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3 Simple Climate Questions for Your Board Going Into 2022

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Investors Aviva, BMO Toughen the Line on Net Zero Pledges

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Environmental campaigners may remain sceptical over the investment industry’s ability to translate its myriad net zero pledges into real world action, but pressure from institutional investors on corporates that do not have credible net zero strategies is continuing to move in only one direction.

Just days after BlackRock CEO Larry Fink reiterated his view that CEOs needed to embrace a new form of stakeholder capitalism that would allow them to turn the net zero transition into the “greatest investment opportunity of our lifetime,” two of Europe’s leading investors stepped up warnings that they would vote against boards that fail to deliver ambitious and effective climate strategies.

First up, Aviva Investors announced updates to its sustainability expectations, alongside its annual letter from CEO Mark Versey to the 1,500 companies in its $354 billion portfolio. In the letter, Versey stressed that the company wanted to see firms step up action on biodiversity and human rights, as well as climate change. “We will hold boards and individual directors accountable where the pace of change does not reflect the urgency required,” he warned.

“We want to encourage companies to consider the whole picture of sustainability because this is how they will create the greatest return for shareholders, while helping to build a better future for society,” he said. “Companies must now turn their pledges into concrete and measurable plans of delivery. Our letter sets out clear expectations as to how they should do this, and what those plans must address across climate impact, biodiversity and human rights.”

He particularly stressed the need for climate strategies to incorporate plans for protecting and enhancing nature. “Simply cutting emissions but allowing the destruction of the rain forest to continue will do little to reverse global warming,” he argued. “Companies need to adopt an integrated approach for maximum benefit.”

Growing numbers of investors have pledged to deliver net zero investment portfolios, with various coalitions totalling trillions of dollars of assets under management joining forces at last year’s COP26 Glasgow Climate Summit to reiterate their support for accelerating the transition to net zero emissions. However, environmental groups have repeatedly accused many of the world’s largest investment firms of continuing to invest in carbon intensive companies and failing to apply adequate pressure to ensure such firms really do accelerate efforts to decarbonize.

However, Aviva Investors insisted its engagement with carbon intensive firms had “teeth.” The company said it undertook 1,277 substantive engagements with investee companies in 2021, voted at 6,648 shareholder meetings and voted against 26 percent of management proposals tabled. It also stressed that it wanted to see all executive compensation structures and performance targets reflect sustainability goals and would “divest in cases where companies consistently fail to meet its requirements.”

Specifically, the company said it was executing a new 1.5-degrees-Celsius-aligned engagement program focused on 30 of the world’s worst carbon emitters, which was introduced last year and includes an “ultimate sanction of divestment if expectations are not met over one to three years.”

The news came the same day as BMO Global Asset Management (EMEA) outlined its 2022 engagement priorities, underscoring its focus on climate change, biodiversity and human rights, and similarly stressed that firms had to be held accountable for their environmental pledges.

“The events of the past year, including the ongoing COVID-19 pandemic and extreme weather events, have reinforced the importance of creating a more resilient future,” said Claudia Wearmouth, co-head of BMO GAM (EMEA)’s Responsible Investment team. “Climate change, biodiversity loss and human rights are all issues that require urgent action. Active ownership is a key cornerstone of our work and we have a role to play as a conduit to concentrate and amplify our clients’ voices with companies. It can take time to build consensus for change within a business and to develop the tools to do so. We support companies on that journey, but in 2022, a key focus of our work will also be holding companies accountable on their commitments.”

The company said its engagement priorities for the coming year were delivering a phase out of unabated coal power in developed economies by 2030 and in the rest of the world by 2050; holding companies to account on their net zero pledges, with a particular focus on ensuring financial institutions have net zero strategies, including a carefully managed decline of coal, oil and gas within their lending and underwriting portfolios; curbing biodiversity impacts and risks across the most critical sectors including food and beverage, extractives, materials, transportation and finance; and working with chemicals companies to enable a sustainable transition.

The company said it would also continue to call for executive remuneration to be linked to the achievement of climate-related objectives and would directly engage with companies across industries including oil and gas, mining, materials, electric utilities, transportation and automotive and financial institutions about their executive pay policies.

