Big Business Calls for EU Climate Neutral Strategy

Europe’s leaders are desperate to move beyond Brexit and focus instead on what’s next for the 28-nation bloc. This week’s Future of Europe Summit is an opportunity to do so, and big business, which has long been voicing its opinion on the United Kingdom leaving the European Union, is looking to put climate action high on the agenda.

Ahead of Thursday’s summit in the Transylvanian city of Sibiu, Romania, CEOs from 50 leading global and European brands, including Diageo, Unilever, IKEA, DSM, Burberry, Phillips and Tetra Pak urged the EU’s heads of government to prioritize a decarbonization strategy. In an open letter, they called for ambitious targets and policies to achieve climate neutrality, protect European competitiveness  and ‘set a new economic direction’ for the continent. “A clear, coherent vision from European governments and institutions for climate neutrality by 2050 at the latest will give us the long-term guidance we need to invest,” the CEOs wrote. “To succeed, this strategy will need to go beyond the traditional climate focus, encompassing trade, transport, agriculture, innovation, industrial and infrastructure policies.” 

They may be pushing at an open door. Although greater political and defense integration is likely to top the summit’s agenda, leaders will debate a broad agenda for the next five years put forward by Jean-Claude Juncker, the outgoing European Commission president. Among his proposed priorities are stronger efforts to “fight climate change…reverse environmental degradation and transition to a circular economy.” Pressure for climate action has also been coming from Europe’s leading banks. In April, the governors of the Bank of England and Banque de France warned that financial regulators, banks and insurers must act to ensure an orderly transition to a low carbon economy.

The CEO letter calls for faster European progress on low carbon transition, powered by targets to drive private sector innovation and investment in net zero emissions industries. Signatories [PG1] cover the automotive, energy, retail, chemicals, steel, engineering, insurance, farming and food and drink sectors, representing more than 1.5m European employees. Business and investment networks representing 16,000 companies, including The Prince of Wales’s Corporate Leaders Group and We Mean Business network, also signed.

Unilever CEO Alan Jope summed up their case for action: "Businesses have a responsibility to take action that will help address climate change, and many of us are already doing so. But we need to accelerate progress. A European strategy to deliver Net Zero Emissions by 2050 is essential to signal the direction and speed of travel that is necessary to achieve the 1.5 C degree ambition set out in the Paris Agreement."

Companies cite low carbon benefits

To bolster their argument, the CEOs cite the European Commission’s own vision document, “A Clean Planet for All,” which details likely positive impacts of a carbon neutral Europe by 2050. These include a net 2 percent increase in the EU’s GDP, millions of jobs created by new industries and reduced costs linked to fossil fuel imports.

Under the Paris Agreement, the EU’s 28 nations agreed a binding target to cut their collective emissions by at least 40 percent below 1990 levels by 2030. A third of these emission cuts are to come from renewable energy and another third from energy efficiency improvements. In arguing for a 2050 decarbonization commitment, and an economy-wide strategy to reach it, European businesses are seeking to up the ante.

Whether these business leaders succeed or not will soon become clear. Following the informal summit in Sibiu, EU leaders will finalize and adopt a Strategic Agenda for 2019-2024 in June.

Image credit: Stefan Schweihofer/Pixabay