Ecological Transition Notes PDF

NOTES 14 January 2025 15:56 Session 1 The challenges behind the ecological transition Doughnut model - a framework for sustainable development created by Kate Raworth Contains 9 planetary boundaries (Rockstrom) complemented by social boundaries (Kate Raworth) - 10th boundary - novel entitie...

NOTES 14 January 2025 15:56 Session 1 The challenges behind the ecological transition Doughnut model - a framework for sustainable development created by Kate Raworth Contains 9 planetary boundaries (Rockstrom) complemented by social boundaries (Kate Raworth) - 10th boundary - novel entities e.g. plastics Tackles how to transition to a circular approach to production and resource use The big challenges such as climate change, biodiversity loss and access to water are - Complex - problems characterised by many interactions, associations and nonlinear dynamics - Uncertain - problems and their evolution are difficult to forecast - Evaluative - they cut across jurisdictional boundaries and evolve constantly Growth impacts the environment due to insufficient coupling UN 17 SDGs (2015-2030) Strengths ○ Most comprehensive overview of sustainability challenges today ○ UN supported, therefore the most globally acceptable framework ○ Designed for all actors i.e. governments, companies, social enterprises, non-profits, entrepreneurs ○ Clear, consistent, quantified targets ○ Grounded in science ○ Goals are interrelated Weaknesses ○ Green washing Historical overview: the emergence of the environment on the international scale 1) Modern Europe ○ Descartes (1637) & diffusion of modernity - belief in progress and rational control of the natural environment ○ Myths bringing about the industrial revolution including : unlimited resources = unlimited progress ○ Despite bringing about tangible benefits to humankind, they would inevitably lead to the current ecological crisis 2) Industrial Revolution (second half of the 20th Century) Exam Page 1  2) Industrial Revolution (second half of the 20th Century) ○ Acceleration of economic and industrial development, a growing feeling of loss of Nature among the Western educated elite ○ e.g. Romantic Movement, Conservation Movement in the US, Yellowstone, National Parks Movement 3) Ecology as a scientific and philosophical movement (1930-40s) ○ Ecosystem (Tansley 1935) - interactive system established between biocoenosis (a group of living creatures) and their biotope (the environment in which they live ○ The Land Ethic (Aldo Leopold) - Conservation is getting nowhere because it is incompatible with our Abrahamic concept of land. We abuse land because we regard it as a commodity belonging to us. When we see land as a community to which we belong, we may begin to use it with love and respect ○ Ecocentric as opposed to anthropocentric view 4) Shift towards environmental governance ○ IUCN (1948) - first global environmental organisation ○ WWF 1961, Greenpeace 1971 ○ OECD recognises the 'polluter pays' principle in 1971 5) International environmental governance system (1970s and 1980s) ○ 1972 is a turning point  Creation of UNEP - first action plan for the environment by the European Community (« pollution knows no borders»)  Creation of EPA in the US  First UN conference on the human environment in Stockholm ○ Limits to growth report - we live e in a world of finite resources, our development model needs to be reviewed. ○ CITES 1975 - First Multilateral Environmental Agreement ○ Chernobyl in 1986: growing media attention reflecting a rise in public opinion awareness ○ 1982: Convention on the Law of the sea, U.N. world Charter for Nature 6) The Sustainable Development concept (1922 and after) ○ 1987: The Brundtland Commission and the adoption by the U.N. of the sustainable development concept ○ 1988: The IPCC is set up by the U.N. to work on climate issues ○ The Rio Summit (1992) - major conventions ratified (climate change, desertification, biological diversity); launch of Agenda 21 ○ fundamental « common but differentiated responsibility » principle ○ Kyoto on climate in 1997, Nagoya on biodiversity in 2010 ○ COP Conferences on climate Business engagement in the environment Up until the 2000s, the business world was not concerned with environmental issues - Environment seen as public policies, businesses solely concerned with profits Developments in business and sustainability Johannesburg Summit in 2002: large MNCs sign type II agreement with international NGOs Creation of the WBCSD in 1995. A major voice of business in the ecological transition composed of CEOs World Business Council for Development (WBCSD) vision in 2050 - Tackle the 3 key issues: climate, nature loss and inequality Vision 2050: time to transform - shared vision with planetary boundaries for 2050 - Requires transformation at scale, and business needs to focus its actions on the areas through which it can best lead the systems transformations - maps how systems transform and lays out a new framework to guide business action in the Exam Page 2  - maps how systems transform and lays out a new framework to guide business action in the decade ahead 9 transformation actionable routes for companies to take 1) Energy 2) Transportation and mobility 3) Living spaces 4) Products and materials 