Opinion Why climate summits keep failing – and how to fix them

Why COPs fail to create consensus

It is common knowledge that the world needs to phase out all fossil fuel usage, speedily, to achieve this goal. Yet, countries have failed to reach any consensus on this front and have noticeably avoided commitments to reducing fossil fuel production accordingly.

Although political logjam and corporate lobbying are largely blamed for this impasse, the underlying issue that is often ignored is that our prevailing global economic system is completely out of sync with our environment. In their 2023 study titled ‘International Business is Contributing to Environmental Crises’, management professors Haitao Yu, Pratima Bansal, and Diane-Laure Arjaliés highlight how the linear economic model espoused by multinational enterprises (MNEs) and governments adopts a “take-make-use-waste” approach towards natural resources (including fossil fuels), which throws cyclical environmental processes into disarray. On the one hand, countries compete to gain or retain their share of MNE investments and complex, global supply chains within this linear economic system. On the other, they make promises to cut back on greenhouse gas (GHG) emissions to safeguard the environmental system, which they struggle to fulfil.

On climate action, where are we going wrong?

We need to realise that natural processes are complex, non-linear phenomena. They cannot be addressed in a linear fashion as countries venture to do while setting individual country-level targets on GHG emission reduction and renewable energy transitions. Since local environmental processes are nested within a dynamic equilibrium of global environmental processes, a linear approach fails to account for the interconnected ways in which local environmental issues cascade into the global climate crisis. Therefore, for COPs to succeed, it is imperative that the system is redesigned to account for complexity.

Ahead of COP28, the Presidency hosted sessions at the Dubai Future Forum focused on technology and climate action, including a panel session discussing the evolving landscape of climate technology and a COP28 Changemakers Majlis exploring AI’s role in climate mitigation.

Members… pic.twitter.com/HTPvOQ9cG3

— COP28 UAE (@COP28_UAE) November 28, 2023

What is the solution?

We argue that instead of entering a destructive spiral of bickering over broken promises, member nations could use the COP28 platform to reimagine the global economic system and their roles within it. Below, we list out a few pointers that can serve as food for thought. First, the COP28 negotiations could benefit immensely from stakeholders zooming out to understand how global supply chains and their associated economic activities are spread across various locations within the participating nations. Understanding how these activities interact with our planet’s environmental system at the macro-level is also important. Next, the stakeholders must zoom in to analyse how industry and firm-level economic activities interact with local ecological processes in relevant locations. So long as the economic system continues to offer cost advantages for shifting environmentally polluting activities in global supply chains to locations with lax environmental regulations such as in textile or mining, the climate goals hold little meaning. Thus — zoom out to understand, zoom in to act/intervene.

Second, with the advent of neo-liberalism in the late 20th century, governments have largely adopted a hands-off approach relying upon the free-market economic system, to solve any negative externalities arising from its functioning. As highlighted by scholars such as Karl Polanyi, it is often forgotten that the free-market system itself was shaped through deliberate policy design rather than by default. The principles of predation, competition and independence that undergird the free-market system are purportedly inspired by natural ecosystems. But, natural systems are also marked by symbiosis and interdependence which plays a critical role in stabilising environmental processes. Although such positive mutualisms exist within small pockets of economic activities at present, such as sustainable agriculture or indigenously co-owned mining projects, it is time for national governments to proactively envision their replication to transform the existing free-market system into a more sustainable one.

Third, in natural systems, hunger is a powerful mechanism that ensures that no living being can consume beyond what is adequate to satisfy its needs. This gives nature ample opportunities to regenerate itself. However, our economic system lacks a similar mechanism to ensure that no actor can take more than their fair share of value. We need to develop an equivalent mechanism within our economic system to ensure our own survival.

Finally, to echo the eminent industrial ecologist John Ehrenfeld, the current notion of sustainable development fails to recognise the systemic source of the problems it seeks to address. Linear approaches towards both economic and environmental systems are based on expectations of achieving the desired outcomes within specific time-frames with absolute certainty. Yet, recurrent financial crises and climate catastrophes in various parts of the world have belied these expectations time and again. It is time we realised that sustainability is an emergent property of the entire complex system that is our world. Therefore, as stakeholders, we must focus on identifying and establishing the critical enabling conditions locally that shall allow for sustainability to emerge globally both within our economic and environmental systems.

Sasikala is a doctoral student in strategic management at IIM Kozhikode. Dhayanithy is associate professor in strategic management and heads the Centre for Climate Studies at IIM Kozhikode