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Two Steps Forward

‘Just transition’ is the new ‘net zero’

Just transition

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"Just transition." For the uninitiated, it’s a compelling, albeit vague term. But for those in sustainability circles, it’s quickly rising up the charts. You can hear about it in corporate communications and international policy, and from the bullhorns of any number of advocacy groups. It was front and center last month at COP26, the global climate conference in Scotland.

And it’s the next "net zero."

What do I mean by that? It means that this term will soon become table stakes inside companies, which will embrace it in their communications and rebrand many of their existing initiatives using this moniker. Over time, the term will become widely used, overused and possibly abused, applied indiscriminately to companies, products, services, government programs, NGO initiatives and other things we can’t yet imagine.

Then, the backlash: Activists, journalists and policymakers will hold accountable companies and organizations that seem to be talking more than they’re walking or that use the term inappropriately. As criticism builds, pretty much all companies that invoke the term will get tarred with the same brush.

Enter the professionals: the academics, the large consultancies and accounting firms, the PR giants, the boutique firms. They’ll attempt to make sense of it all, honing language, developing frameworks, promoting "best practices" and proffering metrics. There’ll be no shortage of billable hours.

We’ve seen this movie before. Consider "net zero."

It first appeared in scientific literature about a dozen years ago as scientists began to understand that the impact of climate change depended less on overall greenhouse gas emissions than on the concentration of those gases in the atmosphere. In 2014, World Bank president Jim Yong Kim called for a climate agreement that provided "a clear pathway to zero net emissions before 2100." The Paris Agreement, signed the following year, didn’t invoke the term but called for "a balance between anthropogenic emissions by sources and removals of sinks of greenhouse gases in the second half of this century" — essentially, the net-zero recipe. Since then, "the second half of this century" has been accelerated to 2050 for most net-zero commitments.

By 2020, net-zero pledges were widespread, including from China, the world’s largest emitter, which pledged to be net zero "before 2060." Today, they cover more than two-thirds of the global economy. (There is even a conference on the topic.)

Then, the backlash. Net-zero pledges rely too much on offsets and not enough on reducing emissions. The time horizons — 2050! 2060! — aren’t meaningful in terms of holding companies and their leaders accountable. Many organizations don’t really know how to achieve that goal — a can kicked to the leaders of tomorrow.

Suddenly, a seemingly laudatory term became problematic.

Today, things are settling. The Science Based Targets initiative this year set a standard for net zero to which more than 1,000 companies have committed. Companies are putting out fewer PR pitches about net zero, seemingly opting for action over aspiration. Indeed, it feels like the signal-to-noise ratio has shifted to favor the former over the latter.

Good work

Now, consider "just transition." It dates to the labor movement of the 1970s, when the United States and other countries first started in earnest to regulate polluting industries while recognizing that there are humans and communities who rely on these industries for their livelihoods. In the 1990s, labor unions and environmental groups began to find common cause on these issues. One result was the Apollo Alliance, in 2004, which brought together more than 200 labor, environmental, business and social justice groups to tackle these issues.

In 2018, "just transition" leapfrogged beyond the labor movement to the global stage. At COP24, in Katowice, Poland, the world’s governments adopted the Solidarity and Just Transition Silesia Declaration, noting that "the creation of decent work and quality jobs are crucial to ensure public support for long-term emission reductions and climate resilient development, as well as to enable countries to reach the long-term goals of the Paris Agreement."

Fast-forward three years to COP26, where a Just Transition Declaration was signed by 16 North American and European governments. It called for supporting fossil-fuel and other workers in their transition to new jobs as well as supporting and strengthening social dialogue on these topics.

Meanwhile, the World Bank launched a Just Transition for All initiative in the developing economies it serves, to put "people and communities at the center of the transition." The European Union established a Just Transition Mechanism to mobilize about $170 billion by 2027 to support regions affected by its Green Deal program. In the United States, President Joe Biden stated that the solutions to the climate crisis offer "opportunities to create well-paying union jobs" and "deliver an equitable, clean energy future."

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Along the way, the definition expanded from local to global. Today, "just transition" refers equally to the workers at a local power plant as to the financial help rich countries provide to poorer ones to help them afford the low-carbon technologies needed to achieve their commitments to the Paris Agreement.

And then, as always, the corporate crowd. In May, 27 companies including Unilever, Autodesk, Ørsted, Enel and Safaricom signed a Pledge for a Just Transition to Decent Jobs, committing to a decent-job-creating net-zero economy. At COP26, the U.N. Global Compact and its member companies partnered with the International Chamber of Shipping and International Transport Workers to launch a new Just Transition Taskforce to develop policy and business recommendations for a net-zero shipping sector.

And Larry Fink, CEO of investment giant BlackRock, warned a COP26 audience, "If we're not getting a fair and just transition, we're going to create more polarization in the world and more political uncertainty." In those circumstances, he said, the emerging world would simply not be able to afford a transition to net zero.

Translation: Just transition is a business imperative.

With "just transition" being applied to local workers, strategic business decisions, developing economies and the global economic order, we’re setting it up for a fall: It risks becoming yet another woke term, poorly defined and indiscriminately applied, to be dismissed and mocked by those who want to stand in its way.

The academics, consultancies, accountants and PR firms are waiting in the wings. They’ll attempt to make sense of it all, honing language, developing frameworks, "best practices" and metrics. There’ll be no shortage of billable hours.

Eventually, there could be some "science-based" framework that will ensure that "just transition" has meaning and accountability. And, if we’re lucky, the signal-to-noise ratio will once again shift, and quickly.

So, what, exactly, should "just transition" mean? Who should define it? I welcome your thoughts.

This is no academic exercise. In the coming years, we’ll be investing trillions of dollars in new energy, transportation and manufacturing technologies. We’ll be shoring up infrastructure and shifting to entirely new ways to power transportation and buildings. We’ll be reinventing how we make and grow things. And we’ll be enacting laws and regulations that govern how, and how quickly, these things happen.

To create the conditions for success, globally and for all, and to ensure that these investments benefit the vulnerable as well as the powerful, we’ll need to speak the same language. And to hold one another accountable for what we say.

I invite you to follow me on Twitter, subscribe to my Monday morning newsletter, GreenBuzz, from which this was reprinted, and listen to GreenBiz 350, my weekly podcast, co-hosted with Heather Clancy.

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