entrepreneur (and a great mentor) who identified, in the late 90s, that most organizations that promoted environmental conservation lacked economic literacy and thus did not took advantage of the use of well-established economic thinking in their work. Since then, CSF has been training them and developing analysis and cost-effective solutions that empower organizations to achieve greater results. I worked as CSF’s Global Network Lead Economist and Brazil Program Lead. In those capacities, I worked with many passionate and smart people from all over the Americas while supporting CSF’s initial global expansion. I led several sustainable development projects in collaboration with partners in sectors such as transportation and energy infrastructure, agriculture, conservation planning, tourism, and protected areas. I co-authored about 20 publications and trained around 500 professionals. It was a very fulfilling time for me.
BayBrazil: What results obtained in this work would you highlight?
Leonardo: During my time at CSF, I became aware that a large number of large and expensive infrastructure projects, such as roads and dams, were actually bad investments by the countries that promoted them. They did not pass basic criteria of cost-benefit analyses, which meant that their benefits were so small that they could not outweigh the project’s costs. The projects were also terrible for the environment as little care had been taken to mitigate their impacts. I led many projects that evaluated the costs and benefits of these large projects from various perspectives. We used these evaluations to engage with decision-makers and civil society and seek alternative solutions that were better for the economy, the environment and to local communities. In some cases, our engagement led to decisions to discontinue bad projects; in other cases, projects were improved based on our recommendations. A classic case was the reconstruction of the BR-319 road in the Brazilian Amazon, a 497 miles highway that had been completely abandoned since 1986. The reconstruction project would open vast lands in the heart of the Amazon to rampant land occupation and property speculation. The magnitude of the potential environmental impact was so large that it was deemed by some accounts as the worst development project in the world in 2009. Unfortunately, the federal government promoted the project without justifying the US$260 million investment with a credible cost-benefit analysis. There was much political interest in making it happen, as the Minister of Transportation had been speculated as a candidate for the upcoming state government elections (he turned out to be a candidate but lost the election). Our independent economic analysis showed that the project was a lousy use of Brazil’s money: for every dollar invested there would be only 30 cents of benefits. Results were featured in the front page of a major Brazilian newspaper (Folha de São Paulo), public hearings were set up at the Congress and the General Prosecutor Office (MPF), and the Senate (Marina Silva, senator at that time) demanded that an audit be performed on the project by the Federal Court of Audit (TCU) based on our study. The final decision was to cancel the implementation of the project. Our work became an international case study and a book chapter. But I would like to reiterate that I’m not against roads in tropical forests. I am in favor of sensible projects that make good use of public resources and do not cause large-scale environmental degradation.
BayBrazil: And how did you come to the Gordon and Betty Moore Foundation?
Leonardo: In 2011 the Foundation was exploring new fields, and they needed someone who could help them develop a new strategy focused on market approaches to environmental conservation. I had finished an MBA a few years earlier, trained about five hundred MBA students on corporate sustainability, and was helping the Brazilian government promote private investments in national parks. I was interested in doing more work with the private sector and in expanding my toolset, so I applied for the new position. It is funny because way before I joined the Foundation Gordon Moore’s name, showed up a few times in my life. I was fascinated by computers as a child which led me to read copious amounts of computer magazines with references to the Moore’s Law. I lived nearby a large private reserve in the Pantanal Wetlands purchased with funding from Gordon Moore. I remember seeing a picture of Gordon fishing in the Negro River, one of his passions. And, finally, the reason CSF was able to hire me when they were expanding to South America was a large grant from the Foundation. For all these reasons I have a lot of gratitude and respect for the generosity expressed by Gordon and the Moore family.
BayBrazil: What is your job in the Gordon and Betty Moore Foundation?
Leonardo: In some respects, my work is like the job of a venture capitalist in that we set funding strategies and provide financial support to organizations pursuing good ideas. Perhaps the most striking difference is that we do not seek a financial return for the Foundation. This does not mean that we do not use performance metrics, but our metrics reflect other types of results. For example, in my role, I propose funding strategies and manage grant portfolios to delink global food production from environmental degradation, so we can help reconcile these two societal needs. One of the metrics is the volume of food that is free of deforestation. I also promote collaboration and learning among our investees and other organizations to help build the field. Currently, my portfolio has approximately 20 projects with organizations from the US, Europe, and Brazil, and we intend to expand to more countries soon.