Alice Evans, co-head of BMO GAM’s Responsible Investment team, said the company was well aware of the risk of “net zero-washing” where firms make bold net zero commitments but then fail to produce credible plans for delivering on their goals. “COP26 in November last year served to further highlight the scale of the challenge in addressing climate change,” she said. “But it also proved a catalyst for action, with the push for private sector commitments resulting in over 3,000 corporates and financial institutions, representing $130 trillion in assets, taking on net zero commitments. Concerns on net zero-washing abound and our 2022 engagement agenda will have a sharp focus on implementation, ensuring that these commitments are backed up by concrete actions to decarbonize.”

And in related news the UK’s biggest pension fund, the Universities Superannuation Scheme (USS), today announced it is to shift $6.76 billion of assets into an index that excludes some of the worst polluters, slashing the emissions of its portfolio by 30 percent in the process.

USS Investment Management said it would introduce a climate “tilt” to a portion of the Global Developed Markets Equity component of the Defined Benefit and Defined Contribution funds. It said the move, to be managed by Legal & General Investment Management (LGIM), would initially reduce emissions compared to the broad equity market by at least 30 percent and further decrease its carbon intensity by 7 percent each year thereafter.

USS said the approach would effectively reward companies that can demonstrate they are on the path to lowering greenhouse gas emissions by giving them a higher weighting, while the converse will be true of companies that lack credible decarbonization plans. “Today’s news is a natural progression to our investment strategy following our announced ambition to be net zero for greenhouse gases by 2050 if not before,” said Simon Pilcher, CEO of USS Investment Management. “We think we will be one of the first major U.K. pension schemes to do this and is a significant step towards achieving our net zero ambition. The move will also inform our thinking on the way we approach investment more widely in both the Defined Benefit and Defined Contribution segments of the Scheme.”

Innes McKeand, head of strategic equities of USS Investment Management, said the firm was confident the new approach would deliver competitive returns. “We believe investment in more climate-friendly assets — those positioned to adapt or benefit as the world transitions to a low-carbon economy — offer upside return potential, while lower exposure to companies poorly positioned to adapt to such a world reduces our exposure to downside risk,” he said.

However, the new plans again underscored the challenge investment firms have in the face of growing calls from campaigners to more quickly divest from fossil fuel assets.

Paul Kinnersley, an emeritus professor at Cardiff University and a coordinator of the group Divest USS, told the Guardian that many academics paying into the fund wanted to see a more aggressive divestment strategy. “Any shift by USS to decarbonize or clean up their investments is obviously a step in the right direction,” he said, “but they’ve been slow about changing and they’ve been slow about sharing detail on the target of net zero by 2050. We’re welcoming it, but there’s a long way for them to go.”

Investment firms of all types can expect calls for them to strengthen their net zero, engagement and divestment policies to intensify with each passing year. And in truth the industry has not always helped itself over the past few years, with too many investment firms touting ESG and climate strategies that demand far too little of carbon intensive businesses. But at the same time, as today’s announcements highlight, many of those same investment companies are steadily ratcheting up the pressure on the firms they own. On the same day as COP26 President Alok Sharma calls on governments to deliver on the pledges they made through last year’s Glasgow Climate Pact, the message from top investors to listed firms is increasingly clear: We will hold you to your climate promises.

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How to Center Environmental Justice in Conservation Finance Projects

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Environmental justice in land conservation requires practitioners to slow down and consider the foundations that exclude or enable relationships with and control over land. The following stories highlight three organizations using conservation finance strategies to advance environmental justice outcomes.

Each considers the history and context that has led to the land ownership, land use patterns, policy decisions and wealth accumulation in the places where these groups work. In each story, participants have asked: Why is this so? They have spent time listening to community groups and tribal nations to understand what these groups desire, and have worked creatively to identify solutions towards these aims. These organizations are working in the intersections between land and human justice, giving consideration to the intertwined rights of natural and human communities.

In these cases, justice means broadening the definition of conservation to ensure more people benefit, using conservation funds in new ways in order to ensure co-benefits and expanding the group of people with power to make decisions about land use.

The story of the Swinomish Forest Bank illustrates how ecosystem markets can be inaccessible to Indigenous peoples due to histories of land fractionation and presents a strategy that respects and acknowledges this history while also creating new legal structures to enable that access.
Greenprint Partners’ work with the city of Peoria illustrates how community organizing strategies can use public investments in green infrastructure to support community benefits.
The Doris Duke Charitable Foundation is using its philanthropic funding to expand the diversity of people working in the conservation field, encouraging conservation organizations to better connect with justice efforts, and funding organizing capacity at a local, grassroots level in BIPOC communities.

