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Green growth - the basis for a new industrial revolution

When the history of the 21st century is written, the years 2010-2012 will almost certainly be seen as a watershed. In two intergovernmental processes between now and 2012 -  the ‘Rio+20’ Conference on Sustainable Development and the UNFCCC Conference of Parties negotiations - the world’s governments will respond to the inter-linked challenges of sustainable development and climate change. In this crucial period humankind will take – or not take - decisions that will determine our common destiny. Let’s consider how future historians might judge us.

Where We Are Now

Based on evidence now widely available, historians could reasonably conclude the following. In 2010, we humans knew that:

  • Our economic activities and lifestyles had set in train far-reaching changes in global ecosystems and atmospheric processes. These changes were well documented, had led to major international commitments in 1992 and 2002, and were closely monitored. While there were some scientific uncertainties, it was understood that many of these changes could have irreversible and potentially catastrophic impacts. The extinctions of numerous species and melting ice sheets were clear indicators of the profound changes already underway.

  • Our civilization – including our diverse political, social and economic systems – was wholly built and dependent on the healthy functioning of natural eco-systems. It had become clear, however, that over-use of non-renewable and renewable natural assets, and the failure to limit the production of waste materials, were undermining the foundations for future human and ecological well-being. The issue of climate change in particular highlighted the dilemma.  Our USD 60 trillion global economic system was based largely on finite supplies of fossil fuels. However, avoidance of dangerous climate change - an essential pre-condition for sustainable development - implied substantial de-carbonization within decades.

  • There was no single, universally agreed cause of the destructive process that had been triggered. Some pointed to ‘market failures’, where the real value of natural assets and services was not properly reflected in their price, resulting in unsustainable production and consumption patterns. Others pointed to governance or ethical failures, including corporate vested interests influencing decision-making for their own short-term economic gains. Whatever the differences, it was known that nearly seven (and shortly nine) billion people all stood to be adversely affected. 

  • The scale and speed of the changes underway created huge political and communications problems for political and business leaders. Responses – political, institutional and economic – were not in proportion to the magnitude of the problems. There was a growing sense that in addressing near-term economic pressures, leaders had failed to communicate how disruptive change could be, and how the transition to a resource- efficient green economy was no longer an option but an imperative. In turn, this ‘vision gap’ encouraged  the tendency to think short term and led to reactions that included denial, helplessness and even resignation.

And our response?

While the decisions to be taken between now and 2012 remain unknown, it is challenging to consider what historians might identify as some of the successful response options that were – or could have been - adopted at the time to align human and ecosystem health.

Led by governments, climate change and sustainability were prioritized by all sectors of society. Changes in the Earth’s natural systems were finally seen as ‘game changers’ which could not be addressed by ‘business as usual’ policies and institutions.

By recognizing the unprecedented scale of the challenges and putting them at the heart of government strategy, it became easier to find the policies, resources and synergies necessary to act decisively. Although committing national budgets above the levels, for example, of military spending was considered to be expensive, this was seen as an investment in security of an even more fundamental kind. It also helped create sustainable growth and avoid progressively higher adaptation costs down the road. 

Policy responses were integrated. It was recognized that an effective climate change response could not be achieved without an equally effective and just sustainability response. It made no sense, for example, to massively develop renewable energy if this drove even higher levels of resource consumption and waste. An effective response to climate change, including a green energy revolution, however, would be a major contribution to sustainable development.

Policy approaches were judged on their effectiveness to measurably improve the net sustainability footprint. No approach was excluded, and responses ranged from voluntary approaches to product bans or phase-outs and sector nationalization. Particular attention was given to ensuring that global trade and investment policies were consistent and supported climate and sustainability goals.

The limitations of a market-based economic system were recognized and adjusted where required. Harnessing the full power of free enterprise was understood to be crucial in order to develop new technologies, help shape consumer and investor behaviour, and to create new business models. At the same time, free enterprise did not mean being free to do anything. Business was the new front line of defence, but had to prove that it took the well-being of society into consideration to retain its license to operate.

Recent financial crises had exposed the large-scale risks of under-regulated markets, and raised deeper questions about their net contribution to human and ecological welfare. Business led the change by measuring and reporting its contribution to climate protection and sustainable development. Regulators offered incentives and encouraged reforms, such as the integration of financial and ‘non-financial’ reporting, which provided the missing transparency on sustainability performance.

Policy mechanisms routinely favoured long-term benefits. While near-term challenges such as avoiding double dip recession, creating jobs and saving financial institutions were seen as important, response strategies sought win/win approaches that increased the growth of activities that would lead to reduced energy and materials use, while vastly expanding investments in education, health and the other foundations of future prosperity.

Regions of the world that were the poorest, fastest growing or neediest became early adopters. A UN Conference in 2012 laid the foundations of a decisive global push towards green and equitable development. It built on climate change commitments in a context that fast-tracked emissions reduction through a mix of policies driving emissions transparency and the rapid uptake of energy efficiency and clean energy technologies. In this way, a green industrial revolution was launched that increased resilience to the changes underway and  made markets work for, instead of against, sustainability.

New decision-finding mechanisms were actively developed. Recognizing that responses to  21st century problems were not being addressed quickly or effectively enough,  innovative approaches took the place of often rigid and out-of-date diplomatic processes and groupings.

Multi-stakeholder initiatives at local, national and international level unlocked diverse and creative responses which profiled and built on best practices. Skilled professionals, including financial experts, sociologists and communications experts provided knowledge on change management. These initiatives were actively promoted, supported and employed by governments and international institutions. 

The historical record will surely show that in a time of impending crisis we had the knowledge, the technologies and the finance to react to the challenges at hand. Historians may also reasonably conclude that the single greatest decision taken in the 2010-2012 period was whether or not to respond in a manner commensurate to the scale of the problems. That crucial piece of history is still to be written. How we do it will determine our future and claim to the name ‘homo sapiens’.

A former Australian diplomat, Paul Hohnen is an Associate Fellow of Chatham House and an independent consultant on sustainable development. For more information, see