makingit_12_pp46-47–endpiece_print 12/11/2012 08:47 Page 46
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Where did Rio+20 leave us? Ahead of the next issue – looking at the future of sustainable industrial development – STEPHEN BROWNE surveys the aftermath of the United Nations Conference on Sustainable Development in Rio de Janeiro. In the 20 years since the first Rio conference, global emissions have risen by nearly 50% and 300 million additional hectares of forest have been destroyed. The population has increased 30% to over 7 billion; one-sixth of them still malnourished. The urgency of another conference was clear enough but the verdict on the outcome was ambiguous. It depended on how high you had set the bar on your expectations. Greenpeace must have anticipated a sudden epiphany by world leaders when it dubbed the meeting a “failure of epic proportions”. Others – mainly UN insiders, including veterans of UN conferences – agreed that a “pathway for a sustainable future” had been laid down. But no one could conceal a measure of disappointment, compared with the urgency of facing up to the huge tasks of turning around a deteriorating global environment. The private sector was strongly in evidence. That was a potentially good sign for the interests of sustainable industrial development, and perhaps one of the real strengths of Rio was that, like its predecessor, it succeeded in corralling a range of interested parties, all focussed on similar concerns. However, there was little for ‘business and industry’ to take away from the rather lame outcome document
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which, in accordance with hallowed UN practice, only governments can be involved in. Which brings us to the nub of the sustainable industry challenge: industry depends on the conditions that surround it, and whether an enterprise is stateowned or fully private, those conditions are strongly influenced by government policies. This is the most important meaning of public-private partnership: the nature of that nexus determines industrial fortunes. Or stated even more starkly: there is no successful industrial development without public enablement. Hence the two statements in the outcome document: from government to industry, “we support national regulatory and policy frameworks that enable business and industry to advance sustainable development initiatives.” And from industry to government, “we also invite business and industry as appropriate and in accordance with national legislation to contribute to sustainable development and to develop sustainability strategies that integrate, inter alia, green economy policies.” In the interests of industrial sustainability, the most critical policy change which governments could have taken at Rio would have been to agree to phase out subsidies (and increase taxes) on the production and consumption of carbon fuels. The International Energy Agency (IEA) has estimated that, in the absence of reform, these subsidies could reach almost $US600bn by 2015, equivalent to 0.6% of global GDP.
Subsidies are often developed in the interests of the poor as consumers. But they represent a huge burden on national exchequers, distort market signals and are ultimately unsustainable economically. Will reform come? The outcome document asks only that governments “reaffirm the commitments they have made” to phase out fossil fuel subsidies. But who is watching? Compared with the much stronger language on fisheries subsidies, this is tantamount to the policy status quo, which the IEA predicts will see fuel subsidies grow further, encouraging rather than inhibiting the use of carbon fuels in industry and electricity generation. There was also an onus on business and industry to make commitments, but the World Resources Institute found few of any significance. The Natural Capital Leadership Compact committed several global corporations to account for natural capital as a business imperative – several others declined. The 45 CEOs who are part of the UN Global Compact’s Water Mandate committed to working with governments and other partners to “help solve the global water crisis”. More meaningful still would have been a universally binding commitment by global firms to report on the sustainability of their operations by measuring resource use, including in particular environmentally significant emissions and pollutants. The outcome document asked industry to “develop models for best practice and facilitate action for the integration of sustainability reporting….”