Each effort broadens the definition of what is considered a conservation organization and what is imperative for conservation groups to consider.

Swinomish Forest Bank

The traditional territory of the Swinomish Indian tribe extended throughout the Salish Sea region of northwest Washington state, and includes the lands surrounding the Skagit and Samish River Valleys; the Skagit, Padilla and Fidalgo bays; and the Fidalgo, Camano, Whidbey and San Juan Islands.

Today, land managed by the Swinomish has been reduced to a 15-square mile reservation on Fidalgo Island. Within the designated reservation boundaries exists a checkerboard of public, private and tribally owned lands; private lands are owned by both Swinomish citizens and non-Swinomish people. The Swinomish Tribal Government owns in trust and in fee a very small percentage of the overall reservation land in a patchwork of small, non-contiguous parcels. The tribe has been working for many years to knit together land, and especially forestland, within the reservation. It currently holds title to about 1,200 of the reservation’s 4,500 acres of forestland. Due to this heavily fragmented landscape, the Swinomish have faced significant barriers to implementing landscape-level forest management strategies.

In 2014, the Swinomish asked Ecotrust, a nonprofit that works across the Pacific Northwest to support equitable, climate-resilient land stewardship and economic development, for help developing a new forest management plan. The Swinomish had previously worked with Ecotrust and appreciated both its forestry expertise and willingness to work collaboratively in order to advance Swinomish goals. The Swinomish sought Ecotrust’s technical expertise towards their wish to unify land management practices across their fragmented acreage.

Today, the loss of tribal lands combined with the mixed ownership patterns within reservation boundaries poses serious challenges for the sovereignty and self-determination of Indian nations.

One strategy involved creating a forest bank, a new legal entity wherein the owners of individual parcels of land (which in this case could include the Swinomish Tribal Government, tribal members or non-tribal residents) enroll in the forest bank. The forest bank manages and harvests enrolled parcels according to a unified forest management plan, enabling landscape-scale management strategies that are impossible on small parcels.

Many climate-resilient forest management practices, a priority for the Swinomish, are only possible on this large scale. As the Indian Land Tenure Foundation says, “Today, the loss of tribal lands combined with the mixed ownership patterns within reservation boundaries poses serious challenges for the sovereignty and self-determination of Indian nations.” The Swinomish’s checkerboarded and fractionated landscape exists due to the imposition of private property boundaries atop traditional, collective management regimes. The legacies of fractionation have harmed the tribe’s ability to control their land.

Fractionation formed part of the process of colonization. The United States Government imposed private property ownership structures and oversight systems on the traditional territories of Native Americans. The government defined a system of reservations and restricted Native Americans to only these areas, often a mere fraction of the size of traditional territories. In so doing, the government forced participation in the U.S.’ private property frameworks rather than respecting many Native Americans’ collective and relational conceptions of land and land use migration patterns. These actions took place by force, by treaty and by allotment.

This Salmon River stretch shows the value of centering equity, even when working that way feels like swimming upstream. Photo via Ecotrust.

In 1855, the U.S. Government and the Swinomish tribe signed the Treaty of Point Elliot, which defined 15 square miles on Fidalgo Island as the Swinomish reservation. Despite this, the Swinomish had to fight to protect their treaty-defined land base in 1873, when President Ulysses Grant attempted to further reduce their land base (a move which the U.S. Supreme Court blocked). Within the 1887 General Allotment Act (which many call the Dawes Act) the U.S. government awarded 40- to 160-acre parcels of land within the reservation to individual families, both Native American and settlers, with the aims of encouraging the establishment of settled, agrarian societies. As these parcels went to successive generations, land was subdivided and fragmented into smaller parcels (thus the term fractionation).

Due to this history, typical barriers to landscape-level management and accessing markets for ecosystem services such as parcel size, forest cover and composition, and past management regimes are compounded. Unifying land through a forest bank would aggregate management across parcels with the potential for both climate resilient and financially beneficial outcomes. The Swinomish anticipated that a large carbon credit sale might help them “seed” the forest bank: Proceeds from the sale would create a source of capital to allow purchase of more acreage and compensate individual landowners for ecosystem services.