5) Financial products and services 6) Connectivity 7) Health and wellbeing 8) Water and sanitation 9) Food Each of the nine transformation pathways contains ten action areas for the decade ahead encompassing the Sustainable Development Goals (SDGs) and the targets of the Paris Agreement To move beyond business-as-usual into the accelerated transformations necessary, business leaders must adopt three mindset shifts: - Reinventing capitalism that rewards true value creation - Focusing on building long-term resilience - Taking a regenerative approach beyond doing no harm Only collaboration at unprecedented levels will create the impact and speed needed to achieve them - Therefore, while business can take a leading role, it must work on and design systems transformations, together with scientists, policy makers, financiers and investors, innovators and consumer Evolution of a business's approach to sustainability Sustainability requires balancing all three pillars of sustainability, not prioritising one over the others Business as usual approach - represents a traditional business model where economic considerations dominate over environmental concerns ○ Social and environmental concerns are secondary and separate i.e. not integrated into the business strategy TBL approach - where businesses consider economic, social, and environmental performance as equally important ○ There is an overlap between the 3, suggesting balance Strong sustainability approach - sustainability is deeply embedded within the business's core strategy and decision-making The CSR integration pyramid: from philanthropy to strategic embeddedness Exam Page 3  Level 1: philanthropy Most basic level of CSR involving charitable donations, sponsorships, or community projects - Limitations: efforts may be fragmented, unsystematic, and lack long-term impact ('garden' metaphor) Level 2: compliance Companies focus on meeting legal and regulatory requirements related to CSR e.g. international standards or frameworks - Mainly driven by risk management and protecting reputation Level 3: strategic CSR CSR is integrated into the company's core strategy and operations, fully aligned with the company's business goals - Not just about fulfilling obligations but about creating shared value for the company and society - About creating long-term, sustainable value for the company and society - Companies that move beyond philanthropy and compliance can gain a competitive advantage, enhance their reputation, and build stronger relationships with stakeholders Companies evolve in their CSR journey, moving up the pyramid over time Session 2 Environmental governance in the EU Defining CSR (2001): “A concept whereby companies integrate social and environmental concerns in their business operations and in their interactions with their stakeholders on a voluntary basis" Phase 1 (1974-1990s) saw a sure in environmental policy/legislation in the EU ○ Over 250 directives - legal act that bind member states ○ However, there were also high rates of compliance breaches i.e. directives were not properly implemented into national laws by member states ○ Command-and-control approach - refers to a top-down approach, where the EU sets strict rules and regulations and member states are expected to comply. ○ 1987 pivotal year with the Single Act in which the Environment becomes a full-fledged objective of the Single Market meaning environmental protection would be integrated into the EU's economic policies ○ Denmark case - highlighted the tension between environmental protection and economic integration as Denmark, with stricter environmental regulations, faced challenges in the Single Market ○ The Maastricht Treaty (1992) - principle of Sustainable Development enshrined in the EU  E.U. also recognized as legal entity, signatory to international conventions Phase 2 (late 1990s-2010s): environmental policy, society and business: towards a triple bottom line approach ○ Comprised of the Sixth Environment Action Plan beyond the traditional command-and- control measures. ○ Diversification of policy instruments  Taxation - environmental taxes to discourage polluting practices  Market based-instruments i.e. emissions trading schemes (ETS) and eco-labels, Exam Page 4   Market based-instruments i.e. emissions trading schemes (ETS) and eco-labels, which incentivized businesses to reduce their environmental impact ○ Sectoral approach - addressing environmental challenges in specific sectors, such as transport, energy, and agriculture ○ Multi-stakeholder decision-making - recognized the importance of involving various stakeholders, including businesses, NGOs, and the public, in the decision-making process ○ 2009 Göteborg Sustainable Development Strategy renewed ○ Triple Bottom Line - emphasizing the need to consider not only economic performance but also social and environmental impacts w 4 key objectives 1. Environmental Protection 2. Social equity and cohesion 3. Economic prosperity 4. Meeting international responsibilities Phase 3: strategizing CSR and sustainability. Towards smart regulation ○ 2011 - a new definition of CSR by the EU Commission resting on the following key principles  Precautionary principle  Polluter pays  Extended producer responsibility ○ EU 2020 strategy: towards a « smart, sustainable and inclusive » growth ○ Mid 2010s - The Better Regulation agenda addresses the need for smarter regulation and that less is more  Cross-sectional frameworks  Focus on regular review and feedback Today: from soft law to hard law ○ The Green Deal and Fit for 55 package aims for climate neutrality in 2050 and GHG emissions cut by at least 55% in 2030 compared to 1990 ○ Focus on transparency, double materiality and business conduct  Non-financial reporting through the Non-Financial Reporting Directive (NFRD) and Corporate Sustainability Reporting Directive (CSRD) which equire companies to disclose information on environmental, social, and governance (ESG) matters  The green taxonomy - classification system for environmentally sustainable economic activities  Due diligence for a more sustainable supply chain - Corporate Sustainability Due Diligence Directive (CSDDD) requires companies to assess and address human rights and environmental risks throughout their supply chains ○ Challenges for implementation: lobbying, political etc Corporate Sustainability Reporting Directive (CSRD, 2023) is the new EU legislation requiring all large companies and listed SMEs, to publish regular reports on their environmental and social impact activities. - First ever common reporting framework for non-financial data - affecting approximately 50,000 companies across Europe - Applies to companies with more than 250 employees and more than €40M turnover and/or more than €20 Million in total assets - as well as all listed companies - Double materiality concept - includes sustainability risks (like climate change) that affect the Exam Page 5  - Double materiality concept - includes sustainability risks (like climate change) that affect the company and the company's impact on society and the environment. - Focus on more forward-looking information, such as targets and progress in reports - Intangible assets info must be disclosed e.g. social, human, and intellectual capital EU Taxonomy - Six environmental objectives - Criteria for Alignment - an economic activity must 1) substantially contribute to at least one of the six environmental objectives 2) Do no significant harm to any of the other five environmental objectives 3) Comply with minimum safeguards related to social and governance factors - Safeguards - minimum safeguards to ensure that activities deemed environmentally sustainable also meet certain social and governance criteria ○ Based on international standards such as OECD Guidelines for Multinational Enterprises Institutional framework of the EU The decision-making process is composed of several steps 1) European Commission as initiator and guardian of legislation ○ Issues a proposal 2) Consultation process, preliminary studies, consensus-based agenda of legislative proposals 3) Ordinary co-decision process: Council and Parliament ○ Different stakes and interests represented: business vs non-business stakeholders, power relations, role of lobbying ○ lengthy procedures, often complex and heavy legislative texts The European Parliament and the Council each review the proposal and adopt a position. If their positions differ, the process moves to the next stage. ○ If they cannot agree on a common position, a Conciliation Committee is formed Exam Page 6 EU legislative tools include - Green and white papers - pre-legislative consultative steps - Recommendations (non-binding) - Directives (binding within 2-3 years into national laws) - Decisions (binding) - Regulations (binding) OVERACHING PRINCIPLE: E.U. LAW PREVAILS OVER NATIONAL LAW Participatory democracy system Overall, public consultation and input from stakeholders are important aspects of the process Ultimately, the Parliament and the Council play a crucial role in shaping EU legislation and the budget. Lobbying in the EU There are an estimated 25,000 to 30,000 lobbyists in Brussels Definition of interest representation: « activities carried out with the objective of influencing the policy formulation and decision making processes of the European institutions » Lobbyists are a vital part of the EU as it is based on consensus-building and compromise seeking: hence the intrinsic role of interest representation Initially, lobbying was taking place mostly at the national level (the « national route »), then at the Exam Page 7 Initially, lobbying was taking place mostly at the national level (the « national route »), then at the European level (the « European route ») gradually intensified, along with enlargement and institutional reforms (Single Act, Treaty on European Union). - Initially lobbying pertained to trade associations but over time, non-business lobbies, individual companies and legal consultancies have been more and more influential Article 11 of the Treaty on European Union: the Legal basis The right to lobby was formalized in the Lisbon Treaty in 2009 The institutions shall, by appropriate means, give citizens and representative associations the opportunity to make known and publicly exchange their views in all areas of Union action. Dual participation - from people and specific « representative groups » The institutions shall maintain an open, transparent and regular dialogue with representative associations and civil