Andreas Rasche is researching and teaching on corporate sustainability with a focus on ESG, governance and sustainable finance. He currently serves as the Associate Dean for the Full-Time MBA program at Copenhagen Business School. Andreas has published over 60 peer reviewed articles in international journals and authored/edited seven books. He has worked for and collaborated with the UN Global Compact on a number of projects. From 2012-2024, Andreas served as Associate Editor of Business Ethics Quarterly and was a Visiting Professor at Stockholm School of Economics (2017-2020). More at: http://www.arasche.com

Today is an important day - the International Court of Justice (ICJ) starts to hear over 100 nations and organizations in order to produce a landmark Advisory Opinion that will assess whether actions responsible for climate change and its negative effects are lawful under international law.

Many expect that this opinion will act as a "legal blueprint" that will inform future climate litigation on the national and international levels. The Advisory Opinion was requested by the UN General Assembly on 29 March 2023, following a push by a global coalition of States led by the Republic of Vanuatu (https://lnkd.in/dUAGH_KB). The Advisory Opinion must answer two questions:

1️⃣ "What are the obligations of States under international law to ensure the protection of the climate system and other parts of the environment from anthropogenic emissions of greenhouse gases for States and for present and future generations?"

2️⃣ "What are the legal consequences under these obligations for States where they, by their acts and omissions, have caused significant harm to the climate system and other parts of the environment?”

This ICJ Advisory Opinion will be critical for judging what countries worldwide are legally required to do to combat climate change. It is reassuring to see that climate change has finally reached the UN's top court, after the European Court of Human Rights already ruled earlier this year that countries must better protect their people from the consequences of climate change.

ICJ hearings close 13 December 2024, and the advisory opinion is expected for 2025.

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Read the full request by the UN towards the ICJ:  https://www.icj-cij.org/sites/default/files/case-related/187/187-20230412-app-01-00-en.pdf 
#climatechange, #sustainability, #humanrights

The biggest bloc in the European Parliament, the EPP, wants to reverse the 2035 ban on petrol cars. This is a shortsighted move (for environmental and economic reasons). The EPP argues: "We should be driven by economic realism and remain technologically neutral." But, we cannot remain technologically neutral if we want to become carbon neutral...

The problem is not this law. The problem is that none of the major European car manufacturers have been capable of producing electric vehicles that can compete on the global market. We do not make car manufacturers more competitive by protecting backward technology, especially as companies have invested billions already. The car industry needs predictability to invest in EV-related innovations, and politicians must ensure that car manufacturers face a fair economic environment (the EU's tariffs on Chinese EVs support this).

Wopke Hoekstra (the EU's climate chief) made clear that he intends to stick to the 2035 deadline during his parliamentary hearing. So, it will be another political battle related to the Green Deal...

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FT Story: https://www.ft.com/content/61a769cc-478e-4935-9c22-10600710afd1#myft:my-news:page 
EPP Group position:  https://www.eppgroup.eu/newsroom/revise-the-combustion-engine-ban 
#eugreendeal, #climatechange

My reflections on the current stage of the planned #CSRD, #CSDDD, #EUTaxonomy omnibus. 

In the article below, I discuss four significant risks that are attached to such a proposal. In one sentence: The omnibus would be an (1) unfocused attempt at the (2) wrong time creating (3) uncertainty for business and reintroducing the risk of (4) watering down the regulations. I unpack each of the four risks and likely consequences for companies and the regulatory process.

The Political Guidelines for the 2024-2029 EU Commission carry the title "Europe's Choice" ( https://commission.europa.eu/document/download/e6cd4328-673c-4e7a-8683-f63ffb2cf648_en?filename=Political%20Guidelines%202024-2029_EN.pdf ). Creating risks around three important sustainability regulations should not be the Commission's choice...

Read the article: https://www.linkedin.com/pulse/eus-csrd-csddd-taxonomy-omnibus-four-arguments-why-bus-rasche-owiaf/

#sustainability, #esg, #eugreendeal

New research shows the diversity of ways in which consumers relate to sustainability. Often, we tend to think of the 'stereotypical' sustainable consumer as someone with high passion and high willingness to pay. But sustainability relates to consumers in many ways based on their relative willingness to pay more and their overall commitment towards sustainability.

This more nuanced segmentation shows that consumers at the extremes (i.e. champions and nonbelievers) only account for 23% of the population. It is the 77% of consumers in the other six archetypes that are interesting - they face different barriers that need to be better taken into account (e.g., product access and affordability). Other research showed, for instance, consumers often assume that sustainable products are more expensive than they actually are ( https://www.bcg.com/publications/2022/consumers-are-the-key-to-taking-sustainable-products-mainstream ) - so communication is key.

Bottom line is that there is not THE sustainable consumer, but a variety of consumer clusters that relate to sustainability in different ways based on how they mix considerations around brand, price, quality, and sustainability.

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Full study:  https://sloanreview.mit.edu/article/the-myth-of-the-sustainable-consumer/ 

Note: The study only looked at Europe and North America (n=8,000) and rests on qualitative and quantitative data. Demographic factors (location, gender, income) had no significant influence on the archetypes.
#sustainability, #esg

Less than 16% of issued carbon credits reflect real emission reductions, according to a large-scale systematic assessment of carbon crediting projects that was just published in 'Nature Communications'. The study looked at 2,346 mitigation projects which together account for nearly 1 billion tons of CO₂ (19% of all issued credits).

But the "offset achievement ratio" (OAR) differs significantly across project categories: Wind power projects in China and improved forest management in the US showed no statistically significant emission reductions, while avoided deforestation achieved a ratio of 25% and SF6 destruction 16%. Even the best performing project category (HFC-23 abatement) only achieved a 68% OAR.

"Our assessment highlights that many project developers pick favourable data or make unrealistic assumptions. Some methodologies make use of outdated data or inappropriate methodological approaches, which can lead to adverse selection or perverse incentives." These problems lead to many non-additional projects being registered.

A stark reminder that carbon crediting systems need much better mechanisms to cope with adverse selection problems...

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Full study (open access):  https://www.nature.com/articles/s41467-024-53645-z 
#climatechange, #sustainability, #carboncredits

ISO launched a new standard focused on ESG implementation principles (ISO IWA 48:2024). Considering that, globally speaking, ESG practices are still fragmented, a standard that provides structure and outlines key processes makes sense. It reads a bit like an "ESG 101" - an introduction to the field.

Although I doubt that such a document in itself can standardise language and processes (without further enforcement by policy makers), it is a welcome reference point, for instance: (1) for those in organizations who increasingly get in touch with ESG debates and need an introduction, (2) for smaller firms that seek initial guidance on how to set up structures and processes, and (3) for non-business entities that come into touch with ESG debates. ISO points out that the standard is explicitly designed for and applicable to different types of organizations, not just large corporations.

While ISO IWA 48 rightly claims that ESG is not just about reporting and that the focus is on embedding relevant practices into an organisation's culture, there is relatively little in the standard on how to shape such a culture. Of course, cultural transformations cannot (and should not) be standardised, but still more specific things could have been said on this topic...