In 2015, Ecotrust and the Swinomish received a USDA Conservation Innovation Grant to support their work to revise the Swinomish Forest Management Plan. The partners established a stakeholder group of tribal members to provide input on the project. Brent Davies at Ecotrust said about the committee: “Rather than practice co-management, we were seeking to put indigenous communities in the driver’s seat.” This involved both carefully considering the Swinomish’s wishes for how forest resources could be managed using climate-smart practices and considering different governance models for establishing the forest bank within the legal constructs governing tribally owned and managed lands.

Unifying land through a forest bank would aggregate management across parcels with the potential for both climate resilient and financially beneficial outcomes.

Because there are few forest bank models, Ecotrust and the Swinomish worked together to envision what an appropriate structure and entity might look like. The Swinomish and Ecotrust together completed their new forest management plan in 2018, which includes an intention to establish a forest bank. Ecotrust and the Swinomish continue to work together towards this aim.

Peoria, Illinois, and Greenprint Partners

Peoria, Illinois, contains one of the poorest zip codes in the country and is a majority-minority community. In 2006, the EPA declared Peoria in violation of the Clean Water Act due to stormwater and sewer overflows, and mandated that the city address these hazards. Although underfunding has resulted in significant infrastructure failures, Peoria’s leaders have sought to use philanthropic and public capital to upgrade infrastructure while also investing in community assets.

Peoria is not unique. Because of histories of disinvestment and redlining (racially discriminatory mortgage lending practices), many urban areas have underfunded and failing infrastructure. In 2014, Peoria won a Bloomberg Philanthropies Innovation award to create a Chief Innovation Officer staff position. With this added capacity, the city contacted Greenprint Partners, a women-run, green stormwater design and project engineering firm. The city needed to make large public investments to comply with the EPA mandate, and wanted to work with a partner who could help them creatively deploy these funds to also benefit the community.

Greenprint says on its website that it aims to develop equitable, scalable, holistic stormwater solutions that also revitalize neighborhoods, increase public health and safety and create new job opportunities in low- to moderate-income communities. A key element of Greenprint’s model is to thoughtfully deploy large public investments in infrastructure to simultaneously incorporate community benefits and community goals. As co-founder and CEO April Mendez commented: “We believe that infrastructure could be developed and designed with communities in mind, but only if the community is centered from the beginning.”

Rather than rely upon traditional, expert-driven infrastructure project models, Greenprint asked the community what their goals were and figured out how to create infrastructure that would satisfy them.

The city of Peoria was a great partner, said Mendez, because it was willing to “design green stormwater infrastructure with the perspective that the parts of the community that most needed this infrastructure also needed other organizational supports.” With support from a $940,800 grant from the USDA’s Conservation Innovation Grant program, Greenprint established a stakeholder advisory group that was representative of the full community’s demographics.

Greenprint asked this group what they needed and what they wanted to see in their community. Rather than rely upon traditional, expert-driven infrastructure project models, Greenprint asked the community to say what their goals were and figured out how to create infrastructure that would satisfy those goals. The advisory group identified local employment opportunities, access to healthy food and accessible urban green spaces as priorities.

Together, Greenprint, the city of Peoria and the stakeholder advisory group decided to develop a 1.5-acre farm that can slow, sink and store stormwater runoff while also providing job training and educational opportunities in growing food and running a farm business. Greenprint facilitated a placemaking visioning exercise, inviting community members to share ideas about what the farm might look like, and the types of infrastructure it would have. The farm was intentionally located in one of the poorest parts of Peoria, thus ensuring that both its stormwater retention and job training benefits stayed in the community of most need. The project team named this farm The Well Farm. In major rainstorms since this infrastructure was installed, it has absorbed 98 percent of rainfall.

Greenprint seeks to bring principles from its founders’ community organizing backgrounds to its work. Although Mendez acknowledged that equity-centered work can cost more in staff and design time, she said: “Community engagement changes the end product … It’s not box-checking, it’s about changing the design of what you’re building … It’s important to have the creativity to design things from a multi-benefit and place-making perspective and not just think about putting the facility in the ground.”

This multi-benefit perspective has had important ripple effects. This project is one that the community is excited about and will benefit from in multiple ways. It also has created potential opportunities for public utilities and public infrastructure funding programs to simultaneously fund equity and community development outcomes. Greenprint estimates that for every $1 invested in establishing Well Farm, $1.50 in community benefits flow out.

