Executive Director of UNEP
Production and Consumption,
Ministerial SessionOslo, 8 February 1995
Will society, through the state, the entrepreneurial sector and other social sectors, be able to forge a new culture that is more altruistic and equitable to replace our society of superfluous consumption and inequitable holdings of land and resources, where the short-term earnings of the few prevail over the integrity of nature and the well-being of present and future generations?
That was the essence of the discussion. That is the question that we must ask ourselves with complete honesty. Never before has humanity been at crossroads like this facing it now, where its own expansion and its own success as the dominant species is threatening its very survival. And never before has humanity been so well connected, so aware of itself and so capable of self-reflection concerning its problems.
A change of course is now urgent and inescapable.
In these few minutes I want to focus on three myths which we need to expose -- because managing change has to start with clear understandings.
The first myth is that sustainable development is really the same old development + growth model clothed in green.We know that environment is all inclusive encompassing the socio-economic as well as the physical environment. We also have come to realize that development policy, if it is to arrive at satisfactory solutions to environmental and resource problems, cannot rely on incremental, piecemeal or palliative approaches. It is true that such approaches may buy us time. But for long- term solutions, integrated and structural approaches are imperative.
Envisaging a future that will ensure production to meet the needs of the growing population, safeguard environmental values and review consumption trends requires, first and foremost, an in-depth analysis of our old concepts of development.
The reductionist framework of conventional economics has given rise to misguided economic policies. Their essence is the attainment of economic growth, a quantitative increase in production, which has become identified with "development".
The plundering of ecosystems, the depletion of natural resources, global environmental problems, which serve as a backdrop for a world rampant with poverty, injustice, disease and war -- all too familiar to us -- are firm evidence that development understood in terms of the values on which the current paradigm is based, is a dead-end road.
The goal of new economic thought is to achieve development. Nevertheless, the concept of development is taking on new meaning. It no longer refers simply to maximizing production and consumption -- which frequently means pollution and the plundering of natural resources -- but rather to the optimum attainment of human well-being maximizing potential.
The new development approach entails a different perception of the relationship between society and nature. It is a shift towards a new world view that demands a profound change in values. The physicist Fitjof Capra notes that we need a change from expansionism to conservation, from quantity to quality, from competition to cooperation, from domination to non-violent control.
After two decades of efforts of drawing up specific policies to protect the natural environment and improve the quality of life, we require innovative socio-economic solutions driven by environmental considerations. We need to identify new possibilities for modifying lifestyles and inducing behavioral changes, and we need to rearrange our national and international institutional mechanisms to make these changes a reality.
Perhaps the biggest challenge in realizing this new "development" is the challenge of modifying the attitudes of producers and consumers to recognize the future that increasing scarcity of resources and expanding population growth will bring -- and to seek creative solutions. Evolution towards more frugal societies (some would say more responsible societies), and more vulnerable and interdependent economies is to a large extent dependent on the possibilities for profound social, economic and institutional change.
The second myth is that we can achieve sustainable development without fundamentally affecting people's lifestyles.We have yet to fully understand the social and ecological limits to the growth of consumption. But it requires no sophistication to see that indefinite increases in certain forms of consumption are incompatible with sustainable development.
Can we translate this awareness into practical measures in environmental management and economic policy without affecting the quality of life? Change is not automatically negative but, clearly, it will require from us all comprehensive measures that would reflect the full cost of environmental damage. It is also a question of directing change now or suffering the consequences later.
Sustainable consumption embraces ideas and practices such as pollution prevention, cleaner production, clean technology, waste minimization, recycling, resource conservation, eco- efficiency, eco-labelling and preservation of biodiversity. But it also focuses on strategies and actions that define the market forces and systems, implying a re-definition of relationships between people and the products they consume and their habits and practices. So, on a more fundamental level, sustainable consumption implies a change in the global economy, socio- cultural values and economic relationships between the North and the South as well as within all societies.
Just one example will suffice -- the manufacture of the motor car. This symbol of mobility, of affluence. Manufacturing a car requires metals like steel, copper and aluminium. It also requires plastics, rubber, water and chemicals. Obtaining the iron ore requires mining, smelting and cooling. Petroleum which fuels the car requires oil wells and refineries. Driving the car requires roads. Roads require land. Every time it is driven, the car emits a range of harmful pollutants. And when the car reaches the end of its useful life, it has to be disposed of, creating even more environmental problems. But this is not all. Individual use of cars multiplies the thousands of times over more efficient mass systems of transportation.
Sustainable consumption is much more than choosing an "environmentally friendly vehicle". We are already living in a time of environmentally driven change. Recognition of the limit of the Earth's carrying capacity will lead inevitably to long- term structural economic change. Artificial low prices for resources cover up severe environmental stress at both ends of the materials cycle -- production that should not have been necessary + disposed of materials that could have been used again. Our purpose is to redefine not only the goals of industrialization itself but also its attendant ramifications such as urbanization, transportation, energy, land use and their relationship to broader societal concerns.
Gunnar Myrdal wrote in 1975, "All the talk about a new international economic order without changing lifestyles in the developed world is just humbug".