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Access ISO IWA 48:  https://www.iso.org/obp/ui/en/#iso:std:iso:iwa:48:ed-1:v1:en 
#sustainability, #esg

Commission President von der Leyen commented on plans to streamline and consolidate #CSRD, #CSDDD, and the #EUTaxonomy by potentially introducing an "omnibus regulation". This is deeply concerning as it may weaken these Green Deal regulations.

At a recent press conference, von der Leyen discussed plans to reduce bureaucracy. “We will look, for example, at the triangle [of the] Taxonomy, CSRD, CS3D.” But she also stressed that the content of the regulations is "good". “We want to maintain it, and we will maintain it. But the way we get there, the questions we are asking, the data points we are collecting – thousands of them – is too much. Often redundant, often overlapping.” ( https://real-economy-progress.com/eu-to-re-open-and-merge-csrd-cs3d-and-taxonomy/ )

Such an omnibus regulation would enact the Budapest Declaration ( https://www.consilium.europa.eu/en/press/press-releases/2024/11/08/the-budapest-declaration/ ) in which the Council asked the Commission to make proposals to reduce reporting obligations by at least 25% in the first half of 2025. An omnibus regulation consolidates or amends multiple other regulations into one document. So, omnibus in the sense of: "covering multiple areas".

Such a move would create legal uncertainty into an area where companies are just starting to build up capacity (and hence it would reward laggards). Further, the legal effects on the three regulations are uncertain. If the omnibus regulation follows the traditional legal path, the Council and Parliament can amend a Commission proposal. Especially the new Parliament may use a "consolidation" as a pretext to weaken the regulations in substantive ways.

So far, the Commission has not officially communicated any position. So, at this stage these are media reports based on a press conference. But, politics moves fast and it can be a dirty game...

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Links to some press articles:
 https://real-economy-progress.com/eu-to-re-open-and-merge-csrd-cs3d-and-taxonomy/ 
 https://www.lexology.com/library/detail.aspx?g=b061ce07-0a2c-41c4-bc57-0bf7a323167f 
 https://www.lw.com/en/insights/eu-commission-suggests-potential-consolidation-of-esg-reporting-frameworks-in-2025 
#sustainability, #esg

The European Council unanimously approved the new ESG ratings regulation. This was the final legal step. The regulation will now be published and then apply 18 months after publication (so in 2026).

1️⃣ ESG rating providers will be authorised and supervised by the European Securities and Markets Authority (ESMA) and must comply with transparency requirements, as a minimum disclosing "the methodology, models, and key rating assumptions."

2️⃣ Rating providers' different business activities need to be separated, but regulators leave a backdoor open: no separate legal entities need to be created if raters can show that activities are separated and no conflicts of interest exist.

3️⃣ Separate E, S, and G ratings should be provided. If a single ESG rating is provided, rating providers need to disclose the rate and weight attributed to each dimension.

4️⃣ If ESMA finds that a rater has intentionally or negligently infringed the Regulation, it should adopt a fine (max 10% of total annual net turnover).

At the same time, the UK regulator has also released and updated draft legislation to regulate ESG ratings. Good to see that the market, which some described as the "Wild West", is getting some more transparency requirements...

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EU Regulation (final text):  https://www.consilium.europa.eu/en/documents-publications/public-register/public-register-search/?WordsInSubject=&WordsInText=&DocumentNumber=43%2F24&InterinstitutionalFiles=&DocumentTypes=&DateFrom=&DateTo=&MeetingDateFrom=&MeetingDateTo=&DocumentLanguage=EN&OrderBy=DOCUMENT_DATE+DESC 
UK Regulation (draft text):  https://www.gov.uk/government/consultations/future-regulatory-regime-for-environmental-social-and-governance-esg-ratings-providers 
#sustainability, #esg, #sustainablefinance

Studies on early #CSRD / #ESRS implementation point towards many challenges. Here comes an overview of key insights from four studies conducted in 2024. Studies include: EFRAG (n=28 firms), Frank Bold (n=100 firms), Position Green (n=400 firms), and PwC (n=547 managers). These studies differ in terms of aims and methods, so results cannot be compared directly. But the findings show some common challenges:

1️⃣ DOUBLE MATERIALITY: The EFRAG data shows that firms adopt a thorough and analytical DMA approach, but it is also this very approach that brings challenges, for instance the lack of specific data. Frank Bold's results point in a similar direction showing that many firms do not specify what types of impacts they have within their material topics.

2️⃣ REPORTING GAPS: Disclosures for "new" topic areas is a challenge (i.e. areas not yet part of existing reporting). The studies by Position Green and Frank Bold reveal significant gaps in terms of biodiversity reporting. Likewise, PwC's findings show that biodiversity was the topic for which managers expressed the lowest level of confidence for meeting reporting requirements.

3️⃣ ORGANISATIONAL CHALLENGES: The results by PwC show that CSRD implementation is approached as a cross-functional effort that reaches beyond the sustainability unit. But, this brings new organizational challenges, which the EFRAG study summarised as being about the need for "clear governance" and "upskilling".

These early results give good insights into those areas where implementation challenges likely exist. Many more details in the four studies...

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Note: Due to the CSRD's scope, the four studies focus mostly on larger companies, as these are the ones that need to file reports in 2025.

Frank Bold: https://lnkd.in/d-tQkBTv
PwC: https://lnkd.in/dqfNjFW7
Position Green: https://lnkd.in/d3Jy8bf5
EFRAG: https://lnkd.in/dpsM_UX6
#sustainability, #esg

Overconsumption drives the transgression of several planetary boundaries, according to a new study in 'Nature'. Significant parts of the planetary boundary breaching responsibility can be attributed to the global top 10% and top 20% of consumers. The data is based on a global expenditure database that includes up to 201 consumption groups across 168 countries.

"The world’s top 10% of consumers were responsible for 51%, 48%, 38%, 31% and 67% of the PB transgressions in terms of climate change, land-system
change, N flows, P flows and biosphere integrity, respectively."

If the global top 20% of consumers would adopt effective mitigation measures, they could yield a reduction of 25%-53% in environmental pressure. In such a scenario, just focusing on the food and services sectors would be sufficient to push land systems change and biosphere integrity back within their boundaries.

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Full study (open access):  https://www.nature.com/articles/s41586-024-08154-w 
#sustainability, #planetaryboundaries

Update on EU Deforestation Regulation: EPP backtracked on the two-year extension. But today's vote still approved the creation of "no risk" categories (by a narrow margin). Belgian, Irish and part of the Dutch EPP had expressed their opposition to some of the centre-right group's proposed changes.

EUDR now goes back into trilogue on the "no risk" category. It will be interesting to see whether agreement can be reached by January 2025.