Greenprint estimates that for every $1 invested in establishing Well Farm, $1.50 in community benefits flow out.

Upon its completion in 2019, the $1.9 million Well Farm received a number of accolades from green infrastructure thought leaders, industry groups and foundations. These include the prestigious U.S. Water Prize from the U.S. Water Alliance. Other recognition came from the Illinois Green Alliance Emerald Award and the Sun Foundation Making Waves Award.

This project also informs Peoria’s stated goal to address its clean water mandates with entirely green infrastructure. Greenprint is working with the National Green Stormwater Infrastructure Exchange to design an educational accelerator program to train other municipal planning and finance entities who are interested in implementing similar “water equity” projects. With the recently signed Infrastructure Investment & Jobs Act committing $55 billion to wastewater, stormwater and drinking water infrastructure, there is an opportunity to use public funds to support community benefits and water infrastructure goals simultaneously.

The Doris Duke Charitable Organization

The Doris Duke Charitable Foundation (“Doris Duke” for short) has rethought its goals and processes to better root its grantmaking in equitable decision-making and work under an expanded definition of conservation. Four programs of the foundation highlight this evolution.

In 2020, according to Green 2.0, about 30 percent of staff, 25 percent of leadership and 32 percent of board members at U.S. environmental nonprofits identified as people of color. Each metric has increased significantly since 2017 when Green 2.0 began compiling this data. Doris Duke has carefully considered who holds power and positions in the environmental movement, and it has reoriented grantmaking in support of a more diverse talent pipeline. For many years, the Doris Duke Conservation Scholars program supported masters-level students in environmental studies and land conservation. In 2013, Doris Duke changed the Doris Duke Conservation Scholars program to fund college-age, BIPOC (Black, Indigenous or People of Color) young people to build conservation careers. By funding students at the undergraduate level, Doris Duke seeks to create earlier exposure to environmental work for BIPOC youth, making this a more tangible professional path. Building a diverse pipeline of young conservation practitioners will help facilitate a more diverse group of staff and leadership at environmental non-profits.

Doris Duke’s Diversity, Equity and Inclusion Capacity Building Program was created in 2020 to provide capacity to both white- and BIPOC-led conservation organizations. Doris Duke awarded two-year grants of up to $60,000 to organizations ranging in size from The Conservation Fund (with hundreds of staff) to the Utah Din? Bik?yah (eight staff), to support staff engagement in diversity, equity, and inclusion capacity building, organizational assessments and structural changes.

Building a diverse pipeline of young conservation practitioners will help facilitate a more diverse group of staff and leadership at environmental non-profits.

Doris Duke’s new “Inclusive Conservation” grant program launched in 2021. Doris Duke partnered with an advisory committee of conservation practitioners who primarily represent and serve BIPOC communities to develop this program, which invests in “culturally driven and community-centered conservation work that builds more positive outcomes for biodiversity, nature and people.” These expanded parameters of what conservation is create a broader set of activities for Doris Duke to fund. The advisory committee nominated organizations who could then apply for grants.

This program awarded long-term, unrestricted, $300,000 grants to five organizations (‘Aina Momona, Ekvn-Yefolecv, McIntosh S.E.E.D., Native Movement and Soul Fire Farm) for the work that each organization does to “prioritize the bridge between environmental and land justice” and “in recognition of and contribution to the pivotal leadership roles they play” in doing inclusive, human- and equity-centered conservation work.

Doris Duke and the Robert Wood Johnson Foundation, together with the Prevention Institute, created the People, Parks, and Power program to geographically redistribute where conservation dollars go. These partners initiated this partnership in 2021 in order to support community organizations “working in urban, low-income communities of color across the United States to increase park equity through local policy and systems change.”

Histories of racially exclusionary housing finance (redlining and racially restricted federal lending programs) and racial covenants prohibiting home ownership by people of color or other ethnic groups have shaped today’s cities. Historically redlined neighborhoods typically are made up of majority renters, have less-well funded schools, have fewer public funds invested in natural amenities and are often majority BIPOC communities. Black, Latinx and Asian communities are more likely to live in historically redlined and today, nature-deprived areas — meaning, areas without access to trees, streams or parks, or poorly maintained park amenities — and thus less access to the benefits parkland offers, such as physical exercise, mental well-being and clean air, water and cooling.

