International Governance of the Green Economy

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The term “Green Economy” implies not only green technologies, infrastructures, investments, and jobs; but also a more equitable society with chances for everyone to earn a living wage, partake freely in democratic political activities, and increase their own well-being, as well as the wellbeing of their communities and of the entire planet. Green economy implies GDP-type growth for developing countries, and steady state economies in the “developed” world; as well as growth of a generally accepted well-being indicator everywhere; in combination with living within our ecological means. It thus implies sustainable production and consumption, trade, investments, and governance.
Green economy implies both top-down and bottom-up governance processes. On the local level, green economy activities are characterized by ecologically sound business and consumption practices, brought about by local policies and multistakeholder grassroots experiments. Such experiments and practices should be endorsed by national and state policies, as well as through international frameworks and mechanisms.
For the global level the Green Economy needs to be endorsed by a taxation of global financial transactions. Such a Tobin tax, which is becoming more and more politically feasible, has the dual benefits of reducing the unfettered financial speculative capital streams, and creating a very large Sustainable Investment Fund (SIF). This Fund needs to be managed by a newly formed Global Sustainability Financial Authority, in close cooperation with existing institutions as the (upgraded) UNEP, the World Bank, and the WTO.
The main task of the SIF would be to provide investment capital for green and equitable projects around the world; both private and by national and regional governments. It would include mechanisms to help fund local projects and experiments, and citizens’ initiatives which foster sustainability. Another function of the SIF would be to create a database of projects and experiments, and enable and facilitate cross-country and cross-sectoral collaborations. Further activities of SIF could include sustainability advertising and education, communication and awareness raising, and research.
Research to study conditions for success and failure of projects and initiatives on all levels, including sustainable consumption, production, trade, investments, cooperatives and other non-for profit business models, should be transdisciplinary and include both the natural sciences (materials, energy, water, ecosystems) social sciences (psychology, sociology, philosophy, ethics, anthropology, economy, behavioral sciences, science and technology studies, and others), and be both reflexive and theoretical, as well as action and change oriented. Regional coordination of this research is commendable, and on the global level a Global Research Forum could bring together and create dialogue between the different regional perspectives.
An upgraded UNEP, together with the Sustainable Investment Fund and other relevant organizations, should address the issue of global, regional, and national Sustainability Strategies. Sustainability Strategies on every level, from local to global, should be constructed through multistakeholder dialogues. Ideally, they would include a comprehensive Sustainability and Equity vision, and a strategy and pathways how to get there. The strategy could include an analysis of local strengths and weaknesses, external threats and opportunities, as well as local assets. Such a mechanism would foster trust among stakeholders, create a long term perspective; and a sense of positive outlook and change. Global Environmental Governance, as envisaged here by an upgraded UNEP jointly with the Sustainable Investment Fund and other global institutions, could provide the know-how and facilitation to help develop such strategies on all levels.

Comments from Thomas Jacob

My comments on specific paragraphs are below. As you had anticipated, my questions are rather fundamental. I would welcome feedback from you or others, but basically feel there are two options: You either constitute and empower a central agent (or in this case, a central agent - UNEP - and a funding resource) to take responsibility for sustainability, or you insist on driving sustainability into all the relevant IGOs. I believe the former merely obviates responsibility from the other agencies and they will continue doing what they're doing. The latter is certainly more challenging, but only by delivering that sensitivity to sustainability across all the agencies (all the pillars) will we even begin to approach sustainability more broadly.
Paragraph 1, re. steady-state economies
This distinction between GDP growth in developing world and “steady-state” in developed world seems politically unrealistic and at odds with economic reality. Since WWII, the real GDP growth has come from innovation, getting more utility from given level of resource inputs, and open markets to enable diffusion of products to additional markets. If the pie does not expand for all, it may well contract for all…
Paragraph 2, re. local level
This should expressly include the work of business & industry to adapt to global expectations of more sustainable practices, since these lead directly to global programs to drive those practices more consistently into global value chains – penetration that will often go deeper and faster than regulation or 3rd Party initiatives. This adaptation to new societal expectations has been happening in B&I, just as it has been happening within in governments (and among other stakeholders) – not everyone is fully there, but most major players are definitely moving and that can be leveraged to advance sustainability practices globally.
Paragraph 3, re. taxation of global financial transactions
Don’t see that as politically viable at global level – perhaps not even at national level, in countries where it would make a difference.
Paragraph 3, re. Global Sustainability Financial Authority
Cannot see any justification for any new institutional mechanism. Indeed, that is counterproductive, as the key to long-term global sustainability is to develop within each of the major IGOs (both UN agencies and the IFIs) consistently sensitivity to and attention to the need to stimulate and reinforce more sustainable thinking and practices, across all three pillars. By tying “sustainability” to a new institution – even if it could get new monies (very doubtful) – you risk absolving the larger, existing institutions from taking responsibility for sustainable practices.
Paragraph 4, re. local experiments and citizens' initiatives
Isn’t this what Agenda 21 commits the global institutions (both UN and IFI) to do, anyway. How does this happen more readily in a new institution separate from those major players that will continue to dole-out the major development resources? I see this as simply “giving up” on the challenge of making a real difference within the political mainstream, and opting merely for symbolic change.
Paragraph 6, re. sustainability strategies
UNEP, as the central agent of the environmental pillar, is in no better position to deliver true integration of the three pillars than would be UNDP, World Bank, WTO or UNESCO. Sustainability interpreted through an environmental lens is no more legitimate than sustainability interpreted through an economic lens. The key has to be integration across the agencies, and that means driving sensitivity to all three pillars into all the relevant IGOs. This includes driving economic reality into UNEP just as much as it includes driving environmental reality into WTO - it can't be delivered by concentrating responsbility within any single pillar.

Arthur Dahl's picture

UNEP or responsibility for all

Tom, on your main point about a central agent (UNEP) versus responsibility for all, we should remember that UNEP was created not so much to be a central agent but to work to integrate environmental concerns in all the parts of the UN system. It had some success after 1972 while it had money to pay the agencies (FAO, UNESCO, IMO, etc.) to undertake environmental activities. It was less successful with the World Bank, UNDP, etc. where the amounts of money it had available were less significant.
I agree that sustainability should not be left solely to a central agent, but we need a central agent to push all the interational actors to take up their relevant roles, and to ensure some strategic direction and coordination. Global sustainability will only be achieved if everyone works together, and that requires some leadership. It is not either or, but both in a balanced combination.
There is still the issue of whether the environmental tail (UNEP) should wag the economic dog to achieve sustainability. UNEP has been singularly unsuccessful at this in the past, but in the present economic uncertainty there may be more scope to make progress. A strengthened UNEP/WEO could set the planetary environmental limits within which the economy must learn to function to be sustainable, while leaving the economic activity itself to the principal actors, public and private.