Issue #12
Stumbling Governance
Like most observers of the “sustainability” world, I expected little from COP28. Some days, I would wake up hoping that with such low expectations, a happy surprise wasn’t impossible, even if it would obviously be insufficient, too late, too little, too inadequate.
Now, its president explains that ending fossil fuels could bring humans back into caverns. I understand the fear strategy to gain a bit more time (and dollars), but I cannot ignore the sense of humour: our mountains have started to melt thanks to climate change! Those caverns will not be safe anymore and, with enough fossil fuel burning, our houses will not be safe either…
I should be writing in the present tense. Yes, the World Bank expects 1.2 billion people to be displaced by 2050 and 260 million by 2030 (tomorrow). But already, according to the UN Refugee Agency, 21.5 million men and women are displaced every year!
Indeed the Sultan and his friends are booting us out of our homes as we speak.
Change. Now. Please.
Change takes time. On that front, our friends at COPxx are right: we will not go from 80% fossil energy dependency to 0% overnight. But we have to get moving. Fast. Together.
We learn in business schools that the first step of a reorganisation is to create a sense of emergency. Well… the message is out and I cannot believe our leaders could be so deaf. Covid, megafires, floods, 60,000 people displaced every day… Emergency is the new normal, we get it. But no change; a piece is missing. And I would argue that this piece is a capacity to cooperate.
World governance is outdated and ineffective
Our global institutions are largely the result of the post world-war reconstruction work. They were necessary at the time and have helped build a relatively peaceful world. But the world has changed! We need to dream something new.
80 years ago, climate was not a global issue; it is one today. Water was not a global issue; it is one today. Inequality was not a global issue; it is one today. Biodiversity was not a global issue; you get the picture…
Our institutions can be revised: they are human constructions. We need them to reflect a governance system capable of generating the right discussions and decisions to allow our societies to evolve in the best interests of the people and the groups we form.
Functioning institutions are key to global cooperation. Because no individual element of a system can change without impacting other elements of the system, and because we live in the same system Earth, we need to take care of connections between the elements in the system.
Put more plainly, we need to communicate in order to take care of each other.
If communication cannot be forced, a positive environment can be designed to foster cooperation. Global institutions can offer that place, but they need to rebuild two critical levers: trust and fairness.
Trust requires safety and honesty
Everything builds on trust. Would you buy bread in a bakery without being 100% sure it is edible?
In our complex world, trust needs to be gained.
First, it requires safety. Obviously, physical integrity must be assured. Threats can temporarily lead to obedience, but not to long-lasting beneficial cooperation. This is one of the reasons why it is so easy to start a war and so hard to end it! Today, many smaller countries feel threatened by their larger neighbours. If this equilibrium of terror could work to maintain a form of peace, it is certainly not conducive to cooperation on matters like climate change.
A less obvious pillar is psychological safety. It is harder to build, but not impossible. It requires listening (with the intent of learning about the speaker and without judgment… not easy!) and cultivating respect for differences. Recognition of indigenous cultures and knowledge is a good step in that direction.
But trust also requires honesty, for which a good start is to agree on facts.
In that respect, playing with reality is criminal. When the World Coal Association renames itself FutureCoal: The Global Alliance for Sustainable Coal, we are beyond greenwashing. To be clear, sustainable coal is coal left underground. (By the way, thank you Philippe Maupas, CFA, CAIA, CIPM for pointing this one out.)
In our modern societies governed by the rule of law, lobbies know that attributing the millions of deaths and displaced to any crazy act of diversion is impossible: so they can do it safely. But this is ethically criminal, not only for the future victims, but also because it destroys the little trust we have left in our institutions.
To go further on that line and coming back to today’s COP: how did we put the drug dealer in charge of the fight against drugs? The conflict of interest is so blatant that it is depressing. In the last COP27, there were 636 lobbyists. More than any country delegation except for that of the UAE… Which now hosts COP28. It seems we have given up.
Fairness is a condition to cooperate
Nobody likes a free rider, and we know from research that people will very quickly stop spending energy on cooperating with a group if they feel some members of this group are abusing them.
Nobody likes to feel cheated; nobody wants to be the only one paying for the road everybody uses.
COP28 operationalised the loss and damage fund announced at COP27. Now, we are told the victims will finally take center stage. Can we really announce something twice to get twice the reward? And what does the 650 M$ pledged represent? Peanuts. The largest oil producer made about 161 Bn$ in profits last year; one company earned 250 times the whole pledge in one year!
And by the way, had Aramco bought carbon credits on the European carbon market to “compensate” their emissions… profits would be nil.
In these conditions, how can we expect the countries that suffer the most to cooperate? And how can we hope their populations to follow peacefully (and not be lured into a destructive spiral of revenge)?
So we need serious contribution mechanisms, not only for the loss and damage fund, but also to prevent as much as possible those losses in the first place. The fair level of contribution is not easy to define: should it be proportional to GDP, to populations, to emissions, historical emissions? Probably some mix of all that, and it will not be perfect. But it will be much better and much more than peanuts!
The hypothesis that cooperation requires safety and fairness is substantiated by research, but we can also easily see it in our daily lives. It is not rocket science: what works at the global institutional level also works at the interpersonal level. (Actually, it is probably the other way around. Please forgive my scientific shortcut here.) Imagine a recent situation where you happily cooperated. This could be at work or in a friendly project. Would you have followed along if you felt unsafe? Would you have been happy to see a free rider in the group?
Help needed
I admit to being a bit of a dreamer. But I also like to realise these dreams! In this case, maybe my dream is too large, and I wonder what we can do at our individual levels to help? If you have any ideas, please share!
As usual, this letter, originally published on LinkedIn, is meant to open a discussion: join it here.
Lenny Kessler