Black, Latinx and Asian communities are more likely to live in historically redlined and today, nature-deprived areas.

Lack of urban access to green space is also a result of the rural bias of land conservation. This is a result of factors such as the funding priorities of private, philanthropic and public conservation funders and the fact that conventionally defined biodiversity conservation targets (presence of large carnivores or minimum acreage thresholds) most often are found in the large tracts of undeveloped land more readily found in rural landscapes.

Because conservation is reliant on philanthropic gifts to support its work, it often happens nearer to where well-resourced communities live. As Sawyer Cresap commented in her recent article on equitable conservation finance: “Low-income communities and communities of color are markedly deprived of access to privately conserved open spaces and less frequently affiliated with private land conservation as land donors, visitors, members, staff or board.” Conservation dollars are much less often invested in urban landscapes, and the outcomes that conservation organizations seek to achieve have been defined by perspectives and beliefs that give less weight to urban parklands.

Doris Duke seeks to support the organizations and community members working on the ground to address the underlying reasons why certain places are underserved by park and other infrastructure.

As it brings a portion of its grantmaking into urban areas, it hopes to not only improve green spaces in urban areas, but more importantly to seed power and capacity among local groups. It seeks to support these groups in building new narratives and greater participation, access to resources and authority over land use decisions.

Philanthropy “holds normative power to make things mainstream and render them visible” through deciding what to fund and which stories to elevate, said Sean Thackurdeen, program associate for the Environment at the Doris Duke Charitable Foundation. Through continued consideration of how it invests philanthropic dollars, Doris Duke seeks to give both resources and power to BIPOC communities, enabling them to create, implement and share their visions for what land conservation could be.

Conclusion

These case studies showcase ways in which some conservation practitioners are taking responsibility for the histories, policies, stories and circumstances that have led to the patterns of land and wealth ownership we see today. These patterns are rooted in discriminatory practices such as fractionation and redlining, which have harmed many non-white communities and restricted their ability to own and manage land. Said in a different way, traditional measures of conservation success will feed off longstanding and systemically reinforced inequities in wealth, power and control, and will continue to produce inequitable outcomes in who the benefits of land and resource conservation accrue to.

Without directional shifts and justice-oriented recalibrations, those with historical access to resources such as land will be able to access conservation benefits predicated on land ownership and accumulate additional and compounding wealth, while those who have been systematically denied access to land will not have the same opportunity.

How can these groups’ willingness to listen and learn and change serve as models?

The organizations above have sought to ensure that the outcomes and benefits of their work do not only accrue to those who already have resources. In place-based, historically informed and community-defined ways, they have both broadened and expanded what conservation is and who conservation is for. They are working with and ceding power to new partners. How can these groups’ willingness to listen and learn and change serve as models? How might these examples inspire future steps along the long journey towards just conservation?

Practitioner reflections

How would your organization answer the questions, “Why does property ownership in our landscape look the way that it does? How is unequal access to land and wealth evident in your operating area today? What historical responsibility might you, individually or organizationally, hold? What could your organization or firm’s role in addressing these histories be?”
How would your organization answer the questions, “What is the conservation we practice, and who is it for?
Who has authority and decision-making power in your organization? How do you partner with other groups in your community? Who is in the ‘driver’s seat’ in your partnership projects?”
What are the specific histories of Native American communities in your region? Who used to call your current region home (see native-land.ca)? Which Native American communities continue to call this place home? If they are no longer here, where did they go (see https://nativeland.info/)?
What do the actions of Ecotrust, the Doris Duke Charitable Foundation and Greenprint make you think about? Is there anything in the above three case studies that your organization might consider adopting?
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What 50 Years of Public-private Partnerships Lends to the World’s Green Transition

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Since the 1970s, Denmark has had a tradition of enacting agreements with broad consensus across the political spectrum on energy and environmental policy issues. Political stability has been vital in securing continuous investment and establishing ambitious, long-term targets. In this regard, public-private partnerships have proved a highly successful way of devising solutions to many sustainable development challenges.

Effective public-private partnerships have allowed shifting Danish governments to enact regulations and programs with the support of business and industry, ensuring successful implementation and adherence. The Danish way of conducting public-private partnerships is characterized by openness and high levels of societal trust. Beyond harnessing the strengths of public and private stakeholders, the Danish model tries to cushion the unavoidable twists and turns faced on an unknown path.