Voting was pure chaos as some of the voting machines did not work. One MEP argued that this calls into question the entire vote. #EUDR, #greendeal

Story on EPP backtracking before vote: https://www.euractiv.com/section/agriculture-food/news/epp-backtracks-on-two-year-delay-for-eudr-trader-exemption-ahead-of-vote/

The University of Oxford has launched a great new tool: the "Climate Policy Monitor" which assesses how ambitious, stringent, and comprehensive the net-zero regulations of 30 countries are. The 2024 Monitor, which assessed 265 regulations in these countries, uncovers significant gaps:

1️⃣ DISCLOSURE: Only 17 jurisdictions mandate firms to disclose emissions across their entire value chains (Scope 3' emissions).

2️⃣ TRANSITION PLANS: Although many countries demand companies to lay out transition planning (describing how they actually meet climate pledges), only 20% of the assessed regulations require actual implementation of the plans.

3️⃣ PUBLIC PROCUREMENT: While many countries have created rules to align government procurement spending with climate goals, there is a lack of clear standards on how to operationalise these requirements.

The good news: climate-related regulations and policies are growing. The bad news: way too many gaps remain in terms of enforcement and clarity.

Considering that the assessed countries reflect most of the main emitters (US, China, EU, India, UK) the results expose those areas where pressure on regulators needs to increase. Because the mere existence of many regulations does not fix it...

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Access the Monitor:  https://climatepolicymonitor.ox.ac.uk/ 
#climatechange, #sustainability, #netzero

CO2 emissions from fossil fuels have increased by 0.8% in 2024, according to new data released at #COP29 earlier today. For 1.5°C, which is only a theoretical goal at this stage, emissions would need to fall by 43% by 2030. No sign of "transitioning away..."

The "Global Carbon Budget 2024" calculations show that 37bn tonnes are expected to be emitted in 2024 (4 million tonnes a minute). Despite progress in clean energy, growth in natural gas and oil use pushes global fossil emissions up. Coal emissions are also projected to increase (0.2%).

Although there is a slowdown in the increase in global fossil CO2 emissions, there is no indication yet that the burning of fossil fuels has peaked...

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Full Paper:  https://essd.copernicus.org/preprints/essd-2024-519/ 
The Guardian:  https://www.theguardian.com/environment/2024/nov/13/no-sign-of-promised-fossil-fuel-transition-as-emissions-hit-new-high 
#sustainability, #climatechange

How can boards integrate sustainability into their oversight tasks? I have collected some important lessons on how to build a "board sustainability infrastructure" and put them into a new paper. The focus is on (1) the structure boards choose to discuss sustainability, (2) directors' collective mindset vis-a-vis sustainability, and (3) the development of relevant competencies.

1️⃣ STRUCTURE: Should boards form a sustainability committee, or should the entire board integrate sustainability discussions? There is no one-best-way, but there are situations and contextual conditions that impact whether a structural model fits better or not.

2️⃣ MINDSET: Maybe more important than structure is how boards approach sustainability discussions. Which beliefs and assumptions shape the debate around ESG topics? Too often, a compliance mindset dominates (e.g. because the link between new regulations and strategic thinking is not yet obvious).

3️⃣ COMPETENCIES: Research shows that boards are still lacking sustainability credentials and relevant expertise. While directors do not need expert sustainability knowledge, they need to build up knowledge in various interrelated areas to fulfil their tasks.

Read the paper: https://media.licdn.com/dms/document/media/v2/D4D1FAQELM6rwJHk-ig/feedshare-document-pdf-analyzed/feedshare-document-pdf-analyzed/0/1731395854530?e=1733961600&v=beta&t=IWpDevvFYHGWEpE_AoMUnJ8jpMfY_EwW8TwE0MuvFyU  

Much more can be said, but these three areas are a good way to start the discussion...
#sustainability, #esg

The estimated damages of the combined CO2 emissions from the 25 biggest emitting oil and gas companies are around $20 trillion for the 1985-2018 time period (financial gains were around 50% higher during the same period).

hashtag#COP29 is supposed to further operationalize the "Loss and Damage Fund", which has $702 million in it right now. Some have suggested that this fund needs $100 billion per year at the very least. This is not about charity - it most of all about responsibility and accountability.

Loss and damage funding cannot just focus on pledges by national governments, the private sector also needs to contribute its fair share. António Guterres said last year "Polluters must pay" when suggesting to tax windfall profits of fossil fuel companies.

The study uses an established method - the social cost of carbon - to calculate the damages. It assumes partial damage allocation: an equal split of responsibility between producers, policymakers, and end users. Access it here:  https://climateanalytics.org/publications/carbon-majors-trillion-dollar-damages

 
#climatefinance, #climatechange, #fossilfuels

New summary showing the evolution of "Planetary Boundaries" (PB) over time. The overview shows (1) the multidisciplinary roots of PBs and (2) how the PB framework itself informed global policy and business. This is based on a new review by Rockström et al. that discusses the past, present and future of PBs.

The PB framework sharpens our understanding for the fact that the environmental crisis is not just based on a single dimension (e.g, climate), but that it is the interaction of multiple dimensions that matters. It is a "systemic planetary perspective" and hence a systemic planetary crisis.

PBs are purely set on biophysical grounds without incorporating specific considerations around feasibility or human demands. The Earth system does not negotiate...

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Full Review Article in 'Nature Reviews' (open access):  https://www.nature.com/articles/s43017-024-00597-z 
#sustainability, #planetaryboundaries

US boards deprioritize ESG discussions with less than half of boards regularly discussing it. Lack of consistency is one driver: 58% of directors believe that ESG is not consistently understood within the boardroom.

This lack of consistency is likely to be driven by a lack of credentials and ESG-related expertise (https://lnkd.in/dR6mW48w). 43% of directors either did not know how their company's climate commitments impact capital allocation or only had a weak understand of it. Another driver is, of course, the strongly politicized and polarized nature of ESG in the U.S, and a Trump presidency is likely to further deepen this divide.

Still a long way to go to integrate ESG discussions into boardrooms...

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Full Report:  https://www.pwc.com/us/en/services/governance-insights-center/library/annual-corporate-directors-survey.html 
#esg,#sustainability, #climatechange

🎙️ Finally, a new episode of our Podcast #Numbers & #Narratives, where we try to unpack the meaning #impact and #materiality with the great Andreas Rasche, authority in sustainable business and Associate Dean of the Full-Time MBA Program at Copenhagen Business School. 🌍

Together with my co-host Laura Marie Edinger-Schons we talk to Andreas about several open questions surrounding sustainable business, such as:

🎱 The complex role of #quantification in sustainability, exploring how metrics can sometimes crowd out moral considerations while also building essential bridges.

🍀 #DoubleMateriality and its significance in pushing companies to account for their broader impact on society and the environment—not just financial returns.

🔮 The evolving landscape of corporate sustainability #strategy and how managers can go beyond numbers to create genuine narratives for change.

Andreas' impressive background, including collaborations with the United Nations, over 60 publications, and leadership roles in business ethics, brings depth and perspective to this conversation. He emphasizes the balance between #measurement and #meaningful #impact — a core challenge for many in times of #CSRD and increased #regulation.

