Member of the European Parliament
Member of the Club of Rome

Sustainable Development Needs a Systems Approach:
Perspectives for Bottom-Up Initiatives

When the Strategy of Sustainable Development (SDS) was adopted in Gothenburg in 2001 it was a major step forward. For the first time the European Union identified a series of problems in a long term perspective and committed itself to action to address these problems. Governments or businesses of today are not very good at long term action. The reason, of course, is that we are living in a system that is very much dominated by a short term horizon.

Five years have passed and the Commission has presented a review. I am sorry to say, but I am quite disappointed by this review. The first problem is that the SDS Review is being undertaken separately from the Lisbon Strategy. The Lisbon Strategy was presented the year before the SDS. The main objective was to turn the EU into the most competitive economy in the world, benefiting a lot from investments in knowledge and ICT. The logic would be to merge these two strategies. Instead we are continuing to discuss issues related to economic growth, social development and environment protection on parallel tracks. This means that we are not living up to the main objective of sustainable development, i.e. policy integration.

Another problem with the SDS review is that it represents a rather thin analysis. The main shortcoming is that the Commission paper doesn't really tell us where we are in terms of progress. Any review paper ought to describe how we are doing compared to the objectives agreed upon five years ago. But the paper has very little to tell. Yet all of us know, that if we look at Europe - in terms of biodiversity, in terms of fisheries, in terms of CO2 emissions, in terms of an aging society etc. - we are not making the kind of progress we would like to see. Another disappointment is that no really new objectives are being set. Rather, the review is a repetition of already agreed objectives. No doubt, to focus on implementation of already agreed objectives is no bad thing. On the contrary, we know that implementation of crucial policy decisions in the EU leave a lot to be desired. However, given the rather dramatic situation we are facing in terms of climate change and a host of other sustainability-related problems, I would have expected the Commission to be a bit more bold and propose new and more ambitious targets. Moreover, some of the objectives presented are very general in nature and will be difficult to monitor. Both EUROSTAT and the European Environmental Agency have provided us with quite good set of analyses related to various aspects of sustainability and it would have made a lot of sense for the Commission to use this analysis both to describe progress – if any - since 2001, and to propose more ambitious targets for the years ahead.

One positive aspect of the SDS review is the reference made to the external dimension. The role of Europe in the world is now a part of the proposed new strategy. However, the action proposed is far from sufficient. Pollution and ecosystem challenges in the developing countries are of a magnitude that would require some kind of a Crash Program. Developing countries don't have to go through the same polluting mistakes that characterized the industrialized countries. But aid policies so far have largely failed to integrate environment concerns.

Another issue that is more or less absent in the review paper is the ecological footprint of Europe. Here again the European Environmental Agency (EEA) has done a lot of interesting work, together with Friends of the Earth, demonstrating that the footprint of Europe is large and increasing. It is important to remind ourselves of this, because there is a tendency to say: "well, we reduced local pollution, so we are more or less o.k.. The problems nowadays are mainly in the third world countries". No doubt, there are serious problems of environmental degradation in most developing countries. But some of those problems are directly related to the policies of the North. It is no exaggeration to say that we have externalized quite a number of the environmental problems to the countries of the South through a number of activities, like mining, logging, fishing, tourism, unsustainable trading practices etc. Much to regret, the EU Commission is far from successful at main­streaming environment concerns into other sector policies, notably development cooperation.

One problem, which the review paper hardly mentions, is the fact that the economic model of today has some major deficiencies and limitations. The accounting methods used don't really help us to move in the direction of sustainable development. GDP is still applied as a major measure of progress in society. Evaluation of natural capital is still very much missing. Even the "polluter pays" principle, which was introduced decades ago is still not consequently applied: for instance, last year member states subsidised conventional energies, mainly coal, with 26 billion Euro. The subsidies for renewable energy were about a fifth of that. It is nice that we subsidise renewable energy but it is absurd that we give five timed more support to conventional fuels!

Another issue that is missing in the review is the concept of “environment scarcity”. The market economy as a model claims as one of its merits that it is good at dealing with scarcity. Whenever there is a scarcity of a product or service prices go up, there is innovation and substitution takes place. But this mechanism does not apply automatically to “environmental scarcity” because, unlike for most products, there is no 100% substitutability. We can replace wood with steel or steel with plastics, but we cannot replace clean water or stability of the climate system with something else – not even backed up by large amounts of money. This difference between conventional products and services and environmental services is critical and requires reflection as well as modifications in the policy framework. But the SDS review says nothing about it. I do not understand how we can move successfully towards sustainability if issues like these are not addressed head on? The issues of environment scarcity and the value of natural capital are fundamental and with respect to this the review document is not helpful at all.