While the public sector provides the ambitious long-term goals and stable framework conditions, the private sector supplies the innovation, solutions and investments needed to achieve the visions. As a current example, Denmark’s 14 industry-specific Climate Partnerships, initiated by the government in 2019, is an instrumental to realizing Denmark’s 2030 climate target. Spanning from energy and finance to construction and transport, industry leaders from ?rsted, Maersk and Danfoss have been tasked with formulating each sector’s contributions to carbon reductions. In simple terms, it is a green roadmap for the industries by the industries. Collectively, the Climate Partnerships have produced more than 400 recommendations, many of which are being integrated into national policy.

Teaming-up the usually separated players from the energy and environmental fields is not new. Trustful collaboration across sectors and industries has long been a key ingredient in the Danish way of innovating and doing business. An example of this is the linkup between the water and energy sector, where sludge from wastewater treatment plants is used to produce power and heating. Collaborations between Danish players such as Ramboll, an environmental consultancy, Biofos, a wastewater treatment company, and public utilities in the cities of Taarnby, Odense and Aarhus have shown great results. Similar tie-ups within climate adaptation have brought about solutions that prevent flooding in cities, while simultaneously creating greener, more resilient cities with strong liveability. Through decades of working across professional boundaries, we have learned that effective sector integration requires a pragmatic approach, and an experimental mindset. But more so, it comes back to stability and trust.

Everyone may not agree on the measures and the speed, but each play an important role on the journey towards the common goal: a greener future. Constructive and committed interplay is key for any societal change to succeed. This goes for public authorities at national and local levels, the business community, investors, academia and citizens.

What did we learn along the way?

The conclusion to Denmark’s learning curve over the past decades speaks loud and clear: Green business is good business. Investing in renewable energy, water, energy efficiency and resource optimization makes good economic sense.

Today, more than 75,000 Danes hold green jobs out of a national workforce of some 2.8 million people.

Every time one gigawatt of offshore wind is set up in Denmark, 14,600 jobs are secured in Danish companies. Today, more than 75,000 Danes hold green jobs out of a national workforce of some 2.8 million people. Looking ahead, realizing the Danish 2030 climate target of reducing its greenhouse gas emissions by 70 percent by 2030 may create up to 300,000 green jobs.

With an annual turnover of around $39 billion, Denmark’s green economy share of GDP is roughly 11 percent, more than twice the EU average. Contributing some 12 percent of total Danish exports, the green share of energy and water technology exports has grown by more than 55 percent since 2010 — compared to a 35 percent increase in total exports of Danish goods. Today, green technologies account for more than three-quarters of total Danish energy and water technology exports.

When it comes to research and development in green technologies, the rewards of a whole-of-society approach also stands out. Today, Denmark boasts several companies that hold globally leading positions in the energy and environment industries, and no other OECD country displays a similar development of green technology measured in patent applications. The gains of public-private tie-up further translates into sustainable financing, where the legacy of long-term commitments has resulted in a number of trailblazing asset managers. In 2019, Denmark’s pension industry committed to invest more than $55 billion in green initiatives towards 2030. Only two years down the road, this target appears to be safely within reach. Nationally, Denmark also allocated 60 percent of the EU COVID-19 recovery funds to green initiatives, against the required 37 percent.

We all need the world more than the world needs us

The global demand for accelerated and coordinated climate action is apparent. While Denmark’s well-proven solutions and long-running experiments with green transition and public-private partnerships may prove valuable, the effects are nothing but a drop in the ocean. Unless they fare globally.

Denmark accounts for 0.1 percent of global CO2-emissions. In driving the global path to net-zero, its national efforts offer very little but inspiration. Inspiration that stands on the shoulder of societal efforts underlining why public-private efforts are essential in the quest to develop technologies, policies and partnerships to accelerate the green transition. Above all, Denmark offers a 50-year strong foundation and a green legacy with primed solutions, which hopefully can show the way for bigger economies.

Being neither a silver bullet nor a standalone, the Danish story is simply a sentiment that trust, continuity and binding commitments are paying dividends. As such, it should be seen as a testament to place public-private partnerships and global cooperation at the center of green transition.

[Interested in learning more about sustainable business? Learn more about GreenBiz 22, the premier annual event for sustainable business leaders]

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