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Business leaders embrace Europe's new green reality for investment and growth

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A plan of action to accelerate the EU Green Deal and post Covid-19 recovery. Image: Photo by Guillaume Périgois on Unsplash

Mirek Dušek
Managing Director, World Economic Forum
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This article is part of: Sustainable Development Impact Summit
  • Global companies have committed to help make Europe the greenest world economy, welcoming ambitious EU targets that help de-risk sustainable investments.
  • With over 20% of the EU recovery plan green compared to 1-3% in the stimulus programmes of other major world economies, Europe is on course to master this transition with the greenest stimulus plan worldwide.
  • The programmes offer the opportunity to reset the economy, create jobs, boost GDP and build resilience.

The urgency of a green transition has never been so obvious. 2020 marks a year where the Arctic is melting faster than most climate models predicted, and WWF’s recent Living Planet Report alarmingly showed that almost two thirds of the world’s wildlife populations have been lost since the 1970s.

Europe’s leaders have not been ignoring these trends. With the European Green Deal, they passed a historic agreement last year, committing to implement the Paris Climate Agenda and to making their continent climate neutral by 2050. But the COVID-19 pandemic has made leaders across all sectors realize that this transition must happen faster, and that they must act now in order to achieve more sustainable and resilient economies.

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Consequently, the European Commission wants to see the Green Deal at centre stage of its recovery efforts. Its Executive Vice-President in charge of the Green Deal, Frans Timmermans, recently went so far as to call it the EU’s “lifeline out of the crisis”, and it has announced an increase in its CO2 reduction target for 2030.

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“This is the right decision at the right time”, say chief executives and senior representatives of 30 global companies who have released a statement of support for the European Green Deal today.

We have to take more and faster action with more emphasis on sustainability and circularity. The European Green Deal presents an opportunity to do just this.

CEO Action Group Co-Chairs, AXA’s CEO Thomas Buberl and Feike Sybesma, Royal DSM’s Honorary Chairman

The business leaders who formed the CEO Action Group for the Green Deal in spring this year, clearly recognize the European Green Deal’s value as sustainable growth strategy and the direction it provides. The International Energy Agency (IEA) shows how green investment in the energy sector alone can create millions of jobs and increase global GDP by 1.1% for each of the next three years. Company leaders also recognize that long-term thinking and circularity are core principles of successful business planning in the future.

Europe’s stimulus programmes offer plenty of opportunity to green the region’s recovery, and to fundamentally reset the economy. Over 20% of the EU recovery plan is green compared to 1-3% in the stimulus programmes of other major world economies, and more is yet to come if the European Commission issues part of its recovery plan as green bonds.

Image: IMF, Rhodium Group

The CEO Action Group for the Green Deal urges EU leaders to base recovery strategies firmly on the economy becoming more equal, circular and sustainable, while supporting companies and industries in their transition path. Achieving the green transition requires trust and sound public-private collaboration. As a next step, the group aims to demonstrate how the private sector can play its part with a series of lighthouse initiatives in the renewable energy, mobility and food sectors.

Business leaders stand ready to accept the new green reality as their investment framework, and they welcome Europe’s lead: “Our commitment goes hand in hand with ambitious EU objectives which help de-risking innovative sustainable developments.”

The business community’s support for the green transition across all sectors, is a game-changer. It puts Europe in pole position to lead the green transition.

Read more on the CEO Action Group for the Green Deal here.

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Forum InstitutionalGeographies in DepthSustainable Development
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