2020 came quickly for most people and it marks more than just the beginning of a new decade. Did you know that many policy designers set 2020 as the year during which many environmental and social targets would be achieved?
Green Power is growing, as well. Germany’s second most popular party is the Green Party, founded in 1980, and currently second only to Angela Merkel’s conservative Christian Democratic Union. We may even see in 2021 the world’s first Green leader (bar a short-lived Latvian premiership in 2004). Robert Habeck, co-leader of Germany’s Green Party with Annalena Baerbock, optimistically says, “If you think Greens have the answer [to society’s ills] you can vote for us whether you’re an old lady or a punk in Berlin.”
I believe that we are facing many challenges and opportunities in 2020, two of which are related (1) national balances of power shifting and (2) individuals, local government, and non-governmental movements are demanding more environmentally sustainable policies from their leaders.
Geopolitical competition that accompanies today’s changing balance of economic power is overwhelming the post-war set of international rules and institutions. US-China and US-EU trade tensions are putting pressures on traditional institutions such as the World Trade Organization, NATO, and the UN. Global supply chains will become more regional and possibly more expensive to maintain and regulate. India will establish itself in the next ten years as one of the world’s five largest economies. The import of this entrance into the world stage is that two of the top five countries (with China) will have significantly lower wealth per person than the other three: USA, Japan and Germany. Brazil was thought to be part of this set of countries yet has been the country of the future and always will be. This disparity will add to the fragmentation of global governance, unless the G20, G7, and unrepresentative IMF can adapt to these changes. Global governance will be fundamental to address environmental and social challenges.
I realize many will respond that U.S. President Donald Trump’s administration is withdrawing its support from today’s multilateral institutions and raising barriers to foreign trade and investment. North Korea, Russia, much of the Middle East, and even countries such as Venezuela and Cuba, are providing challenges for world peace and increasing the need for these multilateral institutions. The U.S. withdrawal may be impactful and make necessary institutional changes more difficult. Yet, U.S. Presidents do not occupy their offices indefinitely!
Human-induced climate change will create new battle lines between governments, individuals, and NGOs. Unpopular policies may weave their ways into corporate and individual lives, especially related to food, energy, transportation, and resources.
The hope is that these changes will parallel multinational corporations adopting more aggressive sustainability practices. The World Economic Forum published a new statement on what it means for business to serve the world in the 21st century. It starts with, “the purpose of a company is to engage all its stakeholders in shared and sustained value creation.” It ends with, “Corporate global citizenship requires a company to harness its core competencies, its entrepreneurship, skills and relevant resources in collaborative efforts with other companies and stakeholders to improve the state of the world.” This statement of a new corporate purpose is a small step in the right direction. Further progress can be made when, July 2020, the UN analyzes progress toward the 169 targets, grouped into 17 broad categories, known as the Sustainable Development Goals, established in 2015. What is obvious is that few, if any, targets will be met a global level. This unsurprising result is not the point of the targets – they are seen mostly as a collection of rallying cries to focus attention rather than a specific strategic plan. Yet, caring that we are making progress toward the global targets will not make large differences in natural and local actions.
The UN’s International Year of Plant Health is another unique focus for 2020. This focus aims to raise awareness about the importance of plans to end hunger, reduce poverty, and protect the environment and boost economic development. This will be the year that the Aichi targets are reviewed at a summit in Kunming, China in October 2020 (the targets were named after the Japanese prefecture where they were finalized in 2010). The United Nation’s Convention on Biological Diversity set these ambitious targets. The Convention’s mission is to protect the biological, ecological, and genetic diversity that sustains all life on Earth.
BlackRock, is the world’s largest asset manager, measured by assets under management ($6.96 as of December 2019). The company has 70 offices in 30 countries and clients in over 100 countries. They are pushing clients toward environmental, social, and governance investing. BlackRock believes that ESG highlights a significant investment risk and thus, wants companies to disclose this risk and to mitigate future negative outcomes from poor environmental, social, and governance activities.
2020 can be a milestone year for these and other reviews and movements. I think we will see active debates on several topics, including (1) what would happen if the US banned fracking? (2) Should fossil-fuel companies bear responsibility for the damage their products inflict on the environment? (3) How can we reduce the risk of fires in various countries, especially places such as Australia and California; and, (4) should cities require buildings to be all electric? (5) should the US require all public companies to have one report rather than allowing two reports – one for company operations and one for ESG matters?
Keep tuned to these summits, to corporate behavior, and research that may be focusing on new directions for biological, ecological and genetic impacts on our world. And, don’t think global focus is all we need – each of us has responsibilities to think about the next ten years and our role in improving environmental outcomes. 2030 will come just as quickly as 2020 came when we were in 2010. Will each of us say in 2030 that we did all we could to improve the state of affairs in our world?