A Sustainable Business View on Economy, Climate

StigsonAs leaders of the world's 20 largest economies gathered in London on April 2 for the G20 summit, international financial institutions announced that the world economy would likely deteriorate more in 2009 than was previously feared. The Organisation for Economic Co-operation and Development predicted that economic activity would shrink 2.7 percent; the World Bank projected a slightly more optimistic contraction of 1.7 percent.

To gain perspective about today's many interrelated sustainability issues, Worldwatch staff writer Ben Block pulled aside Björn Stigson, president of the World Business Council for Sustainable Development (WBCSD), for an interview this week at a U.S. National Academies of Science climate change summit. Stigson has overseen the global coalition of some 200 leading  corporations since 1995.

How do you expect the ongoing recession to affect sustainable business efforts, such as reducing pollution, water consumption, and energy use? Are businesses turning away from corporate responsibility?

The question I get from around the world is: Has sustainable development fallen off the table given there is a recession? My response is the opposite. What has happened is that sustainable development has come to a tipping point, in my view, and that the focus on the strategic aspect on sustainable development, climate change, and so on - that focus is even stronger than before. It's stronger in companies, and it's stronger in governments. The recession is not really a barrier or a blockage.

What are your thoughts on the public response to the ongoing recession - the stimulus packages in the United States and around the world?

The green elements are still quite small in these packages. Still, there is a green element. And we sometimes lose perspective of money. President Obama came out with a stimulus package, some $25 billion for energy efficiency. We say, "Ah, it's really not that much money, as a percentage of the stimulus package." Had $25 billion not been connected to the stimulus package, people would say, "Wow, that's huge!".... So I think it's quite positive that the green element is coming in there. There is a lot that can be done.... A lot of the technologies and solutions that we need to go forward, for actions towards 2020, a lot of that exists. It's a question of getting it deployed.

Governments are meeting in Bonn, Germany, this week as part of the negotiation process leading up to December's international climate summit in Copenhagen, Denmark. How can policies aimed at tackling climate change help businesses develop sustainably?

If you look at the analyses by the International Energy Agency, and you look at actions up to 2030, then 50 percent of emission reductions must come from energy efficiency. Then if you look at where you consume energy in the industrialized world, about 40 percent of energy use is in buildings, 25 percent is in land transport - cars and so on. So two-thirds of the problem is efficiency standards for buildings and cars.

The price of carbon will not do anything for the energy efficiency of buildings. Energy efficiency of buildings is a very important part of the efficiency improvement in society, but it's such a fragmented value chain. So the price of carbon is not going to have any real impact, for the individual.... Between the owner of the building - residents, so on - the lever for change for any individual actor in that value chain would be so small. So if you want to improve the energy efficiency of buildings, you have to look at the building codes and formal standards. The example of California is a good example.

How would you rate various countries' efforts in improving energy efficiency, so far?

It varies in Europe. The EU does not have a common history; you have differences. In the northern parts of Europe, look at Scandinavia, down to the middle of France and Switzerland - they have since a long time had stringent building codes. That goes back to the energy crisis in the 1970s. Europe is much more energy efficient than the U.S. If you look at it in a scale, Japan started looking at [efficiency] earlier, then comes Europe, then comes the U.S. The U.S. is on the same level as China, and so on. It's not a very energy-efficient country.

What should leaders accomplish at this week's G20 summit?

The G20 meeting will be focused on what to do with the financial system. The issues about the broader sustainable development and climate change will not really be on the agenda.... There have been a number of calls to the G20 governments to do things [related to the environment]. I don't know how many I've been asked to sign - they are broad calls to do something. But as far as I can judge, they will not have time to talk about that. It'll all be about dealing with the financial system. Dealing with sustainable development and climate change will come up at the G8 meetings and the preparatory meeting in April. The G8 environment meeting, the G8 business summit - there are other G8 meetings - that's where you get into the 2020 goals. You'll get into a number of [sustainable development] actions. But I don't think it'll happen at the G20.

Ben Block is a staff writer with the Worldwatch Institute. He can be reached at bblock@worldwatch.org.

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