🔗 Tune in to this episode and join the conversation about how we can make sustainability metrics a tool for true transformation here:  https://open.spotify.com/episode/014yCoyMhRLAxMUN6utvCa 

University of St.Gallen
HSG Institute for Economy and the Environment
Institute of Accounting, Control and Auditing
University of Hamburg

2024 is "virtually certain" to be the first year to breach 1.5°C (2023 was 1.48°C), according to new data by the EU's Copernicus C3S. With Trump in the White House, this will enormously intensify pressure. What now?

"If you can’t fly, run; if you can’t run, walk; if you can’t walk, crawl; but by all means keep moving.” - Martin Luther King, Jr (as cited by Al Gore last night)

Press Release:  https://climate.copernicus.eu/copernicus-2024-virtually-certain-be-warmest-year-and-first-year-above-15degc 
#climatechange, #sustainability

Today's US election will shape the future path of ESG and sustainability, not just in the US. A Trump victory will impact ESG disclosure rules (e.g., the SEC's ability to enforce rules) as well clean energy policies, and it would be a serious blow to global climate action. Great overview by ESG Book...

While it is unlikely that Trump will completely repeal the Inflation Reduction Act (IRA) - due to its economic benefits to key conservative states - it is clear that the clean energy sector will take a hit ( https://www.ft.com/content/2a5580d6-3a83-467e-a4b0-efc1b1c52759?desktop=true&segmentId=7c8f09b9-9b61-4fbb-9430-9208a9e233c8#myft:notification:daily-email:content). Trump has also promised to roll back the Clean Power Plan, which would lead to an elimination of methane fees.

A Trump victory would significantly affect global climate diplomacy. He is expected to withdraw (again) from the Paris Agreement within 90 days, leading to what António Guterres described as a "crippled" version of the Agreement. Latest reports even say that a Trump administration could exit the entire UN climate negotiating framework (UNFCCC).

The choice is clear...

Source: https://www.esgbook.com/the-political-climate/   

#sustainability, #esg, #uselection2024

Approaching sustainability regulations like #CSRD through a compliance-only mindset can likely create a vicious circle - compliance is judged sufficient because of a lack of strategic benefits. Such benefits, however, could not emerge due to the original focus on compliance. A closer look:

1️⃣ A compliance mindset towards sustainability regulations is fuelled by the swift emergence of regulations in this area. Often, such a mindset is dominant because the benefits of regulatory implementation are judged to be uncertain.

2️⃣ Due to the focus on compliance, firms do not experience many strategic benefits - e.g., it becomes reporting for the sake of reporting. In other contexts, regulations are so new that benefits could not even emerge.

3️⃣ The lack of perceived benefits supports arguments around sustainability regulations being a cost driver without tangible value.

4️⃣ This framing of "regulation-as-cost" justifies the dominant compliance mindset ("Let's meet the minimum standards if we do not get anything out of it.").

In my own research, I have come across this pattern. The challenge is to find ways to break up this cycle. In the end, it is much about better linking the outcomes of regulatory implementation (e.g., ESG data) and strategic decision-making. #sustainability, #esg, #eugreendeal

The EU Green Deal consists of over 150 directives and regulations stretching across 11 areas (image below with links to all policies). For all those who now shout "this is overregulation", consider this:

1️⃣ LEVELLING PLAYING FIELD: We need a level playing field when it comes to (corporate) sustainability. The years where voluntary standards dominated the field were great for learning (and these standards are still needed), but they do not reach far enough in terms of scale.

2️⃣ INVESTMENT: Many Green Deal regulations aim at more transparency and comparability, so that investors can, ideally, reallocate capital into cleaner companies and sectors. The green transition requires enormous investments and governments alone will not be able to allocate sufficient capital.

3️⃣ BEYOND EUROPE: Some of these regulations also have effects beyond Europe and hence cover non-EU competitors (actually hashtag#CSDDD and hashtag#CSRD are good examples). Also, we have seen a proliferation of sustainability regulations (e.g., taxonomies) in other parts of the world - Europe is not alone...

The next step must be to better link the Green Deal with competitiveness concerns (the Draghi report outlined possibilities). The Mission Letters for the EU Commissioners-designate show that the Green Deal is pushed into this direction.

Source:  https://www.circulaw.nl/European_green_deal.pdf

Link: https://www.linkedin.com/posts/circulaw_european-green-deal-circulaw-activity-7218874812008411137-TiNw?utm_source=share&utm_medium=member_desktop 

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Image credit CircuLaw, #eugreendeal, #sustainability, #esg

The Valencia region, which was hit by severe flash flooding yesterday, was also the region with the highest January temperature ever recorded in Europe: 30.7°C (87.3°F) on 25 January 2024. A stark reminder of how much climate change is pushing us towards extremes...

Rainfall and heat extremes have continued (and will continue) to increase worldwide due to anthropogenic global warming ( https://www.nature.com/articles/s41612-021-00202-w ).

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AVAMET: https://www.nature.com/articles/s41612-021-00202-w

EU companies greenwash less (-20%) compared to firms in the US and UK. Increased transparency through regulations like #CSRD, #SFDR, and the #EUTaxonomy is likely to be one driver behind this trend. The Green Deal’s commitment to tackle false environmental claims at EU level starts to pay off.

European firms may also factor in the new EU anti-greenwashing rules related to the "Empowering Consumer for the Green Transition Directive" (applicable from 2026) and the "Green Claims Directive"(under negotiation). These regulatory changes push many firms into seeing greenwashing as a risk to be managed.

The drop in cases is not uniform across the EU: largest reduction in the Netherlands (-48%) and Italy (-39%), while Germany just saw cases dropping by 15% and in France there even was an increase by 11%.

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Full Report by RepRisk:  https://www.reprisk.com/research-insights/reports/a-turning-tide-in-greenwashing-exploring-the-first-decline-in-six-years 
#sustainability, #greenwashing, #esg

Continuing with current climate mitigation policies gives us a 66% chance that warming is kept below 3.1°C, according to the brand new UNEP 'Climate Gap Report'. Even with all national climate pledges achieved, we arrive at 2.6°C (see image below).

In the most optimistic case where all national climate pledges and all long-term net-zero targets are achieved, there is a 66% chance of limiting warming to 1.9°C. While it is "still technically possible to get on a 1.5°C pathway", this only remains a theoretical possibility (as it would require huge, coordinated and rapid efforts).

GHG emissions rose to a record 57.1bn tonnes of CO2 equivalent in 2023, despite global pledges to cut emissions. Another year, another report, another record, and every year we need sharper cuts...

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Full UNEP Report: https://lnkd.in/dspeWhX8

Earth is sending us vital signals... The long-term evolution of planetary boundaries over almost 75 years shows how significantly Earth processes have been deteriorating since the 1950s.

Two boundaries were already crossed in the 1950s, while we have crossed six boundaries overall in 2024. The transgression of a seventh boundary (ocean pH) is unavoidable due to the CO2 already emitted and the time it takes for the ocean system to respond ( https://phys.org/news/2024-09-world-oceans-critical-acidification.html ). Four boundaries operate in high-risk zones.

