Green Economy Tracker: New digital tool aims to help nations transition to greener economic systems
The Green Economy Coalition - an alliance of big-name businesses, NGOs and researchers - has today (23 January) unveiled a new tool which will help nations measure and accelerate their transitions to economic systems which are more environmentally friendly and socially fair.
Called the Green Economy Tracker and launched at the World Economic Forum (WEF) in Davos, the tool assesses green policies across five key areas: measuring and governance; reforming financial systems; greening individual sectors; tackling social inequality and valuing nature.
The Tracker assigns each nation a score out of 20 for each of these key areas, resulting in an overall score of 100. This enables like-for-like comparisons across any of the areas in isolation or the broader policy picture.
To mark the launch of the Tracker, the Coalition has published a benchmark ranking 20 nations using the tool’s methodology, in which low-income, developing and mid-income countries are represented.
Sweden and France have taken the benchmark’s top and second-place spot respectively, when all key areas are considered. Sweden scored best-in-class across the measuring and governing piece, due to its national green economy plan, its procedures for consulting on legislation and the fact that it requires all businesses to produce annual reports in line with the UN’s Sustainable Development Goals. France, meanwhile, scored points for collaborating with Sweden on a green finance plan that includes stronger disclosure obligations, climate stress testing for banks and support for green bond issuers.
The UK, meanwhile, ranked third. The Coalition highlighted the nation’s net-zero target and legally binding carbon budgets as “best-practice” examples of policies, additionally praising the UK’s more recent work on natural capital. The Government valued the UK’s natural capital at £761bn in 2015 and, since then, has founded a natural capital committee; mandated biodiversity net-gain for certain developments; launched an economic biodiversity review and moved to link nature conservation and restoration to farmer pay.
However, the benchmark also notes that several nations are outperforming the UK in terms of reforming financial systems (India, Bangladesh, China, Trinidad); greening sectors (Uganda, Malaysia, Sri Lanka) and tackling inequality (Mongolia, Malaysia, South Africa, Senegal, China, Canada).
“A new economic agenda that puts people and planet first is possible and emerging in some unexpected places,” The Green Economy Coalition noted in a statement.
The Tracker and benchmark notably assess policies alone, rather than national delivery against them to date.
Rethinking economic models
The launch of the tool comes shortly after the WEF published its latest analysis, which concluded that the five biggest risks to humanity and the planet in terms of likelihood and severity are climate-related. Moreover, no risks classed as solely economic are included in the top ten.
In all previous iterations of the WEF’s annual analysis, economic risks have outstripped environmental risks. But this time around, the WEF called the shift away from economic risk dominating its charts “worrying, given the continuing global economic malaise that will limit progress in all other areas, including climate action”.
The analysis was the latest in a string of calls to reform national and global financial systems with a triple-bottom-line (people and planet as well as profit) approach in mind. Pressure for governments to deliver this reform have, in recent months, come from a plethora of sources, including Mark Carney, Larry Fink, the Financial Times and climate strikers.
“Our global economy is not fit for purpose and is driving social and environmental breakdown,” The Green Economy Coalition’s convenor Oliver Greenfield said.
“Inequality, poverty, climate change and biodiversity loss are not just connected, they arise from the same root cause: how our economies are organised, ruled and managed. Tackling these problems without economic reform is like trying to build a Tesla with wooden tools.
“Within a generation, we need to move to a green and fair economy that respects nature’s limits and prioritises wellbeing. The good news is that this transformation is already happening.”
Greenfield added that the aim of the Tracker was not just to help nations benchmark their policies, but to create a “framework for economic reform” based on best-practice policies already in existence. Moreover, the Coalition is keen for members of the public to use the Tracker’s results to hold their governments to account over weak or ineffective legislation around environmental and social issues.