Currently, my portfolio has approximately 20 projects with organizations from the US, Europe, and Brazil.
BayBrazil: Why is Brazil so interesting for the Foundation?
Leonardo: Reconciling global food production and ecosystem conservation is a daunting task. We may need to double food production by 2050 – the same amount of food production reached over the past 10,000 years. As global food demand grows, Brazil may soon become the world’s largest producer of food. But Brazil is paradoxical in this context. While it has been recognized as a leader in global conservation, it has high deforestation rates due to agriculture expansion. The tricky thing is that scientists are learning that continued deforestation may damage agricultural production because it disrupts local climate and rainfall. And there is no need to fell a single tree to expand agriculture production because there is plenty of open lands where agricultural production could be increased with investments and technology. It is a win-win. Our intent is to provide support to Brazilian organizations who are crafting collaborative solutions to these challenges and involve the private sector, academia, government, and civil society.
BayBrazil: Please explain your work focused on the corporate sector.
Leonardo: I think we need to involve the corporate sector in the crafting and implementing of solutions because the way they operate has been part of the problem. Companies have access to knowledge, relationships, and resources that are uniquely valuable, and they can diffuse innovation through their global supply chains and sectors. Several companies have already realized that the destruction of forests may affect their bottom line. Our grantees collaborate with these companies to strengthen the business case for companies not to source products which exacerbate the problem, and to disseminate these business cases to their peers. We also support the creation of market and policy incentives that reward good practices by companies and producers, and transparency technology and accountability platforms that help market actors adopt sustainability practices by reducing cost and complexity. For example, we have been collaborating we are working with Walmart, which is the largest retailer in the world and one of the major buyers of beef in Brazil. Walmart is committed to only buy meat and other products free of deforestation. We are testing solutions for achieving this reality in the Brazilian Amazon. Together, with our partners, we have also been working with a much with a large group of global retailers and brands in the Consumer Goods Forum, which represents 400 companies with total sales of 3.5 trillion euro and nearly 10 million employees, and include companies like Walmart, Unilever, McDonald’s, Marks and Spencer, and Mars. The group has committed to only buy deforestation-free products by 2020.
BayBrazil: We know that the environmental issue is directly linked to the economy since society uses natural resources to access the products needed for its survival. There is also a poor use of space, as shown in the National Geographic article, supported by the Foundation, on the challenges of feeding the world’s population. Why is there the idea that economic development goes in a direction contrary to environmental preservation?
Leonardo: This is a complex issue. Firstly, our prevailing economic system has incentivized the expansion of land areas under agricultural production to meet the growing demand for food – as opposed to promoting technologies that produce more food with fewer resources. Natural areas are perceived as a source of cheap and abundant land and are often misnamed as unproductive lands. This brings me to another important reason for this perception: there is limited awareness among decision-makers and society of the services that natural ecosystems produce – at no cost – to society and, in particular, to agriculture, as I mentioned earlier. That lack of recognition is translated into sub-optimal decisions where the value of nature to the economy is not accounted for. For example, twenty years ago scientists had warned us of the negative effects large-scale deforestation could have on access to water. Now we see severe water shortages in São Paulo linked to that problem. It is not hard to imagine how that might impact people’s wellbeing and business profits. There is also a temporal dimension to this problem. A landowner who replaces a forest with pasture expects to quickly earn some profit. Unfortunately, the negative consequences of deforestation may take longer to be felt. Our political system also favors these perverse dynamics because the priority of governments is often limited by the president’s four-year term.
BayBrazil: The Gordon & Betty Moore Foundation was created in Silicon Valley by an entrepreneur who has mastered innovation. How is the Foundation contributing to innovation, entrepreneurship and economic development through its work?
Leonardo: We strive to put into practice the lessons from Silicon Valley’s entrepreneurial ecosystem, and some of them are embedded in our culture. For example, our investments are scrutinized by four “filters”: investments need to address an important issue, there needs to be a clear opportunity to be captured with the available resources, results are measurable, and investments need to contribute to a larger portfolio. We also seek solutions to address large problems in a similar way than start-ups which seek to disrupt large markets. I would like to offer one example: a year ago our partners from the University of Maryland, World Resource Institute and Google launched the first global platform to measure and track deforestation, anywhere in the world. Now they are working to turn this comprehensive data into actionable insights to corporations and financial institutions so companies may be managing environmental impacts in their global supply chains and investment portfolios.