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Green Economy: The New Enemy?

By Peter Utting is Deputy Director of UNRISD.

This viewpoint reflects on the United Nations Conference on Sustainable Development (UNCSD), known as Rio+20, held in June. It looks at, among other things, the reactions to the idea of green economy, one of the conference’s main themes; the role of corporations; and the positioning of equity and justice in the sustainable development agenda.


Contested pathways


Delegates arriving at RioCentro on the penultimate day of the United Nations Conference on Sustainable Development (UNCSD) were handed a copy of the Rio+20 newspaper, Terraviva (published by Inter Press Service/IPS), which carried the banner headline “Green Economy, the New Enemy”. This was a somewhat unsettling statement for a world summit that had identified “green economy in the context of sustainable development and poverty reduction” as one of its two main themes for action. In the conference outcome document, The Future We Want, green economy was taken down a few pegs, becoming “one of the important tools available for achieving sustainable development…. [I]t could provide options for policymakers but should not be a rigid set of rules.”

Meanwhile across town, at the People’s Summit, green economy was being rejected explicitly. Green economy and large corporations were “out”, and “in” were alternative concepts and practices, including Buen Vivir (living well in harmony with nature and different cultures), the rights of Mother Earth, decroissance (degrowth), social and solidarity economy, food sovereignty, local economies, non-violence, ethics and spirituality. Feelings were more mixed at the scientific conferences also held around Rio+20. Some scholars and researchers dismissed green economy as “greenwash”; others recognized its potential in contexts where it was possible to significantly adapt valuation, incentives and institutions.

The groundswell of concern about green economy was associated, in particular, with two perspectives. Some Southern governments were worried about the potential for new constraints on growth and Northern conditionalities. Civil society organizations and social movements were concerned about the commodification of nature, privatization of the commons and corporate capture of the green economy agenda, notably their effects in terms of environmental and social injustice and constraints on much-needed structural transformation.

Clearly much had changed since the term green economy had been popularized just a few years earlier as a smart solution not only for climate change (via low-carbon growth), but also for dealing with the triple crises—finance, energy and food. Less than a year ago, UNRISD invited scholars and activists to debate the potential and limits of green economy from the perspective of equity and social justice. While the participants in this inquiry were highly concerned about the social risks of market- and corporate-led green economy transitions, they also highlighted the space that existed for redirecting transition paths through contestation, advocacy and participation of subaltern groups in knowledge and policy processes, as well as in local resource mobilization, and building broad-based coalitions for change.

While the euphoria about green economy may have subsided at Rio, a tour of various parallel and side events organized by mainstream institutions revealed clearly that market-liberal approaches to green economy or inclusive green growth (the preferred term of the World Bank) are here to stay and will receive considerable backing from both North and South. Transnational corporations and business associations were actively positioning themselves as responsible agents for green economy transition, most notably through the high-level “business day” organized by Business Action for Sustainable Development (BASD), in collaboration with the UN Global Compact and various industry and business associations, and attended by some 800 leaders of business, government, UN and other organizations.

As at previous Earth Summits (in 1992 and 2002), transnational corporations were highly visible at Rio+20. Indeed the “business day” was the culmination of a year-long process “to ensure business input to the Rio conference was heard”. If the 1992 Rio conference ushered in a phase of “lite” corporate social responsibility (CSR) that focused on company and industry codes of conduct and stakeholder dialogues, Rio+20 recognized the importance of more recent developments aimed at providing CSR with a few teeth, notably MRV—measurement, reporting and verification (or certification). The “business day” discussions that related to private sector engagement with green economy and sustainable development referred generally to the need to respect and integrate the three environmental, social and economic “pillars” and ensure that sustainability becomes a core business strategy, rather than an add-on. More concrete statements centred on the need for improved measurement, valuation of externalities, sustainability reporting, performance rating, integration of farmers in global value chains, partnerships and multistakeholder collaborations.

While business interests were trying to shape the Rio process, civil society organizations at the People’s Summit were mobilizing against “corporate capture”, not only of the green economy agenda but also of the United Nations. In the build-up to Rio+20, over 400 civil society organizations signed a petition to reclaim the UN from corporate power, calling for a series of measures to restrict the influence of big business and enhance transparency related to corporate engagement in the UN system. Many of these same organizations launched, a global campaign to “dismantle corporate power”. Indeed, one of the main axes of future struggle identified in the People’s Summit final declaration was simply the struggle “contra as grandes corporações”.


Blind spots, equity and justice


The “alternative” perspectives heard at the People’s Summit and other events during Rio+20 highlight both the timidity of the actions agreed upon by governments and corporations, and important blind spots remaining on their agendas. During various forums and side events, considerable store was put in more environmentally friendly production systems, via eco-efficiency and new voluntary regulatory regimes that promote environmental, social and governance standards within corporate structures or value chains and certification. Others pointed to the limited prospects both in theory and in practice of substantive “dematerialization” in contexts of consumerism and profit maximization. Certification schemes have had very mixed results and face serious constraints in terms of scaling up. The corporate responsibility agenda contains blind spots related to concerns about corporate accountability and redistributive justice that were prominent at the People’s Summit and some panels at the conference of ecological economists. Important in this regard are institutional and policy reforms associated with effective remedy for victims of corporate “bad practice”, the redistribution of value within value chains (for example, fair trade and living wages), corporate taxation, executive pay and mandatory regulation of corporations.