The boundaries interact in various ways and so do the human activities that cause their transgression. That is why we cannot 'pick and choose' which boundary to address. We need to respect all nine boundaries equally... and this requires integrated thinking across systems and E, S, and G silos.

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Data comes from the '2024 Planetary Health Check'. Check out their website to learn more about planetary boundaries science: https://www.planetaryhealthcheck.org/planetary-science

Sustainability may follow the so-called 'hype cycle' that is often associated with transformations (see image). In this cycle, sustainability has likely hit the trough of disillusionment, and this may even be good thing...

The peak of inflated expectations was, among other things, driven by the ESG hype on financial markets (especially in 2020/21) and the enthusiasm around new legal regulations (especially the #CSRD and #EUtaxonomy). Now, that ESG markets have cooled and regulations need to be implemented with a lot of attention to detail, some of the enthusiasm has faded (also because sustainability is overshadowed by other debates such as geopolitics and AI).

Being in the trough of disillusionment can help to spur learning if companies are open to it. The low-hanging fruits are picked and the attention shifts to the more difficult discussions such as: (1) organisational integration of regulations, (2) increased collaboration along the value chain , (3) the availability of technological solutions at scale, and (4) sufficient investments to back up targets (instead of cutting back budgets).

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Note: The 'hype cycle' is based on a framework by Gartner and it is used to discuss technological hypes (and, of course, only few technologies actually follow exactly this pattern). It can be used to assess sustainability-related technologies ( https://trellis.net/article/gartners-hype-cycle-applied-to-the-business-of-sustainability-in-2024/ ), but it can also be used as an illustrative(!) framework to discuss where sustainability as a practice stands and where it may go. #sustainability, #esg

The image below is from Bain & Co. - applying the illustrative idea of this cycle to the current state of sustainability. Read their analysis here: https://www.bain.com/insights/topics/ceo-sustainability-guide/

61% of countries in the Global South have already passed the renewables tipping point; some of these countries even push renewable electricity generation faster than the Global North, according to a new report by RMI. Some ground for optimism:

➡️ The Global South controls 70% of global solar and wind resources and 50% of critical minerals. This makes their renewable potential nearly 400 times larger than their current fossil fuel production (Global North has 50x potential).

➡️ 87% of capital expenditures on electricity generation goes into clean energy. Solar and wind generation in the Global South has grown on average at 23% annually throughout the last five years.

➡️ Electric vehicle sales are taking off in some countries - e.g., in Thailand from 5% in 2022 to nearly 18% in 2023 and Vietnam from around 2% in 2022 to nearly 12% in 2023.

Ground for optimism, yes, but still more finance is needed to reach the goal to triple renewable energy by 2030 ( https://www.iea.org/commentaries/tripling-renewable-power-capacity-by-2030-is-vital-to-keep-the-150c-goal-within-reach ). As #COP29 approaches, countries need to scale up financing...

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Full Report:  https://rmi.org/wp-content/uploads/dlm_uploads/2024/10/Powering_up_the_global_south.pdf 
#climatechange, #sustainability, hashtag

Many companies are jumping on the "nature positive" bandwagon these days. The share of corporates with nature-based goals is increasing. In principle this is good, but there is a real risk that firms might uncover that delivering on these goals is harder than they thought.

Great discussion in today's FT ahead of #COP16. One key message: "Scientists and environmental groups worry that companies and governments are starting to brandish the term as a buzzword, before the definitions and metrics needed to ensure accountability have been put in place and without having grasped the scale of the work required."

As firms enter this space, there is need for additional safeguards and accountability, especially because problems like biodiversity are more local and measurement is less standardised (e.g., compared to carbon). Nature-based targets alone won't do the trick. Businesses must back their targets with credible plans and sufficient investments. Most of all, the targets need to be set in a way that they "match the scale of the problem."

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Full discussion by FT: https://www.ft.com/content/4d12f8d1-c0df-4ab6-b374-741e9517448b?desktop=true&segmentId=7c8f09b9-9b61-4fbb-9430-9208a9e233c8#myft:notification:daily-email:content 
#biodiversity, #sustainability, #climatechange

66% of people have never heard of 'climate justice', but a majority of these people still recognises social, historical and economic injustices related to climate change. This is the key finding of a new global study covering 11 countries published in 'Nature Climate Change' .

In other words, there is a mismatch between climate justice "awareness" and climate justice "beliefs". Many of us are somehow aware of the various injustices related to climate change, but we do not consciously relate such beliefs to climate justice.

Two climate justice beliefs stand out (see image below): 78% believe that people living in poverty suffer worse effects from climate change. And another 78% believe that communities most affected by climate change should have more of a say in decisions about solutions.

Bottom line: public awareness of climate justice as a concept is still too limited around the world pointing towards the need for more systematic education.

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Full Article (open access):  https://www.nature.com/articles/s41558-024-02168-y 
#climatechange, #sustainability, #climatejustice

The EU Green Deal is alive. Below is an overview of incoming Commissioners who have a strong sustainability mandate in their portfolios. They all received "Mission Letters" (outlining expectations). The key priority topics mentioned in these Letters show that the EU plans to deliver on the Green Deal.

The list of priorities also shows that the Draghi Report already leaves its marks pushing for competitiveness through sustainability. Some proposals of the Draghi Report are directly implemented, e.g., the industrial action plan for the automotive sector. A key priority will also be the development of a Clean Industrial Deal that operationalizes several elements of the Draghi Report.

Great to see Teresa Ribera Rodríguez being in charge of the "Clean, Just and Competitive Transition." She has been a vehement advocate of emissions reductions for many years. It shows that there is appetite for the Green Deal in Brussels. This is also reflected in her Mission Letter where Ursula von der Leyen writes: "I would like you to guide the work to ensure that we stay the course on our goals set out in the European Green Deal."

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Note: All listed individuals are Commissioners-designate - they need to undergo parliamentary hearings (in November). Final appointments are made by the European Council.

Access the Mission Letters: https://commission.europa.eu/about-european-commission/towards-new-commission-2024-2029/commissioners-designate-2024-2029_en

A new report shows the full scale of the global water crisis and how it impacts virtually all of the #SDGs. Water stress is estimated to put half the world's food production at risk within the next 25 years, according to the study by the Global Commission on the Economics of Water (so far the biggest global study of all aspects related to the water crisis).

The water crisis has been a 'silent crisis' so far - it is not much in the public eye, poorly governed, and yet heavily impacting people and planet because of the interconnected nature of ecosystems. The availability of "green water" (e.g., soil moisture needed for food production) and "blue water" (e.g., from rivers and lakes) impact whether and how the #SDGs are achieved. But water stress is increasing: demand for fresh water will outstrip supply by 40% by the end of the decade.

❗ This shows again: sustainability needs to be tackled through systems thinking and yet we still treat problems in rather isolated ways. Feedback loops and cascading effects matter (e.g., climate change impacting soil moisture) and ESG and corporate sustainability frameworks must reflect this much better!