And the third myth -- sustainable consumption only affects those in developed countries. There is a notion that consumers in the North can alter and reduce resonance consumption input without affecting the economies, resource allocation, price structures and so on of the South. This ignores the compact of stronger economic and production links between North and South (especially with respect to non-services, durable goods). Given the real globalization of economic markets, any significant change in OECD countries cannot take place in isolation.More and more countries are being drawn into trading networks as producers and consumers of goods on world-wide scale. The global proliferation of industrial systems means that there is no prospect for any nation-state insulating itself from changes in the economic climate, from global change and major pollution flows and from the actions of international actors, such as the multinational corporations.
And, this process of globalization is not complete. Expansion in world trade has yet to encompass hundreds of those who live on the margins of the industrialized world. Like inequality, patterns of unsustainable consumption are not limited either to the North or the South. They manifest themselves in contrasting patterns within the geographical boundaries of individual nation states, between regions, between urban and rural areas and between the lifestyles of the rich and the poor. We need only look to the replication of unsustainable patterns of development in rapidly industrializing countries. Yes, changes in consumption and production patterns need to start in the North but, we need to broaden the scope of the debate options to include the perspectives of the South.
There will be implications for trade flows, upstream resource extraction, development and employment. It seems wishful thinking to expect that any real changes can occur in consumption patterns also affecting core economic issues.
Let me suggest just three examples.
Implications of cleaner production methods on developing countries. Although sustainable consumption places considerable premium on eco-efficiency, some empirical work by UNCTAD suggests that developing countries are at a disadvantage in implementing cleaner production, because of questions of scale, higher capital and operating costs, etc.
Implications in terms of investment flows. It remains unclear how private markets are going to respond to this policy call. Analysis by UNEP suggests that equity finance remains largely indifferent to environmental technologies. Hence, there is some real work to be done in looking in links between capital markets, debt finance and longer-term targets associated with sustainable consumption.
Effects of integrated "Green Budgets". Experiences suggest that there will be little gained from shift in market signals to sustainable consumption patterns, if gross environmental distortions remain in other core areas, including monetary policy, subsidies, transport and other areas. This whole and complicated area brings in the question of pricing reforms, and the implications of market-based instruments on developing countries -- i.e. both in terms of trade and market access issues (when used in OECD countries and applied to LDC imports), as well as applicability of market-based instruments in developing countries which do not have formalized markets.
May I insert here just a word about trade.
Some regard international free trade agreements with suspicion on the grounds that they promote "harmonization" of national standards by reducing the lowest common denominator, rather than seeking a general increase in quality thresholds. I agree that the problem of the balance between trade liberalization and restrictions based on the need for sustainability is immensely complex. Restrictions on trade could be claimed on environmental grounds as a convenient excuse for protectionism.
We, in UNEP, think the debate within the WTO should not merely revolve around the concepts of free trade and protectionism, but also include the question of sustainability. The debate should be one between sustainable and fair trade on the one hand, and unsustainable and inequitable trade on the other. There will be need for sensitive rulings in the WTO that do justice to environmental concerns, maximize free trade where possible, and ensure that the interests of developing countries are protected.
So, building sustainable consumption and production patterns globally is a task of immense complexity. It means changing the underlying economic principles, including the relationship between the North and the South in a cooperative long-term endeavour. It means examining our societal goals and lifestyles, injecting an ethical perspective to our actions. It means living within the ecological limits of our planet and the social limits of society. It means reducing our "footprint" on Earth.
It may not be fashionable to say so, but, ultimately, the question of achieving and maintaining sustainable patterns of production and consumption hinges on the fundamental dimensions. We have to ask ourselves simple but fundamental questions: How should we live? How much is enough? What way of life human beings ought to pursue? Simple questions are often the most profound, for they challenge the security of our accustomed norms. We have to develop the ecological, holistic world view which connects us with our environment and other people and species -- both materially and spiritually.
But this Roundtable is about more than understanding why we need to change -- and what that might mean -- it's about finding actions that will be compelling. To the menu provided for your consideration let me underscore UNEP's commitments.
First, -- to our Cleaner Production initiatives.
Second -- applying our data and analytical capabilities to such concepts as carrying capacity -- globally, nationally and locally. Although this is a major undertaking, the trade- environment debate has driven home the need for greater focus and harder empirical evidence, of critical ecological thresholds. (Our Environmental Data Report actually attempts this.)
Perhaps case studies of specific consumer products or activities in terms of trends, pollution intensity, pricing, longer-term sustainability -- "ecological shadow price" of Jim MacNeil -- showing that a country's seemingly clean production record must be linked to unsustainable resource extraction activities done in the neighbouring countries.
Thirdly -- linking science to economic options -- e.g. greater analysis of micro-economic aspects of concepts like eco- space.
And fourthly -- in the legal arena -- determining how commitments on international environmental agreements affect production process methods towards greater eco-efficiency. For example, what is the implication for the energy sector of the provisions in the Climate Change Convention?
As we concluded the meeting last year I remarked upon the necessity for and hope of individual action. I challenged the participants to inform me of three actions they would take personally or professionally. The response was most encouraging - but we must not only challenge the converted -- each individual, each household, each interest group, each nation must be motivated and mobilized. Anything less will not be enough.