The low-carbon transition was the central focus of the 2017 World Economic forum (WEF). Considering the state of world affairs there was a surprising amount of optimism at this year’s WEF. The theme of WEF 2017 was “Responsive and Responsible Leadership”. This annual event took place in Davos Switzerland from January 17 to January 20. There were over 400 sessions on the official program, covering a wide range of subjects ranging from sustainability to inequality. The WEF advocates, “economic opportunity through bold climate action.” They state, “the importance of bold and transformative climate action has never been stronger”. However, climate change is a multifaceted issue with implications for energy, food security, immigration and health. The challenges faced by the global community are daunting and they have become more difficult in the wake of populist movements in Europe and the US.
Everyone appeared to be trying to fathom the implications of the dramatic geopolitical shift in the US and the UK. The rise of populism and the demise of America’s role as a global superpower permeated the conference. There were concerns that this will lead to conflict on a number of levels.
Attendees at the Davos summit said goodbye to America and welcomed China’s leadership. They also appeared to say goodbye to the UK in the wake of the Brexit vote with many of those in attendance planning to downsize their London offices. It was suggested that governance models should be overhauled and economic relations reformed.
The Chinese and others spoke about the value and importance of globalization. A large Chinese delegation was led by Xi Jinping who was the first Chinese president to attend the WEF. China has also indicated that it is prepared to lead on climate change to fill the void of created by the current administration. This includes a $360 billion investment in renewable energy by 2020. This new leadership role for China is a function of the election of Donald Trump who has abdicated US leadership on issues like climate change.
Renewable growth powers optimism
Despite some concerning global trends they are remarkably optimistic about the prospects of climate action in 2017. Nigel Topping, the CEO of the We Mean Business Coalition, cites the accelerated growth of the low carbon economy. He specifically points to the growth of renewable energy and electric vehicles. Climate action also has private sector support and the support of governments. More than 630 businesses and investors have called on Washington to support the low carbon economy. Such economic opportunities are being pursued by the governments around the world including both China and India.
Christiana Figueres, Convenor, Mission 2020 is also optimistic. She points to the falling costs of renewables disrupting fossil fuels, the growth of battery storage capacity transforming the world transportation sector and the changing economics of resource exploitation.
Trump can’t stop it
Referring to the Trump administration Figueres said that even if they eliminate support for renewables and double-down on fossil fuels, such a strategy that is doomed to fail.
“[A] country cannot withstand the global shift forever, in particular with the state of public finances and the need to provide wage growth and jobs, any country that resists this trajectory also relinquishes potential competitive advantage in the new marketplace and in the long run, will only damage itself.” Figueres said.
She believes that there is evidence to support the contention that everyone wants a safe environment (including a stable climate), even those that voted for a
populist government. Figueres also says that, “leadership on climate change is proving to be remarkably resilient.” She illustrated her point by citing the leadership at both the municipal level and in the private sector.
In addition to the growth of renewables there has been massive divestment from fossil fuels. It is not estimated that the total amount of money divested from fossil fuels exceeds $5 trillion (76 countries 688 institutions).
Private sector efforts
At the beginning of Davos week, the world’s first industry led initiative was launched. It is called Carbon Pricing Corridors, and its goal is to define the exact carbon prices required to meet the targets of the Paris Agreement. As part of the RE100 initiative 90 multi-nationals have already committed to get 100 percent of their energy from renewable sources and 200 businesses have set science-based emissions reduction targets. Entire industries are setting their own voluntary emissions limits.
Financial institutions are increasingly highlighting the merits of low carbon investments. The financial industry is moving forward with “recommendations laid out by
the Task Force for Climate-Related Financial Disclosure that should be adopted by the G20 in June.” This will enhance accountability and transparency as well of the rusticity of their climate commitments. In the US alone, SRI investing assets have grown by 33 percent in just two years to $8.72 trillion. As mentioned above industry is leading a new initiative to help identify carbon pricing targets for investors who want to meet the requirements of the Paris Agreement.
New sustainability initiatives
While the WEF is a four day event they support sustainability projects year round. This includes 50 Forum projects in support of the United Nations Sustainable Development Goals.
The Norwegian government submitted plans for a new $400 million fund aimed at reducimg deforestation and peat degradation. The hope is that this fund could lay the foundation for $1.6 billion deforestation free agriculture investments that would create jobs and promote growth.
A partnership between the Forum and the University of California Santa Barbara’s Marine Science Institute seeks to build a coalition to protect the world’s $2.5 trillion oceans and marine resources. Another Forum initiative seeks to build a public private coalition to build a sustainable battery supply chain to capitalize on a market valued at 70 billion by 2024.
A total of 40 governments and businesses agreed to increase global reuse and recycling rates for plastic packaging from its current 14 percent to
70 percent. A water.org initiative in oartnership with Stella Artois seeks to provide clean water to 3.5 million people.
GoodWeave international launched an initiative to end human slavery in supply chains titled “Sourcing Freedom”. A total of 21 million people around the world are subject to forced and bonded labour. The program has widespread support from the business community.
A total of 100 leading businesses signed the Compact for Responsive and Responsible Leadership. This initiative was developed in partnership with the Forum’s International Business Council.
The WEF does important work and they paint an optimistic picture that most of us desperately want to believe. Nonetheless we cannot discount scientific implications of Trump’s stated policy agenda. Figueres, summarized the concerns associated with failing to meet the targets contained in the Paris Climate Agreement, saying this could unleash, “natural feedback loops from which we may not recover…”
The way forward may seem almost impossible, but we cannot afford to let political outliers undermine so many years of hard fought progress. Particularly given that we were beginning to see consorted global climate action. The following excerpt from a WEF article summarizes the situation accurately:
“We must remain optimistic and realistic, pragmatic and visionary. We need to work together in radical collaboration, reaching out across the divides that have grown within our societies. The next five years will make the difference, and this incredible opportunity demands immediate and urgent responsive leadership from us all.”
The GOP and others are playing partisan politics with climate change while contributing to and spring-boarding off of voter ignorance. The logic of climate action is compelling and hard to rationally refute. Doing some about climate change may avert a catastrophe, and has been shown to benefit the bottom line. Failing to act will be deadly and prove to be far more expensive than action.
“Averting climate change is not part of the partisan debate. We are all united in wanting to live in a safe, stable environment and to provide our families with good jobs that will serve the economy of tomorrow.” Figueres said.