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Full Report:  https://economicsofwater.watercommission.org/  (Co-chairs of the Commission: J. Rockström, N. Okonjo-Iweala, T. Shanmugaratnam, M. Mazzucato, H. Ovink).
#climatechange, #planetaryboundaries, #esg

Despite heavy lobbying, the EU plans to stick to the 2035 deadline to outlaw the sale of new cars powered by fossil fuels. This is reassuring, not just for the EU Green Deal, but also for investors and car manufacturers themselves as they need predictability.

The law has come under pressure because EU car manufacturers struggle on world markets, e.g. due to intense competition from Chinese EVs. Many expected that the law could be on the list of items that would be "renegotiated and revised" after the new Commission comes in. However, Wopke Hoekstra (the EU's climate chief) made clear that the EU “cannot and should not roll back” this law.

Good to see that the EU Green Deal is alive, despite recent disappointments related to the delay of the EU deforestation law.

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Full FT story:  https://www.ft.com/content/9b8e685c-622c-467c-ace6-b9dfc203f819#myft:my-news:page 
#eugreendeal, #climatechange

New CDP data shows that initiatives aimed at reducing scope 3 emissions resulted in $13.6bn financial savings. Despite this potential, only 15% of companies explicitly target their value chain with emission reduction initiatives.

One impediment is lack of governance: only 7% of companies disclosing through CDP oversee value chain engagement within their board-level governance. If the 'board is not on board' it is more difficult to push initiatives into the value chain.

What drives supplier actions? Capacity building, education and financial incentives matter. 1️⃣ Supplier were 52% more likely to reduce annual emissions when buyers offered financial incentives. 2️⃣ Suppliers who received support from buyers on setting science-based targets (SBTs) were 2.6 times more likely to set an SBT.

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Full report: https://cdn.cdp.net/cdp-production/cms/reports/documents/000/007/890/original/CDP_HSBC_Report_2024.pdf?1727343420

The overview below shows climate-related natural disasters between Nov 2023 and Aug 2024, with a brief explanation of links to climate change. New data shows that the average annual expected loss from such natural catastrophes has reached a new high of $151 billion - and these are just economic costs that do not even account for the human suffering involved.

A good reminder that the fact that such disasters are increasing in frequency and intensity is not just a theoretical claim - it is the new reality and it is costing us dearly (in all sort of ways).

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Table from '2024 State of the Climate Report':  https://academic.oup.com/bioscience/advance-article/doi/10.1093/biosci/biae087/7808595 

Annual loss data by Verisk: https://www.verisk.com/company/newsroom/new-report-average-annual-natural-catastrophe-losses-for-the-insurance-industry-reaches-new-high-of-$151-billion/
#climatechange, #sustainability, #esg

New data shows a 12% decrease in #greenwashing cases across regions for the first time, according to RepRisk's annual greenwashing report. Europe saw the strongest decrease, likely due to increased regulatory scrutiny: more transparency through e.g. #CSRD, #EUTaxonomy and firms factoring in future anti-greenwashing legislation ('Green Claims' and 'Empowering Consumers' directives). Some key facts:

1️⃣ SEVERITY: The severity of greenwashing cases surged by 30% - the severity is measured based on (a) consequences of the incident, (b) extent of impact, and (c) causes of incident (e.g., negligence or intent). In other words, we see overall fewer greenwashing cases, but more severe ones.

2️⃣ LACK OF LEARNING: Some companies seem stubborn and unwilling to learn - 30% are repeated offenders (i.e. they had cases in 2023 and then again in 2024). This could also point to a lack of risk management and understanding of what drives greenwashing.

3️⃣ INDUSTRY TRENDS: The Oil and Gas sector accounted for the largest share of cases, followed by Food and Beverage and Banking & Financial Services. But, when comparing year-on-year, Banking and Financial Services saw the biggest decline (27%) - likely due to changing dynamics around ESG and increased regulatory scrutiny (e.g., #SFDR).

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Full report and analysis:  https://www.reprisk.com/research-insights/reports/a-turning-tide-in-greenwashing-exploring-the-first-decline-in-six-years#footnote5 
#sustainability, #esg

CFOs and General Counsels are becoming more involved in sustainability (due to regulations) and headcount continues to increase in sustainability teams, according to the new 'State of the Sustainability Profession 2024' report. Two further important findings:

1️⃣ Sustainability becomes better structurally anchored within and throughout organizations. Non-sustainability departments are increasingly adding sustainability staff (see image below). Highest increase is in finance and legal - it shows the effects of swiftly emerging regulation and the corresponding need to integrate financial and ESG data. Such integration is welcome - but: mindsets also need to integrate and this is the bigger leadership challenge...

2️⃣ Sustainability executives are rising in seniority within their companies. This is promising as it shows that CSOs are increasingly at the table when strategic decisions are being made (and they are more likely to influence these decisions). This can support integration of sustainability terminology and frameworks into senior management discussions and thus improve 'sustainability literacy'.

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More here:  https://trellis.net/report/the-state-of-the-sustainability-profession-2024/?trk=feed_main-feed-card_feed-article-content  and thanks to Mikkel Larsen for sharing. I also commented on some related aspects in yesterday's Børsen (in Danish): https://borsen.dk/sponsoreret/cbs-professor-saadan-skal-danske-virksomheder-forvandle-de-gronne-krav-til-sorte-tal-paa-bundlinjen

The '2024 State of the Climate' Report is out - not a pretty picture, but a really good discussion of recent key findings. The authors make clear: "In a world with finite resources, unlimited growth is a perilous illusion." Authors include W. Ripple, J. Rockström, S. Rahmstorf, M. Mann and many others.

The report tracks 35 vital planetary signals annually - of these 25 are at record levels. The report puts climate change in a larger scientific context, e.g. also tracking population effects (e.g., per capita meat production) and various feedback loops (physical and biological) that impact global warming.

Main conclusion: "Despite six IPCC reports, 28 COP meetings, hundreds of other reports, and tens of thousands of scientific papers, the world has made only very minor headway on climate change, in part because of stiff resistance from those benefiting financially from the current fossil-fuel based system."

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Access the report:  https://academic.oup.com/bioscience/advance-article/doi/10.1093/biosci/biae087/7808595?login=false 
Summary in 'The Conversation':  https://theconversation.com/unprecedented-peril-disaster-lies-ahead-as-we-track-towards-2-7-c-of-warming-this-century-240549 
#climatechange, #sustainability, #globalwarming, #climatecrisis

What to tell your board about the new sustainability regulations like #CSRD or #CSDDD? Most of all, boards need to understand that these regulations offer an opportunity for them to better govern the company. But it all depends on how the board itself frames this discussion.

Through my own talks with board members, executives and sustainability professionals, I have collected five insights that can help to make directors understand why these regulations matter for their work and support it. These five insights can (and need to) be extended and they do not reflect an exhaustive list. But, in my experience, they are a good conversation starter.