Another problem in the review has to do with the way the Commission, the Council and the European Parliament organize their work. We suffer from the disease of verticalitis. Our sector organization makes us quite good at dealing with specific issues. But we face enormous difficulties when it comes to addressing cross-cutting issues. And most of the problems we face in terms of sustainability are to be found at the intersection of different disciplines and sectors. Society of today promotes specialization the big way. There are more than 10.000 different disciplines to choose from at universities and scientific institutions. But programs aiming at broadening understanding of how things are interconnected and interlinked are few and far between. And the organization of government agencies, parliaments and (in the case of the European Union) the Commission follow the same pattern. The sector perspective dominates everywhere.

We experienced great difficulties in the Parliament when discussing how to deal with the SDS review. Since we don´t have a committee for sustainable development, there were endless discussions about which of the committees that should take the lead? Should it be the environment committee, the transport committee or the economic committee? Finally we ended up creating a working group comprising of members from several committees, which is a good solution for the time being. In the longer term, however, we need to establish institutions which are competent to deal with policy integration and mainstreaming. This is a real challenge for the future and should have been discussed more fully in the SDS review.

Now, given where we are and the shortcomings of the SDS review proposal - what could be done? There is another two months until the EU Summit in June and it ought to be possible to influence the outcome of the final decision.

There is little to hope for when it comes to merging the Lisbon Strategy and the SDS. This will most probably not happen. What we should demand, however, is that the two strategies are reviewed yearly and in parallel. If this would happen we would oblige the leaders of the EU to deal with all the various components of development at the same time.

When it comes to objectives and targets I would also suggest to the Austrian Presidency to review the targets proposed in the review and aim at strengthening them, in particular in the field of energy and climate. The private sector has repeatedly asked for longer-term targets when it comes to carbon emissions. They need certainty about the framework conditions in order to be able to make the right kind of investments. Right now certainty ends with the Kyoto protocol, i e at 2012. This is not satisfactory for investments that have a life-time of 30-40 years.

Another crucial proposal would be to insert language whereby the EU commits itself to reconsider the way we measure progress in society. GDP is not sufficient as an indicator. We must develop a system whereby natural capital, ecosystem services and the ecological footprint of Europe are taken into account. I don´t have a precise suggestion how this should be done, but we should at least start a serious discussion.

We also need a more realistic approach and discussion about globalisation, competitiveness and jobs. This is part of the discussions in the Lisbon strategy but it is hardly mentioned in the SDS review. We have to be more honest about the perspectives for the future. There is a tendency to pretend as if jobs as well as our standard of living in this new globalised economy - in which we have fierce competition from countries like China and India in almost every possible sector – could be secured by just investing more in innovation and knowledge and by making labour markets more flexible. Personally, I find it difficult to see, given also the environmental and climate constraints, how the standard of living for the average European will be maintained in the decades to come. There is going to be some kind of adjustment. But we hear very little about this, rather that more research and innovation will do the trick. Of course we need innovation, but I think we ought to make people better prepared that we probably have to tighten our belts as well.

Finally, we have to enhance the role in the SDS of both science, civil society and the business community. Politics alone will not solve the problems we are facing. On important challenge will be to bridge the gap between science and decision makers. We live in a very complex world. Science and technology is becoming increasingly important – both to help us understanding the world we live in - and how everything is interconnected - but also in terms of developing new products and services. As decision-makers we are bombarded by information all the time. Much of that information, however, never really reaches the individual decision-maker. Take the Millenium Ecosystem Assessment for example – an extremely important report telling us that more than 60% of the world´s ecosystems are seriously degraded. This is critical, not least from the point of view of the SDS. But most of that information has not been properly understood by key decision-makers in politics or in business. We need urgently to explore how cooperation between science and politics can be strengthened. One way might be to involve in a proactive way quite a number of legislators from different parts of the world in major scientific studies, like the ecosystem assessment, to make them better understand the problems being studied. The role of civil society is critical. Where would we be in the field of SDS if it were not for NGO:s like WWF, IUCN, EEB and others? I would encourage civil society to engage even more in dialogue with decision-makers both in politics and business. Civil society normally brings to the fore perspectives that we urgently need in the decision-making process. One particular suggestion would be for civil society to make use of the provision in the new Constitution for the EU, whereby one million citizens among the EU populace can make their voice heard and - through a petition – demand that a certain topic be seriously considered by the EU. If we agree that we need more long-term thinking and more ambitious targets to address sustainability issues, well, then a “citizen´s initiative” could be an ideal way of pushing for such objectives. The fact that the Constitution has not been ratified is a minor issue. I do feel that the concept of a “citizen´s initiative” has been well received among all the member states and that most people would be ready to work in that spirit.

Finally, the business community must be actively involved as well. We need partnerships with business. The business community is very heterogenic. You find there companies with a lot of ambitions when it comes to SDS. But you also find some of the most backward thinking. Based on my own experience, there is a huge difference - in the context of new SDS policies being discussed - in meeting companies interested in the SDS and seeing business opportunities in developing products and services that meet the highest standards on the one hand, and business organisations which convey a message of "leave us alone, leave it to the market". Market principles are good but only if the policy framework is the right one. We know that it will take a long time to develop the right policy frameworks, not least at the international level. This is a very good argument why we need to develop partnerships with the private sector around SDS themes and objectives.