The factors preventing action

At the most fundamental level, it has to do with (you guessed it) economical interests. The fossil fuel industry in particular is actively involved in blocking action (source 1 — source 2), because the whole sector is bound to disappear as soon as serious countermeasures are taken.

Another huge problem in our society is that no global entity or institution apparently holds the means to enforce global action in extremely dangerous scenarios (backed by the scientific community). Instead, global action today relies on unanimous consensus and voluntary action on behalf of the single Countries (the failure of COP25 exemplifies why that’s a problem).

But the overall scenario is much more complex than this, so I’ll try answering a different question.

Who are the main actors and phenomenons responsible for action (or the lack thereof)?

1) Climate denial — The main cause of inaction.

This may seem exaggerated, but it is truly the root cause of our inaction.

Where does climate denialism stem from? It is fuelled mainly by ignorance and/or greed, together with a mix of arrogance (intended as refusal to change opinion or to consider other’s point of views), distrust of the scientific community and lack of long-term thinking. At the same time, it is actively promoted by those most responsible for carbon emissions (due to economical interests).

The dangers exponentially increase when influential people or even the media support these views, as they generate confusion in the public opinion and fuel debates with multiple points of view. And why would that be dangerous? Because it allows those responsible for the emissions to justify their unethical actions.

I won’t delve further into this topic, but denialism over scientific evidence is not exclusive to climate matters. In this case it is a particularly serious problem because:

Science is ignored in a matter that is critical to the future of humanity and the planet; and Strong economical interests are on the unethical/wrong side.

While it is hard to eliminate denialism completely, with enough effort it can be drastically contained and rendered insignificant. That is why many activists, medias, companies, governments and institutions are constantly raising awareness and educating the public. It is thanks to their efforts and their refusal to stand down that we still have a shot at coming up with a solution.

2) Governments — Those who set up the plans and give a direction to follow.

Governments are responsible for setting the direction of a Country, and taken together they represent the direction taken by human society.

They represent the most fundamental block upon which action is based. While they don’t carry out the bulk of the action themselves, they essentially declare what needs to be done and how.

Their main instruments are policies, such as incentives and penalties. In particular, the carbon tax is widely accepted as the most effective policy for curbing carbon emissions, having achieved great results in the Countries that implemented it.

Today we spend $5,2 Trillions every year in fossil fuels subsidies, so it’s obvious governments (at least on a global level) are not going in the right direction. With respect to this matter, aggressive and comprehensive plans like the US Green New Deal or the Zero Emission Tokyo Strategy are the kind of multifaceted approach that all cities and nations should take inspiration from.

Governments (in most cases) have to follow the will of their own people, which means that the real power is in the hands of the people (and also goes back to why climate denialism is so relevant). If the people collectively demand action, governments are forced to do it; on the other hand, confusion and debates among the people will only result in a delayed and weak action.

I should also point out that climate action is not about left or right, it is about right and wrong. Inaction is irresponsible, unethical and wrong, regardless of the political party. This is actually one of the few topics that should bring left-wing and right-wing people to stand on the same side. Climate change is a matter that unites humanity, because we all are on the same side in this fight.

Finally, governments and decisive policies do not represent the actual solution. They are just the first, crucial step in the right direction.

3) Investments — Those who provide the money to carry out plans.

Investors have to get the highest possible return on their investments, so their focus is entirely on profitability.

As such, it is quite simple to understand their point of view. In fact, in the vast majority of cases impact on society is not their first concern (with some exceptions — see impact investing or venture philanthropy).

While most of them say they care about the environment, they usually make small symbolic investments in clean technologies to shape their public image (similarly to a marketing strategy), but the bulk of their investments always goes where the most money is — and until now for many of them that was the fossil fuel industry.

Why until now? Let’s consider the recent announcement from Blackrock CEO that “climate change will reshape finance”. While it’s hard to believe Blackrock and the whole investment sector have suddenly become environmentalists, it’s much more plausible that they have realised the value and future of fossil fuel market is rapidly eroding (and that they’re losing money), so they’re considering jumping ship before it collapses.

In fact, in the last decades renewable technologies costs have decreased so much that they are already considered more convenient than coal, and their prices are predicted to decrease even further in the next years. In other words, they are already a better long-term investment than fossil fuels and, coupled with the current global situation surrounding climate change, it has become obvious where investments should be directed.

I think what prevented divestment so far was that the largest investment firms are deeply bonded to the fossil fuel companies, which means they cannot move money away easily. However, now that the economical advantages are so obvious and the risks of persevering are so high on multiple levels, even they cannot ignore them anymore. So, I think the above-mentioned statement probably means that they have made their decision and either the fossil fuel companies choose to adapt or they will invest somewhere else (either that, or they’re just fooling everyone. I hope it’s the former).

In any case, it is safe to assume that trillions will eventually start moving into clean technologies. But where does this money actually go? Who carries out the actual projects that cut carbon emissions by employing clean technologies? Who is ultimately responsible for taking action?

4) Companies — Those who carry out the plans.

Companies focus on devising and carrying out plans that maximise their profits, in order to keep growing while giving a higher return on their investors.

They do so while considering the “rules and guidelines” of the governments and by putting to good use investors’ money.

This is where the true importance of government lies: if governments fail to set out the right rules (or to enforce them), companies would have to justify economically-counterintuitive decisions.

To clarify, only small and medium companies with a strong culture and where the CEO has decisional power can freely take a morally conscious approach. And that is definitely not easy, as it involves convincing investors in making not obvious choices and going against their interests.

But that’s not how it should be, because it should not be their responsibility and — most importantly — because not all companies can act this way.

In fact, in large (usually public) companies — such as all fossil fuel companies — decisions are distributed among the shareholders, and as they grow larger it becomes practically impossible to justify anti-economical choices. Their very nature consists in always taking the most profitable path, and that includes a well-oiled process that removes any obstacles that stands in the way. And, let me be clear, that’s not necessarily a bad thing — it’s just how things work when companies scale.

Referencing the recent case of the Adani coal mine, I am 99% convinced that the Siemens CEO in its letter was trying to explain that if he could he would have stopped its realisation. But the decision of the shareholders was different, and his role was to merely execute it (and take the blame for it). So even if he refused or tried to do something about it, it would have probably resulted in the appointment of a “more suitable” CEO to carry out the plan in his stead.

As a result, it is safe to say that the problem cannot be solved by simply labelling large companies as “the bad guys”, because it ignores the complexity of the whole situation. And it goes without saying that trying to change how companies operate should be out of the question because it would require changing the foundation of our society, which realistically requires more than the few years we have available to act.

One could argue that it is time for a new wave of sustainable companies to take the lead. And while I strongly support it, I also believe it’s unrealistic to think we’ll be able to cut global emissions in time without the involvement of the large existing companies (especially in the energy sector). Specifically, it is absolutely crucial to promote a swift transformation of these companies that involves a full transition towards clean technologies by employing effective environmental strategies.

Therefore, we should focus on both facilitating the growth of new and innovative companies, while achieving a green transformation of the existing ones.