In the end, we do not just want more information about how boards provide oversight for sustainability (mandatory disclosures under ESRS 2, GOV 1-5). What matters is that boards actually integrate sustainability impacts, risks and opportunities into their decision-making...

Board members still lack ESG credentials, although more directors have credentials in the 'E' and 'G' areas (compared to 2018). Most surprising, not even 2% of directors have specific climate-related credentials. These results come out of a review of directors' ESG credentials by NYU Stern.

1️⃣ The good news: more directors have ESG-related credentials compared to 2018. Overall, 43% of directors had one or more credential in the E, S or G categories (up from 29% in 2018).

2️⃣ While directors' credentials have grown in the 'E' and 'G' areas, the overall level of credentials suggests that boards are still not well prepared for ESG-related discussions.

3️⃣ There has also been a significant increase in the number of sustainability committees at board-level. In other words: boards form structures to discuss sustainability, but credentials lag behind...

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The survey looked at directors serving on Fortune 100 boards (n=1161), so the data is U.S.-centric. Access the report here:  https://www.stern.nyu.edu/experience-stern/about/departments-centers-initiatives/centers-of-research/center-sustainable-business/research/research-initiatives/fortune-100-board-members-lacking-esg-credentials 
#esg, #sustainability, #climatechange

The EU Commission has proposed an additional 12-months "phasing-in" time for the EU Deforestation Regulation (EUDR). At the same time, the Commission also published new guidance documents to clarify key questions around definitions and processes (available here:  https://green-business.ec.europa.eu/document/download/162138c8-7c22-4bb5-98ce-fd31c81d6936_en?filename=C_2024_7027_1_EN_Guidance%20on%20EU%20Deforestation%20Regulation%20.pdf ).

"The Commission said that three months ahead of the intended implementation at the end of this year, 'several global partners' have repeatedly expressed concerns about preparedness and that European stakeholder preparation is 'also uneven'. It added that the delay in 'no way puts into question the objectives or the substance of the law'." ( https://www.argusmedia.com/en/news-and-insights/latest-market-news/2614178-eu-commission-pushes-for-12-month-deforestation-delay )

The proposed change still requires approval from EU member states and the European Parliament to make the EUDR applicable from 30 December 2025 for large companies (and 30 June 2026 for small companies).

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Official Press Release:  https://ec.europa.eu/commission/presscorner/api/files/document/print/en/IP_24_5009/IP_24_5009_EN.pdf 

#eugreendeal, #eudr

The EU Commission has opened infringement procedures aimed at 17 EU member states for having not (yet) fully transposed the hashtag#CSRD into national law. The deadline was 6 July 2024 and the 17 member states were targeted because they failed "to notify their national measures transposing fully" those Directives that were amended by the CSRD.

The Commission commented: “In the absence of transposition of these new rules it will not be possible to achieve the necessary level of harmonisation of sustainability reporting in the EU and investors will not be in a position to take into account the sustainability performance of companies when making investment decisions.” (see link to press release below)

The formal letters sent to the 17 member states reflect the first step of the infringement procedure. Member states have two months to reply, after this the Commission can send a formal request to comply. In a last step, the European Court of Justice can be involved to impose penalties. ( https://commission.europa.eu/law/application-eu-law/implementing-eu-law/infringement-procedure_en )

Letters were sent to: Belgium, Czechia, Germany, Estonia, Greece, Spain, Cyprus, Latvia, Luxembourg, Malta, the Netherlands, Austria, Poland, Portugal, Romania, Slovenia and Finland.

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Full press release by the EU Commission: https://ec.europa.eu/commission/presscorner/api/files/document/print/en/inf_24_4661/INF_24_4661_EN.pdf

The figure below reflects the first effort to link planetary boundary processes with tipping points. The tipping points categories were taken from the first 'Global Tipping Points Report'. A connection was made if a planetary boundary's control variables (or drivers) were connected to the drivers of a tipping system.

The results are clear: climate, biosphere integrity, land systems change, and freshwater have a significant impact on fragile regional systems that create global consequences (i.e. 'tipping points').

The analysis shows what planetary boundary science has been trying to tell us for years: it is the interconnections (a) among boundaries and (b) of boundaries with tipping points that matter. We need to analyse systems and not just 'E', S' and 'G' categories...

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Full analysis in the 'Planetary Health Check 2024':  https://www.planetaryhealthcheck.org/ 

#climatechange, #planetaryboundaries, #esg, #sustainability

The IAASB approved 'ISSA 5000', the new International Standard on Sustainability Assurance. Really good news as this standard is designed to be an internationally applicable reference point that should guide future assurance practices related to sustainability information.

Designed as a principle-based standard, ISSA 5000 can be used independently of the reporting framework used. Right now, it is assumed that the standard will be adopted by the EU as a reference point for #CSRD assurance by means of a delegated act. The CSRD requires that a standard for limited assurance is adopted by 1 October 2026 at the latest.

Until full legal adoption of ISSA 5000, another reference point are the non-binding guidelines for limited assurance developed by the Committee of European Auditing Oversight Bodies (CEAOB). The proposal was published in June 2024:  https://www.drsc.de/app/uploads/2024/07/CEAOB_Draft_Guidelines_on_Limited_Assurance_June_2024.pdf 

The final text of ISSA 5000 still needs to be certified by the Public Interest Oversight Board and will then be published by the end of the year. You can access the approved text here: https://www.iaasb.org/meetings/iaasb-quarterly-board-meeting-september-16-20-2024

Great move - CDP and the Net-Zero Data Public Utility (NZDPU) just announced to expand their partnership, so that for the first time core climate data on more than 10,000 companies will be freely available to all. The covered companies reflect over 50% of global market cap.

"The data provided by CDP will incorporate core climate transition-related data, such as GHG emissions and emissions reduction targets, including detailed sector-specific data [...]." Such partnerships also help businesses as it becomes easier for corporate actors to assess progress on climate goals of those they (want to) do business with.

The hurdles to access quality corporate climate data often remain too high, excluding key stakeholders from gaining more insights on where we stand on the net-zero transition. In 2023, over 23,000 companies disclosed through CDP, so making parts of this data open access is a significant step to closing data gaps.

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Press Release:  https://nzdpu.com/news-and-publications/2b666309-34df-4df0-ba0f-bf957664ce1d 

#climatechange, #climatedata, #netzero

Six planetary boundaries are already crossed - soon it will be seven (out of nine), according to the first 'Planetary Health Check' report by the Potsdam Institute for Climate Impact Research (PIK) that was just published. The seventh boundary that is about to be crossed is ocean acidification.

"As CO2 emissions increase, more of it dissolves in sea water [...] making the oceans more acidic. [...] Even with rapid emission cuts, some level of continued acidification may be unavoidable due to the CO2 already emitted and the time it takes for the ocean system to respond. Therefore, breaching the ocean acidification boundary appears inevitable within the coming years." (https://lnkd.in/dXmUEeZD).

