2050 is almost tomorrow when we talk about the objective of carbon neutrality.
Can we decently play for time when a transition of such magnitude is an upheaval for our society, its businesses and its citizens? Acting now is probably advisable, provided that the right conditions are put in place to achieve it, and these are not always the ones we think of.
The pressure is undoubtedly increasing. Imagining living in a 4° world is a somewhat terrifying projection if we can draw its outlines. A profoundly different society that will surely have nothing to do with the one we live in today. At the risk of repeating ourselves, the urgency is real, and it seems that the European legislator is gradually strengthening regulations to achieve carbon neutrality or Net Zero Carbon by 2050. The Green Deal is the strongest embodiment of this. If companies do not follow this movement, they risk regulatory sanctions, loss of competitiveness and risks of damage to their image.
The demands are high and companies are expected to deliver. Transparency is therefore becoming a key challenge in the face of the risk of greenwashing; and they have every interest in relying on recognized standards such as the Science-Based Targets Initiative (SBTi) to set their targets on scientific recommendations. However, beyond the logical efforts to achieve Net Zero Carbon, a coherent and credible approach will be required, far from the sometimes fantasized expectations in terms of ecology.
Lifting the taboo between ecology and money
Let’s be clear, the carbon neutrality objective is so ambitious that it is imperative to put all the chances on our side. In other words: go beyond certain approaches to avoid inaction. The vision of ecology must no longer only reflect an urgency but also be clear on the necessary conditions to put in place: yes, this transition has a cost, and putting our hands in our pockets is and will be essential to achieve this objective. We must make it tangible by measuring its impact on companies to facilitate its acceptance. They will have no choice but to consider it as an investment item like any other, even if these may be more or less far removed from their core business.
However, we cannot fall into an all-or-nothing policy in the deployment of decarbonization strategies, as some dedicated technologies are not yet mature or accessible on a large scale. The legislator may want to set the pace, but climate ambitions will be regularly slowed down if the State does not sufficiently encourage change by setting up suitable mechanisms: financial incentives, subsidies, public-private partnerships. In other words, it is not enough to simply impose the rules and be indignant when they are not respected, but to truly support those who are leading the transition. This will perhaps further legitimize unpopular measures such as the one on the distribution of efforts. Asking more from those who can is, in fact, an avenue to explore, provided that such a measure is sufficiently justified to avoid major injustices.
Reintroduce economic protectionism
Beyond the financial commitment of companies, they are also experiencing a profound organizational transformation both from a social point of view and in terms of the companies’ own governance. The list of challenges is long: training employees, reviewing internal processes, or even completely rethinking the economic model. Some industries are even forced to reduce their production or restructure their supply chains, which can create tensions and lead to job losses. The efforts required are enormous and if our companies must follow these rules, we can only regret that they do not apply everywhere and equitably.
Economic liberalism as we experience it is of little benefit to French companies, which are subject to strong competition from other foreign companies ready to slash their prices to gain market share. Let’s be blunt, we cannot ask our companies to make ever greater efforts if we allow unfair competition that undermines their activity. To achieve carbon neutrality, it is becoming imperative to protect our economic area by introducing protectionist measures. Taxing foreign products may be necessary to legitimize the transition of our companies.
Of course, the uncertain political context casts doubt on our government’s position on Net Zero Carbon. It remains to be seen what the executive’s real priorities will be, especially if the forecasts for our economy continue to darken.