by Bobby Banerjee / About 25,000 people, including nearly 120 heads of state, have descended on Glasgow to participate in the 26th United Nations Climate Change Conference of the Parties (COP26). And in a modest attempt to manage expectations the UN’s top climate official has warned ‘word conflict and chaos’ could be the result of a summit failure. For a realist cynic like myself who has been observing these conferences for the last 20 years my prediction of the outcome of COP26 remains the same: more hot air, much hand wringing, plenty of finger pointing, more empty promises, climate protests on the streets, and unenforceable commitments. At COP1 in Berlin in 1995, governments had agreed to establish specific, legally-binding targets and timetables for reducing developed country emissions of greenhouse gases. At COP26 governments (including ‘developing’ countries) are being asked to commit to ‘ambitious 2030 emissions reduction targets that align with reaching net zero by the middle of the century’. Basically, despite some progress global action on climate change over the last 25 years essentially amounts to countries agreeing climate change is a serious problem and agreeing that action needs to be taken. So at COP26 countries are ‘being asked to commit’, ‘encouraged to investment in renewables’, ‘need to work together’, and ‘deliver on their promise to raise $100 billion in climate finance per year’. Meanwhile, concentrations of greenhouse gases (GHG) in the atmosphere reached new highs in 2020, despite a decrease of 6% in global carbon dioxide emissions due to the COVID19 pandemic.
Which brings us to a somewhat uncomfortable truth: a single microbe has done what climate policies have been unable to do for the last 25 years – reduce global GHG emissions. But sadly early indications after the relaxation of lockdowns in various parts of the world seem to reflect a desire to return to our fossil fuelled economy. In the UK carbon emissions have begun to rebound following the easing of lockdown measures. A similar trend was seen in the 2008 financial crisis as emissions very quickly returned to pre-crisis levels. It appears our species is either unwilling or unable to learn from our mistakes and is bent on the path to planetary destruction. And while the pandemic has resulted in a global economic downturn are there lessons to be learned from the COVID emergency that can help deal with the climate emergency? ‘Build back better’ is the mantra to address both COVID and climate change but what exactly should we be building back?
The world is waiting for the pandemic to pass so the economy can grow again and life can resume as normal. But what if normal was the problem in the first place? What if this artificial halt in the global economy is permanent? What would that mean for the future of work, jobs, and growth? Can the pandemic crisis allow us to imagine a just and more sustainable world? What lessons can we learn from the pandemic to address the serious problems posed by climate change? Both COVID-19 and climate emergencies are not unfortunate accidents but a result of decisions humans have taken.
In building back we seem to have missed the boat and determined to follow a path that leads to environmental destruction. According to a McKinsey report government spending in the wake of COVID-19 in 2020 alone was more than three times larger than that spent in the wake of the 2008 financial crisis. Yet the Institute of International Finance reported that only 1% of the $11 trillion in stimulus money worldwide is dedicated to the so-called green economy. Government subsidies to fossil fuel companies continue unabated: high carbon industries received more than half a trillion dollars worldwide with no conditions to ensure they reduce their carbon output, compared to $12.3 billion provided to low-carbon industries, such as renewable energy. Companies like Shell and Total along with several coal companies received €220bn from the European Central Bank. In 2019 fossil fuel companies received $478 billion of government subsidies. And more than 5,600 companies in the fossil fuel industry have received at least $3billion in coronavirus aid from the US federal government.
The pandemic has also exposed the stark inequalities and injustices of our society. The lockdown, the policing of the lockdown and the maintenance of essential services during the lockdown have highlighted the systematic and structural racism that exists in our societies. A report by Amnesty International, examining the enforcement of physical distancing measures in 12 European countries, concludes that the pandemic has led to greater marginalisation, stigmatisation and violence, echoing the long-standing concerns aired by the Black Lives Matter movement. The coronavirus does not discriminate, but exposes and reinforces existing racial and social inequalities.
The consequences of climate change reflect similar inequalities: those that have contributed the least to the problem will suffer the most. While climate change did not cause the pandemic, human activity is responsible in both cases: our fossil fuelled economy of production and consumption has led to the climate emergency along with habitat and biodiversity loss that created the conditions for spreading diseases by reducing the natural barriers between humans and virus carrying animals.
Rebuilding economies based on exploitation of people and nature, which was the ‘normal’ state of affairs, will not solve the COVID-19 or climate crisis. The world we rebuild post-coronavirus needs to be founded in well-being, and so needs to bail out people and planet, not corporations. If there is one lesson that we need to learn from the pandemic is that there is something more important than the ‘economy’, which is people and the planet. We don’t need to sacrifice lives to save the economy. The economy does not need to be saved. It needs to be transformed. A return to business ‘as usual’ is not possible or desirable. We can use the COVID19 crisis and the climate emergency to decide what is useful and what is not. Who is important who is not important. Which jobs are required, which jobs are not.
So in what ways do our economies need to change? Our economies need profound transformations. First, we need to shift from economies of accumulation to economies of distribution. The scale of redistribution of money to deal with Corona is unprecedent and has never happened before in human history. In just 4 months governments have spent more than three times the amount of money to tackle the virus is than all the money spent to address the financial crisis of 2008. The climate change emergency needs a similar sale of redistribution of wealth.
Second, we need to shift from economies of extraction to economies of restoration. We live in an economy that where an oil spill in the oceans or destroying forests is economically rewarding. But growing your own vegetables or taking care of an aged relative are considered unproductive activities. In the UK during the height of the pandemic the National Health Service NHS, issued a call for 30,000 volunteers. Within 30 minutes half a million volunteers signed up and their website crashed. At the end of the day they had a million volunteers. Could we imagine a society and economy where volunteering to help people is a productive activity that increases the wealth of a society by enhancing its wellbeing? Where restoring forests is seen as being more beneficial than destroying them?
Finally, we need to shift from economies of competition to economies of cooperation. When COVID related hospitals and deaths were at record levels earlier this year 7 teams from Formula 1 who were competitors, shared their technologies and cooperated with each other to manufacture ventilators. Imagine if powerful multinational companies or even smaller regional companies started doing the same? Where we can create new markets by sharing technology and resources to address environmental and social problems.
We also need to ask ourselves some fundamental questions. What work is necessary to have a good life? How much work is necessary? What goods and services are essential for a sustainable world? How do we organize society around the provision of these goods and services?
Sadly, business schools and management education in general refuse to address these questions. More than 30 years of organization and management research on sustainability has proved inadequate to the task of addressing the ecological crisis because as long as our research remains constrained by making a business case for sustainability, the worse our ecological crisis gets. A managerial and functional approach to sustainability, which is the fundamental basis of most research in organization and management studies, remains solely focused on the ‘it pays to be green’ narrative and trivial win-win cases that do little to address the structural biases in our discipline. What is the point of introducing a sustainability or environmental management course in the curriculum that advocates concern for future generations when the fundamental economic and financial assumptions of management education teaches students to discount the future? What is required is a shift in the logic of the dominant political economic system and not just to improve living conditions in the current system
No one is immune to the corona virus or to climate change – we have found vaccines for COVID19 but unfortunately there will never be a vaccine for climate change. Both require a collectivist response and a different kind of politics based on solidarity and an ethics of care, not on competition or individualism. We do not need to make a business case for sustainability. We need to make a sustainability case for business. Otherwise, we will run the risk of becoming the only species on the planet that is sufficiently intelligent to recognize our own imminent extinction but too foolish to prevent it.
Bobby Banerjee is Professor of Management at Bayes Business School.