While cooperatives and microenterprises get a mention in the Outcome Document, there is no explicit acknowledgement of “social economy”, as called for by some governments and networks. This refers to the arena of community groups, cooperatives, social enterprises and non-governmental organizations (NGOs) whose productive and service provisioning activities simultaneously address economic, social and environmental objectives, and often involve associative and solidarity relations. The potential of such forms of organization and the need for them to be enabled through policy, law and institutional support was emphasized in various events. These included not only the People’s Summit but also the presidential address at the International Society for Ecological Economics (ISEE) conference and a prominent side event at the official venue on Social and Solidarity Economy, where the new French Minister of Social Economy, the Brazilian government’s National Secretary of the Social and Solidarity Economy and others called for far greater institutional and political support for this sector.

As may be expected in an aspirational intergovernmental document, The Future We Want largely sidesteps many of the values, institutions, processes and structures, identified in other forums as key drivers of unsustainable development—to name a few: growth, greed, short-termism, consumerism, competition, privatization, financialization, patriarchy, the concentration of capital and corporate power. Structural and macroeconomic issues do get a look in—the Outcome Document refers to the need for “urgent action on unsustainable patterns of production and consumption”. But how this is to be done remains unclear, as do the means for addressing “the root causes of excessive food price volatility” and promoting “meaningful trade liberalization”.

Concerns emanating from both developing countries and social movements point to the need to place equity and justice at the centre of discussions of green economy. These include issues of both distributional justice—how ends or outcomes impact different groups (for example, related to income, ethnicity and gender), winners and losers, and the perpetuation or reinforcement of inequalities; and procedural justice—whose values, knowledge, voice, bargaining power and vote is shaping policy and other decision-making processes. The findings of the UNRISD inquiry on social dimensions of green economy, which were presented at six events during Rio+20, emphasized the key role of social protection, redistribution and rights, as well as the need to build countervailing power through collective organization and mobilization of disadvantaged groups, and broad-based coalitions. Social policy and participation are crucial in this regard.

Some of these elements feature quite prominently in The Future We Want, although in a truncated version. From the perspective of equity and justice, noteworthy innovations or statements include references to the rights of—and harmony with—nature or “Mother Earth” (albeit with the caveat that “only some countries” recognize these rights), the right to food, standards for land governance and agricultural investment, the right to information, women’s empowerment and sexual and reproductive health, universal access to social services and social protection floors, the role of cooperatives and microenterprises, decent work, and recognition of the substantial contribution to well-being and sustainable development of informal unpaid work, particularly of women.

The language of rights is toned down vis-à-vis the analysis and recommendations of the report of the UN Secretary-General’s High Level Panel on Global Sustainability, Resilient People, Resilient Planet, published in January 2012. In The Future We Want, social policy is framed as relating primarily to social protection, not to redistributive policies associated with income, wealth or land. Considerable emphasis is put on “effective participation” to be achieved through dialogue and consultation with relevant stakeholders, as well as the empowerment of women, small farmers and others, largely through the right to information, training, capacity building, promotion of entrepreneurship and market access. Missing here is the notion of participation coined by UNRISD over 30 years ago: the organized efforts of the disadvantaged to gain control over resources and regulatory institutions that affect their lives.

The UNRISD inquiry on social dimensions of green economy revealed that such efforts are occurring and need to be enabled at various levels. These include the organized efforts of:

  • communities to defend their livelihood and natural resource management systems, as well as gain control over resources at the local level;
  • disadvantaged groups to have both voice and influence within governance or policy processes; and
  • social movements to contest, advocate for change, and reframe policy agendas and common sense understandings of what we actually mean by “development”.

As attention now shifts from 2012 to 2015 as the key year in the global sustainable development agenda, it is crucial that policy makers address the blind spots that characterize mainstream thinking and analysis, and reposition issues of equity and justice more centrally. Both the Rio+20 and the People’s Summit intended, in their own ways, to re-energize the political momentum for action to craft a more sustainable future. The Future We Want (like the Durban climate conference) authorizes a number of processes aimed at strengthening the global institutional architecture for sustainable development, as well as designing a revised set of development targets as a successor to the Millennium Development Goals (MDGs). As seen during the Rio+20 negotiating process, the risk is that contexts of ongoing economic crisis, the proliferation of geopolitical power, and the influence of corporations and market forces over policy making, will severely limit the scope and depth of action. In such contexts, many commentators are pointing to the need for visionary and bold leadership. Historical analysis of how progressive change actually happens suggests that pressures from social movements and an active citizenry are also key. The People’s Summit clearly honed the capacity of disparate social movements to connect, forge alliances, launch advocacy campaigns and craft a strategy for action. Their challenge now is to sustain that momentum.