society However, much remains to be done Evidence for the growing importance of lobbying - New role of Parliament & the co-decision process - Widening scope of EU issues from « traditional » E.U. issues to new « civic interests » (social, environmental, health-related, regional issues) - Qualified majority voting system - New consultation procedures - The Transparency Register 2011 Types of interest groups Private interests - by order of appearance ○ Trade associations (chemicals, food & drink, agriculture & fisheries) ○ Pan-European groups (e.g.: BusinessEurope, Copa-Cogeca, ETUC) ○ Individual companies (320 companies with full-time EU public affairs directors) ○ Legal consultancies Public interests ○ NGOs ○ Think tanks Governments ○ Non-EU embassies (167) ○ Delegations from regional bodies Lobbying practices in each institution The Commission ○ Key role preparation of legislative proposals:  Green (to stimulate discussion) and  White (proposals for action) papers, ○ Forums and Hearings (expert groups) ○ Internet consultations ○ Criticism: "elite pluralism," where a limited group of experts and interest groups have disproportionate influence on policy-making The European Parliament ○ Key role of committees ○ A system of official affiliations: 5,000 accredited lobbyists ○ Increased transparency - most committees publish online meeting with lobbyists The Council of Ministers ○ Least transparent. No registration. The importance of the National route The new Inter Institutional Agreement Agreement between the Commission, the Parliament and the Council on the new Transparency Exam Page 8 Agreement between the Commission, the Parliament and the Council on the new Transparency Register finalized in May 2021 Transparency shall include Council’s Permanent Secretariat Increased incentives to register & broader scope of lobbying activities to be included ○ Reciprocal obligations to register However, remains non mandatory and not 100% explicit on the incentives to register Activities covered: Overall, lobbying is an integral part of the policy formulation and decision-making process in the E.U. today BUT much remains to be done to achieve this transparent participatory democracy the Union is calling for Key issues remaining: - Elite pluralism - Historic club vs new entrants - low level of transparency of the Register/ The Council - The « Revolving Door » phenomenon - the movement of personnel between government and Exam Page 9  - The « Revolving Door » phenomenon - the movement of personnel between government and private sector jobs, particularly in highly regulated industries ○ I.e. Individuals working in senior positions within the EU (Commission, Parliament, Council) leave their roles and take up jobs in the private sector, often with companies that lobby the EU on issues they previously dealt with in their official capacity - Role of the media The chocolate case study The « historic » members (Italy, France, Germany, and the Benelux) prohibit the use of vegetable fats in the making of chocolate products. But the new entrants, the UK, Ireland and Denmark, are used to adding a certain percentage of vegetable fats in their chocolate products… Hence an « opt- out » clause allowing these new members to manufacture these chocolate products on their territories Session 3 the climate challenge 3 scopes to measure CO2 emissions Few companies venture into scope 3 Mitigation vs adaptation practices Mitigation - avoiding the unmanageable ○ Learning to do better with less ○ Reducing impacts / soberness ○ Adopting sustainable lifestyles Adaptation - managing the unavoidable ○ Adapting companies to climate change / biodiversity /resource scarcity ○ Crisis management / management in degraded situations Net zero - state where the total amount of greenhouse gases emitted into the atmosphere is balanced by an equivalent amount removed - Idea of offsetting Is offsetting a myth? The practice of carbon offsetting, where individuals or organizations invest in projects that remove carbon dioxide from the atmosphere to compensate for their own emissions There is ongoing debate about the effectiveness and reliability of carbon offsetting, with concerns about the accuracy of carbon credits and the potential for "greenwashing." The LEARNING CURVE: from Carbon neutral to climate positive/carbon - Carbon neutrality - where emissions are balanced by offsets - Climate Positive- involves not only offsetting emissions but also actively removing more greenhouse gases from the atmosphere than are emitted - Carbon Negative - represents the most ambitious goal, where an organization actively removes more greenhouse gases from the atmosphere than it emits Exam Page 10  removes more greenhouse gases from the atmosphere than it emits PRESENTATIONS The global governance of climate: from Kyoto to Bakou The E.U. Green Deal: A model for the world community? The challenges of Global governance of biodiversity: from Rio to today The E.U. Green Deal: A model for the world community? Energy and sustainability in the E.U. Global Trade and the Environment: where do we stand? Businesses and the Carbon neutrality objective: a myth? MNCs as new political actors of sustainability? POST COP 29: What is likely to happen? Which role for business? Exam Page 11