❗ The report makes clear that we cannot address the nine boundaries in isolation - they are deeply interconnected. Ocean acidification, for instance, impacts and is impacted by climate change and has significant consequences for biosphere integrity (as it leads to breakdowns of food webs).

Only upside: addressing one planetary boundary can have benefits for other boundaries. Nature works in systems - corporate responses should better acknowledge this...

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Access 'Planetary Health Check' Report: https://d1gwxouzo4hr10.cloudfront.net/planetaryhealthcheck2024_report.pdf

Currently, climate skeptics share the results of a recent study in 'Science' that reconstructed the Earth's climate throughout the last 485 million years (see image). BUT: they attach misleading conclusions to it and hence try to fool people.

The study neither shows nor claims that "everything is OK" because the climate has always been changing throughout Earth's history.

A discussion of this study by The Washington Post makes clear: "At no point in the nearly half-billion years that Judd and her colleagues analyzed did the Earth change as fast as it is changing now." and “In the same way as a massive asteroid hitting the Earth, what we’re doing now is unprecedented.”

It is all about the rapid rate of temperature increase and our inability to cope with the resulting conditions. "Life on Earth has endured climates far hotter than the one people are now creating through planet-warming emissions. But humans evolved during the coldest epoch... "

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Article in Washington Post:  https://www.washingtonpost.com/climate-environment/2024/09/19/earth-temperature-global-warming-planet/ 
Article in Science (open access):  https://www.science.org/doi/10.1126/science.adk3705 

#climatechange

Globally, governments are spending $2.6 trillion per year on environmentally harmful subsidies ($800 billion more than in 2022), according to a new report. Such subsidies relate to government programs that enable unsustainable production and consumption and thereby contribute to biodiversity loss and climate change (among other things).

Environmentally harmful subsidies (EHS) are in need of urgent reform and governments are in the driver's seat. Compared to other possible actions, reforming some aspects of EHS reflect 'low-hanging fruits'. Some investor coalitions have also realised this and pushed for reforming such subsidies (e.g., here: https://lnkd.in/dkjkwzND).

EHS exist in various forms, ranging from direct cash payments to government provision of credit, special tax breaks and regulatory exemptions. Overall, we spend 2.5% of global GDP each year to exhaust natural resources, degrade ecosystems and damage planetary boundaries. Rethinking is long overdue...

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Full report:  https://www.businessfornature.org/reformingehs 
#climatechange, #biodiversity, #fossilfuels

People consistently underestimate the carbon footprint of the wealthiest 1% and overestimate emissions of lower income earners, according to a new study in 'Nature Climate Change'. Here are some key take-aways:

1️⃣ We know that there is a big difference between the carbon footprints of the rich and the poor - this study shows that we are not sufficiently aware of this inequality.

2️⃣ The underestimation is particularly strong in the U.S. and Denmark (see image below). The study surveyed 4,000 people in the US, Denmark, Nigeria and India (countries chosen due to differences in per capita emissions and levels of economic inequality).

3️⃣ People from the top 10% income segment perceived the actual carbon footprint inequality to be significantly fairer than people from the general population. This is concerning, as wealthier people often have disproportionate influence on policy-making ( ➡ If you do not see problem, you do not promote policy change).

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Full study (open access):  https://www.nature.com/articles/s41558-024-02130-y 

Big congrats to my colleagues at the CBS Sustainability Centre, Kristian Steensen Nielsen and Jan M. Bauer, who were part of this international research team. #climatechange, #sustainability, #carbonfootprint

CEOs' prioritisation of sustainability is in sharp decline, according to an aggregated analysis of multiple CEO surveys by Bain & Co. The relative perceived importance of sustainability is overshadowed by growth concerns, AI, geopolitical issues, and inflation. But, this needs to be viewed in context...

▶ After years of (often) inflated sustainability expectations, CEOs recognise that it is difficult to go from ambitions to practical delivery. Hence, some companies have 'adjusted' their expectations and targets (we have seen a lot of this recently).

▶ Increased regulation has pushed the perception(!) that sustainability is about compliance and not strategising. This is, of course, a misperception as most of the regulations (such as #CSRD, #CSDDD) were designed precisely to move sustainability concerns closer to strategic decision-making.

▶ CEOs may overreact to short-term trends. The Bain & Co. discussion shows that sustainability is likely to go through a "normal" transformation cycle where reality and expectations are matched over time. This matching process is impacted by the interplay of technological developments (impacting efficiency and lowering costs), consumer behaviour (responding to lower prices) and governmental policy support (pushing technologies towards critical thresholds).

These dynamic adjustments take time. Hence: CEOs should take a long-term view. (How often have we said this?)

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Full Analysis by Bain & Co:  https://www.bain.com/insights/topics/ceo-sustainability-guide/ 

#sustainability, #esg

Reforming and strengthening the hashtag#SDGs - some important reflections in "Science" right ahead of the UN Summit of the Future (22-23 Sept). From a governance angle, SDG reform should include four main pillars:

1️⃣ Differentiation: High-income countries need to commit to stronger goals. While the universal character of the SDGs is appealing, implementation targets are still set nationally. Hence: high-income countries often insufficiently address those Goals that are challenging to them (e.g., responsible consumption, SDG 12).

2️⃣ Dynamization: The SDGs need to become more dynamic. Some of the current Goals rest on past political compromises that do not sufficiently account for the escalating nature of the underlying problems.

3️⃣ Legalisation: Although it is unlikely that all SDGs become binding, "like-minded countries should work toward a series of legally binding, plurilateral agreements and governance arrangements in support of specific goals and targets." Form coalitions of the willing supporting certain Goals and expand over these time.

4️⃣ Institutionalization: While some SDGs can draw on a well-developed institutional infrastructure, other SDGs lack institutional support at global and local levels. It would make sense to strengthen such an infrastructure for some of the Goals (e.g., SDGs 12 and 16).

At the very least, these reforms should feed into the process of thinking about sustainable development post-2030. The SDGs run until 2030 - we do not need new Goals or a new framework but better implementation and governance of what is already there...

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Full Access: https://pure.rug.nl/ws/portalfiles/portal/781740647/science.adj5434.pdf

Planetary boundaries and social justice thinking combined. Under current conditions of inequality and fossil fuel-intensive lifestyles it is impossible for all humans to live healthy lives within a "safe and just corridor" - this is the key finding of the Earth Commission report published in The Lancet Group yesterday.

The Commission defined a "justice floor" (defined by basic living standards) and then calculated how much space there was between this and a "safety ceiling" (defined by planetary boundaries). "The safe and just corridor is a conceptual space in which everyone can have their essential needs met without compromising the stability of Earth’s essential systems."

Right now, we are outside of the safe and just corridor in various areas (e.g., climate, natural ecosystems; scenario A in image). Without changes, there is no safe and just space left in the climate area by 2050 (scenario B). In other words: even if everyone had access to basic resources in 2050, we would still be outside of the climate boundary.

Full Report:  https://www.thelancet.com/action/showPdf?pii=S2542-5196%2824%2900042-1 

#planetaryboundaries, #climatechange